Paris the Home of International Arbitration (Paris Place d’arbitrage) unveiled its newly drafted Paris Arbitration Rules on Monday, April 15 at the group’s annual conference, held at the Hôtel de Ville in Paris. The conference, chaired by Charles Kaplan (President of Paris Home of International Arbitration and Co-Head of Herbert Smith Freehills’ Global Arbitration Practice), featured several speakers including Alexis Mourre (Honorary President) and Philippe Pinsolle (Vice President). Professor François-Xavier Train (Université Paris Ouest (Nanterre La Défense)), Pierre-Yves Tschanz, and Isabelle Hautot (General Counsel, International Conflicts Resolution, Groupe Orange) provided additional commentary from the perspectives of academics, practitioners, arbitrators and users. The conference also featured an address by Christiane Féral-Schuhl, Bâtonnier of the Paris Bar.
The Paris Arbitration Rules set out an innovative mechanism for ad hoc arbitration.
They grant broad discretion to the Arbitral Tribunal with respect to case management and procedural issues, and impose corresponding obligations on the parties to cooperate in the resolution of such issues. This combination of discretion and cooperation is intended to “provide a framework for the swift, efficient and cost-effective resolution of disputes” (Article 1.1). Further emphasizing the focus on efficiency, the Tribunal exercises its discretion within strict time limits. The Rules also provide for the timely awarding of interim measures, either by a specially-appointed Interim Arbitrator, or by the Tribunal itself.
Discretion and cooperation
As noted, the Rules provide the Tribunal with broad discretion to resolve procedural issues, and impose corresponding duties of cooperation on the Parties.
The Tribunal’s discretion is particularly broad with respect to the admissibility and weight of evidence (Article 6.8). The Tribunal is thus free to decide issues related to the appearance of witnesses (Article 6.8(d), (e)) and experts (Article 6.8(f)), and to order documentary disclosure (Article 6.8(g)). Where a party submits pleadings or evidence after a prescribed time-limit, the Tribunal may declare such submissions inadmissible (Article 3.1). The Tribunal also has complete discretion to dispose of part or all of the dispute by early awards: “The Arbitral Tribunal may, on its own motion or at the request of a party, decide to dispose of all or part of the case by way of an early award, including by dismissing the claim at an early stage, if it considers such conditions as it determines, in its discretion, to be applicable for such early dismissal are met” (Article 7.4). The primary limitation on the Tribunal’s discretion is the agreement of the Parties themselves: Pursuant to Article 6.6, where the Parties agree to a Procedural Calendar, the Tribunal is bound by it.
The Parties’ correlative duty to cooperate in the resolution of procedural difficulties is perhaps best demonstrated by Articles 5.3 and 5.4. Article 5.3 provides that arbitrators must inform the parties of any circumstances that could call into question their independence or impartiality. Conversely, Article 5.4 obliges the parties to inform the arbitrators of any circumstances of which they are aware that could be relevant to the arbitrators’ disclosures provided for under Article 5.3. A party failing to make such a disclosure could be deprived of the right to challenge the arbitrator in question (except where the party can show that the arbitrator should in any event have been aware of the circumstances in question). Similarly, where issues arise as to the date of communication of a given document, each party is obligated to provide, “all information it possesses regarding the tracing of the communication” (Article 2.4).
Effective time limits
While the Rules confer extensive discretion on arbitrators in the conduct of the arbitration, this discretion is exercised within strict procedural time limits. Pursuant to Article 3.2, a final award should be rendered within 18 months of the latter of (i) the date of the first hearing, and (ii) the date on which all members of the Arbitral Tribunal have accepted their mission as arbitrators. In addition, the award is to be rendered within three months of the final step provided for in the Procedural Calendar.
The effectiveness of these deadlines is ensured through an innovative mechanism. Where the delays are exceeded, either party may request that the Appointing Authority inquire as to the reasons for the delay. The Tribunal is obligated to provide such information. Where arbitrators do not or cannot perform their mandate, the Appointing Authority may replace them (Articles 3.2, 5.6). In addition, two members of the Tribunal may choose to proceed with deliberations where a third member has refused to participate (Article 7.5). These provisions provide a mechanism to deal with rare but potentially disruptive cases where an arbitrator becomes a barrier to the fast and efficient resolution of the dispute.
Interim relief can be granted by the Tribunal or, in exceptional cases, an Interim Arbitrator appointed by the Appointing Authority. As with other matters governed by the Rules, broad discretion is granted in order to allow arbitrators to pursue their mandates in as efficient a manner as possible. Aside from requiring the Respondent to submit its reply within seven days of the application for interim measures, the Interim Arbitrator is left complete discretion with respect to the procedure to be followed (Article 4.4). The Interim Arbitrator is likewise granted full discretion in determining which measures, if any, to grant: Article 4.2 provides that the Interim Arbitrator has “full discretion to grant whatever interim relief he or she deems appropriate in view of the circumstances“. While a number of factors that the Interim Arbitrator may consider in granting these measures then follow, none are mandatory conditions. This is in contrast to many institutional rules, which set out conditions (such as urgency) for the awarding of interim measures, or limit the types of measures that can be granted. The Interim Arbitrator also has discretion to order interim measures on an ex parte basis, provided that an inter partes decision is rendered thereafter (Article 4.7). The Arbitral Tribunal has the same authority to grant interim measures, pursuant to Article 7.
The Paris Rules thus provide a nimble procedure that relies on the expertise of the Arbitral Tribunal and the cooperation of the Parties in order to ensure as efficient a procedure as possible, while respecting rules of due process. The Rules are thus intended for experienced arbitrators, counsel and clients.
“Any dispute arising out of or in connection with this agreement shall be settled by arbitration in accordance with the Paris Arbitration Rules.“
Where the Parties do not specify otherwise, the Rules designate the Secretary General of the Permanent Court of Arbitration as Appointing Authority (Article 1.3), provide for Paris as the place of arbitration (Article 11.1), and leave the choice of the language of arbitration in the discretion of the Arbitral Tribunal (Article 11.2).