A warm welcome for new arbitration regulations in Abu Dhabi

Introduction

The Abu Dhabi Commercial Conciliation and Arbitration Centre (ADCCAC) recently announced new procedural regulations of arbitration. These will come as a welcome move to those companies, predominantly Abu Dhabi-based, which contractually agree to refer their disputes to ADCCAC for resolution. The new regulations are undoubtedly more in line with international procedure than the previous ADCCAC rules: this will boost user confidence in ADCCAC.

ADCCAC was established in February 1993 and lays claim to being the first arbitration centre established within the Gulf Cooperation Council States. Set up by the Abu Dhabi Chamber of Commerce and Industry, its objective is to provide a facility for resolving trade disputes through conciliation and arbitration.

The new regulations, which came into effect on September 1, 2013, repeal the old ADCCAC arbitral rules in their entirety, mark the first update to ADCCAC’s arbitral rules in over 20 years and include new provisions on confidentiality, interim relief and arbitrator liability. They have been widely welcomed as they aim to streamline and clarify the arbitral process, creating an efficient and user friendly service that is more closely in line with internationally recognized procedure.

Procedural changes

The new regulations make clear:

• What is required of parties when submitting a request for arbitration – ensuring that claimants properly consider their cause of action and requested remedies when commencing arbitral proceedings
• The process for nominating party-appointed arbitrators
• The wide discretion of the arbitral panel.

Interim awards

Arbitral panels can now order “provisional and precautionary” measures relating to the subject matter of the dispute.

Such measures will be issued by the arbitral panel in the form of provisional arbitration awards and may be ordered on the panel’s own motion or at the request of the parties.

Waiver of rights

The new regulations provide that “a party who becomes aware that a given provision, a procedural rule or any of the Panel’s orders has not been complied with and yet continues the arbitration without objecting within a reasonable time, shall be deemed to have waived his right to object.”

Protection of arbitrators

Under the new regulations, the liability of arbitrators, ADCCAC and its staff is excluded. Such individuals shall have no liability for “any action, acts or inadvertence in relation to the arbitration” taken in good faith.

Confidentiality

While the old rules failed to address issues of confidentiality, the new regulations make it clear that the award – as well as all hearings, records, documents, materials, expert reports, witness statements and procedures – will be confidential unless the parties agree otherwise in writing or as required by law.

Arbitrator's fees

Historically, arbitrators’ fees were charged directly to the parties at rates that were to be agreed in advance. The New regulations require that an arbitrator’s fees be based on the size of the claim and introduce an ad valorem (i.e. ‘in proportion to the value’) table of fees similar to that used by the ICC.

Conclusion

The new regulations look set to provide greater clarity and efficiency to the arbitral process in Abu Dhabi and certainly merit the welcome they have been accorded.

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