2020 at LCIA and SIAC despite the pandemic
2020 AT LCIA AND SIAC DESPITE THE PANDEMIC
Arbitration institutions such as the LCIA and SIAC, as well as domestic Indian institutions such as the Mumbai Centre for International Arbitration (MCIA) have continued to administer and resolve disputes throughout the pandemic…
The lockdowns and switch to virtual working brought about by the COVID-19 pandemic have inevitably caused disruptions to the traditional forms of dispute resolution. 'In person' filings and hearings have been difficult or impossible in many jurisdictions. Some courts have been able to switch to e-filing and online hearings with minimal disruptions, while others have struggled. The arbitration world has similarly seen a switch from in person to virtual, or 'hybrid', hearings, and an increased focus on e-filing and electronic hearing bundles over the use of paper. To some extent, this has built on the use of email, online document transfer, telephone and video conferencing which have been deployed in arbitration for many years, although there is no doubt that 2020 has seen a step change in the ability of arbitration institutions, counsel, and tribunals to operate entirely online.
However, this change has not caused any reduction in the popularity of international arbitration, nor seemingly in the ability of stakeholders to continue to bring claims, hold hearings, and receive their awards. On the contrary, many arbitral institutions are reporting record numbers for 2020.
This article looks at two such institutions of particular relevance to Indian parties: the London Court of International Arbitration ("LCIA") and the Singapore International Arbitration Centre ("SIAC").
Record Case Numbers
2020 saw the LCIA achieve all-time highs with 444 referrals and 407 arbitrations under the LCIA rules. These strong figures have helped the LCIA achieve a doubling of arbitrations over the past decade.
The arbitrations came mostly from the top three industry sectors of the LCIA's caseload: energy & resources, transport & commodities and banking & finance. Between them, these three sectors accounted for 68% of all LCIA arbitrations in 2020.
Underlining its status as a global arbitral institution, 86.6% of the parties to LCIA arbitrations in 2020 came from outside the UK (an increase of over 5% from 2019). Further, 16% of LCIA arbitrations in 2020 took place at locations ('seats') outside the UK. While English law was chosen to govern the dispute in 78% of arbitrations, LCIA arbitrations also applied the laws of 33 other jurisdictions. Interestingly, the LCIA reports that for arbitrations held in Germany, Pakistan and Mexico, more parties chose to match the applicable law with the seat.
2020 saw the LCIA make a total of 553 arbitrator appointments comprising 42% of all arbitrator selections (i.e. the remainder being chosen by the parties or the other arbitrators). Of these appointments by the LCIA, 45% were female reflecting the LCIA's continued commitment to gender diversity.
As in previous years, there were very few challenges to LCIA arbitrator appointments. 2020 saw only six challenges of which just one was upheld.
More Records Broken
SIAC also had a record-breaking year reporting over 1,000 new case filings. Astonishingly, this is more than double the filings in 2019. The dominant sector for SIAC's cases was trade which alone made up 64% of cases. This reflects both the high use of SIAC arbitration for trading contracts, especially within Asia, and the turbulence of markets in recent years.
International Popularity Continues
94% of SIAC cases were reported as being of an international nature. Of its many non-Singaporean users, Indian parties continue to dominate being involved in 690 cases (an increase of over 40% from 2019), followed by US parties at 545 cases. Having long had a representative office in Mumbai, it is no surprise that SIAC chose 2020 to open a representative office in New York.
The remaining top ten foreign users were China, Switzerland, Thailand, Indonesia, Hong Kong, Vietnam, Japan and the Cayman Islands. In total, SIAC received cases from 60 different jurisdictions.
Singaporean law was chosen in 76% of SIAC cases in 2020, having risen from 41% in 2019.
SIAC made a total of 143 arbitrator appointments, accounting for almost half or all arbitrator appointments in 2020. Of these, just over 32% were female.
As with the LCIA, there were few challenges to SIAC arbitrator appointments. Just four in 2020, of which only one was upheld.
Arbitration institutions such as the LCIA and SIAC, as well as domestic Indian institutions such as the Mumbai Centre for International Arbitration (MCIA), are to be commended for their flexibility in continuing to administer and resolve disputes throughout the pandemic.
While many courts in India remain challenged by the ongoing disruptions, it seems likely that the numbers of parties choosing arbitration will continue to grow.
Disclaimer – The views expressed in this article are the personal views of the authors and are purely informative in nature.