The ICC Court’s Guidance Note published on 9 April 2020 is a welcome attempt to encourage arbitral tribunals and parties to find ways to continue with their proceedings despite the current disruption caused by the COVID-19 pandemic.
The first part of the Guidance Note:
a. points out that the ICC Court remains fully open for business (subject to being able to receive communications only electronically);
b. encourages arbitral tribunals and parties to find innovative ways (as well as using existing ones, including the case management techniques provided by Article 24(1) and Appendix IV to the ICC Rules) to reduce delay;
c. encourages arbitral tribunals and parties to sign Terms of Reference electronically; and
d. addresses the question of how to notify awards in the current circumstances (in particular, the notification in electronic form subject to the parties’ agreement and subject to any applicable mandatory laws).
The second part of the Guidance Note then deals with a particularly interesting and difficult question currently faced by arbitration practitioners: whether and (if so) how to hold virtual hearings (i.e., hearings where the arbitral tribunal and parties are not actually present. In this respect, the Guidance Note identifies three different scenarios:
1. The parties agree or the arbitral tribunal determines that a physical hearing is indispensable yet impossible in current circumstances. In such a case, the Guidance Note encourages the parties and the arbitral tribunal to find an early alternative date and to consider advancing at least part of the case without the need for a physical hearing.
2. The parties agree or the arbitral tribunal determines that a physical hearing is indispensable and is possible despite the current circumstances. In such a case, the Guidance Note reminds the parties and the arbitral tribunal of the importance of taking appropriate sanitary measures to protect all participants.
3. The parties agree or the arbitral tribunal determines to proceed with a virtual hearing. In such a case:
a. The Guidance Note reminds the arbitral tribunal that Article 22(2) of the ICC Rules allows it to “adopt such procedural measures as it considers appropriate, provided that they are not contrary to any agreement of the parties.” In other words, although the Guidance Note does not explicitly say so, it appears to discourage arbitral tribunals from imposing a virtual hearing where the parties are agreed that there should not be one. In addition, the Guidance Note reminds arbitral tribunals that any decision to proceed with a virtual hearing without party agreement or over party objection should be reasoned, taking into account the arbitral tribunal’s duty to make every effort to ensure that the award is enforceable at law pursuant to Article 42 of the ICC Rules.
b. The Guidance Note addresses Article 25(2) of the ICC Rules, which provides (in English) that the tribunal “shall hear the parties together in person if any of them so requests.” Significantly, the Guidance Note concludes (particularly in light of the French version of that provision) that Article 25(2) does not give a party the right to insist on a physical hearing.
c. The Guidance Note provides (i) a checklist, (ii) suggested clauses for “cyber-protocols” and (iii) suggested procedural orders for the organization of virtual hearings.
While the checklist, suggested clauses for cyber-protocols and suggested procedural orders are helpful in identifying (and trying to find ways to avoid) certain pitfalls that may lay in waiting for arbitral tribunals and parties choosing to proceed with virtual hearings (in particular pitfalls relating to data protection, confidentiality and cybersecurity), it may perhaps have the undesirable effect of putting parties who might otherwise have opted for virtual hearings off from doing so. We would hope that this will not be the case, and that the guidelines will instead encourage arbitral tribunals and parties to retain specialist service-providers who will help them avoid the pitfalls of virtual hearings, thus allowing them to focus on the issues of the dispute at stake.
Should you have any questions, please feel free to contact us:
Jacob Grierson, Partner
Tel: +33 (0)1 79 35 64 12
Thomas Granier, Of Counsel
Tel: +33 (0)1 79 35 64 15