International arbitration is the dispute resolution method of choice for international business. It has become increasingly prevalent as a means of resolving intellectual property disputes.  Arbitration is particularly attractive for resolving multi-jurisdiction intellectual property disputes because it enables the parties to resolve their disputes in a single forum, avoiding the costs, delay and risk of inconsistent judgments that can arise from multiple proceedings in different countries.

Another feature of arbitration that makes it attractive for resolution of intellectual property disputes is its confidential nature.  This can be particularly important where a dispute involves trade secrets or technology and information that are commercially sensitive. 

Also, international arbitration awards are enforceable in 145 countries under the New York Convention on Recognition and Enforcement of Foreign Arbitral Awards.  The Convention provides that local courts must enforce awards, subject only to limited grounds of challenge set out in the Convention.

One of the world's leading arbitration institutions, the International Chamber of Commerce, has recently released a new version of its arbitration rules.  The rules will apply to all ICC arbitrations commenced after 1 January 2012. The new rules are designed to make the process more efficient, and to fully encompass modern forms of communication and technology (telex is out; email is in!).

The new ICC Rules of Arbitration include changes aimed at saving time and cost and improving the efficiency of complex multi-party arbitrations.

The key changes to the ICC Rules include:

  • Emergency arbitrators: Provisions for the appointment of an emergency arbitrator to grant interim relief before the Tribunal is constituted.  In some intellectual property disputes (such as to protect trade secrets) it can be of key importance to obtain an urgent injunctive relief.  An emergency arbitrator appointed under the new ICC Rules can make an interim order granting such relief until the arbitral Tribunal has been appointed.  This avoids the need of parties having to go to court to attempt to obtain such relief.  Under the new rules the ICC will appoint an emergency arbitrator within as short a time as possible, which will normally be within two days.  The emergency arbitrator provisions only apply to arbitration agreements entered into after 1 January 2012.
  • Confidentiality: The ICC Rules now expressly provide that the Tribunal may make orders regarding the confidentiality of the proceedings and any other matters in connection with the arbitration, including taking measures to protect trade secrets and confidential information. As mentioned above, confidentiality of arbitration makes arbitration attractive for disputes dealing with commercially sensitive information, such as IP licensing rates.  Accordingly, the strengthening of the confidentiality provisions in the ICC Rules is likely to be welcomed by arbitration users in the intellectual property sector.
  • Arbitrator independence and availability: The new ICC Rules provide that Arbitrators must sign declarations of their independence and impartiality at the time of appointment and must keep the ICC secretariat informed of any matters that arise after their appointment that may impact their independence and impartiality. Arbitrators must now also sign a Statement of Availability before appointment by the ICC, disclosing their existing arbitral commitments and confirming that they will have adequate time to devote to the arbitration.  These developments are also likely to be welcomed by arbitration users, as they are designed to ensure that arbitrators are and remain free of conflicts of interest and have adequate time available to resolve the arbitration in a speedy and cost-effective manner.
  • Time and Costs: A number of provisions have been added aimed at reducing time and costs of arbitrations including:
    • an express duty on the Tribunal and the parties to conduct the arbitration in an expeditious and cost-effective manner;
    • a requirement for a mandatory case management conference at an early stage of the proceedings between the parties and Tribunal to discuss procedural matters;
    • a requirement for the Tribunal to consider whether various case management techniques aimed at reducing time and costs are appropriate for the arbitration. Suggested case management techniques are contained in an appendix to the Rules and include techniques such as identifying preliminary issues or conducting part or all of the arbitration on documents only basis. In intellectual property cases there is often benefit to the parties in employing some of these techniques, such as having a hearing on issues of liability first and dealing with quantum issues at a later stage;
    • The possibility for the arbitral tribunal, when deciding on the costs of the proceedings, to take into consideration the extent to which each party has conducted the arbitration in an expeditious and cost-effective manner; and
    • The possibility of better monitoring the time taken to deliver an award to the parties by the Court.
  • Multi-parties and multi-contracts arbitration: The Rules contain entirely new provisions which facilitate joinder (of a party to the arbitration agreement), multi-party arbitrations, cross-claims and consolidation.  These provisions give recognition to the growing number of complex multi-party and multi-contract arbitrations.  These provisions are particularly important in the context of intellectual property disputes which commonly include multiple claimants (such as licensees and licensors of intellectual property rights) and multiple respondents (such as manufacturers and distributors of allegedly infringing products).

Overall, the changes to the ICC Rules are likely to be welcomed by users of international arbitration in the context of intellectual property disputes, as they strengthen protection of confidential information and are likely to improve efficiency, speed and cost effectiveness of arbitration.