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The Eve of the New York Convention’s 60th Anniversary and the Birthday Party: How to Prepare with too Many Guests at the Table. “Il ne faut pas melangér les tables”  

Kluwer Arbitration Blog - Thu, 2018-06-21 04:51

Marike R. P. Paulsson

What Is the Future of the New York Convention as a Primary Means for Enforcement of Arbitral Awards Across the Globe? Is There Any Future at All?1)UNCITRAL will be having several celebrations in June. At these occasions, thought leaders will reflect on the last 60 years and give their prognoses on the next 60 years. However, the views are on extreme sides of the spectrum with some proposing for complete overhaul whilst others abide by the adagio: if it ain’t broken, don’t fix it. jQuery("#footnote_plugin_tooltip_2105_1").tooltip({ tip: "#footnote_plugin_tooltip_text_2105_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

The year 2018 has featured many conferences and publications celebrating the 60th year that the New York Convention has been in existence, and with that, the question has been posed, as it had ten years ago at the occasion of its 50th anniversary at the ICCA Congress in Dublin: Does the treaty need replacement? The answers have been multiform since:

  1. One extreme answer on the spectrum: The New York Convention has been showing its cracks and needs replacement due to 60 years of divergent interpretation in the different 159 Contracting States.2) The replacement of the New York Convention has been proposed by Albert Jan van den Berg and has been dubbed the Miami Draft. The Draft has been discussed by the author in an earlier post. jQuery("#footnote_plugin_tooltip_2105_2").tooltip({ tip: "#footnote_plugin_tooltip_text_2105_2", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });
  2. The other side of the spectrum suggests: The New York Convention has been hailed around the world by thought leaders as the most successful instance of international law in the history of international commerce. It has even been proposed to be given the Nobel Prize, or at least its father – Piet Sanders and, in the alternative the organization that has been monitoring its existence, the International Council for Commercial Arbitration.
  3. A more moderate, yet realistic point of view: The New York Convention works, but it requires various instruments of soft law in order to assist judges in applying its text in the domestic realm.
  4. A more moderate, yet acceding view: The New York Convention will continue to promote international arbitration whilst being monitored by UNCITRAL.

Being on extreme sides of the spectrum at roundtable discussions with thought leaders has brought me to the use of the phrase – “Il ne faut pas mélanger les tables”.3)A French expression often used at wedding table seating advising the naïve bride to be not to mix the tables but to seat like-minded people with like-minded people. jQuery("#footnote_plugin_tooltip_2105_3").tooltip({ tip: "#footnote_plugin_tooltip_text_2105_3", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); Some tables do not need controversy leading to great conversations. Sometimes, a common path must be found for stakeholders to reach consensus about a treaty that has enabled the flourishing of international arbitration and international trade.

Perhaps the New York Convention ought to be a living breathing document like the US Constitution. Perhaps the original purpose or intent of the drafters was not for the treaty to be applied in a uniform manner in every single Contracting States for decades to come. Perhaps the New York Convention does not need replacement, yet it needs some hip or knee replacements such as the Global Restatement, or official recommendations issued by UNCITRAL or a policy guide for both executive and legislator by ICCA. Or perhaps the application of the New York Convention over the last 60 years has taught us that something far more radical is required than a replacement. Given the outcomes of the application of setting aside regimes in the countries where the award was rendered, perhaps the time has come again to pose the question as to whether setting aside regimes should be abolished.4)For the idea of revisiting the New York Convention and domestic setting aside regimes, please see here. jQuery("#footnote_plugin_tooltip_2105_4").tooltip({ tip: "#footnote_plugin_tooltip_text_2105_4", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

To these possible outcomes, I would add the following three pivotal developments that ought to be taken into account when finding a common path:

  1. First, the idea that international arbitration will continue to be the preferred method of dispute settlement in international trade is under revision both in the realm of international commercial arbitration and international investment arbitration. It is subjected to harsh criticism both from the arbitration community and from users, often citing costs and duration as a potential downfall.
  2. Second, the New York Convention is being currently presented with a mandate that was not even remotely considered 60 years ago: to be the enforcement mechanism for ‘awards’ rendered by a permanent court envisioned by the European Union.
  3. Third, perhaps Pieter Sanders was the first to think of mediation as one of the important topics in the future of dispute resolution back in 2010. But since then, the proponents of mediation have taken center stage and are making progress; thus, leading us back to the – perhaps original – idea of alternative dispute resolution. This idea was that first parties ought to attempt to settle any disputes through direct negotiation. If those attempts fail, parties can resort to what one could coin as third-party assisted settlement, which could be conciliation, mediation or commercial diplomacy (the latter I would coin as Dispute Resolution Diplomacy “DRD”). With that, the New York Convention loses its relevance: it is no longer just the successor of the Geneva Conventions. On the basis of Article VII(2), perhaps the New York Convention was less favorable than the European Convention of 1961, but otherwise, it continued to be celebrated at important milestones. Now, a new convention is underway: the United Nations Convention on International Settlement Agreements [resulting from mediation]. Is this to be the twin sister of the New York Convention?

Admittedly, 60 years with the commitment of 159 States gives a lot to celebrate. Yet, it is time for reflection about (partial?) replacements, additional reading glasses, crutches to enable the treaty to last another 60 years. Alternatively, the treaty could gradually phase out with the rise of third-party assisted settlement as the new way forward for dispute settlement in international trade (with the use of a probable Mediation Convention). Even if mediation will only supplement the ‘stick’ – international arbitration – the question remains what the role of the New York Convention will be when the idea of international arbitration will change fundamentally. If the EU is to move forward with its permanent court, the New York Convention will most likely not be the treaty under which those awards can be enforced.5) The community seems to be confident that the Convention can serve as the enforcement mechanism for any awards coming out of this court. I disagree. The awards of the court will most likely not fall under the scope of Article I(2) of the New York Convention as the travaux preparatoires demonstrate. jQuery("#footnote_plugin_tooltip_2105_5").tooltip({ tip: "#footnote_plugin_tooltip_text_2105_5", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); George Bermann states that “what emerges from the court will not be arbitration awards and thus the future – should the proposed EU investment court come into existence – could spell an end for the role of the New York Convention in European investor-state cases”.

Of course, most awards to be enforced under the New York Convention are commercial arbitration awards, for instance, those rendered under the auspices of the ICC. Even so, recent case law demonstrates judicial freestyling with some faint memory of the New York Convention. It is not all doom and gloom: institutions have embarked upon admirable journeys to shepherd judges across borders through the fog that has enveloped the text of the New York Convention. The International Council for Commercial Arbitration was created by Piet Sanders and his peers at the occasion of the conclusion of the European Convention of 1961. Piet Sanders then created the ICCA Yearbook with the purpose of monitoring the application of the New York Convention. That Yearbook has published over 2500 decisions to date. ICCA proceeded to write and distribute the ICCA Guide for the judicial interpretation of the New York Convention in 2011, a guide translated in 20 languages and distributed worldwide for free. In 2012, it embarked upon NYC Roadshows, which has led to certain States signing on to the New York Convention. The work has been done. The work continues to be done by UNCITRAL and ICCA. The work remains to be done. Powerful soft law must be developed; a dialogue must continue to take place with judiciary, legislators and executive and with all stakeholders in the community of international arbitration but also and especially with the actors in international trade.

Proposals? The community should continue to reflect on the Miami Draft, as a suggested replacement for the New York Convention, for the simple reason that it leads to ideas that could be effectively implemented: a Harvard Draft, a Global Restatement, a Supplementary Commentary, the possibilities are countless when mapping the future.

I would compare the Miami Draft metaphorically to the impossible dream of the Man of La Mancha.6) As referenced by Fali Nariman in his speech in 2013 in Delhi on sovereignty. jQuery("#footnote_plugin_tooltip_2105_6").tooltip({ tip: "#footnote_plugin_tooltip_text_2105_6", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); From the time of Yukos v. Russia to Pemex, notions of sovereignty have collided like billiard balls and gone in opposite directions and given the current nationalist waves, it will get worse. I would symbolically compare modern day enforcement as a never-ending Russian Doll of proceedings before numerous forums – all at the cost of predictability. However, the proposals are there and provide ways forward so one can end this note in times of geopolitical turmoil and the PR crisis of international arbitration with the one thing we do well to remember: international law has perhaps not achieved much, but it is good that it is there.

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References   [ + ]

1. ↑ UNCITRAL will be having several celebrations in June. At these occasions, thought leaders will reflect on the last 60 years and give their prognoses on the next 60 years. However, the views are on extreme sides of the spectrum with some proposing for complete overhaul whilst others abide by the adagio: if it ain’t broken, don’t fix it. 2. ↑ The replacement of the New York Convention has been proposed by Albert Jan van den Berg and has been dubbed the Miami Draft. The Draft has been discussed by the author in an earlier post. 3. ↑ A French expression often used at wedding table seating advising the naïve bride to be not to mix the tables but to seat like-minded people with like-minded people. 4. ↑ For the idea of revisiting the New York Convention and domestic setting aside regimes, please see here. 5. ↑ The community seems to be confident that the Convention can serve as the enforcement mechanism for any awards coming out of this court. I disagree. The awards of the court will most likely not fall under the scope of Article I(2) of the New York Convention as the travaux preparatoires demonstrate. 6. ↑ As referenced by Fali Nariman in his speech in 2013 in Delhi on sovereignty. function footnote_expand_reference_container() { jQuery("#footnote_references_container").show(); jQuery("#footnote_reference_container_collapse_button").text("-"); } function footnote_collapse_reference_container() { jQuery("#footnote_references_container").hide(); jQuery("#footnote_reference_container_collapse_button").text("+"); } function footnote_expand_collapse_reference_container() { if (jQuery("#footnote_references_container").is(":hidden")) { footnote_expand_reference_container(); } else { footnote_collapse_reference_container(); } } function footnote_moveToAnchor(p_str_TargetID) { footnote_expand_reference_container(); var l_obj_Target = jQuery("#" + p_str_TargetID); if(l_obj_Target.length) { jQuery('html, body').animate({ scrollTop: l_obj_Target.offset().top - window.innerHeight/2 }, 1000); } }More from our authors: International Arbitration and the Rule of Law
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Seven Takeaways on Asian Approaches to Conflict Prevention and Peacebuilding - The Asia Foundation - In Asia

Google International ADR News - Wed, 2018-06-20 21:22

The Asia Foundation - In Asia

Seven Takeaways on Asian Approaches to Conflict Prevention and Peacebuilding
The Asia Foundation - In Asia
While conflict, peacebuilding, and development is not a new area of development cooperation, many lessons from past international efforts have little applicability in Asia. These efforts have often focused on the role that Western nations or ...

Perceived corruption affecting growth of arbitration in Nigeria –Olawoyin - The Punch

Google International ADR News - Wed, 2018-06-20 18:04

The Punch

Perceived corruption affecting growth of arbitration in Nigeria –Olawoyin
The Punch
You are one of the front-line promoters of Alternative Dispute Resolution, especially arbitration, in the country. How has ADR, particularly arbitration, fared over the years? ADR, which incidentally includes arbitration, is gaining ... I should add ...

Perceived corruption affecting growth of arbitration in Nigeria –Olawoyin - The Punch

Google International ADR News - Wed, 2018-06-20 18:04

The Punch

Perceived corruption affecting growth of arbitration in Nigeria –Olawoyin
The Punch
A professor of Business Law and Senior Advocate of Nigeria, Gabriel Olawoyin, in this interview with OLADIME JI RAMON, shares his thoughts on the financial autonomy for the state judiciaries as well as the growth of Alternative Dispute Resolution in ...

JPO Released Its Practical Guide to SEP Licensing Negotiations - Lexology

Google International ADR News - Wed, 2018-06-20 10:31

JPO Released Its Practical Guide to SEP Licensing Negotiations
Lexology
[9] The initial plan was to introduce an alternative dispute resolution mechanism.[10] However, in light of the opinions of key industry organizations such as the Japan ... The first half of the Guide concerns the procedural aspect: it mainly ...

The Future of Arbitration: 5, 10, 25 Years and Beyond

Kluwer Arbitration Blog - Wed, 2018-06-20 03:30

Michael McIlwrath

At the recent Finnish Arbitration Institute’s Arbitration Day in Helsinki, I spoke on the topic of the future of arbitration from the user’s perspective.

While I am not a futurist by any stretch, I do have something to say as a user, since I have been an in-house counsel in a global company for the past 20 years. Also, in 2016-17, I had the honor of chairing the Global Pound Conference (GPC), an event held in 29 cities around the world where we asked over 2,000 stakeholders the same 20 questions to help shape the future of commercial dispute resolution.

A consistent finding from these events was that users are the ones most likely to bring about change.1) Interestingly, this was not the same finding of the recent Queen Mary/White & Case International Arbitration survey, which found that 80% of respondents believe that “arbitral institutions” are best placed to make an impact on the future evolution of international arbitration. But in her own remarks at the event, Heidi Merikalla-Teir, the Secretary General of the Finnish Arbitration Institute, clarified why this data is not inconsistent. She pointed out that arbitral institution themselves look to what the market wants, which means offering services that users will need. jQuery("#footnote_plugin_tooltip_9752_1").tooltip({ tip: "#footnote_plugin_tooltip_text_9752_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); Therefore, in trying to predict the future of arbitration, I will focus on the effect of pressures that users will bring to bear in the coming years.

About predicting the future

I feel relatively confident that my short-term predictions in this post are likely to come to fruition. Although they may arrive a bit sooner or later than I predict, they are all grounded in trends or dynamics that are already shaping dispute resolution practices.

The longer-term, of course, will be less constrained by current practices and expectations. This allows bigger swings about how dispute resolution may radically depart from customs we currently know and trust, and how it might adapt to society as it will come to exist.

One thing about the future, however, does not require a time machine to be certain it will occur: the users who will most shape the future will not be me or my contemporaries. We are already being displaced by a younger generation that, unlike us, trained in international arbitration at university, is quicker to adopt new technologies, and is highly networked. They also include a vocal contingent of “super-users,” the third party funders.

The next 5-10 years

The most significant development in the next five years will be the emerging divide between procedures for resolving low value/low complexity disputes on one end, and high value/complexity on the other.

While discussion about efficiency in arbitration typically focuses on larger-sized disputes (where the largest costs are incurred), institutions will continue to introduce tools to make it cost-effective to resolve disputes on the lower end. They will do this to retain market share, realizing there are many more small cases than large ones, and therefore more opportunities to attract and retain users.

To do this, institutions will market new forms of automation, especially versions of Online Dispute Resolution (ODR). At least initially, users will adopt these tools not because they appear better than non-automated procedures, but because they offer a method of resolution where no viable alternative is available.

In rules revisions, institutions will sacrifice some degree of party autonomy in favor of more efficiency, and users will ultimately embrace this. An example of this today are the recent SIAC and ICC rule changes imposing a sole arbitrator in smaller-sized cases, even where the parties had agreed to three arbitrators in their contract, or the proposed “Prague Rules” that impose a more restrictive “civil law” flavor on international proceedings.

Mediation will continue its steady growth, especially as an escalation step in medium and large disputes, or in cases that were once sent to investment arbitration. There will still be fewer mediations than arbitrations, but leading institutions will offer both to keep users from moving to other providers.

Institutions will seize upon the lack of accessible information about arbitrators—a common user complaint—and transform it to opportunity. As the 2018 Queen Mary/White & Case survey highlighted, 43% of in-house counsel respondents stated they have insufficient information to make an informed choice about the appointment of arbitrators. If nearly half the market wants more information, why are institutions not providing it? Because they are run mainly by arbitrators, not users.

This tension will not last. Within the next five years, the transparency trend will gather speed. Institutions will offer competing avenues to provide users with information about arbitrators (in particular case their management skills) and awards rendered under their rules.

Institutions will also explore new forms of cooperation, especially in the sharing of administrative resources and technology. Some of this will be driven by the need for expensive compliance with regulatory frameworks, like Europe’s new privacy regulation, or ensuring cybersecurity, or adopting modern electronic case management systems. This pooling of back-offices will be a boon to regional institutions, allowing them to punch above their weight with limited resources.

Finally, before the decade is over, Kluwer will publish the 5th edition of Gary Born’s treatise on international commercial arbitration. The treatise will grow from three to five volumes in order to accommodate published arbitration awards that will begin to lay the foundation of an emergent international commercial arbitration jurisprudence.

After 10 years of change

As users become more experienced with technology tools to resolve their lower value disputes, demand for them will creep into higher value and more complex cases.

Leading institutions will begin to market resolution methods that draw on data analytics and tools of predictive justice that purport to help users assess likely outcomes and resolve their disputes earlier. The ability to better predict outcomes will bolster amicable methods of resolution, especially mediation.

Users will begin to appoint arbitrators based on their ability to automate by incorporating machine learning into the tasks of sorting facts and developing their legal analysis of the case. The IBA’s arbitration committee will recommend full disclosure of the types of AI-assistance, algorithms, or other technologies arbitrators use in aid of the management of proceedings or the drafting of awards.

At the same time, the market will see an emerging “professionalization” of the role of international arbitrator, akin to that imposed on lawyers, doctors, and even mediators (who are already licensed/certified in many countries). Initially there will be regional, state-sponsored certification regimes for court-referred disputes and other domestic cases. Partly in response to these inconsistent approaches creeping into international cases, global certification schemes, codes of conduct, and accompanying enforcement regimes for international arbitration will come into existence.

Gender diversity in the appointment of international arbitrators will be close to parity in both regional and global institutions. Diversity will still be a concern, however, as there will still be a broad gap in the geographic and ethnic backgrounds of those being appointed.

Building on their successes in sharing back-office resources, regional institutions will extend their collaboration to attract more users. The international arbitration market will be split between large multinationals and the “super regionals.”

But the biggest competition facing arbitration in 10 years will be from the courts. And not the ambitious international courts that are already underway in Singapore or planned in Germany and France, but rather domestic courts.

Many users insist on including an arbitration clause in their contracts not because of the enforcement advantages or flexibility or confidentiality it provides, but simply the lack of an acceptable court alternative. Yet the commercial courts of many countries are already undergoing sweeping reforms and multi-year modernization efforts. This will continue, making it difficult for a contracting party to object to the courts of a buyer’s home country because they are not fair, competent, or efficient.

In the late 2020’s, Kluwer will publish the seventh and last version of Gary Born’s treatise to appear in printed form. It will return to its original two volumes, but buyers will have access to an on-line database of annotated arbitration awards and court decisions equivalent to a much larger, multi-volume set.

25 years and beyond

The changes to occur in the next two decades will establish new norms and expectations for users. In the eyes of future users, the lines between human decision-maker and automated processes will become increasingly blurred. Users will still want a human to be held responsible for the quality of a decision, but they will look mainly to institutions to fulfill this role.

Above all, users will expect technology to quickly crunch the data of the issues in dispute and provide accurate, predictable awards.

As we get closer to the singularity, the point where human and machine intelligence intersects, users will be able to select arbitrator programs that may that offer different approaches or that may even be modeled on human decision-makers. In this future, the Finnish Arbitration Institute could be called to address party disagreements over whether the dispute calls for a “John Beechey” or a “Carita Wallgren-Lindholm” flavor of arbitrator.

And, finally, Born on Arbitration, currently scheduled by Kluwer for release on June 20, 2043, will be an interactive artificial intelligence. The voice of Gary Born will answer user queries about any type of arbitration by drawing on the author’s collected writings and all arbitrations conducted to date.

The future or not?

Or, possibly, little will change.

Perhaps in the year 2043 we will still be gathering information about arbitrators exclusively via word of mouth, complaining that the procedure is too expensive for many disputes, struggling to agree dates for hearings 12 to 24 months after the first procedural conference, and arguing over whether a respondent in Europe should receive additional weeks to reply on a submission that falls due during the summer holidays.

Check back in 25 years and let me know.

 

References   [ + ]

1. ↑ Interestingly, this was not the same finding of the recent Queen Mary/White & Case International Arbitration survey, which found that 80% of respondents believe that “arbitral institutions” are best placed to make an impact on the future evolution of international arbitration. But in her own remarks at the event, Heidi Merikalla-Teir, the Secretary General of the Finnish Arbitration Institute, clarified why this data is not inconsistent. She pointed out that arbitral institution themselves look to what the market wants, which means offering services that users will need. function footnote_expand_reference_container() { jQuery("#footnote_references_container").show(); jQuery("#footnote_reference_container_collapse_button").text("-"); } function footnote_collapse_reference_container() { jQuery("#footnote_references_container").hide(); jQuery("#footnote_reference_container_collapse_button").text("+"); } function footnote_expand_collapse_reference_container() { if (jQuery("#footnote_references_container").is(":hidden")) { footnote_expand_reference_container(); } else { footnote_collapse_reference_container(); } } function footnote_moveToAnchor(p_str_TargetID) { footnote_expand_reference_container(); var l_obj_Target = jQuery("#" + p_str_TargetID); if(l_obj_Target.length) { jQuery('html, body').animate({ scrollTop: l_obj_Target.offset().top - window.innerHeight/2 }, 1000); } }More from our authors: International Arbitration and the Rule of Law
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Shaping the Future of International Arbitration: A Report from Helsinki International Arbitration Day 2018

Kluwer Arbitration Blog - Wed, 2018-06-20 00:41

Heidi Heidi Merikalla-Teir

Finland Arbitration Institute (FAI)

Helsinki International Arbitration Day (HIAD) is an arbitration conference organised by the Arbitration Institute of the Finland Chamber of Commerce (FAI). Since its inception in 2012, HIAD is held every year in the city of Helsinki bringing together legal practitioners from Finland and abroad to hear from top experts about the latest developments in international arbitration and mediation. Already in its seventh edition, this year’s event, held on 24 May 2018, was attended by some 200 delegates from 16 countries.

Welcome remarks

Petra Kiurunen (FAI Board Chair) and Heidi Merikalla-Teir (FAI Secretary General) opened the event with an outline of the conference topics—public-private arbitration, transparency, technology, sports arbitration and the users’ perspective—examined during the conference from non-conventional angles to shed new insights into the shaping of international commercial arbitration.

Petra Kiurunen asked whether there is anything new under the sun if we think about hot topics in international arbitration. She noted that even though international arbitration can perhaps be said to have matured, to have certain best practices that are followed to a large extent regardless of the seat, there is at the same time an increasing trend that we see in almost all aspects of life: nothing survives in a bubble. Instead, influences come, and need to be considered from various directions.

Heidi Merikalla-Teir referred to the results of the 2018 Queen Mary/White & Case survey, where a great majority of the respondents identified arbitral institutions as best placed to influence the evolution of international arbitration. However, she said, it is the users—in-house counsel and business people in different sectors—who should be listened to and allowed to take the driver’s seat in the shaping of the future of international arbitration.

Keynote address

Catherine A. Rogers (Penn State Law, USA / Queen Mary University of London, UK), delivered the conference’s keynote address. Rogers said that, in international arbitration, the starting point of the shaping process—the one that the shapers of the future of international arbitration must preserve and deal with—is a truly exceptional mechanism that like the “fly of the bumblebee” is unique and counter-intuitive. Despite lacking the conventional features of traditional adjudication, international arbitration works better than national courts to resolve international disputes and is being increasingly asked to do so—by some estimates, over 10,000 disputes are resolved annually through international arbitration worldwide, Rogers said. This is the result of international arbitration’s evolutionary advances—an evolution that requires an active intervention from all custodians of the continuous success of international arbitration in the face of new challenges, Rogers concluded.

Panel: “Public-Private Arbitration – How to Strike the Right Balance Between Public Interests and Private Proceedings?”

A panel of four speakers—Stavros Brekoulakis (Queen Mary University of London, UK), Robert Lambert (Clifford Chance, UK), Eva Storskrubb (Roschier, Sweden), and Galina Zukova (Bélot Malan & Associés, France)—moderated by Patrizia Netal (KNOETZL, Austria), discussed about public-private arbitration in their respective jurisdictions.

Brekoulakis explained the rise of public-private arbitrations involving states or state entities in the last decade as a result of two concurrent developments: 1) the collapse of the doctrine of non-arbitrability of disputes involving public interest or public policy, and 2) ideological and economic forces that combined to massive privatisation programmes in the 80’s and 90’s. Nowadays, many of the standard contractual forms that are used for concessions and infrastructure projects contain arbitration as a default provision. A further rise in public-private arbitrations is foreseen for the future, e.g., in connection with the “One Belt, One Road” initiative.

Zukova added that, in some jurisdictions, it is also important to consider disputes with a public interest component involving private parties, e.g., in France, in road construction concessions involving a contractor and subcontractor.

Storskrubb addressed the concepts of public policy and public interest. From a Nordic perspective, she said, public policy or ‘ordre public’ is an outer boundary of arbitration. In Finland and Sweden, ‘what is manifestly in breach of the fundamental principles of the legal order’ is quite a high threshold, which is why it is quite rare to refuse the recognition of an arbitral award on this basis. Public interest, for its part, is a broader concept.

The panellists further discussed about how to capture the public interest in the contract or with some laws that go beyond the contract, such as mandatory laws or rules. Lambert told the audience about the “e-Borders case”, which served to illustrate these issues, generating an interesting debate on how to better align these contracts with the public interest.

Interview: “Can Some Characteristics of Sports Arbitration be Adopted to International Commercial Arbitration?”

Interviewed by Markus Manninen (Hannes Snellman Attorneys Ltd, Finland), Professor Richard McLaren (University of Western Ontario, Canada) addressed the main features of sports arbitration, some of which could or should be used in commercial arbitration.

McLaren mentioned that commercial arbitration gave birth to sports arbitration and addressed some of its features, many of which can be found in in commercial arbitration as well, like the role of arbitral institutions, the composition of arbitral tribunals, the appointment of arbitrators, the use of (tactical) challenges in arbitrations. However, he also mentioned that, in sports arbitrations, there was a greater transparency due to the nature of sports disputes (frequently parties want their names concealed), control of costs and general speediness.

On speediness, McLaren explained that sports arbitrations are generally speedy, which is made possible by the quality of parties’ counsel: experienced, specialised and cooperative, and by procedural features: usually one round of briefs, short time frames with limited or no room for extensions—the latter because of the ripple effects of some decisions, and cases done on the papers without a hearing.

Speech: “Users’ Perspective on the Future of International Arbitration”

Michael Mcllwrath (GE Oil & Gas, Italy) quoted Yogi Berra’s ‘Future ain’t what it used to be’ to refer to arbitration’s golden age in the ever-evolving arbitration scene.

McIlwrath emphasised that it has become clear, e.g., at the Global Pound Conference, that it is the users of arbitration who will most likely drive change in arbitration. He proposed to look at the drivers of the market over the next years, i.a., the current generation of young arbitration practitioners and third-party funders; the latter ones, according to McIlwrath, will be the super users of arbitration in the future.

Further, McIlwrath made some interesting predictions for the next 5, 10 and 20-25 years and encouraged everyone to enjoy the golden age of arbitration while it is possible.

Panel discussion: “How to Embrace the Disruption in International Arbitration?

The last panel session—moderated by Riikka Koulu (University of Helsinki, Finland) and including speakers Michael Lind (Tyler Technologies, Inc., UK), Clemens Heusch (Nokia, Germany), Catherine A. Rogers (Penn State Law, USA, and Queen Mary University of London, UK), and Meera Sivanathan (Dottir Attorneys, Finland)—focused on disruptive digital technologies and overall trends that might become influential and how the arbitration community should react to them.

Koulu presented the Legal Tech Lab, a research hub at the University of Helsinki’s Faculty of Law focusing on digitalisation of the legal practice. According to their research, there is a discrepancy between the hype around technology and lawyers’ everyday use of only basic tools, such as Google, Word and e-mail.

Lind spoke about online dispute resolution (ODR), originally applied to small cases and progressively used in more complex cases. Technology allows, e.g., the scheduling of arbitrators/adjudicators to these cases, which are conducted efficiently through a platform.

Sivanathan presented the FAI Arbitration Process flowchart—a legal design project carried out in close cooperation between the FAI, law firm Dottir and design agency Hellon. The flowchart aims to provide arbitration users with a one-stop tool to quickly understand the whole arbitration process.

Rogers gave a presentation on “Arbitrator Intelligence (AI)”, a project aiming to promote transparency, fairness and accountability in the selection of international arbitrators by increasing and equalizing access to critical information on arbitrators and their decision making. The collection of information on arbitrator case management and decision-making is conducted through the feedback questionnaire “Arbitrator Intelligence Questionnaire” (AIQ), which is open for all parties, counsel, and third-party funders to fill in after the conclusion of an arbitration in which they are involved.

Heusch commented on the use of new technologies in arbitration and shared his views on their benefits and impacts from the point of view of the different stakeholders.

Closing remarks

Petra Kiurunen thanked the key note speaker, the moderators, the speakers, and the HIAD Partners, and invited all participants to the next year’s conference to be held in Helsinki on 23 May 2019 under the umbrella of the International Federation of Commercial Arbitration Institutions (IFCAI): the 15th IFCAI Biennial Conference.

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The post Shaping the Future of International Arbitration: A Report from Helsinki International Arbitration Day 2018 appeared first on Kluwer Arbitration Blog.

Drinker Biddle Adds IP Pro From Kirkland In Chicago - Law360

Google International ADR News - Tue, 2018-06-19 20:49

Drinker Biddle Adds IP Pro From Kirkland In Chicago
Law360
Law360 (June 19, 2018, 9:37 PM EDT) -- Drinker Biddle & Reath LLP has expanded its intellectual property team with a seasoned patent litigator in Chicago from Kirkland & Ellis LLP who has handled complex cases involving data, gaming technology, ...

JPO Released Its Practical Guide to SEP Licensing Negotiations - JD Supra (press release)

Google International ADR News - Tue, 2018-06-19 11:44

JD Supra (press release)

JPO Released Its Practical Guide to SEP Licensing Negotiations
JD Supra (press release)
[9] The initial plan was to introduce an alternative dispute resolution mechanism.[10] However, in light of the opinions of key industry organizations such as the Japan ... The first half of the Guide concerns the procedural aspect: it mainly ...

JPO Released Its Practical Guide to SEP Licensing Negotiations - JD Supra (press release)

Google International ADR News - Tue, 2018-06-19 11:44

JD Supra (press release)

JPO Released Its Practical Guide to SEP Licensing Negotiations
JD Supra (press release)
[9] The initial plan was to introduce an alternative dispute resolution mechanism.[10] However, in light of the opinions of key industry organizations such as the Japan ... The first half of the Guide concerns the procedural aspect: it mainly ...

Giacolone Appointed Acting Director of FMCS - FedSmith.com

Google International ADR News - Tue, 2018-06-19 09:15

FedSmith.com

Giacolone Appointed Acting Director of FMCS
FedSmith.com
He has also served as the Director of the FMCS International/Alternative Dispute Resolution Department and Special Assistant to the Director of FMCS. Prior to receiving his commission with FMCS, Giacolone was Labor Relations Advisor for the Department ...

Relationship between the Arbitrators and their Law Firm: A case for Dynamic Application of the IBA Guidelines on Conflicts of Interest

Kluwer Arbitration Blog - Mon, 2018-06-18 19:10

Sharanya Shivaraman

Independence and impartiality of an arbitrator form the bedrock of effective and fair legal proceeding. However, there are many requisites to an impartial tribunal such as fair and timely disclosures of potential conflicts by parties and the arbitrators. In this article, I shall explore the critical impact of the professional relationships of an arbitrator’s law firm on the perception of arbitrator’s independence.

The IBA Guidelines on Conflicts of Interest reflect on the growth of law firms and the commercial realities surrounding the practice of appointing arbitrators belonging to large law firms. In this regard, the Guidelines mandate that the arbitrator, in principle must be considered to bear the identity of his/her law firm. The Guidelines in multiple entries under waivable red list and orange list discuss the impact of engaging an arbitrator who belongs to the law firm with whom a party to the case has an established connection.

This is because the arbitrator has a substantial interest in his law firm’s sustenance and well-being and is expected to appreciate the professional relationships of his law firm as an active agent of the firm. However, this raises concerns on the presumptive approach under the Guidelines in stark contrast to the analytical approach under most of the domestic arbitration rules and even UNCITRAL, ICC etc.

Application of IBA Guidelines

In the case of Vivendi, the arbitrator was challenged on account of a connection between his law firm and a party. The challenge was dismissed on the ground that the connection was of minor value and wholly discrete. However, applying the IBA Guidelines, it was envisaged that an arbitrator’s law firm’s professional relationship with any party to the case may seriously impair his/her independence in the proceedings. It is further observed that where the arbitrator holds a key position in the law firm, there is a legal presumption on singularity of interest between arbitrator and his law firm so far as his independence in any arbitration is concerned (KPMG AB v PROFILGRUPPEN AB (Svea Court of Appeal), (Case no. T 1085-11)).

A different position emerged in the case of W v. M. Ltd. The point of contention was whether in treating the arbitrator and his or her firm as well ‘‘compendiously’’ without reference to the question of whether the particular facts could realistically have any effect on the impartiality or independence of the arbitrator is consistent with the need to evaluate cases of impartiality from an objective standpoint. The Judge even went on to state that where the facts fit the situation detailed under the IBA Guidelines, it ‘‘causes a party to be led to focus more on assumptions derived from the fact, and to focus less on a case-specific judgment.”

Dynamic interpretation of the IBA Guidelines

The IBA Guidelines are not legal provisions and are not meant to override any applicable national law or arbitral rules chosen by the parties. The Working Group while framing these guidelines trusted that they will be applied with robust common sense and without pedantic and unduly formalistic interpretation. While detailing the scope for a factual approach to conflicts of interest, the Guidelines state that “the relevance of the activities of the arbitrator’s firm, such as the nature, timing and scope of the work by the law firm, and the relationship of the arbitrator with the law firm, should be considered in each case.

The case-specific analysis as the W v. M Ltd. case requires, might hinder the larger goal that the IBA Guidelines set out to achieve. An analytical approach will defeat the purpose of the Guidelines to achieve uniformity and consistency. However, blanket acceptance of these Guidelines will dissuade appointment of any arbitrator who has any semblance of a commercial relationship with appointing party merely to escape the narrow conduit under the Guidelines.

Independence and impartiality of arbitrator are shaped by the ‘legal traditions and culture’ along with the specific nuances of each case (Jung Science Information Technology Co. Ltd. v. ZTE Corp.). In the light of such clear observations, it might be premature to accord significant value to the relationships of the law firm of arbitrator while assessing the arbitrator’s impartiality as the identity of an arbitrator with law firm has to be preceded by a legal analysis of the likelihood of justifiable doubt and cannot be naturally presumed.

Though tribunals have repeatedly stated that these Guidelines carry indicative value only, it must be ensured that the IBA Guidelines must not take the position of customary international arbitration law (Will Sheng Wilson Koh, p. 720). In conclusion, it would suffice to say that any assessment of an arbitrator’s propriety will have to take cognisance of the dynamic and commercially oriented law firm-client relationship without restricting the application of law to any pre-conception or pigeon holes.

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The post Relationship between the Arbitrators and their Law Firm: A case for Dynamic Application of the IBA Guidelines on Conflicts of Interest appeared first on Kluwer Arbitration Blog.

Tenth Annual Securities Dispute Resolution Triathlon

ADR Prof Blog - Mon, 2018-06-18 10:39
The Hugh L. Carey Center for Dispute Resolution at St. John’s School of Law and the Financial Industry Regulatory Authority (FINRA) invite you to participate in the tenth annual Securities Dispute Resolution Triathlon, a competition of competence in the dispute resolution field. The Triathlon is the first and only competition to include negotiation, mediation, advocacy, and arbitration … Continue reading Tenth Annual Securities Dispute Resolution Triathlon →

Ebner Wins Award

ADR Prof Blog - Mon, 2018-06-18 10:34
A simulation co-authored by Noam Ebner (Creighton) has been named a first-prize co-winner of Syracuse University’s Maxwell School of Citizenship and Public Affairs annual E-PARCC teaching case and simulation competition. Congratulations, Noam! The simulation places participants in the role of EU leaders tasked with forming EU policy in face of the waves of migration entering … Continue reading Ebner Wins Award →

Lawyer in Vietnam Dr. Oliver Massmann - e-commerce - the World Bank is asking Duane Morris Vietnam on the ... - Lexology

Google International ADR News - Mon, 2018-06-18 06:22

Lawyer in Vietnam Dr. Oliver Massmann - e-commerce - the World Bank is asking Duane Morris Vietnam on the ...
Lexology
Use of the general judicial system for addressing online disputes; Use of alternative dispute resolution (ADR) mechanism such as consultations, conciliation, or mediation; and Other provision for a dispute resolution mechanism (e.g. administrative ...

Recent Issue b-Arbitra

Kluwer Arbitration Blog - Sun, 2018-06-17 17:51

Gloria Alvarez (Associate Editor)

We are pleased to present to you this second issue of b-Arbitra 2017, which is also the second issue of our new cooperation with Wolters Kluwer. As announced, our journal is now also accessible in digital form on Jura in Belgium and in the Kluwer Law Arbitration database.

In this issue you will find an in depth analysis by Olivier Caprasse and Maxime Malherbe of the Belgian Constitutional Court decision of 16 February 2017. This decision addresses the important issue of the effects of judicial and arbitral decisions and of their consequences on the recourse that is available to third parties against an award. A distinction is made between the current inability of a third party to resist enforcement of an award and the limited possibility recognized by the Cour de Cassation for a third party to request the annulment of an award, in case of fraud. The decision of the Constitutional Court is published in the Case law section of this issue.

We then publish two contributions dealing with third party funding mechanisms. These contributions complement, as announced in our previous issue, the articles and documents already published in that issue on this topic, following a CEPANI colloquium on Third Party Funding that took place on 9 March 2017. The first contribution is an article by Dirk Van Gerven and Arie Van Hoe published in the Doctrine section about the ethical and deontological issues related to third party funding. The authors first discuss the views as to the ethical or unethical character of third party funding as such. Then they comment on the various aspects and manifestations of the ethical issues, from the perspective of both the lawyer and the arbitrator. They end with a question : how will arbitration institutions deal in the future with third party funding in their rules? You will find a second contribution on third party funding in our Documents section, written by Christopher P. Bogart, co-founder and chief executive officer of Burford Capital LLC, a major actor in litigation and arbitration finance, publicly traded on the London Stock Exchange. His contribution offers the finance industry’s point of view, as a primer of sorts, on the advantages that arbitration finance in general and third party funding in particular bring to both corporate clients and their lawyers. It also addresses two areas of concern that are frequently raised in regard to financing international arbitration : disclosure and security for costs.

In our Case law section, we publish a decision of the Brussels Court of First Instance, with a note by Stephanie Davidson. That decision deals with particular procedural aspects of a third party’s objection to enforcement of an arbitral award. The first aspect is the time limit applicable to a third party for filing its objection to enforcement of an award, in combination with a simultaneous application to set aside the award. In a second aspect, the court confirms the position of the Cour de Cassation as to the right of the third party to seek the annulment of an award that was obtained by fraud.

We also publish two decisions of the Brussels Court of First Instance rendered in the Yukos saga. In a first decision of 9 December 2016, the court has declared inadmissible the third party application (“tierce opposition/derdenverzet”) filed by the Russian Federation seeking to withdraw its decision of 24 June 2015 that had granted the exequatur of two arbitral awards against the Russian Federation. By another decision of 8 June 2017, the judge of attachments (“juge des saisies/beslagrechter”) lifted the seizures that had been obtained by Yukos on a number of assets in Belgium of the Russian Federation and of related entities. Both decisions raise interesting issues of international private law and of procedural law regarding the interaction between the enforcement and the annulment of awards, as well as the related seizures. A doctrinal comment on those decisions will be published in a next issue of our journal.

In the Documents section, after the contribution of Christopher Bogart, you will find the first Dutch translation of the rules of CIETAC (the China International Economic and Trade Arbitration Commission), made and commented upon by Jacques Herbots. International arbitration is today a hot topic in China and a priority of Chinese diplomacy under the presidency of Xi Jinping. No fewer than 387 international cases were dealt with under the auspices of CIETAC in 2016. This journal has previously published in 2014 a contribution by the same author on the characteristics of arbitration in China.1)Herbots J.H., “Les caractéristiques propres au droit de l’arbitrage de la République populaire de Chine », b-Arbitra, 2014/2, pp. 379-420. jQuery("#footnote_plugin_tooltip_6630_1").tooltip({ tip: "#footnote_plugin_tooltip_text_6630_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

Herman Verbist then delivers a comprehensive presentation of the new ADR Rules of CEPANI that have just been revised, 5 years after the 2013 revision of its Arbitration Rules.

Finally, this issue contains a book review of the interesting and challenging reflections of Rémy Gerbay in his book on the Functions of Arbitral Institutions, as well as a brief presentation of the remarkable 1958 New York Convention Guide and Website launched in 2017 as a collaboration between UNCITRAL, Shearman & Sterling and the Columbia Law School.

We wish you excellent and stimulating reading and we always welcome further views, exchanges and suggestions from our readers.

To make sure you do not miss out on regular updates on the Kluwer Arbitration Blog, please subscribe here.

References   [ + ]

1. ↑ Herbots J.H., “Les caractéristiques propres au droit de l’arbitrage de la République populaire de Chine », b-Arbitra, 2014/2, pp. 379-420. function footnote_expand_reference_container() { jQuery("#footnote_references_container").show(); jQuery("#footnote_reference_container_collapse_button").text("-"); } function footnote_collapse_reference_container() { jQuery("#footnote_references_container").hide(); jQuery("#footnote_reference_container_collapse_button").text("+"); } function footnote_expand_collapse_reference_container() { if (jQuery("#footnote_references_container").is(":hidden")) { footnote_expand_reference_container(); } else { footnote_collapse_reference_container(); } } function footnote_moveToAnchor(p_str_TargetID) { footnote_expand_reference_container(); var l_obj_Target = jQuery("#" + p_str_TargetID); if(l_obj_Target.length) { jQuery('html, body').animate({ scrollTop: l_obj_Target.offset().top - window.innerHeight/2 }, 1000); } }More from our authors: International Arbitration and the Rule of Law
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A New Arbitral Institution for the Art World: The Court of Arbitration for Art

Kluwer Arbitration Blog - Sun, 2018-06-17 02:48

Jane Parsons and Claire Morel de Westgaver

Bryan Cave Leighton Paisner LLP

A new court dedicated to resolving art-related disputes was launched earlier this month in The Hague. The Court of Arbitration for Art (“CAA”) was founded by the Netherlands Arbitration Institute (“NAI”) in collaboration with Authentication in Art (“AiA”), a not-for-profit foundation that promotes best practice in art, particularly in art authentication.

The CAA will administer arbitrations conducted by arbitrators with significant disputes, art and art law expertise and under arbitration rules (“AiA/NAI Court of Arbitration for Art Adjunct Arbitration Rules” (the “Adjunct Arbitration Rules”)) that have been designed to accommodate common issues in art-related disputes, such as provenance issues.

 

Submission to CAA arbitration

Parties can agree to submit a dispute to arbitration administered by the CAA and/or under the Adjunct Arbitration Rules in a contractual arbitration clause or submission agreement. Where parties have incorporated these Rules, the NAI Arbitration Rules will apply as well, except where they are modified by the Adjunct Arbitration Rules (Point 2, Adjunct Arbitration Rules and Explanatory Note 3.2).

Historically, the art market was notorious for conducting business without any paperwork or with only an invoice or very informal agreement to document a transaction, without any dispute resolution provisions. Where that is still the case or where no contractual relationship exists at all, the CAA would only have jurisdiction if the parties agreed a submission agreement after a dispute has arisen. Increasingly, however, written contracts are put in place for art purchases, consignments, artist/gallery agreements, loan agreements and other art-related transactions. It might be that in the early years of the CAA the majority of disputes will be referred to the CAA by way of a submission agreement after a dispute has arisen, but as the CAA gains prominence it will be interesting to see if parties decide to incorporate the Adjunct Arbitration Rules into their contracts from the outset.

 

Key features of the Adjunct Arbitration Rules

Number of arbitrators

The default position is that there will be three arbitrators, unless the value of relief sought is less than €500,000 or the parties have agreed to a sole arbitrator (Point 5). This is the reverse of the position of most leading commercial arbitration rules, under which a sole arbitrator is appointed unless the circumstances of the case warrant the appointment of three arbitrators (see Article 9.1 of the SIAC Rules 2016, Article 5.8 of the LCIA Rules 2014 and Article 12.2 of the ICC Rules 2017).

 

AiA/NAI pool of arbitrators

The starting point is that arbitrators will be appointed from a “Pool” compiled by the AiA Board and the NAI composed of international lawyers with experience in litigating or advising clients in art law disputes and/or international arbitration (Point 4 and Explanatory Notes 2.1 and 5.1). If a party wants to deviate from that Pool and has compelling reasons to do so, the party must obtain the consent of the NAI administrator (in consultation with the AiA Board) after having disclosed the name of the arbitrator they want to appoint and the reasons for the deviation (Points 4 and 6 and Explanatory Note 5.1). The only example of a compelling reason the Rules provide is wanting an arbitrator with a very specific background and the absence of such an arbitrator in the Pool.

Given the default position under the Adjunct Arbitration Rules is that the parties’ choice of arbitrator is restricted to the Pool, the calibre of people in the Pool has to be good and they have to be available to progress the proceedings efficiently, in order that parties have confidence in the process. If the Pool compiled by the NAI and AiA contains high quality candidates, these provisions should add credibility to the decisions and provide comfort to parties that their dispute will be resolved by a panel with the specific legal and sectorial expertise required in art disputes, which a judge in court may not always have.


Experts in forensic science and provenance

The only admissible expert evidence on forensic science and provenance issues will be from an expert or experts appointed by the tribunal (and not by the parties), which overrides Article 28 of the NAI Arbitration Rules (Point 10 and Explanatory Notes 7.1 and 7.2). The tribunal must consult with the parties on the appointment of the expert and will establish the expert’s terms of reference after considering comments from the parties.

These experts may come from an “Expert Pool” of art historians, materials analysts, forensic scientists and provenance researchers compiled by the AiA Board, but relevant scholars of a particular artist may be approached on a case-by-case basis. The parties are able to appoint experts on other issues, but any such evidence must not compete with or supplement the tribunal-appointed expert’s evidence on forensic science or provenance (Point 10 and Explanatory Note 2.2).

This provision, inspired by inquisitorial systems of civil law jurisdictions under which the court is in charge of investigating the facts of the case, appears to stem from the concern that party-appointed experts may advocate for the party who appointed them, as opposed to being a neutral expert whose duty is to assist the tribunal. The Explanatory Notes to the Adjunct Arbitration Rules state that “As an alternative to having disputing parties retain their own respective experts in these particular fields [provenance and forensic science], with such experts then advocating for their side, the AiA/NAI Rules shall offer the Expert Pool to provide the exclusive analysis and testimony on these subjects”. Parties who are used to a more adversarial system may not like to seemingly cede control to the tribunal in this regard. What is clear is that this feature reinforces the significance of provenance and forensic science, given they can be prominent or decisive factors in disputes regarding ownership, authenticity and value. In practice it will be interesting to see what proportion of disputes fall into forensic science and provenance categories, thereby leaving the expert evidence solely in the hands of the tribunal in those cases. As with the Pool of arbitrators, the parties’ confidence in the process and whether decisions rendered under these Rules will command the respect of the art market will depend on the calibre and independence of the experts in the Pool.

 

Technical process advisor

If the case involves highly technical issues, for example in relation to an object’s authenticity, the tribunal may appoint a “technical process advisor” from the Expert Pool in relation to pre-hearing evidence gathering and evidence exchange processes (Point 12 and Explanatory Note 8). This advisor will only be appointed with the parties’ consent, the parties first having seen the tribunal’s proposal setting out the intended role, scope of authority and advisory mandate of the advisor. The technical process advisor will act under the tribunal’s direction but, if requested, may draft proposed procedural orders for adoption by the tribunal. The Rules underline that the tribunal retains ultimate decision-making responsibility on all matters.

These provisions appear to have taken on board the criticisms often levelled at the use of tribunal secretaries that the scope of their role can lack clarity and transparency.

 

Choice of law guidance

Another interesting feature of the Adjunct Arbitration Rules relates to the cross-border nature of art-related practices and the international bearing of certain works of art in terms of legal implications typically arising under more than one legal system. Point 13 of the Adjunct Arbitration Rules provides that “An appropriate choice of law for the arbitral tribunal may be the law of the principal location of the seller, if known at the time of the transaction, or, if no sale is involved, of the owner of the object in question at the time of the commencement of the arbitration.” Point 13 supplements Article 42.2 of the NAI Arbitration Rules which, like other commercial arbitration rules, provides that the tribunal shall apply the law it considers appropriate in the absence of party choice. Point 13 appears to be intended to enhance certainty with respect to factors relevant to the determination of the applicable law by a tribunal in the absence of a party choice. This is an issue of significance in art disputes where it is not uncommon for controversies to be resolved without the benefit of a choice of law provision. Given the lack of constraint on tribunals under Point 13, whether this provision will actually render the arbitration process more efficient remains to be seen.

 

Publication of awards

As is the case with the NAI Arbitration Rules, awards may be published by the NAI and AiA although the parties’ identities will not be revealed. One difference under the Adjunct Arbitration Rules is that they note that the name or identity of the art work in question may be revealed (Point 15). Publication of the name of the object may be desirable if a party wants vindication, for example in relation to provenance. In other cases, sometimes the fact that there has been a dispute at all about an art work may negatively affect its value in the future, so a party may want to consider objecting to publication.

 

Looking ahead

The CAA certainly offers many attractive features that have been carefully tailored for art-related disputes. If the arbitrators and experts selected are well regarded in the art market, the CAA could become a popular method for resolving disputes, particularly when coupled with the other advantages arbitration offers, such as confidentiality which remains attractive to many parties involved in art-related transactions as well as the ease of enforcement of awards in foreign jurisdictions, which is pertinent given the cross-border nature of many art disputes. As the prominence of the CAA grows, this could lead to more parties including dispute resolution clauses in their contracts to refer disputes to the CAA.

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Efficient Arbitration – Part 1: Metrics

Kluwer Arbitration Blog - Sat, 2018-06-16 03:04

Victoria Pernt and Marina Stanisavljevic

Schoenherr

This is the first in a series of articles by Schoenherr focusing on efficiency in arbitration. In our series, we will explore various tools which serve to improve the efficiency of any given arbitration and so achieve a favourable outcome without wasting resources.

But before exploring those tools we need to determine what efficient arbitration actually means.

Thanks to its well-known advantages, arbitration has grown exponentially over the past few decades. However, as more complex, high-value disputes emerge and become regular subjects of arbitral proceedings, the length and cost of these proceedings inevitably increase. In fact, cost is now regarded as one of, if not the, worst feature of international arbitration (IBA Compendium of Arbitration Practice 2017).

This has not only spawned a torrent of third-party funding (an initiative to de-risk dispute resolution through the involvement of a funder), but a general push for efficiency in arbitration. For the past few years, law firms have been flagging efficiency as the year’s hottest trend. Possible solutions and tools have been evaluated in surveys, protocols, institutional guides and panel discussions. The recent tightening of institutional procedures, including expedited and summary disposition, is yet another example of the impact of this quest.

But efficiency is not just about cutting costs. Some argue that efficiency can be measured against two standards: time and money. In his article Key to Efficiency in International Arbitration, Veijo Heiskanen explains that in terms of money, arbitration may be deemed efficient if its costs are significantly less than the value in dispute. Thus, the greater the difference between the amount awarded and the fees spent, the more efficient the arbitration. The same could apply in terms of time. But a shorter arbitration is not necessarily an efficient arbitration. While it may save the party money in the immediate term, it could result in a less persuasive case and an unfavourable award. In a slightly longer arbitration, on the other hand, the parties could present their case more compellingly and thoroughly, which may result in a more favourable (and economic) award.

But time and money aren’t everything. Efficiency is also about quality. In her article Efficiency in Arbitration: Whose Duty Is It?, Jennifer Kirby postulates the concept of the “Iron Triangle”, in which efficiency in arbitration is the relationship between time, money and quality. When less time and money are spent on arbitration, its quality suffers. It is only when time and money are spent (or rather, wasted) on things that do not contribute to improving the arbitration that time and money can be reduced without affecting the quality.

Therefore the key to efficiency is to identify when resources are being invested and when they are being wasted – a daunting task. A variety of tools can help to identify and avoid unnecessary expenditures throughout the proceedings. We will introduce and explore these tools in the course of our series.

After all, if the right tools are chosen, arbitration will be efficient. The parties will end up with a quality arbitration free of unnecessary costs, and still be in a position to achieve the best possible outcome.

To make sure you do not miss out on regular updates on the Kluwer Arbitration Blog, please subscribe here.

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A Toddler's Wisdom on Conflict Resolution - Mediate.com

Google International ADR News - Fri, 2018-06-15 11:17

A Toddler's Wisdom on Conflict Resolution
Mediate.com
Edinburgh Declaration of International Mediators ... She also serves as a Trustee of the Board of Directors of the San Fernando Valley Bar Association, and has presided as Chair of it's Alternative Dispute Resolution Section and Litigation Section. She ...

Arbitration, Social Media and Networking Technologies: Latent Existing Conflicts

Kluwer Arbitration Blog - Fri, 2018-06-15 02:00

Alonso Bedoya

Introduction

Currently, social network trends are focused on consumer markets, such as the fashion or food industry. The uninterrupted use of smart phones, computers, tablets, Ipod´s, etc. with unlimited internet connection has resulted in us being mere dependent beings on these devices. Social networks are everyday forms of social interaction, defined as a dynamic exchange between people, groups and institutions of high complexity, involving groups that identify with the same needs and problems.

It is within this understanding that a novel additional variable has become relevant within the legal domain as technology pervades all ambits of our human endeavor. International arbitration has since several years ago been affected by social networks as the latter have become an important part of our day-to-day lives. Whether we access them in our workplaces or elsewhere, social networks no longer serve solely to keep us connected with friends and family but also establish very important networks of professionals in the global labour market. Social networks for this purpose must thus be understood enunciatively – and without simply being limited to: Facebook, Twitter, Tumblr, LinkedIn, YouTube, Google +, Instagram, etc.

Arbitration and Social Networks: A reason for conflict

In addressing the matter, and as an anecdote, he who writes these lines was once appointed to act as party arbitrator in an ad hoc arbitration some time ago, and as it is expected, prior to accepting the charge, did research on both parties in the dispute and on those who were to be their counsels so that the proper disclosure and declaration of independence and impartiality could be provided. After concluding that there was no connection with any of the parties or with any of their lawyers involved in the case, the disclosure was made, indicating that there existed no conflict of interests by being part of the tribunal, in accordance with the minimum standards for impartiality and independence for arbitrators that is exemplified in the new Arbitration Regulation of the Lima Chamber of Commerce in its article 14, numeral 2, which is very similar to the provisions in the English Arbitration Act or the U.S.A. Federal Arbitration Act, as follows:

“(…) 2. The arbitrator, upon accepting the designation, subscribes to a statement of availability, independence and impartiality, in which he must make known in writing to the institution any fact or circumstance that could give rise to justified doubts about his impartiality or independence … ”

Nevertheless, on the first procedural hearing day, one of the parties objected to my appointment as arbitrator, requesting  me to desist from being part of the arbitral tribunal. The party alleged that I do so because I had the brother of the other party as a LinkedIn contact; this was a fact of which I was not aware and could have, therefore, never anticipated the objection.

Conclusion 

It is undeniable that under current social media trends, contact suggestions, automated publicity and repetitive confirmation notifications are the standard once a person is online; and few are those who do not manage their professional contact networks with LinkedIn and who have probably accepted contacts before really knowing them in person. A good reason may be that the present competitive work environment prompts international arbitrators as well as highly trained individuals to establish a solid professional network that may generate business opportunities and/or work positions in the future. Hence, many have come to add contacts without necessarily coming to meet or know all the members of this network personally, and thus I found the objection to my appointment quite absurd. Consequently, having a relative of one of the parties to the process as a LinkedIn contact did not compromise any impartiality or independence; even so, one of the parties wanted to challenge one of the arbitrators and his counsels devised a viciously pernicious campaign in order to achieve it.

In principle, the synergy between arbitration and social media has been fruitful and constructive. Since the publicity of arbitration as an alternative mechanism for dispute settlement, arbitral institutions and arbitrators in general have been positively received by the majority of the domestic and international community. Nonetheless, this still-not-well-documented combination of areas does present some incompatibility, since arbitration is based on the premise that the arbitrators who form the panel have the obligation to be an independent and impartial body and must not have any bond with the parties in dispute; and yet this premise, by reference to social networking, is not always true.

Thus, arbitrators are prompted to consider that, as a consequence of technology becoming an everyday-life instrument, some of the following questions need to be addressed: What happens if the Chairman of the arbitral tribunal has as a “friend” on Facebook who is the respondent or one of his counsels in the arbitration?  A worse scenario still, what if the respondent, being a national or international celebrity, has one of the members of the arbitral panel as a follower on Instagram? As we see, the various possibilities for arbitrators to be linked to their parties or their counsels may become endlessly numerous; and even the most diligent of arbitrators may likely never be able to foresee all these facts in this ever evolving digital era.

Moreover, even though the International Bar Association (IBA) Council has created Guidelines on Conflicts of Interest in International Arbitration (hence, the famous Non-Waivable Red List, Waivable Red List, Orange List and Green List, which in brief terms try to reflect situations that in practice are usually present in arbitration), These Guidelines fall short of covering the plurality of potential scenarios that may arise as a consequence of a conflict of interest. Even more, none of the lists remotely mentions all the probable relationships that the parties and arbitrators may have with one another through social networks. Therefore, although the Red List describes critical situations in which the arbitrator has a very close relation with one of the parties or with the result of the process, and the Orange List only mentions those situations in which the arbitrator and any of the disputing parties may have a degree of closeness, I still stand pondering as to where being part of the same social network should be included.

This latent but active social media phenomenon further presents a condition in which the parties involved in an arbitration process, whether acting as claimant or respondent, may stand vulnerable to the fact that one of them (or its lawyers) may maliciously use social networks to manipulate and to challenge arbitrators principally because of fear that such arbitrator may issue an award (if it is a sole arbitrator) or vote against one of the parties’ interests. It is clear then and without doubt that these sorts of inquiry should inspire us practitioners to continue studying and researching on the evolution of new technologies and social media and its effect on our legal profession because we are currently entering a transformational digital era that will bring rise to issues requiring continuous analysis during the coming years.

 

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