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Despite its many attractions, arbitration has sometimes been criticised for the time it takes and how much it costs. In recent years, practitioners and arbitral institutions alike have endeavoured to reduce both in a material way, including by offering parties a menu of expedited arbitration procedures.
Following on from similar efforts by institutions such as the International Chamber of Commerce, the United Nations Commission on International Trade Law (“UNCITRAL”) recently adopted its own set of “Expedited Arbitration Rules” (the “Rules”). The Rules came into force on 19 September 2021 and are accompanied by an advance copy of UNCITRAL’s explanatory note (the “Explanatory Note”).
The key mechanics of the Rules are summarised below.
Consistent with the principle of party autonomy, Article 1 provides that the Rules apply only by express agreement between the parties. The Explanatory Note adds that the parties can agree to apply the Rules at any time, including after the dispute has arisen. Where the Rules apply, they operate to modify the UNICTRAL Arbitration Rules (“UAR”), so, in such cases, will work in conjunction with the UAR (and any further modifications agreed by the parties).
Article 2(1) permits the parties to withdraw from the expedited procedure by agreement at any time during the proceedings. A party may apply for unilateral withdrawal from the expedited procedure, but tribunals should only grant such requests in “exceptional circumstances” (Article 2(2)).
Article 3 reiterates the need for the parties and the tribunal to act expeditiously throughout the proceedings, including by adopting appropriate technological measures.
Articles 4 and 5 abridge the deadlines for filing the notice of arbitration, the response thereto and the parties’ statements of case. The Explanatory Notes envisage that a party may elect to treat its notice of arbitration or response (as appropriate) as its statement of case, provided that it complies with the requirements of the UARs. Article 6 aims to streamline the procedure for the designation of an appointing authority where none has been agreed.
Article 7 provides that unless otherwise agreed by the parties, a sole arbitrator shall be appointed – an unsurprising default position given that tribunals comprising three arbitrators can be less expeditious (e.g. due to the need to align diaries for hearings). Article 8 then contains provisions aimed at shortening the time taken to appoint that arbitrator where the parties have not agreed on who it should be.
Under Article 9, within 15 days of its constitution the tribunal is to consult the parties on the manner in which it will conduct the arbitration, while Article 10 confirms the tribunal’s powers to extend or abridge periods of time prescribed by the UAR and the Rules (or otherwise agreed by the parties).
Article 11 confirms that absent a party request to hold hearings, the tribunal may decide that hearings shall not be held. However, parties can be reluctant to dispense with hearings in practice, so cases determined on the papers may well remain exceptional.
Article 12 sets tight boundaries for the filing of counterclaims and set-off claims, requiring the respondent to include such claims in its statement of defence unless otherwise permitted by the tribunal. Article 13 also prohibits the parties from amending or supplementing their claims or defences during the course of the proceedings, absent permission from the tribunal.
Pursuant to Article 14, the tribunal has discretion to determine whether further written statements shall be required from the parties. Consistent with the UAR, Article 15 provides the tribunal with a broad discretion regarding the production of evidence, including the ability to dispense with the document production phase of the proceedings (unless all parties have requested the inclusion of that procedural step).
Article 16(1) prescribes that the tribunal’s award shall be made “within six months from the date of the constitution of the arbitral tribunal unless otherwise agreed by the parties” – which implies an exacting timetable for the dispute. As mentioned in the Explanatory Note, as adverse consequences could flow from the deadline being missed, the Rules include some flexibility for extensions. In particular, the tribunal may extend that deadline by a further three months in “exceptional circumstances” (Article 16(2)). If it is not possible for the tribunal to render its award within that total nine-month timeframe, a further extension shall only be adopted with the agreement of all parties (Article 16(3)). Failing such agreement within a fixed period of time, any party may request that the Rules shall cease to apply, and the tribunal may determine to conduct the arbitration in accordance with the UAR (Article 16(4)).
Implications
The introduction of the Rules represents an important and welcome move towards streamlining arbitral procedures in the field of ad hoc arbitrations. These (to which the UAR are so often applied) can, given the absence of a supporting institution, be more vulnerable to protracted timetables and increased costs. So, use of the Rules is something that parties may wish to consider at the time of entering into an UNCITRAL arbitration agreement where, in the context of the particular relationship to be covered by it, they are happy to place the emphasis on speed.
In cases where the Rules apply, it remains to be seen to what extent parties actually adopt some of the more impactful cost and time-saving measures contemplated by the Rules, such as dispensing with hearings and the document production phase. At a minimum, however, the Rules should further streamline proceedings by focusing minds on the parties’ agreement to resolve their disputes quickly and efficiently, particularly given the timeframes set down for the making of the award.
Erin Marsh would like to thank Angelika Turner for her assistance in the preparation of this article.