The London Court of International Arbitration (LCIA) has just published its 2018 Casework Report. As ever, the statistics deriving from the number and nature of cases filed provide a useful barometer of trends in the London arbitration market.
Banking and financial arbitrations constituted 29 per cent of all cases filed under the LCIA rules. That is 5 per cent up from 2017, and was the most common type of dispute. Energy and resources disputes counted for 19 per cent; transport and commodities for 14 per cent; construction and infrastructure for 10 per cent; and professional services for 7 per cent. Healthcare and pharmaceuticals disputes comprised 2 per cent of cases filed, probably reflecting a preference for life sciences/pharma disputes to be heard at the WIPO (World Intellectual Property Organization) Centers in Geneva or Singapore.
The preponderance of banking and financial arbitrations reflects the growing use of arbitration for financial services disputes over the past six years. That trend has spawned the establishment of competitor arbitral institutions such as P.R.I.M.E. (Panel of Recognised International Market Experts) Finance and the London Chamber of Arbitration, which is part of the London Chamber of Commerce and Industry. It was back in 2013 that the ISDA (International Swaps and Derivatives Association) first published an Arbitration Guide for its Master Agreement. Up to that point, both the 1992 and the 2002 agreement model clauses had provided only for New York or English governing law and concomitant court jurisdiction.
Also of note from the LCIA report is that the percentage of English law disputes which came before it dropped from 85 per cent in 2017 to 76 per cent in 2018. Unsurprisingly, the perennial question of one arbitrator or three has continued to split contract drafters. For 2018, the percentage of sole arbitrator LCIA panels as opposed to three member panels was 51 per cent against 49 per cent.
Time will tell if the political uncertainty over Brexit will drive the percentage of banking and financial disputes coming before London arbitral tribunals even higher in the coming years.