Revised arbitration rules from the United Nations Commission on
International Trade Law (UNCITRAL) have commenced.
The UNCITRAL Rules are amongst the most popular arbitration rules
adopted for international arbitration.
The revised UNCITRAL Rules will apply to any new arbitration
agreements, concluded after 15 August 2010, adopting the UNCITRAL
Rules. They may also apply to arbitrations commenced after 15
August 2010 under existing arbitration agreements adopting the
UNCITRAL Rules, depending on the terms of those agreements.
Background to the revisions
The UNCITRAL Rules are typically used in non-institutional
arbitrations, but they also provide the basis for the international
rules of some arbitral institutions, such as the HKIAC.
The original UNCITRAL Rules were issued in 1976 when use of
arbitration as an alternative to domestic courts was not as
widespread as it is today, and were intended to be used by parties
in both common law and civil law systems. In 2006 UNCITRAL decided
that the UNCITRAL Rules ought to be revised and updated to reflect
changes in international arbitration practice over the last 30
years, as well as to refine the existing rules where it was felt
revision was required.
According to Neil Kaplan, an internationally-renowned arbitrator
and International Arbitration Adviser in our Asia practice:
"..the 1976 UNCITRAL
arbitration rules have served the international arbitration and
business community very well over the last 34 years. However, as
with all sets of laws and rules, they require updating to take
account of problems that have arisen in practice and new
developments. Accordingly, the 2010 version of the rules is timely.
For the first time these rules deal with matters untouched
previously, such as multiple parties, joinder, liability of the
appointing authority, the arbitrators and other appointees,
objections to tribunal-appointed experts, and a review procedure
for the Tribunal's fees."
Highlights of the revisions
Notices - Notices can now be sent by any means
that provides or allows for a record of transmission. Electronic
service of notices is permitted, provided the parties have
specifically agreed to this in advance. There are now more detailed
provisions regarding receipt of notices.
Response to notice of arbitration - The
respondent is now required to issue a response to the notice of
arbitration within 30 days of receipt of the claimant's notice
Multiple parties and joinder - Provision is
now expressly made for joinder of additional parties who are party
to the same arbitration agreement. New rules are included to deal
with difficulties in appointing the tribunal where there are
Express recognition of need for efficiency and avoiding
delay - The rules now expressly require the tribunal, when
exercising discretion in conducting the proceedings, "to avoid
unnecessary delay and expense and to provide a fair and efficient
process for resolving the parties' dispute."
Interim measures - More detail is provided
under the new rules concerning the availability and scope of
interim measures, such as preservation of assets. It is now clear
that the party which sought the interim measure may be liable for
costs and damages if it transpires that the interim measure was
Exclusion of liability - The rules now specify
that the parties waive to the fullest extent permitted under the
applicable law, claims against the arbitrators, the appointing
authority and any person appointed by the tribunal for acts or
omissions. Intentional wrongdoing is excluded from this
Appointment of the arbitral tribunal and the appointing
authority - New rules provide for agreement on an
appointing authority if this has not been provided for in the
arbitration agreement. Greater scope is also made for the
appointment of a sole arbitrator where the parties have not agreed
the number of arbitrators in advance. Previously, the automatic
default position under the rules was three.1
Experts appointed by the tribunal - New
provisions provide the opportunity for parties to object to an
expert appointed by the tribunal.
Awards - References to partial, interim and
interlocutory awards have been removed. All awards are now
expressed to be final and binding, and the tribunal may make
different awards at different times. The aim of this revision is to
remove confusion over the status of awards, which is particularly
important for enforcement purposes.
Costs - The principle that the unsuccessful
party bears the costs of the arbitration remains, subject to the
tribunal's discretion. The costs of legal representation now
fall within the general rule, and recovery of legal costs is no
longer subject to special consideration. Additional provisions have
also been added which give parties greater review rights relating
the tribunal's costs.
The revisions to the UNCITRAL Rules are welcomed. Arbitration is
of ever increasing importance as a means of resolving international
disputes fairly. In most cases arbitration offers superior
enforcement opportunities. The revisions to the UNCITRAL Rules will
assist in maintaining UNCITRAL arbitration as a useful, efficient
and effective procedure for dispute resolution.
1 In Hong Kong, specific provision is made under the
Arbitration Ordinance for the HKIAC to decide on the appropriate
number of arbitrators in the absence of agreement by the
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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