Asia Pacific - The New ICC Expedited Procedure Rules.
Legal News & Analysis - Asia Pacific - Dispute Resolution
24 March, 2017
On 1 March 2017, the new International Chamber of Commerce Rules (ICC Rules) came into effect. One of the main changes to the Rules is the introduction of the Expedited Procedure for matters that satisfy the requirements set out under Article 30, read with Appendix VI of the Rules.
Underlying the introduction of the Expedited Procedure Provisions, is the need to maintain appropriate control of time and cost, especially in cases of low complexity and cases that have a low value.
Once parties agree to arbitration under the ICC Rules, the parties automatically agree that the Expedited Procedure Rules shall take precedence over any contrary terms of the arbitration agreement.
The Expedited Procedure Rules will also automatically apply if the amount in dispute does not exceed US$2 million at the time that the Answer to the Request for Arbitration is filed. The Secretariat of the ICC will inform the parties at that stage that, the Expedited Procedure Provisions will apply in the case.
The parties may also agree to the application of the Expedited Procedure Rules; however the Rules cannot apply in the following circumstances:
- the arbitration agreement under the Rules was concluded before the date on which the Expedited Procedure Provisions came into force;
- the parties have agreed to opt out of the Expedited Procedure Provisions; or
- where the court, upon the request of a party before the constitution of the arbitral tribunal or on its own motion, determines that it is inappropriate in the circumstances to apply the Expedited Procedure Provisions.
The courts may also, at any time during the arbitral proceedings and on its own motion or upon the request of a party, decide that the Expedited Procedure Provisions shall no longer apply to the case.
The rules make provision for the administration of expedited arbitrations as follows:
Article 23 of the Rules, which deals with terms of reference, is not applicable to arbitrations under the Expedited Procedure. However, although parties are not restricted to the terms of reference, they may not make new claims after the arbitral tribunal has been constituted. The only exception is if a party has been authorised to make a new claim by the arbitral tribunal. In allowing an exception, the tribunal will consider the nature of such new claims, the stage of the arbitration, any cost implications and any other relevant circumstances.
In an effort to have the matter expeditiously dealt with, the case management conference shall take place no later than 15 days after the date on which the file was transmitted to the arbitral tribunal. The court may extend this time limit pursuant to a reasoned request from the arbitral tribunal or on its own initiative if it decides it is necessary to do so.
Furthermore, the arbitral tribunal may, after consultation with the parties, decide not to allow requests for document production or to limit the number, length and scope of written submissions and written witness evidence (both fact witnesses and experts). This ensures that the matter is dealt with as swiftly as possible, with only the documents that are relevant, without the burden of procedural steps and unnecessary documents which may delay the matter unnecessarily.
The matter may also be decided solely on the basis of the documents submitted by the parties, with no hearing and no examination of witnesses or experts. A hearing may also take place by videoconference, telephone or similar means of communication.
Appointment of an arbitrator
In terms of the Expedited Procedure, the court may, notwithstanding any contrary provision of the arbitration agreement, appoint a sole arbitrator. The Rules allow the parties to nominate the sole arbitrator within a time limit to be fixed by the Secretariat. In the absence of such nomination, the sole arbitrator shall be appointed by the court within as short a time as possible.
The time limit within which the arbitral tribunal must render its final award is six months from the date of the case management conference. The court may extend the time limit pursuant to Article 31(2) of the Rules. This provision is a welcome change for parties who wish to have their matter finalised without having to wait for months, and sometimes years, before an award is handed down.
Although the new procedure will be a welcome change for parties who often decide not to proceed with the arbitration process because it can be protracted, parties who have complex claims that fall within threshold of US$2 million may not find this procedure appealing.
Parties who intend to enter into an arbitration agreement, which is subject to the ICC Rules, will have to carefully consider whether they want to opt out of the Expedited Procedure Rules before signing the agreement.
The process is ideal for simpler, straightforward claims and it may not be as well-suited to more complex matters with lesser quantum values.