Long-Awaited Amendments to LCIA Arbitration Rules to Result in Streamlined, Tech-Friendly Arbitrations

Bennett Jones LLP

Bennett Jones LLPOn August 11, 2020, following input from external users, the London Court of International Arbitration (LCIA) issued a significant update to its 2020 LCIA Arbitration Rules. Among other things, the 2020 LCIA Rules include tools to streamline the arbitral process and provide for the use of modern technology, including videoconferencing software, for arbitrations held under the 2020 LCIA Rules.

A summary of the changes implemented by the 2020 LCIA Rules is as follows:

Efficiency-Seeking Updates

  • Tribunal's Power to Expedite the Arbitral Process: Should an arbitral tribunal believe it is appropriate to accelerate an arbitration, the 2020 LCIA Rules grants it expanded powers to issue procedural orders to:
    • limit or dispense with written submissions; 
    • limit the written and oral testimony of any witness; 
    • employ technology to enhance the efficiency of an arbitration; 
    • exercise powers of a new procedure called "Early Determination", a form of summary judgment, whereby the tribunal may strike a claim or defence on the grounds that it is manifestly beyond the tribunal's jurisdiction, is inadmissible or is without merit; 
    • abridge any period of time; or
    • dispense with a hearing altogether (Article 14.6).
  • Prescribed Timelines: The parties and the arbitral tribunal are now required to make contact, either in-person, by conference call or by videoconference, no later than 21 days from the formation of the arbitral tribunal. An arbitral tribunal is now required to make its final award no later than three months following the last submission from the parties (Articles 14.3 and 15.10).
  • Composite Requests for Arbitration and Powers to Consolidate: A claimant wishing to commence more than one arbitration may now serve a composite request against one or more respondents, and under one or more arbitration agreements. Conversely, a tribunal, with the approval of the LCIA Court, may consolidate an arbitration with one or more other arbitrations into a single arbitration, provided that all the parties to the arbitrations to be consolidated so agree in writing and provided that no arbitral tribunal has yet been formed by the LCIA Court (Articles 1.2 and 22A).

Technological Updates

  • In a timely effort to embrace modern technology, the 2020 LCIA Rules states the following:
    • Electronic Communication: Any written communication in relation to the arbitration shall be delivered by email, or any other electronic means of communication that provides a record of its transmission (Article 4.2).
    • Virtual Hearings: A hearing may take place either in-person or virtually by conference call, videoconference or some other communications technology (Article 19.2).
    • Electronic Signature: Any award may be signed electronically by the arbitrators, and in counterparts and assembled into a single instrument (Article 26.2).
    • Information Security and Data Protection: Any processing of personal data by the LCIA is subject to applicable data protection legislation and either the LCIA or an arbitral tribunal may issue directions addressing information security, which shall be binding on the parties (Article 30A).

Other Updates of Note

  • Tribunal Secretaries: While tribunal secretaries can play an important administrative role in the arbitral process, concerns have arisen that an individual serving in this position can have an improper level of influence in the arbitral process, past the bounds of a purely administrative role and rising to the level of a pseudo-arbitrator. To rectify this, the 2020 LCIA Rules state that an arbitral tribunal may obtain assistance from a tribunal secretary in relation to an arbitration; however, under no circumstances may an arbitral tribunal delegate its decision-making function to a tribunal secretary and an arbitral tribunal may only obtain assistance from a tribunal secretary once the tribunal secretary has been approved by all parties (Article 14A).
  • Compliance: In an effort to ensure that the LCIA Rules remain compliant with existing international legal and regulatory frameworks, the 2020 LCIA Rules classify bribery, corruption, terrorist financing, fraud, tax evasion, money laundering and economic or trade sanctions as "Prohibited Activities" and the LCIA may refuse to act on any instruction and accept or make any payment relating to a Prohibited Activity (Article 24A).

The 2020 LCIA Rules will take effect on October 1, 2020, and will apply to any arbitration commenced on or from that date under the LCIA Rules. 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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