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Editorial

The New ICC Arbitration Rules

As of 1 March 2017, the new Arbitration Rules of the International Chamber of Commerce (“New ICC Rules”) have come into effect and superseded the former version of the ICC arbitration rules, which have been in effect since 2012.

What the New ICC Rules Bring

Expedited Procedure

The most significant change introduced by the New ICC Rules is the Expedited Procedure. By this new procedure, disputes with relatively lower value will be resolved quickly and cost-efficiently.

The Expedited Procedure shall automatically apply to arbitration agreements concluded after 1 March 2017 where the amount in claim is less than US$ 2 million, but the parties have the right to opt out. The Parties may also opt in the Expedited Procedure even if the arbitration agreement is concluded before 1 March 2017 and/or the amount in claim is more than US$ 2 million, unless the ICC Court determines that it is inappropriate to apply the Expedited Procedure in the specific case at hand.

Some important features of the Expedited Procedure are as follows:

  • The ICC Court may, notwithstanding any contrary provision of the arbitration agreement, appoint a sole arbitrator.
  • Article 23 of the New ICC Rules regarding the Terms of Reference shall not apply to an arbitration under the Expedited Procedure.
  • After the arbitral tribunal has been constituted, no party shall make new claims, unless it has been authorized to do so by the arbitral tribunal.
  • 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 arbitral tribunal have discretion to adopt procedural measures as it considers appropriate.
  • The arbitral tribunal may decide the dispute solely on the basis of the documents submitted by the parties, with no hearing and no examination of witnesses or experts. When a hearing is to be held, the arbitral tribunal may conduct it by videoconference, telephone or similar means of communication.
  • The arbitral tribunal must render its final award within 6 months from the date of the case management conference.
  • The fees of the arbitral tribunal shall be fixed according to the scales of administrative expenses and arbitrator’s fees for the expedited procedure set out in Appendix III of the New ICC Rules.

Communication of Reasoned Decisions

The former version of ICC arbitration rules did not allow the ICC Court to communicate to the parties the reasons for decisions as to the appointment, confirmation, challenge or replacement of an arbitrator, without the consent of both parties to the dispute. The New ICC Rules, however, authorize the ICC Court to communicate the reasons for such decisions, which is a positive step for increasing the transparency of arbitration procedures.

Reduction of the Time Limit

Under the New ICC Rules, the arbitral tribunal shall send the terms of reference signed by it and the parties to the ICC Court within 30 days of the date on which the file has been transmitted to it. This time limit was 2 months under the previous rules.

Fees and Advance on Costs

The fee scales for administrative expenses and arbitrator’s fees have been revised to be effective from 1 January 2017.

According to the New ICC Rules, each request to commence an arbitration must be accompanied by a filing fee of US$ 5,000, which was US$ 3,000 under the former rules.

Concluding Remarks

The novelties brought by the New ICC Rules are expected to increase the efficiency and transparency of the arbitrations while reducing the costs, which are certainly positive steps for especially disputes with a lower claim amount. On the other hand, the parties should now pay more attention in drafting arbitration clauses, as the Expedited Procedure rules apply automatically in some cases unless the parties opt out in their agreements.

Full text of the New ICC Rules is available here.

This information is provided for your convenience and does not constitute legal advice. It is prepared for the general information of our clients and other interested persons. This should not be acted upon in any specific situation without appropriate legal advice. This information is protected by copyright and may not be reproduced or translated without the prior written permission of Ergün Avukatlık Bürosu (www.cergun.av.tr).

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