LCIA Draft Rules 2014: addressing emergencies, efficiencies and ethics

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It appears that could be all change in the London Court of Worldwide Arbitration (LCIA), with new arbitration rules expected to enter into pressure later this summer time. The draft rules, that the LCIA printed captured, were the topic of extended discussions through the LCIA Court on 9 May 2014. The Court’s decision regarding which ones is going to be adopted has not yet been released however, it’s anticipated that individuals which are approved will enter pressure later this season.

The draft rules promote procedural efficiency, support adherence to ethical standards and propose new mechanisms through which parties for an LCIA arbitration can address emergencies. The relative merits from the key amendments are thought below.

Imposition of ethical standards

Perhaps probably the most innovative proposal within the new rules, the imposition of conduct guidelines for lawyers, is hidden within an annex. The following tips are relevant to any or all lawyers appearing before an LCIA tribunal and provision is perfect for the tribunal to police adherence for them. A tribunal can impose significant sanctions in case of default.

In conclusion, the rules stop lawyers from:

participating in activities intended unfairly to obstruct the arbitration or jeopardise the finality associated with a award (Annex, paragraph 2)

knowingly making false statements towards the tribunal or LCIA Court (Annex, paragraph 3)

knowingly procuring and/or relying upon false evidence (Annex, paragraph 4)

knowingly concealing any document purchased to become created through the tribunal (Annex, paragraph 5) and

initiating or trying to initiate unilateral connection with any person in the tribunal or even the LCIA Court without disclosure to another people from the tribunal, another party and also the LCIA Registrar (Annex, paragraph 6).

Sanctions that the tribunal can impose in case of breach vary from an itemized reprimand to, at most severe finish from the scale, “mention of legal representative’s regulatory as well as professional body” (Article 18.6).

Although these provisions share similarities using the IBA guidelines on party representative ethics, the LCIA may be the initial arbitral institution to propose such rules. It will be wished that they’re adopted and hang a pattern for arbitral institutions imposing strict ethical standards.

The conduct from the parties may also belong to scrutiny through the tribunal when figuring out costs, “including any co-operation in facilitating the proceedings regarding cost and time and then any non-cooperation leading to undue delay and unnecessary expense” (Article 28.4).

Appointment of the emergency arbitrator

The present rules permit parties in situations of “exceptional emergency” to try to get the expedited formation from the tribunal. However, as a substitute, the draft rules offer parties a choice of trying to get the appointment of the temporary sole arbitrator (an “emergency arbitrator”) to be able to obtain emergency relief (Article 9B). We know that this specific proposal is going to be adopted, which may bring the LCIA rules into line concentrating on the same provisions within the ICC, SIAC and HKIAC rules.

Once hired, the emergency arbitrator may have 20 days to consider around the application for emergency relief. A hearing won’t be necessary but reasons should always get. Any award or order by an urgent situation arbitrator should be confirmed through the arbitration tribunal (once created), within a 3 week period, otherwise an order or award through the emergency arbitrator will lapse instantly.

Procedural efficiency

Pursuant towards the draft rules, candidates for appointment as arbitrators are needed to declare that they’re “ready, ready to devote the required time, diligence and industry to guarantee the expeditious conduct from the arbitration” (Article 5.4). Once hired, the tribunal includes a ongoing duty under Article 14.4(ii) to consider procedures to make sure not just fair proceedings but additionally individuals which are “efficient and expeditious” by “staying away from unnecessary delay and expense”.

Further amendments made to encourage procedural efficiency are listed below:

the parties and also the tribunal is going to be within duty to create contact when practicable but no after a 3 week period following the LCIA’s notification from the formation from the tribunal (Article 14.1)

the award will be made through the tribunal “when reasonably possible” in compliance having a timetable notified towards the parties (Article 15.10) and

should a celebration desire to change its an attorney it has to inform both sides, the tribunal and also the LCIA Registrar. This type of change is depending on your application from the tribunal, which can be withheld when the tribunal views it might compromise the composition from the tribunal or even the finality from the award (Articles 18.3 and 18.4).

Seat from the arbitration

As underneath the existing rules, parties is going to be liberated to agree the seat from the arbitration. Even without the agreement, the default seat is London (Article 16.2). However, this can only apply before the formation from the tribunal, then the tribunal may determine that another seat is much more appropriate. The default seat is going to be of no relevance towards the LCIA Court when appointing arbitrators, that is of some comfort to individuals concerned that the British law bias may prevail when arbitrating with the LCIA.

Conclusion: positive proposals

A stringently applied ethical code, the supply of the emergency arbitrator and also the concentrate on procedural efficiency (which will modify the costs of the LCIA arbitration in addition to reduce the opportunity of any satellite litigation) are positive proposals, so it will be wished are adopted through the LCIA Court. As the emergency arbitrator provisions actually bring the LCIA consistent with other leading institutions, another proposals discussed above (particularly the brand new ethical standards) offer an item of difference. If adopted, these proposals should help make the LCIA a much more attractive institution for prospective parties.

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