On June 29, 2010, the United Nations Commission on International Trade Law (“UNCITRAL”) amended its Arbitration Rules that were originally adopted in 1976. The UNCITRAL Arbitration Rules are intended to be used in the course of an ad hoc arbitration, that is, an arbitration that is not conducted under the umbrella of an arbitration institution, such as the International Chamber of Commerce (“ICC”), the American Arbitration Association (“AAA”) or the London Court of International Arbitration (“LCIA”). The impetus for the changes was a desire to reflect important changes in international arbitration over the past few years, and to provide a more efficient and cost effective arbitration procedure. The most significant changes to the Rules are outlined below.
Pursuant to Article 4, the Respondent is now permitted to submit a Response within 30 days of receiving the Notice of Arbitration. Article 4 (2) provides the right to the Respondent to bring a Counterclaim. These changes are consistent with modern arbitration rules that provide the Respondent the opportunity to present its position before the constitution of the Arbitral Tribunal and the execution of the Terms of Reference. In addition, by virtue of Articles 20 and 21, the parties elect the Notice of Arbitration or Response that may be treated as their respective Statement of Claim or Defence.
The Rules pertaining to the Arbitral Proceedings have not been substantially changed. However, Article 17 of the Revised Rules provides that the Tribunal shall conduct the proceedings in a manner that avoids unnecessary delays and expenses, and provides a fair and efficient process for resolving the parties’ dispute. This may permit the Arbitral Tribunal to reduce the scope of documentary and oral discovery. In addition, the Revised Rules have also been adapted to new means of communications such as email. Article 2 specifically allows the transmission of a document by facsimile and by email.
Article 6 of the Revised Rules significantly expands the range of interim measures that the Tribunal may grant, including provisional injunctions, seizures before judgment and orders directed at preserving evidence. The criteria relating to the issuance of an interim measure are essentially similar to those generally applicable in Canada. The moving party will have to prove irreparable harm that cannot be compensated by an award of damages and that there is “a reasonable possibility that [it] will succeed on the merits of the claim.” Article 26 (6) of the Revised Rules provides that the Arbitral Tribunal may require the party requesting an interim measure to provide appropriate security.
Article 27 of the Revised Rules, which addresses the issue of evidence, is in line with international arbitration practice and, more specifically, with the most recent version of the IBA Rules on the Taking of Evidence in International Arbitration. The Arbitral Tribunal has the power to order the production of documents and exhibits, and to determine the admissibility and relevance of the evidence presented by the parties. The Revised Rules do not address one of the most critical issues, namely e‐discovery. While greater clarity may have been desirable, it would seem that the Arbitral Tribunal may rely on its general procedural jurisdiction contained in Article 17 of the Revised Rules to fashion the most appropriate order for production of electronic documents.
Article 27 of the 1976 Rules gave the Arbitral Tribunal power to appoint an independent expert. Now, Article 29 of the Revised Rules requires the Arbitral Tribunal to consult with the parties before appointing an expert. This is consistent with international practices, as evidenced, for example, by Article 20 of the Rules of Arbitration of the ICC. Article 29 (2) of the Revised Rules provides the right to the parties to challenge an expert appointed by the Arbitral Tribunal. The challenge shall be made before the appointment.
With respect to the hearing, the Rules remain substantially unchanged, though the Revised Rules now expressly contemplate the use of videoconferencing and similar technologies.
Article 32 of the 1976 Rules referred to different type of awards: interim, interlocutory, partial and final awards. These subtle distinctions have been abandoned by the Revised Rules. Article 34 of the Revised Rules provides that the Arbitral Tribunal can make separate awards on different issues at different times, all of which shall be final and binding. The Arbitral Tribunal may, for example, split the proceedings and decide on the issue of liability and reserving its jurisdiction on the issue of damages.
Exclusion of Liability
The new Article 16 of the Rules provides an exclusion of liability for the benefit of the members of the Arbitral Tribunal, the Appointing Authority and any person appointed by the Arbitral Tribunal. This protection is in line with domestic laws and international rules of arbitration. Obviously, Article 16 does not cover any intentional wrongdoing on the part of the arbitrators.
Coming into Force
The new rules became effective as of August 15, 2010 and will (subject to certain objections) apply to an arbitration agreement referring to the UNCITRAL Arbitration Rules concluded after that date.