On 1 October 2014, the new London Court of International Arbitration Rules (“LCIA Rules”) came into effect.
The new LCIA Rules follow the trend set by other institutions, such as the HKIAC and ICC, to make the arbitral process more efficient. This article provides an overview of the key changes.
Consolidation of arbitrations (Articles 22.1(ix) and (x))
New provisions on consolidation have been introduced as part of the arbitrators’ additional powers. Arbitrators now have the power, upon the application of any party and after giving the parties a reasonable opportunity to state their views and upon such terms as the Arbitral Tribunal may decide, to order the consolidation of the arbitration:
In either case, consolidation requires approval of the LCIA Court.
Notably, the powers to consolidate under the LCIA Rules are more restrictive than those under the HKIAC Rules, which also allow consolidation where the parties are not identical.
Emergency Arbitrator (Articles 9.4 to 9.14)
Following HKIAC, ICC and SIAC, the LCIA Rules now provide for the possibility of appointing an emergency arbitrator.
The new provisions allow a party to apply to the LCIA Court for the immediate appointment of a temporary sole, arbitrator to conduct emergency proceedings, pending the formation or expedited formation of the arbitral tribunal.
The Emergency Arbitrator must decide the claim for emergency relief as soon as possible, but no later than 14 days following the Emergency Arbitrator’s appointment. This deadline may only be extended by the LCIA Court in exceptional circumstances.
The Emergency Arbitrator is not required to hold any hearing with the parties and may decide the claim for emergency relief on available documentation only.
Any order or award of the Emergency Arbitrator (apart from any order adjourning to the arbitral tribunal, when formed, any part of the claim for emergency relief) may be confirmed, varied, discharged or revoked, in whole or in part, by order or award made by the arbitral tribunal upon application by any party or upon its own initiative.
The Emergency Arbitrator provisions do not apply where the parties have:
General Guidelines for the Parties’ Legal Representatives (Annex to the LCIA Rules)
The LCIA Rules have introduced, in an annex, guidelines for the parties’ legal representatives appearing by name within the arbitration, which are intended to promote the good and equal conduct of the legal representatives.
Compliance with these guidelines is compulsory by virtue of Article 18.5, which places an obligation on the parties to ensure that their legal representatives have agreed to comply with the general guidelines, as a condition of such representation, and, in permitting any legal representative so to appear, a party thereby represents that the legal representative has agreed to such compliance.
The guidelines prohibit, activities intended to unfairly obstruct the arbitration, jeopardise the finality of any award, knowingly make any false statement or rely on any false evidence.
Article 18 of the LCIA Rules sets out additional provisions on any intended change or addition by a party of its legal representatives and the arbitral tribunal’s powers regarding complaints against a party’s legal representative, as follows:-
Of considerable practical relevance in this context will be Article 28, which expressly allows the tribunal, when making its decision on costs, to take into account the parties’ conduct in the arbitration, including any non-co-operation resulting in undue delay and unnecessary expense.
Other revisions of note, include:
Arbitration agreement: The LICA Rules expressly provide that the law governing the arbitration agreement shall be the law applicable at the seat of the arbitration, unless and to the extent the parties have agreed in writing on the application of other laws or rules of law and such agreement is not prohibited by the law applicable at the arbitral seat (Article 16.4). Only recently, the HKIAC, has included in its model clause specific wording to prompt parties to consider designating an appropriate law governing the arbitration agreement. Express agreement on the law governing the arbitration agreement is desirable due to uncertainties that have arisen in recent cases as to the applicable governing law.
Seat: Article 16.2 provides for London as a default arbitral seat, absent any agreement on the seat between the parties. Upon its appointment, the arbitral tribunal may, however, order that another seat is more appropriate.
Electronic submissions: The LICA Rules now allow the parties to submit to the LCIA in electronic form (as e-mail attachments) the Request for Arbitration, the Response, applications for expedited formation of the arbitral tribunal, applications for expedited appointment of a replacement arbitrator, and applications for the appointment of an Emergency Arbitrator.
Arbitrator availability: arbitrator candidates are now required to confirm in writing, in addition to their statement of impartiality and independence, that they are ready, willing and able to devote sufficient time, diligence and industry to ensure the expeditious and efficient conduct of the arbitration (Article 5.4).
Conduct of proceedings: the LCIA Rules encourage parties and the arbitral tribunal to make contact (whether by a hearing in person, telephone conference-call, video conference or exchange of correspondence) as soon as practicable, but no later than 21 days from receipt of the LCIA Registrar’s written notification of the formation of the arbitral tribunal (Article 14.1).
Timing of award: although the LCIA Rules do not set out a specific time limit for the making of the award (as is, for instance, the case under the ICC Rules), the arbitral tribunal is now under an express obligation to seek to make its final award “as soon as reasonably possible”, following the last written or oral submission from the parties, in accordance with a timetable notified to the parties and the LCIA Registrar as soon as practicable (Article 15.10).
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