SCC Institute adopts New Arbitration
Rules
Background
Over the past decade the
Arbitration Institute of the Stockholm Chamber of
Commerce (“the SCC Institute”) has handled between 100
to 200 new cases per year. More than half of these cases
have had an international character. Every year there
are typically parties from 30 to 40 different countries
arbitrating before the SCC Institute, and these numbers
are increasing. The legitimate needs of these users
should be satisfied by offering an efficient, up-to-date
and easily comprehensible set of rules.
The
current version of the SCC Rules, which was adopted in
1999, is still considered to be modern and well-suited
for international commercial arbitration. When the
matter of revising the Rules was raised last year, it
was therefore a broad consensus that there was no need
for completely rewriting the Rules. It was felt,
however, that the Rules in some respects could be
further improved (1) to make them more comprehensive and
respond to the latest development in international
commercial arbitration, and (2) to clarify and make more
precise certain provisions of the Rules that have proved
in practice to require elucidation or modification.
The Revision Work
Accordingly,
the Board of the SCC Institute decided to commission a
revision of the SCC Rules. The revision work was to be
undertaken in the course of 2006 with the aim that new
SCC Rules could enter into force on 1 January 2007. A
revision committee composed of Professor Kaj Hobér,
acting as chairman, Mr Ulf Franke, Dr. Sigvard Jarvin,
Dr. Patricia Shaughnessy, Mr. Christer Söderlund and Mr.
Martin Wallin was entrusted with the task of drafting
the new Rules. Mr. William McKechnie was appointed as
Secretary.
In September this year, the Committee
presented the draft of the new Rules. The draft rules
were distributed to a number of Swedish and
international experts who were invited to submit
comments. More than 50 experts commented on the draft
new Rules.
In light of the comments, the
committee reviewed and revised the draft new Rules and
submitted a final draft to the Board of the SCC
Institute. The new Rules were adopted by the Board of
the SCC Institute and were subsequently approved by the
Board of the Stockholm Chamber of Commerce. The new
Rules will enter into force on 1 January 2007.
New Structure
No fundamental
changes have been made in the Rules. The structure of
the Rules has been somewhat amended. One example is
that, the more detailed provisions on the organization
of the SCC Institute have been severed from the Rules
and instead included in a separate appendix attached to
the Rules. The new SCC Rules are more transparent as
regards the role of the Institute because the new Rules
clarify which body within the SCC Institute - the Board
or the Secretariat - that carries out the various tasks
of the SCC Institute.
International
Perspective
Each provision of the current
SCC Rules has been reviewed from an international
perspective. As a consequence a number of changes, both
in substance as well as editorial and linguistic
character, have been made. For example, the provisions
on evidence, Articles 26, 28 and 29, have been
redrafted. Among other things, it explicitly provides
that the Arbitral Tribunal may determine the
admissibility, relevance, materiality and weight of the
evidence.
Consolidation
One of
the most important substantive changes to the Rules is
the inclusion in Article 11 of a provision on
consolidation, which enables the Board to consolidate
arbitral proceedings pending under the SCC Rules,
provided they concern the same legal relationship and
involve the same parties. Such consolidation can only
take place after consultation with the arbitrators and
parties. The current SCC Rules do not contain any
provision on consolidation.
Interim
Measures
There are several other important
changes that deserve mentioning. One is the inclusion in
Article 32 (3) of a new provision regarding interim
measures, which specifically provides that the Arbitral
Tribunal has the power to grant an interim measure in
the form of an order or in the form of an award. This
new provision is in line with UNCITRAL’s Model Rules on
interim measures and is aimed at facilitating the
enforceability of interim measures.
Separate
Award on Advance on Costs
There is also a
new provision regarding advances on costs in Article
45(4). This new provision provides that the Arbitral
Tribunal may, at the request of a party, make a separate
award ordering a party to reimburse another party for
any Advance on Costs paid on its behalf. It was included
in order to remedy any uncertainty as to whether an
Arbitral Tribunal may make a separate award when a party
has paid a part of the Advance on Costs on the behalf of
another party.
Appointment of Arbitrators
Furthermore, a few changes have been made with
regard to the appointment of arbitrators (Article 13).
Under the current SCC Rules, the SCC Institute makes the
appointment where the Arbitral Tribunal consists of a
sole arbitrator. Under the new SCC Rules the parties are
given an opportunity to jointly agree upon the
arbitrator. The new Article 13(1) also expressly
provides that the parties may agree on a different
procedure for appointing the Arbitral Tribunal than the
one set out in the Rules.
Multi Party
Where there are multiple Claimants or
Respondents and the Arbitral Tribunal is to consist of
more than one arbitrator, the principal rule, both
pursuant to the current and the new SCC Rules, is that
the multiple Claimants, jointly, and the multiple
Respondents, jointly, shall appoint an equal number of
arbitrators. If either side fails to make such
appointment the current SCC Rules stipulates that the
SCC Institute shall make the appointment for that side,
but that it may appoint the entire Arbitral Tribunal, if
the circumstances so warrant. Pursuant to the new SCC
Rules, the Board shall always appoint the entire
Arbitral Tribunal should one side fail to jointly make
the appointment. The reason for this procedure is to
avoid the risk of national courts considering that the
parties have been treated unequally and therefore decide
to quash the award. The new SCC Rules also better
clarify the circumstances the Board shall take into
account when appointing arbitrators than do the current
SCC Rules.
Seat of Arbitration
Finally, some less significant revisions may be
noted. The first change is that the term “Place of
Arbitration” has been changed to “Seat of arbitration”
and the new Article 20 deals specifically with
designating the seat of arbitration. The term “Seat of
arbitration”, which can also be found in some other
institutional rules, has been chosen to distinguish this
technical term, and its legal effects from more general
references to the place of arbitration. The second
change is the inclusion of the provision in Article
15(4) that a challenged arbitrator shall resign if the
other party agrees to the challenge. The third change is
the inclusion of a provision in Article 23 stipulating
that the Arbitral Tribunal shall promptly consult with
the parties to attempt to establish a provisional
timetable for the conduct of the arbitration. This
provision is intended to increase the efficiency of the
arbitral proceedings and to reflect current practice in
international arbitration.
New Appointments to the SCC
Board
Mr Ulf Jonsson and Mr Jan-Mikael Bexhed will, at the
end of 2006, retire from the Board having completed
their allotted terms of office
These are the members of the SCC
Institute's Board as of 1 January 2007:
Dr M.I.M.
Aboul-Enein, Egypt
Dr. Pierre
A. Karrer, Switzerland, Vice Chairman
Professor
Alexander S. Komarov, Russia
David W.
Rivkin, USA
V.V.
Veeder QC, England
Dr. Wang
Sheng Chang, China
The SCC Workshop and Arbitration Moot in
November 2006
On November 26 – 28, 2006 the first SCC Workshop
Arbitration Moot took place at the SCC Institute.
The programme was primarily directed to the
Russian-speaking lawyers from the former Soviet
republics. The SCC Institute’s long experience in
resolution of East – West disputes and a considerable
share of the case load involving CIS-parties were the
starting point for the development of this three-day
training.
The event was structured as a
combination of lectures, preparation of written
submissions in groups under the guidance of
international arbitration experts and, finally, mock
arbitration proceedings including a mock hearing.
English and Russian were the working languages at the
lectures and during the group sessions.
The
workshop was very successful, resulting in the intensive
sharing of practical experience and expertise among the
participants, the reporters and group-leaders. The
participants were given the opportunity to acquire
in-depth expertise in the subject, learn more about the
international arbitration environment in Sweden, and, in
their turn, enrich the SCC Institute with the up-dated
knowledge of commercial arbitration culture and
developments in the CIS Republics.
The SCC
Institute would like to thank thanks all the reporters,
group-leaders and participants for their valuable
contribution to the event and the positive feedback upon
its termination.
SIAR
News
Dr M.I.M.
Aboul-Enein, Egypt 
Arbitration
Institute of the Stockholm Chamber of Commerce