ICC Arbitration (2021 Rules)

Overview

In 2021, the ICC updated its rules for arbitration: the Rules of Arbitration of the International Chamber of Commerce^{[1 p.5]}, in force from 1 January 2021 (the 2021 Rules). The 2021 Rules define and regulate the management of arbitration cases received by the ICC from 1 January 2021 onwards and replace the previous 2017 Arbitration Rules (the 2017 Rules - see Practice Note on ICC Arbitration (2017 Rules)), unless the parties specify otherwise in their arbitration agreement. The 2021 Rules also codify a number of provisions contained within the ICC Guidance Note on Possible Measures Aimed at Mitigating the Effects of the COVID-19 Pandemic^{[2 p.5]} (the COVID-19 Guidance Note) released in April 2020.

Alexis Mourre was the ICC Court President at the time of publishing the 2021 Rules and when announcing the rationale behind the changes found in them, stated that:

• “The amendments to the Rules...mark a further step towards greater efficiency, flexibility and transparency of the Rules, making ICC Arbitration even more attractive, both for large, complex arbitrations and for smaller cases.”

Notable amendments to the 2017 Rules relate to the following areas:

• Paperless filings and remote hearings.
• Joinder of parties and consolidation of cases.
• Disclosure of third-party funding arrangements.
• Preventing conflicts of interest and ensuring fairness of proceedings.
• Changes to the expedited arbitration procedures.

There are also a number of other changes to the 2017 Rules, in particular to article 36, Appendix I and Appendix II which go beyond the parameters of this note. However, for a detailed view of the changes made to the 2017 Rules, the ICC produced a 2017 to 2021 comparison document available here^{[3 p.5]}.

This note discusses a number of these key changes below.

Definitions

• ICC: International Chamber of Commerce.
• 2017 Rules: Rules of Arbitration of the ICC in force as from 1 March 2017.
• 2021 Rules: Rules of Arbitration of the ICC[1 p.5] in force as from 1 January 2021.
• COVID-19 Guidance Note: ICC Guidance Note on Possible Measures Aimed at Mitigating the Effects of the COVID-19 Pandemic.[4 p.5]
• 2021 Guidance Note: Note to Parties and Arbitral Tribunals on the Conduct of the Arbitration[5 p.5] from 1 January 2021.
• The Court of Arbitration: International Court of Arbitration of the ICC.

Practical Guidance

Paperless filings and remote hearings

The 2021 Rules marked a clear shift away from paper filings, as well as making provision for the practice of virtual or remote hearings (or such other form of communication as befitted the facts and circumstances of the case).

Articles 1(3), 3(1), 4(4) and 5(3) along with the 2021 Guidance Note, clarifies that, as a general rule, the Request for Arbitration, the Answer and any counterclaims, and any Request for Joinder, must be sent to the Secretariat by email. Hard copies should be submitted only where the filing party specifically requests transmission thereof by delivery against receipt, registered post or courier.

Article 26(1) provides that physical attendance at a hearing, remote attendance by videoconference, telephone “or other appropriate means of communication” may all be considered by the tribunal and parties in consultation, with the arbitral tribunal having the explicit power to decide. The phrase “other appropriate means of communication” essentially futureproofs the rules to encompass advancements or preferences in hearing options.

Joinder of parties and consolidation of cases

Article 7 of the 2021 Rules clarified the previous position under the 2017 Rules regarding joinder after the tribunal’s appointment is confirmed. Previously, no additional party could be joined after confirmation of the tribunal’s appointment unless all of the parties, including the additional party, agreed. The 2021 Rules allow for a Request for Joinder after the confirmation of appointment of any arbitrator, to be decided in light of all of the relevant circumstances, by the tribunal.

Article 10 of the 2021 Rules confirmed that consolidation may occur in circumstances where “all of the claims in the arbitrations are made under the same arbitration agreement or agreements”. The 2021 Guidance Note provides additional detail regarding how the ICC will assess consolidation issues.

Disclosure of third-party funding arrangements

Parties to arbitration must, under the 2021 ICC Rules, disclose their funding arrangements promptly and throughout the life of the arbitration.

Article 11(7) of the 2021 Rules was a newly added provision which required that each party must “promptly inform the Secretariat, the arbitral tribunal and the other parties, of the existence and identity of any non-party which has entered into an arrangement for the funding of claims or defences and under which it has an economic interest in the outcome of the arbitration”. Doing so will assist arbitrators with complying with their duties of impartiality and independence. The wording used in the 2021 Rules is narrow and the 2021 Guidance Note confirms the types of arrangement that article 11(7) “would not normally capture”.

Preventing conflicts of interest and ensuring fairness of proceedings

Perhaps the most controversial change to the 2021 Rules was the introduction of article 12(9) enabling the ICC Court in exceptional circumstances to override the parties' agreement on how to constitute the arbitral tribunal to avoid a ‘significant risk of unequal treatment and unfairness that may affect the validity of the award'. The example given in the 2021 GuidancevNote is where one party has drafted the arbitration agreement and (potentially unfairly) included a right for it to constitute the panel unilaterally. Outside of the example provided however it is difficult to see usage of this discretion.

Article 17(2) further empowers an arbitral tribunal to take any measure necessary to avoid a conflict of interest of an arbitrator arising from a change in party representation, including the exclusion of new party representatives from participating in whole or in part in the arbitral proceedings.

Article 13 regarding the appointment and confirmation of the arbitrators was also adjusted by the 2021 Rules. Article 13(5) of the 2017 Rules stated that the default position was that a sole arbitrator or the president of the arbitral tribunal should be of a nationality other than those of the parties (albeit that the parties had a right to waive this requirement should they so choose). This was tweaked slightly so that the default position now is that the sole arbitrator/president should be of a different nationality where it is the court that appoints them. The 2021 Guidance Note suggests that this is ultimately to place the
choice in the hands of the parties, who may well have no objections to or interest in the nationality of a sole arbitrator.

A limitation to this rule is the addition of article 13(6), which cements the position that no arbitrator shall have the same nationality of any party to the arbitration whenever the arbitration agreement upon which the arbitration is based arises from a treaty (unless the parties agree otherwise). The differentiation here is likely to relate to the fact that arbitration under a treaty may have more of a focus on a national interest as opposed to an arbitration agreement made in commercial, nonterritorial dealings.

With relation to arbitration agreements arising from treaties, the ICC, at article 29(6)(c) of the 2021 Rules, clarified that the Emergency Arbitrator Provisions shall not apply to such arbitrations.

Changes to the expedited arbitration procedures

A final key change to the 2017 Rules was the extension of the popular ‘Expedited Procedure' which provides a final award within six months of the case management conference. Under the 2017 Rules, the expedited procedure applied automatically (with the option to opt-out) if the amount in dispute did not exceed USD 2 million (article 30 and annex VI). The 2021 Rules increased the financial threshold to USD 3 million for cases where the arbitration agreement was concluded on or after 1 January 2021.

Related Content

International Regulations

• Rules of Arbitration of the International Chamber of Commerce in force as from 1 March 2017
• Rules of Arbitration of the International Chamber of Commerce^{[1 p.5]} in force as from 1 January 2021

International Guidance

• ICC Guidance Note on Possible Measures Aimed at Mitigating the Effects of the COVID-19 Pandemic^{[2 p.5]}
• Note to Parties and Arbitral Tribunals on the Conduct of the Arbitration from 1 January 2021^{[5 p.5]}

Notes

1. ^^{[p.2] [p.2] [p.3]} https://iccwbo.org/news-publications/arbitration-adr-rules-and-tools/arbitration-rules-andmediation-rules/
2. ^^{[p.2] [p.3]} https://iccwbo.org/news-publications/arbitration-adr-rules-and-tools/icc-guidance-note-on-possiblemeasures-aimed-at-mitigating-the-effects-of-the-covid-19-pandemic/
3. ^^[p.2] https://iccwbo.org/publication/icc-arbitration-rules-2017-and-2021-compared-version/
4. ^[p.2] ICC Guidance Note on Possible Measures Aimed at Mitigating the Effects of the COVID-19 Pandemic .
5. ^^{[p.2] [p.3]} https://iccwbo.org/publication/note-parties-arbitral-tribunals-conduct-arbitration/

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