International Chamber of Commerce (ICC) plays prominent role at international level by promoting investment and trade of goods and services. It is not merely a private organization though it was created by handful of entrepreneurs as group of industrialists, financiers and traders were determined to bring economic prosperity to a world that was still reeling from the devastation of World War I and called themselves merchants of peace. The organization expanded from five countries to become a world business organization with member companies in more than 120 countries.
The International Court of Arbitration (ICC Arbitration Court) was founded in 1923 which added impetus to the ICC as it has provided a distinctive functionality to the organization. The ICC Courts provides dispute resolution mechanisms in line with international business requirements considering the need of resolution which do not have state interference and provides juridical supervisions. ICC Arbitration Court is the most preferred and widely used arbitration institution with 50% of research respondents preferring ICC as per 2010 research survey.
The ICC Arbitration Court has developed dispute resolution mechanisms specifically for international business disputes as such disputes pose unique challenges, usually because the parties will be of different nationalities, implying varied linguistic, distance between nations, legal and cultural backgrounds. ICC arbitration is preferred to resolve issues of perceived or actual inequality for one party to submit to the courts of another party’s home ground.
What is ICC Arbitration Court?
ICC Arbitration Court is defined under Annexure I of the ICC Statute as an autonomous body; it carries out these functions in complete independence from the ICC and its organs. The function of the ICC Arbitration Court is to ensure the application of the Rules of Arbitration of the ICC (the ICC Rules), and it has all the necessary powers for that purpose. Accordingly, though it is called International Court of Arbitration of ICC it is an administrative body and does not adjudicate upon cases, but exercise judicial supervision on the arbitration proceedings and ensures the implementation of ICC Rules [Article 1(2)]. The awards are rendered by independent arbitrators appointed by the parties to the dispute.
What are the Rules governing ICC Arbitration Court and what aspect of arbitration they govern?
The ICC’s first rules of Arbitration were published in English and French in 1922. The ICC Rules are amended several times and there have been ten revisions, the recent one being made in 2011 and implemented on 1 January 2012. The ICC Rules govern the conduct of proceedings before ICC Arbitration Court from initiation till award is passed. ICC Rules regulate the filing of claims, the constitution of arbitral tribunals, the conduct of proceedings, the rendering of award and the determination of costs. The ICC Rules allow parties flexibility in terms of preferences of parties to dispute with respect to certain aspects of the proceedings such as the choice of arbitrators, the place and the language of arbitration.
How does one refer the dispute to ICC Arbitration Court?
The Parties can refer to any dispute if they have stated the ICC standard clause or such other clause in the arbitration or dispute resolution clause in the contract agreed between the Parties. The standard clause in various languages is available on this link. It is not mandatory for party seeking arbitration under ICC Rules to be ICC member or to have any other affiliation with ICC. The requirement is that the parties to a contract, treaty, or separate arbitration agreement have agreed on ICC Arbitration. The party can be a company, state, state entity, international organization or individual.
How is the request for arbitration filed?
The Request for Arbitration must be filed with the ICC Secretariat for the ICC Arbitration Court at ICC Headquarters. The request must include (a) name, description and address of each of the parties; (b) a description of the nature and circumstances of the dispute giving rise to claims; (c) a statement of the relief sought including any compensation claimed, if required ; (d) the copy of relevant contract and arbitration agreement; (e) all relevant particulars concerning the constitution of the Arbitral Tribunal; (f) any preference for place of arbitration, the applicable rules of law and the language of the arbitration. The Request must be filed with enough copies for each respondent party, each arbitrator and the Secretariat. The Request must also be accompanied by some fees as an advance payment on administrative costs.
Which sectors or disputes can be referred for arbitration under ICC Rules to ICC Arbitration Court?
ICC Rules have been formed to be used in all sectors and for all types of disputes and hence there is no limitation on which type of industry or business sector can seek arbitration under ICC Arbitration Court.
What is the language of proceedings under ICC Arbitration Court?
There is no language limitation. The proceedings can be conducted in any language that the parties may agree to in their respective contract. As per Article 20 of ICC Rules, the arbitral tribunal shall determine the language/s of the arbitration in the absence of an agreement by the parties and all relevant circumstances including the language of the contract shall be given consideration while deciding the language of proceedings.
Where is the arbitration proceedings conducted under ICC Rules?
Article 18 states that the seat of arbitration and place of hearing can be anywhere as agreed between the parties. If it is not agreed between the parties, the arbitral tribunal may, after consultation with the parties, conduct hearings and meetings at any location it considers appropriate, unless otherwise agreed by the parties. However, ICC Hearing Centre, Arbitration Place and Seoul International Dispute Resolution Center are recommended for hearings and meetings because of their state-of-the-art hearing facilities and all-encompassing service.
Which rules applies while adjudicating the dispute?
The rules of proper law of contract can be national law of the country of one party or of other party to contract or it can be international or general principles of law. As per Article 21 of ICC Rules in the absence of any such agreement arbitral tribunal shall apply the rules of law which it deems to be appropriate.
What are the applicable rules to the proceedings of arbitration?
As per article 19, ICC Rules shall govern the proceedings and if the same is silent on any issue, the rules which the parties agree on and failing which the rules that is agreed by arbitral tribunal shall apply, whether or not reference is thereby made to the rules of procedure of a national law to be applied to the arbitration.
What is the procedure for appointing arbitrator as per the ICC Rules?
The ICC Rules provides for arbitral tribunal provisions under Article 11 to 15. The section provides for general provisions laying down the requirements for appointment of arbitrator. As per Article 11, any person can be appointed as arbitrator based on his expertise in specific field of work, nationality, and language, so on and so forth as agreed by the parties to the dispute. However, the arbitrator must be independent and impartial. The Court’s role is to ensure that prospective arbitrator shall sign a statement of acceptance, availability, impartiality and independence. The prospective arbitrator shall disclose in writing to the Secretariat any facts or circumstances which might be of such a nature as to raise doubt on 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.
If the Parties have not provided otherwise in contract, the arbitral tribunal shall be appointed under article 12 and 13 which states about constitution of the arbitral tribunal and appointment and confirmation of the arbitrators.
Can the appointment of arbitrator be challenged?
The appointment can be challenged as per article 14 for an alleged lack of impartiality or independence, or otherwise, shall be made by the submission to the Secretariat of a written statement specifying the facts and circumstances on which the challenge is based.
The challenge is admissible only if it is made within 30 days from receipt by that party of the notification of the appointment or confirmation of the arbitrator, or within 30 days from the date when the party was informed of the facts and circumstances on which the challenge is based, if such date is subsequent to the receipt of such notification.
The Arbitrator can be replaced under article 15 of the ICC Rules upon death, upon acceptance by the ICC Arbitration Court of the arbitrator's resignation, upon acceptance by the court of a challenge, or upon acceptance of a request of all the parties. The ICC Arbitration Court can also replace the arbitrator on its own initiative when it decides that the arbitrator is prevented de jure or de facto from fulfilling the arbitrator's functions, or that the arbitrator is not fulfilling those functions in accordance with the ICC Rules or within the prescribed time limits.
What is the time limit for rendering final award?
Article 30 directs that the award must be passed in six months from the date of last signature by the arbitral tribunal or by the parties of the Terms of Reference or, in the case of application of Article 23(3), the date of the notification to the arbitral tribunal by the Secretariat of the approval of the terms of reference by the court. The court may fix a different time limit based upon the procedural timetable established pursuant to Article 24(2).
The Court may extend the time limit pursuant to a reasoned request from the arbitral tribunal or on its own initiative if it decides it is necessary to do so. [Article 30(1)]
Whether awards granted by arbitral tribunal binding on parties and enforceable?
Article 34 (6) of ICC Rules provides that the award shall be binding on the parties as by submitting to the arbitration under the ICC Rules the parties waive their right to any form of recourse insofar as the waiver can be validly made.
However, the enforceability of the awards remains to be major concern and many courts around the world have cast doubts about its enforceability. The matter of enforceability is decided on case to case basis by the state/national courts and the practice defers based on the considerations in each case and country. The enforcement is not automatic and depends on the legal system wherein the parties seek to enforce the judgment. The UK’s Court of Appeal in Dallah Estate and Tourism Holding Co. v. The Ministry of Religious Affairs, Government of Pakistan  EWCA Civil 755 highlighted the limitations of tribunal's authority to rule on its own jurisdiction (kompetenz-kompetenz). It upheld the view that courts enforcing the awards have final word on the issue of tribunal’s jurisdiction to grant award. It further emphasizes that the consideration on contracting party being state entity can change the approach of the judiciary.
Considering the doubts on enforceability of awards granted by arbitral tribunals under ICC clause under supervision of ICC Arbitration Court, ICC has released a new edition of its guide to national procedures for recognition and enforcement of awards under the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention).