By Robert Price
The Stockholm Chamber of Commerce’s (SCC) revised draft Rules for Expedited Arbitration (the Expedited Rules) and the SCC’s draft Arbitration Rules (the Arbitration Rules) (together the Rules), due to come into force in January 2017, are a welcome innovation.
The Rules introduce provisions that aim to combat the longstanding criticisms of arbitration in relation to delays and excessive costs. The following provisions are of particular significance:
- Frontloading – Articles 6 and 9 of the Expedited Rules provide for an accelerated process where the Claimant’s Request for Arbitration also constitutes its Statement of Claim and the Respondent’s Answer constitutes its Statement of Defence. This combines two procedural steps to increase efficiency and reduce delays.
- Summary procedure – The SCC is the first major arbitral institution to expressly adopt a summary procedure where the arbitrator will be able to decide one or more issues of fact or law. This is a feature of both the Expedited Rules and the Arbitration Rules (Article 40 and Article 39, respectively) and invites the arbitrator to dispose of an unsustainable claim at an early stage in what otherwise could be long and costly proceedings.
- Expedited steps – The Expedited Rules further provide for the appointment of one arbitrator (Article 17) who is then obliged within 7 days to establish a timetable (Article 29). The Expedited Rules make it unlikely that there will be a hearing unless the reasons are compelling (Article 33). In order to ensure an accelerated procedure, the Rules include a duty on all parties to “act in an efficient and expeditious manner” (Article 2).
The changes to the rules may encourage other institutions to follow suit. Only time will tell how far the summary procedure under the SCC Rules will be adopted by parties. However, it is foreseeable that this could be the precursor for further change to other institutional rules.
However, it remains to be seen how useful the expedited process proves to be in practice. It is widely recognised that such a process would not be suitable in every case, particularly in complex arbitrations with difficult fact patterns and voluminous amounts of documentation. In reality, parties may prefer to present full submissions over the course of traditional length proceedings, despite the extra costs.
Overall, the fact that these express provisions are designed to tackle concerns over costs and delays in arbitration is a welcome development.
This post was prepared with the assistance of Eleanor Scogings in the London office of Latham & Watkins.