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New 2021 ICC Arbitration Rules – Main Changes

The International Chamber of Commerce ("ICC") has launched its revised arbitration rules for 2021. The 2021 Arbitration Rules came into effect on 1 January 2021 and will apply to all disputes submitted to the ICC thereafter.

While most of the changes are minor in comparison with its 2017 Arbitration Rules, the 2021 Rules contain a number of new provisions and modifications which purport to provide greater efficiency, flexibility and transparency, namely on what concerns:

  • The constitution of the arbitral tribunal (Articles 12 and 13)

The addition of paragraph 9 to Article 12 provides that the ICC Court may now appoint each member of the arbitral tribunal in exceptional circumstances, to avoid a significant risk of unequal treatment or unfairness which may affect the validity of the award, "notwithstanding any agreement by the parties". This addition has been considered somewhat controversial inasmuch as doubts arise as to what the ICC Court will deem as an "exceptional circumstance" for this purpose.

In order to ensure the neutrality of the tribunal in cases involving public interest, the addition of paragraph 6 to Article 13 now provides that in treaty-based arbitrations, and unless the parties agreed otherwise, arbitrators shall not have the same nationality as any of the parties.

  • Disclosure duties regarding Third Party Funding (Article 11)

In order to ensure greater transparency, and pursuant to the addition of paragraph 7 to Article 11, parties must now disclose the existence and identity of any non-party which has "an economic interest in the outcome of the arbitration", i.e., any third-party funder.

  • Conflict of interests (Article 17)

In an effort to prevent the use of dilatory tactics, the addition of paragraph 1 to Article 17 provides that the parties must now inform the Secretariat, the arbitral tribunal and the other parties of any changes in its representation. The addition of paragraph 2 of the same provision is particularly relevant to legal counsels since the arbitral tribunal may now prevent new party representatives from partaking in the arbitration if a conflict arises between the new representative and one of the arbitrators.

  • Joinder and Consolidation (Articles 7 and 10)

One of the main changes concerns the joinder of additional parties: while under the 2017 Rules the joinder of an additional party after the arbitral tribunal was constituted demanded consent by all parties, the addition of paragraph 5 to Article 7 now grants the discretion to an arbitral tribunal to admit the joinder of additional parties without the agreement of all parties, considering the relevant circumstances such as (i) whether it has jurisdiction over the additional party, (ii) the additional party agrees to the tribunal as constituted as well as (iii) to the Terms of Reference.

According to the changes made to Article 10, the consolidation of claims is now allowed even if the parties are not the same, provided that the arbitration agreement is binding to all (indent b)), as well as where the arbitration agreements are not the same but yet are compatible, the parties are the same and the dispute arises in connection to the same legal relationship (indent c)).

  • Virtual Hearings and Paperless Filings (Article 26, Articles 3, 4 and 5)

In a year severely hit by a pandemic, the ICC has amended Article 26(1) providing expressly for the possibility of the arbitral tribunal to determine that a hearing will take place remotely, after consulting the parties and bearing in mind the relevant facts and circumstances of the case.

Amendments to Articles 3, 4 and 5 further remove the presumption that pleadings and written communications shall be sent in hard copy, providing that filings shall be made electronically with the ICC Secretariat.

  • Expedited Procedure Provisions (Article 1(2) of Appendix VI)

The update on the Expedited Procedure provisions has expanded its scope of application by increasing the threshold for the automatic application from the 2.000.000, 00 USD set in the 2017 Arbitration Rules to 3.000.000, 00 USD, unless the parties have expressly opted out (Article 30 and Appendix IV).

By elevating the threshold, the ICC aims at reducing costs while accelerating the procedure, since the administrative expenses and arbitrators' fees in Expedited Procedure Provisions are 25% cheaper than in regular cases.

You may consult the compared version of the ICC Arbitration Rules 2017 and 2021 here.

Authors

Manuela Costa
Manuela Costa
Associate
Lisbon
Carolina Apolo Roque
Carolina Apolo Roque
Associate
Lisbon