The LCIA's changed approach to India

Video | August 2016 | 00:05:46

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The LCIA's changed approach to India

Sherina Petit: Jackie it is a pleasure welcoming you to our offices today. I know you have an absolutely crazy travel schedule so thank you for accommodating us. We last interviewed you in October 2014 for our arbitration video series and that was when the LCIA Rules were launched. But today we are here for a different purpose, really to understand the LCIA’s changed approach to India. Now I understand in January 2016 - this year actually - the LCIA announced that it was going to close its office in India and it had a changed approach to India. In April this year, you, I and Bill Rowley went out to India for a conference to discuss these changes. So really it would be great to understand from you, for the benefit of a wider audience, the LCIA’s changed approach to India. Particularly since the change has really come into effect from June this year.

Jacomijn van Haersolte-van Hof: It was a very difficult decision and it has been a very painful decision I think, but the reality is that it was about 10 years ago that the LCIA decided to make this big step and it took a while to implement it, but it has been 10 years and the reality is that there has not been an uptake in the clauses that we had expected and effectively it was not financially worthwhile to continue the separate offering of LCIA India. Therefore both the board of LCIA India and the board of the LCIA decided that the better approach would be effectively to integrate the work of the LCIA India back into the LCIA and that’s where we now are.

Sherina Petit: So the fact that the LCIA has closed its offices in India doesn’t mean it has closed its doors on India?

Jacomijn van Haersolte-van Hof: Well exactly, it’s very important to stress for users and everybody that it is business as usual in the sense that we will continue to administer the cases that we have and continue to administer the cases that are incoming on the basis of clauses that predate the 1st of June this year. We have an acting registrar who is based in London and she and her team are in charge of the cases on the basis of the LCIA India Rules and on the basis of the LCIA fee schedule that applies to LCIA India cases. So for users they effectively won’t notice anything about the difference, it is only in respect of new clauses that there is a different approach.

Sherina Petit: Jackie what should our clients do if their contract contains an LCIA India arbitration clause, do they need to do anything?

Jacomijn van Haersolte-van Hof: Well it’s a good point. In a way the big distinction is between clauses concluded now and clauses that have been concluded in the past. As I just said, we will continue to administer old cases and old referrals based on existing clauses, even if they arise in the next couple of years. For new clauses we have made it quite clear in the Rules that enter into force on the 1st of June that we will not accept them. But for existing clauses I can imagine that people will rethink, especially if they have ongoing relationships where they are still continuing to think about their contractual setting, then they might think it is worthwhile amending the contract to for instance include reference to LCIA India. But there is no need as we will respect the existing clauses.

Sherina Petit: Jackie one of the benefits of a regional arbitration centre is that it can offer expertise in terms of culture, law and language. What is the LCIA going to do to ensure that the needs of Indian parties are met?

Jacomijn van Haersolte-van Hof: It is absolutely right that in order to, let’s say, participate in the arbitration life in a country you need to understand the culture, you need to be in connection with the users that are there. I personally don’t think that it requires a physical presence necessarily to have that connection. To give you an illustration of this, we have a large number of Russian cases (as you know, being on the board of the LCIA). About a third of our cases are Russian and we do not have a physical presence in Russia. The US is an important market for us, and again we do not have a physical presence. We are of course very conscious of the need to stay in touch with the users. One of the things we have done is to make sure that we have on the board a representative who knows the market well, that is you. That has proved immediately to be very productive in a sense that when we now go to India we liaise with you and you have been able to also attend events with us and think with us about which initiatives we should deploy or not deploy. We obviously also keep abreast of the developments in the law. But I don’t think you necessarily need to be there all the time, especially in this day and age with all the electronic means of communication that we have. But you do need to stay in touch.

Sherina Petit: Jackie it has been a real pleasure chatting with you today. I am sure our clients will feel reassured to know the LCIA’s continued commitment to India and the fact that it is really business as usual.

Jacomijn van Haersolte-van Hof, Director General of the LCIA, and Sherina Petit, Partner and Head of Norton Rose Fulbright’s India Practice and member of the LCIA’s Board of Directors, discuss the LCIA’s changed approach to the Indian arbitration market, in force from 1 June 2016.