Over the last few months, several global arbitration institutions have introduced amendments to their arbitral rules. In the US alone, both the American Arbitration Association (AAA) and the International Institute for Conflict Prevention and Resolution (CPR) have introduced and implemented such amendments.
The AAA provides increased oversight and appellate review through revised rules
In November 2013, the AAA issued new Arbitration Rules and Mediation Procedures for use in commercial matters (the Commercial Rules), which are available for use in domestic and international disputes, administered either by the AAA or the International Centre for Dispute Resolution (IDCR). The Commercial Rules incorporate substantial revisions, including the availability of immediate injunctive relief, the availability of dispositive motion practice, greater arbitrator control over the discovery process, and a new appellate review procedure. Each of these developments are responsive to a perceived need for additional relief mechanisms during an arbitration.
Specifically, Rule 9 now mandates mediation for arbitrations involving disputes concerning a claim for more than US$75,000. Rule 22 limits discovery to documents “relevant and material to the outcome of the disputed issues.” While this requirement is generally consistent with the frequently used IBA Rules on the Taking of Evidence in International Arbitration, it is narrower than the requirements imposed by the rules used in American federal courts and provides a benchmark more in line with international standards. Rule 22 further empowers arbitrators with greater control over the discovery process. Finally, Rules 23, 38 and 58 work together to provide mechanisms for emergency relief and sanctions against a party for failure to comply with the rules or an arbitrator’s instructions.
Additionally, AAA and ICDR are now offering new Optional Appellate Arbitration Rules, which allow for appellate review of arbitration awards by a special panel. This mechanism is only available when all parties agree to its implementation, whether at the time of the arbitration agreement or at a later time. The appellate review process will involve the submission of written briefs and a full record, and allows no option for oral argument. An appellate review mechanism is not a novel concept as other American institutions, including CPR and JAMS have offered similar rules for many years, but it is a new development for the AAA and ICDR.
The AAA and ICDR have marketed these changes as streamlining the arbitration process and increasing effectiveness. However, critics in the arbitration community have suggested that, as a practical matter, these amendments reflect a shift toward arbitration procedures that may be more familiar to those who usually litigate in the US courts.
New administration options introduced by the CPR
Over the last few decades, CPR’s non-administered arbitration rules (the Non-Administered Rules) have helped the institution establish itself as a leader in global commercial dispute resolution. The recent revisions will allow it to continue at the forefront of its arena. Based on user requests, CPR is now for the first time offering case administration for domestic arbitrations in conjunction with newly introduced administered arbitration rules (the Administered Rules).
The Administered Rules are similar to the CPR’s previously existing Non-Administered Rules, but include new provisions in conjunction with the administration process. The development of the Administered Rules was spearheaded by an internal subcommittee made up of attorneys, academics, and various users in the arbitration community to respond to emerging trends in the arbitration community, with the goal of streamlining the arbitration process.
Among the features of the Administered Rules is the ability to appoint a “Special Arbitrator” for interim remedies. The Administered Rules also seek to provide an efficient arbitrator review and selection process and a multi-faceted arbitrator challenge process. The Administered Rules implement predictable fixed administrative fee scale in an effort to add efficiency and cost effectiveness to the arbitral process. CPR has also committed to perform a limited review of all awards rendered under the Non-Administered Rules for formatting, computational, and other clerical errors.
CPR’s foray into domestic arbitration administration will no doubt serve as a test case for potential entry into case administration for international arbitrations.
The evolving landscape of available arbitral rules and dispute resolution mechanisms continues to clarify the procedural mechanisms that parties can expect to encounter and provides parties with increased autonomy and predictability as the arbitration process proceeds.