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Global | Publication | May 2018
In recent months, a number of arbitral institutions have launched, or have announced the imminent launch, of updates to their rules of arbitration. In this article, we look at these changes and highlight key points of interest.
The London Maritime Arbitration Association (LMAA) Terms 2017 are now in effect for appointments on or after May 1, 2017. These seek to improve the time and cost efficiency of the LMAA while maintaining the LMAA’s ‘light touch’ approach. The LMAA has also released revised versions of the LMAA Small Claims Procedures and the LMAA Intermediate Claims Procedure.
Of most interest are new terms addressing: appointment of arbitrators where either a party fails to appoint its party‑appointed arbitrator in time or the parties are unable to agree on the sole arbitrator; obligations to make the arbitration process as cost effective as possible; powers to order security for costs; and increasing the maximum level for small claims to US$100,000.
Dealing first with the new terms addressing appointment of arbitrators; where one party has failed to appoint its arbitrator in time, the non‑defaulting party (having duly appointed its arbitrator) may give seven days’ prior written notice to the other party to appoint an arbitrator, failing which the non‑defaulting party’s arbitrator will be appointed the sole arbitrator and their award shall be binding on both parties.
There is also a new term which provides that where the parties have agreed to appoint a sole arbitrator but fail to reach agreement within 14 days of calling for arbitration, the arbitrator can be appointed by the President of the LMAA.
As for costs; the new terms emphasise the importance of cost efficiency and impose an express obligation on the parties and the Tribunal to actively consider ways to make the arbitral process as cost‑effective and efficient as possible. They also strengthen tribunals’ powers in respect of costs, including the power to require security for the tribunal’s own costs.
The new terms have been welcomed by the maritime arbitration community.
The German Institution of Arbitration (Deutsche Institution für Schiedsgerichtsbarkeit, DIS) has implemented major changes to the DIS Arbitration Rules. These are the result of extensive consultation over the last two years.
The updated rules continue to have a focus on supporting early settlement, but also represent an attempt to modernise DIS arbitrations implementing widely used best practices under comparable regimes. The rules are designed to assist international and domestic parties, whilst retaining certain key elements linked to civil law proceedings. Key motivations behind the revisions were to enhance the efficiencies afforded by arbitration under the DIS Rules, and to provide a modern, non‑bureaucratic flexible system in line with comparable arbitral regimes.
Highlights of the amendments include
It should be noted that whilst the new rules implement welcome efficiencies, there are some notable differences to comparable regimes. These include no provisions for the appointment of an emergency arbitrator, no mechanism for the expedited formation of a tribunal, and no opt in system for expedited procedures where lower sums in dispute are concerned.
A non‑final version of the English rules can be accessed here.
The Hong Kong International Arbitration Centre (HKIAC) is proposing amendments to the 2013 version of its Administered Arbitration Rules (2013 Rules).
The HKIAC does not contemplate a wholesale revision, rather, the proposed amendments are aimed at addressing practical problems arising from the surge of international arbitrations and enhancing efficiency in arbitral proceedings.
Highlights of the proposed amendments include
The proposed amendments are now at the public consultation stage.
The Kuala Lumpur Regional Centre for International Arbitration (KLRCA) has rebranded and relaunched as the Asian International Arbitration Centre (AIAC). The AIAC has adopted new arbitral rules, based largely on the UNCITRAL Arbitration Rules 2013, and published a new model arbitration clause. Key features of the new AIAC rules include provisions dealing with expedited appointment of emergency arbitrators, new powers to consolidated proceedings, and amendments to the provisions dealing with joinder and technical review of awards.
The AIAC administers international commercial arbitration under its AIAC Rules as well as offering fast track arbitration and Shariah (Islamic law) arbitration. In addition AIAC offers mediation, adjudication, and resolution of domain name complaints. Its facilities are also available for investment arbitration — it has arrangements with both the ICSID and the PCA, and AIAC is itself an administrating authority under the 2009 ASEAN Comprehensive Investment Agreement.
The Dubai International Arbitration Centre (DIAC) has recently announced its intention to launch a new set of Arbitration Rules in 2018 (the New Rules) to replace the existing 2007 Rules. Although the New Rules are yet to be published, DIAC has released details of its proposed changes. These include
The New Rules, which are intended to address some of the common issues encountered in UAE‑seated arbitrations, are currently expected to be enacted during the first quarter of 2018. It remains to be seen how some of these changes will apply in practice, but their issuance is viewed as a positive step.
In a welcome move for businesses and arbitration practitioners in the Middle East, the United Arab Emirates’ advisory parliament, the Federal National Council, has recently approved a new arbitration law for the UAE.
It is anticipated that the new arbitration law will be passed later this year, once it has been approved by the President of the UAE and presented to the Federal Supreme Council for ratification.
The new arbitration law will replace Articles 203 to 218 of the Civil Procedures Law. Although the contents of the new arbitration law are yet to be published, it is expected that it will be largely based on the UNCITRAL Model Law, a model for international commercial arbitration that has been adopted successfully in many jurisdictions worldwide. The new arbitration law will apply to all arbitration proceedings in the UAE except those seated in the Dubai International Financial Centre (DIFC) or the Abu Dhabi Global Market (ADGM), autonomous free zones within the UAE that have their own courts and arbitration laws.
If, as hoped, the new arbitration law specifies clear and limited grounds for setting aside and challenging awards and provides procedures for expediting the recognition and enforcement of awards in the local courts, it will help cement the UAE’s position as a seat of choice within the region.
The authors would like to thank Matthew Gregson and Santiago Lev, trainees in the London office, for their contributions to this article.
Nina Varumo is a freelance portrait and documentary photographer based in Stockholm. A recent project of hers Kvinnor till sjöss (‘Women at sea’) is on ongoing photo series highlighting the working life of female seafarers in order to change the stereotypical image of what and who is a seafarer.
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