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The German Institution of Arbitration (Deutsche Institution für Schiedsgerichtsbarkeit e.V. – DIS) has thoroughly revised its arbitration rules. The previous DIS Rules, which have been in force since 1998, functioned well in practice and are very popular in international agreements involving German parties. However, particularly in view of the reform projects of other national and international arbitration institutions, it was time to modernise the rules. Thanks to the revision, the DIS is even better positioned in competition with other arbitration institutions and even more so in competition with state courts.
The revision of the DIS Rules focuses on four goals:
Efficiency: First, the new DIS Rules reflect the intention to make arbitration more efficient and hence more attractive and cost-effective for the parties. To this end, a number of new control mechanisms have been introduced such as (i) new and stricter time limits (e.g. for the constitution of the arbitral tribunal, the submission of the answer to the request and the final award), (ii) procedural management techniques, and (iii) cost sanctions in the event of delays.
Transparency: The revised rules, second, aim at enhancing transparency, for instance regarding arbitrators and costs. For that purpose, the powers of the DIS are extended in manifold respects in order to establish an independent supervisory authority. However, the revisers also paid attention to the fact that the parties’ autonomy is not excessively restricted in this context. Most notably, the new rules on multi-party arbitration demonstrate that the DIS gives priority to the principle of party autonomy.
Flexibility: Third, numerous new provisions reflect the intention to increase flexibility. For instance, the new rules include more flexible provisions on the number of arbitrators as well as on the determination of the rules of law applicable to the merits. In addition, more discretion has now been conferred to the arbitral tribunal with regard to costs decisions. In exceptional circumstances, also ex parte orders are allowed.
Modernisation and internationalisation: With the previous version having been in force since 1998, the revision, finally, aims at adjusting the rules to international standards and modernising them. For instance, the hitherto existing obligation to encourage amicable settlements now only applies if no party objects thereto. For international proceedings, which often involve parties and jurisdictions that are unaware of such an endeavour to encourage amicable settlements, this is a welcome modification. Moreover, some amendments are meant to adjust the rules to the conditions of modern electronic legal communication.
The new DIS Rules will enter into force on 1 March 2018. As has been the case under the old regime, the version of the rules in force on the date of commencement of the arbitration (i.e. the date on which the request is filed with the DIS) shall apply.
The overall concept of the new rules seems to be well balanced and some innovative solutions have been found to strike a balance between the parties’ autonomy, the arbitral tribunal’s discretion and the arbitration institution’s powers of intervention. The revision uses an abundance of small changes to address potential weaknesses and loopholes that caused inefficiencies under the old rules. Practice will show whether or not the users of the DIS Arbitration Rules actually perceive genuine improvements regarding efficiency, transparency and flexibility – chances are good.
For further information on the new DIS Rules and their practical impact, please refer to our recent Linklaters Arbitration Alert (also available in German).