AMENDMENTS TO THE ICC RULES OF ARBITRATION: AUTOMATIC EXPEDITED ARBITRATION PROCESS FOR CLAIMS WORTH LESS THAN US $2 MILLION

by Mark Davison and Katherine McKenna

On 20 October 2016, the ICC Executive Board approved changes to their Rules which will be effective as of 1 March 2017.[1]

Within the amended rules, the ICC has followed other arbitration centres such as SIAC in implementing an expedited process for lower value disputes.  However, the ICC has gone a step further and has provided that all disputes which are less than US $2 million will automatically need to be administered under the new expedited process unless the parties have expressly agreed to opt-out of this process in their arbitration agreements.  Parties with claims greater than US $2 million will have the option to opt-in to the new expedited process.

Under the expedited procedure:

  • the ICC has the discretion to appoint a sole arbitrator even if the parties have agreed otherwise in their arbitration agreement;
  • there is no requirement to prepare terms of reference;
  • the tribunal shall have discretion after consulting with the parties as to procedural measures it adopts – i.e. the tribunal may decide to dispense or limit document production, limit the length and scope of written submissions and witness evidence and even determine whether or not it should dispense with a formal hearing where witnesses are cross examined;
  • tribunals are required to issue awards within six months of the date of the case management conference being held; only in limited and justified circumstances will the ICC grant tribunals extensions.  The ICC Court and its Secretariat will maintain their roles in the quality control of awards made.

In return for using the expedited procedures, the ICC arbitration fees will be significantly reduced for the expedited procedure although it will still be calculated on a scale of the amounts in dispute.

It is likely that the amendments will be welcomed in the market.  With other arbitration centres and even courts invoking expedited procedures[2], it is clear that market users want to create environments where they can resolve their disputes quickly and cheaply.  Forcing users with small disputes to use the expedited process may convince those users that expedited processes may be suitable in certain circumstances to larger disputes.

[1] http://www.iccwbo.org/News/Articles/2016/ICC-Court-amends-its-Rules-to-enhance-transparency-and-efficiency/

[2] For example, the English Commercial Court has recently handed down its first decision under the High Court’s Shorter Trials Scheme, where a judgment was made totalling US $68 million. This had been determined within seven months of the claim being issued and with total costs on both sides of £350,000 (National Bank of Abu Dhabi PJSC v BP Oil International Limited [2016] EWHC 2892 (Comm): the judgment is here).

*This article was authored by Mark Davison (Senior Associate) and Katherine McKenna (Trainee Solicitor) of Olswang LLP, and was  originally published on Olswang LLP’s Legal and Regulatory News. 

About Wei Ming Tan

International Dispute Resolution and Arbitration Lawyer
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