ICC arbitration awards – a reasonable expectation of privacy?
On 01 January 2019, the International Chamber of Commerce (“ICC”) issued a “Note to Parties and Arbitral Tribunals on the Conduct of the Arbitration Under the ICC Rules of Arbitration” (the “Note”). The Note contains practical guidance to parties and arbitrators conducting arbitrations under the ICC Rules. Although references to the ICC Rules in the Note are to the 2017 Rules (which are currently in force), the Note itself makes clear that, unless otherwise indicated, the guidance provided applies to all ICC arbitrations, regardless of the version of the Rules they are being conducted under.
Largely, the Note provides administrative guidance, for example, which arbitration documents must be sent in hard copy, and to whom. It also addresses, amongst other things, costs of the arbitration, and fees incurred by the Tribunal in carrying out their duties. For the most part, the content is uncontroversial. However, where parties currently in ICC arbitrations may pause for thought is section IIID.
Publication of arbitration awards
Under this section of the Note, the ICC first explains that “publicising and disseminating information about arbitration has been one of the ICC’s commitments since its creation and an instrumental factor in facilitating the development of trade worldwide” (paragraph 40). Paragraph 41 then goes on to state that all parties and arbitrators involved in ICC arbitrations accept that, as of 01 January 2019, all ICC arbitration final and interim awards from current arbitrations, including dissenting or concurring opinions, may be “published in [their] entirety”.This may obviously cause concern amongst commercial parties who chose arbitration, over litigation, due to the perceived privacy and confidentiality of the process. But all is not lost. There are also a number of safeguards included in the Note which the parties may take advantage of to delay or prevent publication.
For example, the Secretariat of the ICC will remind the parties at the time the final award is notified that the award may be published. There is also a two year period from that date before which it will be published, although the parties can agree to a longer or shorter period should they so wish. Further, it is open to any party to opt out of publication, or insist that the award is first partially or fully anonymised or pseudonymised. Publication will also be subject to any specific confidentiality agreement between the parties which covers the arbitration; where such a provision exists, the parties will be asked to positively provide their consent to publication.
In practice, therefore, it is relatively straightforward to prevent publication of an award. However, it is now necessary for parties to opt out, rather than opt in (other than as set out above), and parties should be alive to this if they receive final awards in ICC arbitrations on or after 01 January 2019.
Although this change may initially be met with consternation, there is, of course, a potential upside. The confidential nature of arbitration has long meant that any new or novel legal finding in an award cannot be relied upon in subsequent disputes. If this new policy succeeds in widening the available arbitration awards that can be studied, then greater certainty about particular points of law or procedure may be achieved if they can be used as precedents. However, it remains to be seen (i) whether parties will be willing to have their awards published, even in an anonymised/pseudonymised form, and (ii) whether such anonymisation/pseudonymisation will be fit for purpose in all industries. For example, we can foresee situations that might arise in the energy industry where parties may be identified from the facts of the case through general industry knowledge, even where sensitive party information has been successfully redacted.
If confidentiality is an overriding concern, then to ensure it is secured it may be prudent for parties to anticipate this change in policy by including specific arbitration confidentiality provisions in any contracts that choose ICC arbitration as the dispute resolution forum. Correctly drafted, this should require the parties to positively consent to publication of the arbitration award, rather than having to opt out of publication as would be required by the default position under the new policy.
Arbitrator independence and impartiality
A further noteworthy area of guidance in the Note relates to section IIIA in relation to the independence and impartiality of arbitrators. Although not a new requirement, the ICC Rules require all prospective arbitrators to complete and sign a statement of acceptance, availability, impartiality and independence (Article 11(2) of the 2017 Rules). As part of this statement, the prospective arbitrator is obliged to disclose “ … any facts or circumstances which might be of such a nature as to call into question the arbitrator’s independence in the eyes of the parties, as well as any circumstances that could give rise to reasonable doubts as to the arbitrator’s impartiality.”
What is new in the Note, though, is the more detailed guidance, at paragraph 23, as to the type of “relevant circumstances” that should be disclosed. The nine examples provided (which are explicitly stated not to be exhaustive) include where the potential arbitrator acts or has acted as arbitrator in related cases, and where the potential arbitrator acts or has acted as arbitrator in a case involving one of the parties or its affiliates. Both of these examples arose in the case of Halliburton v Chubb, which we wrote up in a previous Bulletin, and which is currently awaiting appeal to the Supreme Court. We will provide a further update on this appeal in due course.
In addition, the Note states that potential arbitrators should also consider, and disclose if necessary, relationships that they may have with non-parties to the arbitration who may nevertheless have an interest in the outcome of it (see paragraph 24).
Subsection D of section VI of the Note also provides guidance on the position in relation to personal data. It confirms the ICC’s compliance with the General Data Protection Regulation (“GDPR”) and states that by participating in an ICC arbitration, every individual involved with the arbitration (including the parties and their representatives, the administrative secretary, the witnesses, the experts, and any other person involved in the arbitration in any capacity) accepts that collecting, transferring and archiving personal data is necessary for the purposes of the arbitration, and that the data may be published in the event of publication of the award. It is up to each party to make the relevant people aware of this requirement.
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