From time to time, the HKIAC issues practice notes to supplement its Administered Arbitration Rules, to facilitate arbitrations governed by those Rules. On 1 June 2016, two updated HKIAC Practice Notes came into effect in respect of the costs of arbitration, to supplement the provisions on costs of arbitration under the 2013 HKIAC Administered Arbitration Rules. Parties to an HKIAC administered arbitration have a choice about how the arbitration tribunal’s fees are determined. Such fees can be calculated either on the basis of agreed hourly rates (Schedule 2) or on the basis of the amount in dispute (Schedule 3). The two updated Practice Notes relate to these Schedules and are entitled “Practice Notes on the Costs of Arbitration Based on Schedule 2 and Hourly Rates” and Practice Notes on the Costs of Arbitration Based on Schedule 3 and the Sum in Dispute”.
The updated Practice Notes replace the Practice Notes on Arbitral Tribunal’s Fees, Expenses, Terms and Conditions effective on 1 November 2013. They clarify and detail HKIAC’s practice of paying fees and expenses of arbitrators, tribunal secretaries and the HKIAC under the Rules. New provisions include a section indicating the amount of HKIAC administrative fees payable where the parties settle or terminate their case at different stages of the arbitral proceedings. Another new provision expressly permits a party to seek a separate award from the arbitral tribunal to reimburse that party for any deposit which it has paid on behalf of another party.
Both Practice Notes cover the following:
The new Practice Notes should be welcomed by users of HKIAC administered arbitrations since they provide clarity on many issues which frequently arise in such arbitrations.
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