The results of a major new survey on international arbitration, conducted by the School of International Arbitration at Queen Mary, University of London (QMUL) and sponsored by global law firm White & Case LLP, were launched last night at an event in Dublin during the International Bar Association's Annual Conference.
Titled 'Current and Preferred Practices in the Arbitral Process,' the survey "examines the extent to which harmonized practices are emerging in international arbitration and whether they reflect the preferred practices of the international arbitration community," said Paul Friedland, partner and global head of White & Case's International Arbitration Practice. The survey drew a record 710 questionnaire responses and 104 interviews – more than a five-fold increase from the previous survey.
"For the very first time, the closed doors of international arbitration – a private dispute resolution mechanism – have been opened up for the world to look behind. We now know which practices in the arbitral process are most common around the world and which are preferred, and by identifying the gaps between the current and preferred practices we can help shape the direction of international arbitration. The sheer number of this year's questionnaire respondents and interviewees makes this survey the most comprehensive empirical study ever conducted in the field of international arbitration," said Dr. Stavros Brekoulakis, senior lecturer in International Dispute Resolution at QMUL.
Key findings of the survey include:
- Selection of arbitrators: A significant majority of respondents (76%) prefer selection of the two co-arbitrators in a three-member tribunal by each party unilaterally. This shows that the arbitration community generally disapproves of the recent proposal calling for an end to unilateral party appointments.
- Organising arbitral proceedings: The IBA Rules on the Taking of Evidence in International Arbitration ("IBA Rules") are used in 60% of arbitrations: in 53% as guidelines and in 7% as binding rules. Interviewees explained that they prefer adopting the IBA Rules as guidelines as it provides for more flexibility.
- Document production: Notwithstanding the differing traditional approaches to document production in civil and common law systems, the survey reveals that 70% of respondents believe that Article 3 of the IBA Rules (documents 'relevant to the case and material to its outcome') should be the applicable standard for document production in international arbitration.
- Fact and expert witnesses: While cross-examination is sometimes criticised as an ineffective common law procedure, the survey reveals that there is very strong support for the use of cross-examination in international arbitration to test witness evidence. The vast majority of respondents believe that cross-examination is either always or usually an effective form of testing fact witnesses (90%) and expert witnesses (86%).
- Pleadings and hearings: Substantive written submissions are generally exchanged by the parties either sequentially or simultaneously. The survey reveals not only that sequential exchange of substantive written submissions occurs much more regularly (82%) than simultaneous exchange (18%), but also that there is a strong preference for this type of exchange (79%).
- The arbitral award: How long should a tribunal take to render an award? For sole arbitrators, two-thirds of respondents believe that the award should be rendered within 3 months after the close of proceedings. For three-member tribunals, over three-quarters of respondents (78%) believe that the award should either be rendered within 3 months (37%) or in 3 to 6 months (41%).
- Costs: Tribunals allocate costs according to the result in 80% of arbitrations, and leave parties to bear their own costs and half the arbitration costs in 20% of arbitrations. However, only 5% prefer this latter approach, which shows a desire for tribunals to allocate costs according to the result even more frequently than they are currently doing. An overwhelming majority of respondents (96%) believe that improper conduct by a party or its counsel during the proceedings should be taken into account by the tribunal when allocating costs.
"In a departure from previous surveys, views were sought not only from in-house counsel, but also from private practitioners and arbitrators. This provided a pool of respondents which was both highly knowledgeable of international arbitration and dramatically larger than earlier surveys. This critical mass of participants provided authoritative empirical evidence as to what actually occurs in international arbitration, and also enabled us to go further than previous surveys by breaking down the results by categories of respondents, whether by different geographic regions, legal backgrounds or roles," said Ank Santens, partner in White & Case's International Arbitration Practice.
"The survey should act as a reference point for the international arbitration community for years to come – not least when arguing points of procedure before arbitrators," said Paul Friedland.
This year's survey, the second sponsored by White & Case LLP, was conducted over an eight month period from January to August 2012 by Mr. Jure Zrilic, LLB, LLM (cum laude), White & Case Research Fellow in International Arbitration.
About the School of International Arbitration
The School of International Arbitration was established in 1985 as part of the Centre for Commercial Studies to promote advanced teaching and research in the law and practice affecting international arbitration. Today the School is widely acknowledged as the leading teaching and research centre on international arbitration in the world. Almost all its courses are at post-graduate level. In its 27 year existence, the School has had over 2,000 students from more than 80 countries all over the world.
About Queen Mary, University of London
Queen Mary, University of London is one of the UK's leading research-focused higher education institutions with some 16,900 undergraduate and postgraduate students. Queen Mary's 3,800 staff deliver world class degree programmes and research across 21 academic departments and institutes, within three sectors: Science and Engineering; Humanities, Social Sciences and Laws; and Medicine and Dentistry. Queen Mary is ranked 11th in the UK according to The Guardian analysis of the 2011 Research Assessment Exercise, and has been described as 'the biggest star among the research-intensive institutions' by The Times Higher Education. The Queen Mary School of Law is ranked fourth in the UK in The Guardian's 2012 University Guide and has consistently been ranked in the top 10 in the UK for research.
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