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Guide to Regional Arbitration (volume 5 - 2017)

White List: Western Europe

02 November 2016

Europe is home to the biggest arbitration providers in the world, the ICC and the LCIA. So, why feature anyone else? Aren't the rest just little fish?

Well, yes and no. For a start there are some at least medium-sized fish, such as the SCC and Swiss Chambers. But more importantly – as we said in the guide's introduction – other providers exist. And when an arbitral institution exists, one can always run into it (or find a use for it). Western Europe is full of such organisations. Some have been happy to focus on domestic work. Others (a growing segment) have wider ambitions. They'd like a bit more international work. So, in case you bump into either sort, here's GAR's guide to the cream of the crop of those other organisations in Europe. Note: the LCIA and ICC are not included in this chapter, because they're already so well known.

THE CHAMBER OF ARBITRATION OF MILAN (CAM)

Why's it on the white list?

It's very well thought of – and quite international.

How international?

It's emerged as a bit of a lightning rod for disputes from around the Mediterranean including North Africa.

Is that deliberate?

Yes. Whereas some have shied away from international work (partly because it's an expensive business building your brand to audiences away from home), CAM has done the opposite. It's aimed itself squarely at work from abroad, particularly its immediate environs – from North Africa to Turkey and parts of the Middle East It's formed partnerships with a number of other providers in the region – such as the Moroccan Arbitration Court, the Centre of Arbitration of Tunis, the Cairo Regional Centre for International Commercial Arbitration, the Algerian Centre of Arbitration and the Istanbul Chamber of Commerce. Meanwhile, its board includes Spanish and German lawyers alongside some eminent Italians. And the rules are available in Arabic as well as the major European languages.

How busy is it?

In 2015, it received 134 new cases, 27 of them international. Since 2009, its new cases total hasn't dropped below 120.

What do foreign counsel and arbitrators think?

The Milan Chamber is starting to get some glowing reviews from both camps – who it's fair to say were lukewarm about it for a time (not necessarily because of the Chamber, but more the tendencies of local arbitrators).

What do they like?

Arbitrators like that the chamber assigns one legal counsel to each case to play the role of secretary – thus saving the tribunal the expense of doing so. Its administration also draws praise – one source described it as "flawless and very responsive". The average time for a Milan Chamber arbitration at present is 14 months.

What changed to get these reviews?

The centre's appointment process is a lot more "rigorous" than it used to be, according to one source who said it was on a par with the ICC. As a result, the diversity of its tribunals has improved (in terms of sex, age and – when the arbitrator is Italian – which part of Italy they come from).

Are there any other new developments?

Like the ICC, the Milan Chamber is now disclosing the names of arbitrators appointed to cases on its website, as of January 2016.

Recent statistics also show more international cases going there – 27 last year.

CORTE DE ARBITRAJE DE MADRID

Why's it white-listed?

Spain isn't short of arbitration centres, but many think that the Madrid court is the best of the bunch (one source called it "head and shoulders" above local rivals). As well as being one of the oldest, the Corte De Arbitraje de Madrid is seen as more modern, forward-thinking and professional than the majority of others. Even more importantly, it bucks a local trend: it's not seen as dominated by a particular clique.

How many cases does it have?

New requests topped 150 in 2013 (the latest statistics we had access to), and the overall total of cases being administered was just over 200.

Within this, banking and corporate disputes are a big component – perhaps unsurprisingly, given Spain's recent misfortunes.

How big and international are those cases?

At the time it last produced statistics (2013) the court estimated the total value in dispute to be around €1.3 billion. About one-third of its arbitrations were international, US$800 million of which is tied to international arbitrations.

What are its rules like?

It adopted the current rules in 2015. They're said to combine elements of the UNCITRAL, ICC and LCIA rules (as they were at the time). The rules now include an emergency arbitrator provision. The other main changes were to narrow the opportunity to present additional evidence later in the case  and clarify the rules for hearing disputes about company by-laws.

Who's in charge?

In April 2014, the court appointed a new president, Antonio Sanchez-Pedrano, who is well known in Spanish arbitration. He said he would continue his predecessor Miguel Angel Fernandez-Ballesteros' good work raising the court's international profile, especially in Latin America.

Has he? 

The Madrid court already had agreements in place with Latin American centres such as the Câmara de Comércio Brasil–Canada (CCBC) and the Corte de Arbitraje in Mexico. It's now also got an agreement with the Arbitration Centre of the Lima Chamber of Commerce.

How big is the secretariat?

It has seven members. It's got a good reputation for efficiency in its administration, turning most cases around in less than a year.

DANISH INSTITUTE OF ARBITRATION (DIA)

Why's it on the white list?

It's a healthy centre with a strong caseload and good connections with the wider international arbitration community. It's been operating now for 35 years.

What's the caseload like?

The centre reports concluding 23 international cases last year and constituting 65 tribunals in the past 12 months.

How international are the cases?

The institute certainly has international aspirations. Its rules are available in Danish, English, German, French, Russian and Chinese, which shows the range of its ambition. Its arbitrators so far have been mainly Danes with only a smattering of other (all-European) appointments though.

What about the topics of cases?

A broad mixture, with shareholder agreement cases coming out on top, followed by IT and telecoms. A fair few M&A, employment, cooperation and distribution agreements also came the centre's way in 2014.

What are the rules like?

The DIA's current rules come into force in May 2013 and now allow for interim and emergency arbitrator appointments (one of which was made in 2013), consolidation of claims and parties, provisions for sole arbitrator appointments, and some extra powers and responsibilities for tribunals and the secretariat.

The dispute board rules were adopted in 2014 and the mediation and experts rules were revised in 2015.

Is it well staffed?

The board is 12-strong, chaired by local big-hitter Jesper Lett, and made up mostly of lawyers appointed by various Danish industry associations. The centre also boasts expert committees on maritime, IT, mediation and international disputes.

What else is it up to?

The DIA is starting to put itself a little more in the shop window. It put on a conference on the arbitration of energy disputes aimed at an international crowd, with Doak Bishop giving the keynote, in 2014, and since then has run several other events. It also has an active young arbitrators group.

In 2017, it will host the International Congress of Maritime Arbitrators (ICMA XX), reflecting Denmark's maritime heritage.

DEUTSCHE INSTITUTION FÜR SCHIEDSGERICHTSBARKEIT EV (GERMAN INSTITUTION OF ARBITRATION) (DIS)

Why's it on the white list?

It's a competent and professional German alternative to the ICC. The only other international player in Germany is the German Maritime Arbitration Association.

How did it get to this point?

It benefited from good connections. For many years the illustrious Karl-Heinz Böckstiegel was its president.  Today it's led by Klaus Peter Berger.

How international is it?

It's steadily become more so. In 2009 it embarked on a campaign to  get expat German lawyers to promote it (this included the "DIS IberoAmericana project", intended to promote Germany as a venue for Latin American arbitrations being conducted in Spanish and Portuguese. More recently it appointed its first non-German  secretary general, Italian Francesca Mazza, in part for her international experience.

As for statistics, the latest show foreign parties participating in around 31 per cent of cases in recent years.  The biggest non-German users are Swiss, Russian and Luxembourgish parties, though Chinese, Italian and Spanish parties all appeared in multiple cases recently.

Are there any complaints?

The worst that anyone has to say about the DIS is that it's a little behind the times. The current rules date from 1998, which is old by current standards. During the last round of major rule revisions (around 2010–2012) the DIS decided to sit out and see what others such as the LCIA and ICC did. Having done that, fresh DIS rules are now in the pipeline. So it may be up to date again soon.

What about German arbitrators – are they everyone's cup of tea?

German arbitrators are German lawyers, first and foremost, and so trained in a certain way. The result has been termed the "German approach to arbitration", which includes, among other things, an unprompted provisional view of the merits of the case delivered at the start of the hearing, plus a tendency to select gatekeeper issues to be decided at the outset of the case. It's true that this isn't everyone's cup of tea. But the better arbitrators realise that and will ask international parties if that's what they want at the outset of a case.

What's the secretariat like?

Users compare the reliability and responsiveness of the DIS case managers favourably with the ICC, while at the same time noting that arbitrator fees are lower and turnaround quicker than in Paris. The secretariat is 11-members strong and led by recent appointee Francesca Mazza, who users seem to love.

How quick is it?

The average dispute duration, from filing to award, is around 14 months according to users.

What kind of disputes does it see?

Post-M&A and corporate cases, in particular shareholder disputes, are a big element and users like the centre's supplementary rules for corporate claims, which came into force in 2009. Sport is another key sector for DIS disputes.

How busy is it?

It registered  112 new cases in 2015. Numbers have been falling steadily since its highpoint in 2011, when 174 new cases were brought.

And case value?

Just over €2 billion – down from previous highs of nearly €4 billion in 2011 but up from 2012's €940 million. A significant portion of 2015's total was accounted for by a single €845 million case.

Any other pitfalls?

The only consistent recommendation one hears is that the centre keep trying to build its international presence, perhaps by offering more services in non-European languages.

THE ARBITRATION INSTITUTE OF THE FINLAND CHAMBER OF COMMERCE (FCC)

Why's it on the white list?

It's a venerable organisation that's built a local following for itself and is now seeking to position itself for more international work.

How old?

The first arbitral rules of the FCC were adopted in 1910. The institution was founded the following year.

How busy is it?

It had 52 new requests in 2015, a dip on previous years – most years the cases number in the 60s. Four in five were brought under the centre's rules.

How many of those are international?

Just over a quarter: 14. South Koreans were the most numerous non-Finnish parties, followed by German, Swedish and US parties.

What are the rules like?

The centre's adopted its current rules in 2013. It also has a set of expedited rules, and guidelines on the use of secretaries from the same year.

What are its strengths?

The centre is regarded as very efficient. On average, cases get turned around in eight months, or three months under the expedited procedure rules. That's a process of ongoing improvement – it has brought the average down from 11 months in 2009. And the majority of cases (77 per cent in 2014) are heard by sole arbitrators, not tribunals.

Are there any negatives?

Some think too many ex-judges get appointed there, at the expense of more commercial folk. The current rules, though, have given the centre greater power to reject proposals, and this may steer things in a better direction.

Is the centre seeking to become more international?

It clearly is. There's now a rule in place that it must have international lawyers on its board, leading to the addition of individuals from UK, Switzerland, France, Belgium, Sweden, Estonia and Russia (among them Gabrielle Nater-Bass, Christopher Seppälä and Sophie Lamb). Since the internationals have arrived, it appears more young lawyers and more non-locals are receiving appointments. The centre is also running its own regular arbitration day. It's also attempting to draw attention to gender diversity: for the first time in 2015 it published the percentage of female arbitrators appointed by the centre itself (32 per cent).

Who's in charge?

Mika Savola of Hannes Snellman is the chair. Marko Hentunen and Petra Kiurunen are vice chairs.

NETHERLANDS ARBITRATION INSTITUTE (NAI)

Why's it worth a closer look?

It's a long-established (1949) and well-thought-of general provider in a country where the arbitral environment has been shaped by the presence of the Permanent Court of Arbitration and the United States-Iran Claims Tribunal.

The presence of those state level bodies has helped to foster respect for arbitration – including supportive state courts. In fact arbitration is so well established that the NAI isn't even the largest institution in the country; that's the Utrecht De Raad van Arbitrage voor de Bouw, which handles construction disputes.

How international is the NAI?

It's fair to say that the NAI hasn't sought international work, viewing it at one point as a management distraction.

Even so  it heard 24 international cases last year, which is around a quarter of the total.

Is it seeking to become more international?

The 300-strong arbitrator pool is still overwhelmingly Dutch.

How up-to-date are the rules?

The current version came into effect in 2015, at the same time as the new Dutch Arbitration Act.

Do they contain any surprises?

Not really. The big change was a move to party autonomy when picking arbitrators. Previously appointments were made using a list procedure. In theory this switch should make it easier to appoint more internationals, but in practice there are still some obstacles. It also provides for the first time that tribunals cannot apply amiable compositeur reasoning in their decision-making unless specifically permitted by the parties. The provision only applies to disputes arising out of arbitration clauses dating from after the rules came into force on 1 January 2015 – a detail which the centre says some arbitrators have been losing sight of.

What are these obstacles to appointing internationals?

Each arbitration taking place in the country, regardless of party nationality, is subject to the Dutch Arbitration Act, which is pretty liberal, but has some quirks. The main one is the concept of summary arbitral proceedings – which is more or less uniquely Dutch. So literacy in the nuances of Dutch arbitration law is probably a must on a difficult case. It's debatable how many international names have that skillset.

How efficient is the centre at the moment?

Just under 30 per cent of 2015's registered cases were concluded in the same year.

THE ARBITRATION INSTITUTE OF THE STOCKHOLM CHAMBER OF COMMERCE (SCC)

Why's it white-listed?

The SCC and its staff "just know what they are doing", to quote one source – and that includes expertise on international cases.

How did it reach that point?

Well, it's been running for nearly 100 years (established in 1917). During that time Swedish business came to prefer arbitrating in private to public courts. So the SCC is not only old, but vastly experienced. And then a twist of fate propelled it towards international work.

What happened?

In the 1970s the US and the Soviet Union needed somewhere to resolve trading disputes (a surprisingly large amount to those unfamiliar with the realities of the Cold War). The Soviets rejected the ICC and suggested Stockholm instead. The US side accepted it after learning that Swedes were much more likely to speak English than Russian, and reasoning that this gave them a potential upper hand (source: Gerald Aksen's recent lunch speech at GAR Live New York). From then on the SCC became the go-to place for East–West disputes.

Do East-West disputes still exist?

Not in the same sense, but the SCC still makes much of its ability to handle matters with the same dynamic – where, say, a US business is doing deals with partners from China, Africa or the Middle East.

How busy is it?

In 2015 181 new cases came through the door. It's a bit down from a high in 2013 of 203, but it hasn't dropped below 170 in a decade.

What kinds of cases?

Traditionally it's service and supply agreement cases, which, along with business acquisition matters, were the busiest areas in 2015.

It has also benefited from more investment treaties naming it as an acceptable case administrator – it took in 11 investment treaty cases last year.

How many treaties?

According to the centre's statistics, 60 investment treaties provide for arbitration under the SCC rules, while 61 treaties list the SCC as an appointing authority and 13 list Stockholm as the seat of arbitration.

How international is it?

The board is impressively diverse and it does receive plenty of international cases – unusually for an ostensiby "regional"institution, they outnumbered their domestic cases by three to two last year. From the international point of view, some would like to see it go even further than it already has done to attract cases – for example, bringing more arbitrators in from outside Sweden, and using younger arbitrators. On the other hand, steps are under way that may accomplish that wish.

What's it doing?

New rules, currently in preparation, are expected to include features not seen elsewhere. It won't be the first time that the SCC has taken on the role of pioneer. In 2010 it became the first centre to offer emergency arbitrator help (including on investment cases – something the ICC, but not ICSID, has copied). It is also one of the only centres to have success getting parties to use its expedited rules for smaller cases.

What about case values?

These are high. The official top 10 of its highest-value disputes range from €1.3 billion to €13 billion, though, anecdotally, claims administered by the SCC (though not necessarily under the centre's rules) have recently reached almost twice that amount.

Are there any other reasons to seek it out?

It's cheap and turns cases around impressively fast when compared with either the ICC or the LCIA. Its "brand" can also help to get awards enforced in difficult jurisdictions such as Russia and China.

Why is it so quick?

SCC case administration is noted for its "light touch". The rules don't require any terms of reference and contain no formal procedure for scrutiny of awards. That, of course, puts a heavy burden on the arbitrators, who have to police their own quality. But the SCC board helps out here by taking an unusually active interest at the appointment phase.

Who runs the show?

The current secretary general is Annette Magnusson, who's emerging as something of a thought leader and all-round star. (See her recent speech at GAR Live Stockholm for example.) She's supported by an eight-member, full-time secretariat. They can work in English, Swedish, Russian, French and German.

When will the new SCC rules be out?

They're expected in 2017. Some initial proposals are already in circulation, and the centre held a consultation event in June.

SWISS CHAMBERS' ARBITRATION INSTITUTION (SWISS RULES)

Is it a set of rules or a centre?

It's both: it's a set of rules, but the rules don't belong to any one organisation. Rather they're applied by many. In the 1990s, a consensus formed that Switzerland would be easier to promote, internationally, if it had a single arbitration service as the focal point. But local chambers of commerce were an obstacle. They stood to lose out, since they all administered international cases.

The solution was "the Swiss model": a common set of rules, administered by all chambers of commerce. The Swiss arbitration institution itself is a marketing and management layer that has grown up to maintain the rules and promote their use internationally.

The Swiss rules came into force in 2004, and were revised in 2007 and 2012.

Is Switzerland still a popular seat?

Very much so. Geneva is the ICC's third most popular, behind Paris and London. Swiss law remains highly favourable to arbitration. In particular, appeals (allowed only on the narrowest of grounds) must be lodged with the Supreme Court, which then undertakes to turn its decisions around fast.  And the Swiss Rules have definitely boosted it further. It is possible to seat a Swiss Rules arbitration outside of Switzerland, though – around 2 per cent of its cases have had a non-Swiss seat.

How many cases per year take place under the rules?

 In 2015, 89 per cent of parties were non-Swiss, a figure that hasn't dropped below 70 per cent in the rules' history. The most recent statistics saw new filings, at 105, bounce back dramatically from 2013, when they had hit a five-year low of 68.

How international is this system?

It's very hard to critique the Swiss approach for not being international. The institution  offers arbitration in English (its most-used language) but is equally competent in German, French and Italian, and has also administered cases in Spanish. The rules are now available in 13 languages, including Arabic and Chinese.

What kind of cases does it handle?

Purchase and sale of goods has been the busiest over the institution's history, and were among the most frequent cases of 2015. The average amount at stake was around 10 million Swiss francs. Most cases fall around the 100,000–10 million franc range, and last year it had around 1 billion francs total in dispute.

Last year, 43 per cent of all cases were conducted under the expedited procedure rules.

How fast are they?

Ordinary proceedings are pretty speedy – they take an average of 14 months according to recent stats. There's an expedited procedure too – which takes an average of seven months from filing to award.

What are the case figures?

In 2015 they had 100 cases, 89 of which were international and involved parties from 49 different countries. Just under a third of their cases are sale of goods disputes, but corporate disputes, service agreements and agency disputes are also significant areas. The SCAI says the average amount at stake in one of their cases is around US$15.5 million, but the biggest they've ever done was worth US$1.62 billion.

How up-to-date are the rules?

The current set were adopted in 2012, so they're not the most up-to-date, although they were quite forward-thinking at the time. The focus in the 2012 update was on speeding up proceedings. That saw deadlines for arbitrator challenges and deposit payments cut to 15 days, and various steps with the expedited procedures  to ensure the tribunal can get things moving on the very first day. The rules also allow obstructive parties to be hit with costs.

Does it have an emergency arbitrator procedure?

It does. And the centre duly got its first emergency filing in February 2014. The decision was handed down within seven days. It had another three emergency filings last year.

Does it offer any other service?

Since 2014 the centre has been able to act as an appointing authority in ad hoc cases.

Anything else to be aware of?

If you're an arbitrator you are now required to report the time that has elapsed since the original filing when submitting their draft awards, to help calculate fees.

How is it structured?

Caroline Ming is now the director general and general counsel, having replaced Rainer Füeg (now retired). Philipp Habegger is the overall chairman. The secretariat has one representative in each member-chamber throughout the country. The secretariat added three counsel in 2015–2016.

Vienna International Arbitration Centre (VIAC)

Why's it on the white list?

VIAC's a more than credible option, especially for disputes with a connection to Germany or Central Europe. Its administration is very effective and it benefits from excellent transport connections around Eastern Europe.

How busy is it?

 It had 40 cases last year, down from 56 in the two years previously. It had 55 cases on foot at the end of 2015.

What's happened recently?

The VIAC rules were selected for the Vis Moot competition in 2016. The centre also released new mediation rules.

Who runs it?

The most important figure is probably deputy secretary general Alice Fremuth-Wolf. She arrived in 2012, and VIAC has been on an upwards track ever since. She has the support of both the centre's board (headed by Anton Baier) and a 21-member international advisory board with practitioners from most significant centres of arbitration around the world.