As is well known, Section 1782(a) provides that a “the district court of the district in which a person resides or is found may order him to give his testimony or statement or to produce a document or other thing for use in a proceeding in a foreign or international tribunal”.

The applicability of 28 U.S.C. § 1782 to international arbitration has generated an interesting debate, especially on this blog (see lastly G. Born’s post, L. Reed’s post, E. Triantafilou’s post, adde, Y. Lahlou, l’applicabilité de l’article 28 USC 1782 à l’arbitrage commercial international, Gaz. Pal., 2009-3). The debate is essentially concerned with the question whether an international arbitral tribunal constitutes a “foreign tribunal” for purposes of § 1782 (see the recent: In re Application of Chevron, 2010 WL 1801526, at *6 (S.D.N.Y. May 6, 2010 and Roger Alford’s blog). Conflicting solutions on this issue have been rendered in the United States (against the application of § 1782 to international arbitration see e.g.: National Broadcasting Co. Inc and NBC Europe v. Bear Steans & Co., Inc et al, 165 F.3d 184 (2d Cir. 1999); El Paso Corp. v. La Comision Ejecutiva Hidroelectrica del Rio Lempa No 08-20771, 2009 US App. Lexis 17596 (5th Cir. Aug. 6 2009); In re Arbitration in London, England, No. 09-C-3092, 2009 US Dist. Lexis 49827. For the application of § 1782 to international arbitration see e.g. In re Oxus Gold plc, MISC 06-82-GEB, 2007 WL 1037387 (D.N.J. April 2,2001), In re Roz Trading Ltd, 469 F. Supp. 2d 1226; In re Hallmark Capital Corp., 534 F Supp. 2d 951 (D. Minn. 2007), Comisión Ejecutiva, Hidroeléctrica del Río Lempa v. Nejapa Power Co., LLC, No. 08-135, 2008 WL 4809035, at *1 (D. Del. Oct. 14 2008).

A related, and somewhat minor question, has however attracted little interest, and that is whether costs incurred by the party to an arbitration procedure in court proceedings based on § 1782 (“the Discovery costs”) may be treated as costs of the arbitration and allocated by the arbitral tribunal. The question will be relevant to the parties since, as it is known, costs are not refunded to the prevailing party in the context of Discovery court proceedings in the United States.

The critical issue is whether the Arbitral Tribunal has jurisdiction to allocate Discovery costs as costs of the arbitration.
The first element of answer may be found in the arbitration agreement.
Proceedings related to a Discovery application in aid of the arbitration may well be considered as a dispute arising out or relating to the underlying contract. Hence, there should not be any difficulty to admit that, in principle, Discovery applications are related to the contract. As a consequence, a broadly formulated arbitration clause (such as a clause worded as follows “all disputes arising out of or in connection with the present contract shall be finally settled through arbitration by one or more arbitrators”) may well be construed as applying to Discovery costs. This is not the end of the story, however.

A first argument against the arbitral tribunal’s jurisdiction to apportion Discovery costs is that applications for Discovery in aid of the arbitration applications usually involve third parties in possession of the evidence sought. Such circumstance, however, should not be relevant as long as the parties in dispute in the arbitration are also parties to the Discovery court proceedings.
Another possible objection relates to the concept of “costs of the arbitration”.

In the context of UNCITRAL or institutional arbitration, it should be seen whether the applicable arbitration rules permit to treat such costs as costs of the arbitration.

It is for example doubtful that, under Article 38 of the 1976 UNCITRAL rules, Discovery costs can be treated as costs of the arbitration. Article 38 provides that “the term ‘costs’ includes only: (a) the fees of the arbitral tribunal to be stated separately as to each arbitrator and to be fixed by the tribunal itself in accordance with article 39; (b) the travel and other expenses incurred by the arbitrators; (c) the costs of expert advice and of other assistance required by the arbitral tribunal; (d) The travail and other expenses of witness to the extent such expenses are approved by the arbitral tribunal; (e) the costs for legal representation and assistance of the successful party if such costs were claimed during the arbitral proceedings, and only to the extent that the arbitral tribunal determines that the amount of such costs is reasonable; (f) Any fees and expenses of the appointing authority as well as the expenses of the Secretary-General of the Permanent Court of Arbitration at the Hague”.

The new 2010 UNCITRAL rules, however, include a new wording of § (e) below. The new Article 40 (e) of the Rules now provides that costs include “the legal and other costs incurred by the parties in relation to the arbitration to the extent that the arbitral tribunal determines that the amount of such costs is reasonable”. Arguably, Discovery costs are costs incurred “in relation to the arbitration”. As a consequence, Discovery costs would be treated as costs of the arbitration.

The ICC rules, with respect to costs, provide in Article 31(3) that “The final Award shall fix the costs of the arbitration and decide which of the parties shall bear them or in what proportion they shall be borne by the parties”. Article 31(1) also provides that the costs of the arbitration include the “reasonable legal and other costs incurred by the parties for the arbitration”. Such a provision does not seem to encompass costs incurred “in relation” to the arbitration. It is generally admitted, however, that arbitrators have wide discretion in apportioning costs. Whether such discretion could be used to allocate Discovery costs remains to be seen.
The LCIA rules confer to an arbitral tribunal the power to “order in its award that all or part of the legal or other costs incurred by a party be paid by another party” (Article 28.3). However, this provision seems to relate to the costs incurred in the arbitration, and would thus not apply to costs incurred in court proceedings. The ICDR rules refer in Article 31 to “the costs of arbitration”. Although the rules also provide for a non-exhaustive list of what “may” be included as such costs, , the concept of costs of arbitration is arguably not equivalent to that of costs incurred “in relation to” the arbitration. The same observation applies with respect to Article 38 of the Swiss Rules.

Another possible ground to recover Discovery costs could be as damages for breach of the arbitration agreement. It is unlikely that the lex arbitri would prevent a party from seeking Discovery in aid of the arbitration, but it may well be that the arbitral tribunal enjoined the party from doing so or from pursuing an application made without the tribunal’s leave.

A U.S. court has, in this respect, decided that § 1782 application suppose the consent of the arbitral tribunal (see In re Bacock Borsig AG, 583 F. Supp. 2d a 233 (D. Mass. 2008)). Such principle is healthy as Discovery applications – as they include leave to depose witnesses and suppose broad discovery – are likely to be inconsistent with the tribunal’s procedural directions. In such a scenario, an application made in disregard of the tribunal’s directions or order would constitute a breach of the arbitration agreement insofar as the arbitration agreement obliges the parties to cooperate in good faith to the proceedings. There should be no valid reason why such a breach could not give rise to damages.

Alexis Mourre/Alexandre Vagenheim

When it comes time to identify an arbitrator candidate, be it in the investor-state context or in an international commercial arbitration, there are many factors to consider. One such factor, however, that has been the focus of much attention recently by arbitration institutions, practitioners and commentators alike, is arbitrator availability. It is clearly a sore subject.

In August 2009 the ICC took a major step towards transparency with respect to arbitrators’ availability and workload. As a result of these measures, the ICC now requires ICC arbitrators to complete an ICC Arbitrator Statement of Acceptance, Availability and Independence listing their “currently pending” cases, and confirming their ability to devote the necessary amount of time to the arbitration and to conduct the process “diligently, efficiently and in accordance with the time limits in the Rules”.
While the ICC’s measures to increase transparency about arbitrator availability are certainly welcomed and commendable, they are only a first step. Aside from ascertaining the number of “currently pending” cases in which an arbitrator candidate is involved, either as tribunal chair, co-arbitrator or counsel, other objective data is relevant and ought to be available. This kind of data includes details about the calendar of an arbitrator candidate, and details about an arbitrator candidate’s record for award drafting in past cases.

Calendar of an Arbitrator Candidate. Arbitral institutions should not be afraid to ask an arbitrator candidate for a calendar of his/her professional responsibilities for the upcoming 12 – 18 months. We obviously do not mean a calendar with case (or personal) details, but rather a calendar showing dates blacked-out for existing commitments: hearings, deadlines for the drafting of awards and time blocked for drafting (particularly if the candidate is acting as tribunal chair), and responsibilities as counsel.

An Arbitrator Candidate’s Record on Awards. As we have said publicly before, why shouldn’t institutions – and parties – ask arbitrator candidates to indicate on their disclosure statements information, from past cases as arbitrator, about the length of time (i) from the final hearing to the close of the proceedings, and (ii) from the close of the proceedings to the issuance of the award. Arbitrators would, of course, be able to explain any particularly long delay, for instance, due to suspension of the proceedings by the parties for settlement purposes or illness of a tribunal member.

Although the number and type of arbitrations an arbitrator candidate has done is perhaps the most important piece of information for appointing parties and institutions, surely it would help those parties and institutions also to have information about the candidate’s availability – real availability – and pattern of award issuance. If the first type of objective date is required on disclosure statements, why not the second?

By Lucy Reed and Noiana Marigo

In 2007, the Russian Supreme Arbitrazh (State Commercial) Court in OAO NK Rosneft v. Yukos Capital S.a.r.l ruled that arbitrators must disclose their connection to the legal counsel of the other party at the time of their appointment. The facts of the case suggested that one of the arbitrators spoke at a conference organized and sponsored by the law firm representing Yukos Capital S.a.r.l. in the arbitral proceedings.

Russian law stipulates that an arbitrator must disclose any circumstances which may give rise to justifiable doubts as to his impartiality or independence. Based on such disclosure, a party to the arbitration may decide whether to challenge the arbitrator. The arbitrator’s failure to provide such information at the time of his appointment may serve as grounds for appealing an arbitral award in the future.

Departing from the law and the facts of the case, the court set aside the arbitral award. However, the court did not explicitly rule whether the participation in the conferences may per se speak for the partiality of the arbitrators. This led to a vivid discussion regarding whether the arbitrators are biased if they appear at academic events organized and sponsored by the opposite party’s counsel (law firm).

There was no subsequent case law regarding this matter until the Court of Cassation of the Moscow Federal Circuit recently rejected the claim of the partiality of an arbitrator based on a similar set of facts. In Erick van Egeraat Associated Architects B.V. (Netherlands) v Capital Croup LLC (Russia) (Case No. А40-51596/09-68-437), Capital Group LLC alleged that a co-arbitrator once spoke at a conference organized and sponsored by the law firm of the opposite party’s counsel. In addition, Capital Group LLC reported that the counsel representing Erick van Egeraat also spoke at the same conference.

The court rejected Capital Group LLC’s claim and based its ruling on two specific arguments. Firstly, it was established that the law firm acted only as a so-called ‘information sponsor’ (promoting the conference among its clients and partners) and certainly had no influence on either the program of the conference or on the speakers’ list. Secondly, the participation of the co-arbitrator in the conference did not create any dependence or commercial interest with the counsel (law firm). Therefore, the arbitrator fulfilled the impartiality criteria set forth by international laws and the SCC Arbitration Rules.

The decision of the Court of Cassation of the Moscow Federal Circuit is timely and welcomed as it brings some clarity to the issues of arbitrators’ impartiality.

Russian courts adopted the position that an arbitrator’s involvement in academic events must be made known to the other party, otherwise this is a ground for setting aside awards. Yet, the courts did not answer the main question of whether the mere participation in a conference biases an arbitrator.

The recent decision illustrates that the impartiality test is based on establishing whether or not any interaction creates dependence or commercial interest between the counsel (law firm) and the arbitrator. Therefore, it is at the court’s discretion whether or not to define in each individual case whether any form of sponsorship may speak for an arbitrator’s partiality. In this particular case, the court ruled that ‘information sponsorship’ does not create any special relationship between the counsel (law firm) and arbitrator.

Furthermore, the court held that the fact that the arbitrator and counsel spoke at the same conference does not necessarily lead to the partiality of the arbitrator.

The court also underlined another important aspect in that the standards of impartiality should also be found in the applicable arbitration rules. In our opinion, any relevant guidelines by arbitration institutes on the impartiality of arbitrators would be of a significant value in cases concerning setting aside awards or in enforcement procedures in Russia.

United States Code Title 28 Section 1782(a) is well-known to practitioners who have participated in international arbitral proceedings involving U.S. parties. The provision governs the judicial assistance U.S. federal courts can provide in foreign discovery. It states, in relevant part, that federal trial courts “of the district in which a person resides or is found may order him to give his testimony or statement or to produce a document or other thing for use in a proceeding in a foreign or international tribunal….” The court may issue the order “pursuant to a letter rogatory issued, or request made, by a foreign or international tribunal, or upon the application of any interested person….”

In a recent decision, the U.S. District Court for the Northern District of Illinois ruled that a “private” international arbitration tribunal was not entitled to judicial assistance under Section 1782 because it is not a “foreign or international tribunal.” An appeal from that decision is pending before the U.S. Court of Appeals for the 7th Circuit. As Lucy Reed noted in a previous post, U.S. court rulings are inconsistent on the eligibility of international tribunals for discovery assistance under the statute. An affirmation of the District Court’s decision may lend support to the view that only certain tribunals are eligible for such assistance, and affect the choice of forum by parties to international arbitration.

Specifically, in In re Arbitration in London, England between Norfolk Southern Corp. et al. and Ace Bermuda Ltd., (“Norfolk”) one of the parties to an ICC arbitration filed a motion under Section 1782 with the U.S. District Court for the Northern District of Illinois, asking the court to order the deposition of the other party’s former counsel. The court reviewed the motion against the backdrop of the most recent, and leading, U.S. Supreme Court case on Section 1782(a), Intel v. Advanced Micro Devices, 542 U.S. 241 (2004) (“Intel”).

Notably, the Supreme Court in Intel did not address directly the question of whether private arbitral tribunals fall within Section 1782. As the Norfolk court recognized, however, in the wake of Intel, most federal courts in the United States have adopted a liberal interpretation of “foreign or international tribunal,” and have considered private arbitral tribunals as such. Still, the Norfolk court sought to curb the scope of 1782 by reading certain limitations into the statute, and by drawing a distinction between the “foreign tribunal” in Intel (European Commission Directorate General-Competition) and the tribunal in the case before it (International Chamber of Commerce arbitral tribunal).

According to the Norfolk court, Section 1782 covers only “state-sponsored” arbitration. To illustrate the meaning of that term, the court noted that “a reasoned distinction can be made between arbitrations such as those conducted by UNCITRAL … and purely private arbitrations established by private contract.” The distinction, according to the court, is that UNCITRAL is “a body operating under the United Nations and established by its member states.” This is sufficient to render UNCITRAL arbitration “state-sponsored,” and therefore within the purview of the statute. Furthermore, Norfolk found that the Supreme Court in Intel had “emphasized” the availability of judicial review as a factor in determining whether the administrative agency before it was a “foreign or international tribunal.” Since judicial review of private arbitral awards is very limited, the court reasoned that private arbitral tribunals are not contemplated by Section 1782.

Whatever its merits, if upheld, this ruling could affect the choice of forum by arbitration parties planning to obtain evidence or witness testimony from the United States. To ensure the availability of Section 1782 discovery, such parties might seek actively to arbitrate under the auspices of “state-sponsored” organizations— although further clarification likely will be necessary as to the meaning of “state-sponsored” in light of the Norfolk court’s example regarding UNCITRAL. As its mandate suggests, UNCITRAL is a UN administrative body, not a government-founded forum for the resolution of disputes in the mold of, say, ICSID or the Permanent Court of Arbitration. This leaves open to question, among others, whether the court in Norfolk meant that the mere use of arbitral rules established by any state-founded or -affiliated institution, legislative/administrative body, or arbitral forum, extends the “state sponsorship” mantle over the entire arbitration for purposes of Section 1782.

The Norfolk ruling also touches upon a public policy debate regarding the grounds for, and the desirability of, Section 1782 discovery in private international arbitral proceedings. This debate likely will influence the decision of the 7th Circuit, before which the issue is now pending. For its part, the court in Norfolk appears focused on the notion, which finds some support in the origins of Section 1782, that discovery under the statute is meant as a discretionary act of comity by the United States judiciary towards other jurisdictions. Such jurisdictions can be national or supra-national (e.g. European Union, United Nations), but they must be based on the exercise or relegation of sovereign authority. Jurisdiction by purely private fiat (e.g. private contract) is not entitled to the statutory benefits of Section 1782.

In further support of rendering Section 1782 unavailable to parties in private arbitration, other U.S. courts have raised the potentially adverse impact of U.S.-style discovery on the arbitration parties’ choice of procedural rules, including limited discovery. If Section 1782 were to be used indiscriminately in private arbitration, it could serve as an end run around mutually agreed discovery limitations. Moreover, by violating party autonomy, broad discovery under Section 1782 can be disruptive and burdensome, thereby undermining the very assistance it is meant to provide.

Finally, the liberal use of Section 1782 could end up inundating U.S. courts with discovery requests. International arbitration is still expanding at a high rate, with the strong support of several legal systems, including in the United States. A commensurately increasing number of requests for production of evidence under Section 1782 eventually may cause U.S courts to shoulder a significant logistical burden—a result that pro-arbitration policies generally aim to avoid.

The above arguments illustrate one side of the issue—and do not necessarily carry the day. Despite its emphasis on “state-sponsored” proceedings, Norfolk did not elaborate sufficiently on which proceedings may qualify as “state-sponsored” (perhaps deferring to the judgment of the Court of Appeals). Nor did the court address the argument that private international arbitration is also in a sense “state-sponsored” through the numerous national laws that support it, and the enforcement of arbitral awards by national courts.

Moreover, arguments concerning the potential for abuse of Section 1782 seem to underestimate the abilities of U.S. judges, who possess wide latitude to limit requests under the statute; and the astuteness of arbitrators, who can decipher which evidence to admit and/or to consider. As for the criticism that a widely construed Section 1782 would “open the floodgates” of discovery requests, it requires further empirical substantiation, and ignores the fact that U.S. courts receive such requests routinely from parties before them. Increased access to discovery in arbitration might simply encourage parties keen on broad discovery to pursue arbitration and to rely on the courts merely for discovery requests—thereby decreasing, rather than increasing, the courts’ overall costs. At any rate, the debate over logistical costs may be more relevant in the context of future congressional debates on the statute (which Norfolk may instigate), and not of court judgments that must interpret the statute as currently worded.

Finally, perhaps the strongest argument in favor of using Section 1782 in all arbitrations is that it allows parties to avail themselves of the U.S. federal court system—one of the most open and transparent in the world—to gather the best evidence possible for their case. So long as the parties behave responsibly, U.S. courts exercise their discretion prudently, and arbitral tribunals supervise the process, Section 1782 can be a tool for the fair, effective, and swift resolution of arbitral disputes.

In conclusion, five years after the Supreme Court’s decision in Intel, certain important issues remain unsettled with respect to Section 1782. In attempting to resolve one of these issues, the court in Norfolk issued a decision with significant implications for parties to arbitration. Pending the 7th Circuit’s opinion, the question remains: should Section 1782 be available to private international tribunals, and if not, what connection should such tribunals have with “state-sponsored” proceedings to avail themselves of the statute?

The already much debated Paris Court of appeal judgment in Tecnimont, rendered on 12 February 2009, has put into light the dangers arising from the lack of uniformity in the field of conflict disclosure. The Paris Court of appeal has quashed a partial award because the chairman of the arbitral tribunal, a well-known international arbitrator who is part of one of the world’s largest law firms, had failed to disclose circumstances that did not exist at the time of his appointment and which he subsequently had not been aware of. No one in the arbitration community can seriously doubt of the total impartiality of that arbitrator. Yet, the award has been annulled, with the consequence of throwing in the garbage a carefully drafted 400 pages award, years of efforts and millions of Dollars in legal costs. Such an outcome would seem absurd, however, the reverse situation would have been equally questionable, leading to admit that an arbitrator can at the same time be judge and member of a law firm providing legal assistance to one of the parties.

The issue of conflict disclosure in international arbitration cannot be addressed from the narrow perspective of a particular national litigation culture. Has the time now come to meet that goal from a truly international perspective? And, if yes, is there on the marketplace a better instrument to achieve that objective than the IBA Guidelines? Institutional decisions on challenges should at the same time be dealt with in such a manner that they be transparent and final, and that parties are not left to re-litigate before courts an issue that they believed was addressed by the institution years before. The harsh consequences of the Paris Court of appeal decision in Tecnimont tells us that the fate of awards having requested years of work and millions of Dollars cannot any longer be left to the hazards of a party becoming aware by chance, in a press release or by attending a conference, of a circumstance that the arbitrator did not disclose when accepting its appointment.

The already much debated Paris Court of appeal judgment in Tecnimont (SA J&P Avax SA v. Société Tecnimont SPA, court of appeal of Paris, 12 February 2009, Rev. Arb. 2009.186, note Clay) has put into light the dangers arising from the lack of uniformity in the field of conflict disclosure. The Paris Court of appeal has quashed a partial award because the chairman of the arbitral tribunal, a well-known international arbitrator who is part of one of the world’s largest law firms, had failed to disclose circumstances that did not exist at the time of his appointment and which he subsequently had not been aware of. No one in the arbitration community can seriously doubt of the total impartiality of that arbitrator. No one, either, can doubt of his good faith and his generally acknowledged high moral standards. Yet, the award has been annulled, with the consequence of throwing in the garbage a carefully drafted 400 pages award, years of efforts and millions of Dollars in legal costs. Such an outcome would seem absurd at first glance to anyone. The reverse situation, however, would have been equally questionable, leading to admit that an arbitrator can at the same time be the judge and a member of a law firm providing legal assistance to one of the parties, its parent company or subsidiaries. At a time when transparency and ethics are – rightly – one of the main concerns of the arbitral community, leaving such situations unsanctioned could have devastating consequences. If the recent financial crisis tells us something, it is that trust is a volatile commodity: it is built in decades of efforts, but it can also vanish overnight.

At the core of the problem is the obligation to disclose. The issue is well known to all arbitrators. Disclosures are needed to enable the parties to exercise their right to challenge. In the absence of a proper level of disclosure, the tribunal’s impartiality and independence would solely rest on the appointee’s discretion, with no possible form of control of circumstances that are and will most of the time remain unknown to the parties. The parties would be left to rely on the arbitrator’s impartiality and independence as an act of faith. But not all parties can be asked to share blind faith in the arbitral community, and more and more users of international arbitration are increasingly vocal to ask for more transparency. On the other side, over-disclosure should be avoided. As Molière showed us, excessive rigor can at times hide a deeply vicious soul. And, leaving aside the ridicule of requesting arbitrators to disclose whether they have twenty years ago shared the same college classroom with a relative of one of the parties, suspicion has never allowed building trust. Quite to the contrary, suspicion feeds suspicion. A balance thus needs to be found.

From this perspective, we submit that the IBA Guidelines were entirely right in their submission, ten years ago, that ‘existing standards lack sufficient clarity and uniformity in their application’ (IBA Guidelines, Introduction). The situation is no different today. And the problems remain unsolved. The active role of global law firms in arbitration is only one of them. The professionalization of many arbitrators, some of whom now practice in arbitration boutiques, is another. The need to protect professional liability and the increasingly adversarial behaviour of many counsels compounds the difficulties.

The facts in Tecnimont are telling. The arbitration was administered by the ICC. At the time of accepting his appointment, the arbitrator disclosed that his firm has represented the parent company of one of the parties in a concluded case in which he had never been involved. During the proceedings, apparently after attending a conference, one of the parties’ counsel became aware that the law firm of the arbitrator was assisting on various projects a company which had since then been acquired by the other party’s mother company. That party made a challenge against the arbitrator, which the ICC rejected for reasons which were not revealed. Meanwhile, the arbitral tribunal had rendered a partial award on the principle of responsibility, which was challenged and annulled pursuant to Article 1502-2 of the French Code of Civil Proceedings on the ground that the arbitrator had failed to comply with his duty of disclosure.

Interestingly, the other party had argued that the challenge had not been made within the 30 days time-limit provided by Article 11 of the ICC Rules of arbitration, and the court of appeal held that this time-limit was only applicable before the institution and not before the court.

The first remark to be made at this juncture is that the distinction between institutional and judicial challenges is highly unsatisfactory. If the parties accepted institutional rules that set time-limits for challenges, why should such time-limits not be enforced by the judge? Let us go one step further: once the institution decides a challenge, why should the parties re-litigate the same issue years later before the judge? Would it not be more appropriate to treat challenge decisions rendered by arbitral institutions as if they were awards?

This would of course suppose that such decisions be rendered by neutral third parties and that each party have a sufficient opportunity to present its case before the institution. It also supposes, in addition to those requirements of due process, that challenge decisions be reasoned and that the reasons be given to the parties. From this perspective, the LCIA made a step in the right direction when it decided to publish sanitised extracts of its challenge decisions. We hope that the publication will soon come out.

The second remark is that, as noted by the IBA ten years ago, there is remarkable uncertainty as to the level of disclosure that is required from arbitrators in each single case. The UNCITRAL Model Law, as most national laws, is mute on this important issue, with the result that each court builds its own requirements on a case-by-case basis, in a manner that necessarily lacks uniformity and fails from providing a satisfactory level of certainty to arbitrators and predictability to parties.

As for the rules of arbitral institutions, they present common features, but diverge on important aspects. It is of course widely accepted that an arbitrator must disclose all circumstance which can affect its appearance of independence and impartiality in the eyes of the parties, and that this duty is a continuous one. Most of the rules, however, adopt a purely subjective requirement, leaving the arbitrator to decide the circumstances to be disclosed, while others, like the ICDR Rules, provide for an objective test, with a list of questions for the arbitrators to answer in its declaration of acceptance. The result is that the same situation may be disclosed under some rules of arbitration but not pursuant others, which is not satisfactory.

From this standpoint, a remarkable exercise of balance and transparency is that undertaken by the IBA in its 1999 Guidelines on Conflict of Interest in International Arbitration. Of course, the Guidelines do not satisfactorily address all issues. Of course, they are imperfect in many respects. But they are unique in that they address at the same time the need for balance in the level of disclosure requirement, the requirement of legal certainty and the legitimate expectation of transparency of the users of international arbitration. The Guidelines also conciliate the subjective test, by requiring arbitrators to disclose “facts or circumstances that may, in the eyes of the parties, give rise to doubts as to the arbitrators’ impartiality or independence”, and the objective test by instating presumptions based on the well-known red, orange and green lists.

The IBA Guidelines are also adapted to the needs of international arbitration. The recent rejection by the American Bar Association Dispute Resolution Section of the widely circulated “Best Practices for Meeting Disclosure Requirements Under the RUAA and Similar Arbitrator Disclosure Standards” shows that the issue of conflict disclosure in international arbitration cannot be addressed from the narrow perspective of a particular national litigation culture. The proposed ABA guidelines were certainly driven by an overly judicial culture, and they have as such – and rightly – been rejected by the arbitral community, starting by the College of Commercial Arbitrators, the Chartered Institute of Arbitrators and other practitioners interested in preserving the United States as an attracting venue for international arbitrations. One leading figure ironically declared that the draft should be stamped BBR ‘Burn Before Reading’. This almost unanimous rejection of the text shows that any attempt to set international standards for conflict disclosure should take into account the transnational culture of international arbitration.

Has the time now come to meet that goal from a truly international perspective? And, if yes, is there on the marketplace a better instrument to achieve that objective than the IBA Guidelines? Why not imagine that the main international arbitral institutions jointly decide to adopt the Guidelines by reference in their rules? And why not imagine that the UNCITRAL Arbitration Rules, which are currently under revision, also include a reference to the Guidelines? Of course, this would not be sufficient to address all issues. As said above, institutional decisions on challenges should also be dealt with in such a manner that they be transparent and final, and that the parties are not left to re-litigate before the court an issue that they believed was addressed by the institution years before.

The mere contention that every arbitration procedure is different and has its specificities should not hide that there is need for transparency, predictability and legal certainty in international arbitration. The harsh consequences of the Paris Court of appeal decision in Tecnimont tells us that the fate of awards having requested years of work and millions of Dollars in costs, and in which the interests involving nine or ten figures claims are disposed of, cannot any longer be left to the hazards of a party becoming aware by chance, in a press release or by attending a conference, of a circumstance that the arbitrator did not disclose when accepting its appointment.

Alexis Mourre/Alexandre Vagenheim