Canada: New LCIA Arbitration Rules Come Into Effect Today

The London Court of International Arbitration (LCIA), one of the world’s leading international arbitration institutions, recently adopted a new set of arbitration rules, which will come into force on October 1, 2014. The new rules revise and update the previous version of the LCIA Arbitration Rules which have been in effect since 1998, and are intended to better align the rules with modern arbitral practice, and to promote a speedy, efficient, and fair arbitral process.

Although the previous version of the LCIA Arbitration Rules was popular, the practice of international arbitration has evolved since it came into force. International commercial disputes have become substantially more complex, and a view developed that the LCIA Arbitration Rules needed to be modernized. This perception became all the more pronounced when other well-known sets of arbitration rules were revised in recent years, including the UNCITRAL Arbitration Rules in 2010 and the ICC Arbitration Rules in 2012, among others.

Some of the more significant changes to the LCIA Arbitration Rules include:

• New Rules for a More Efficient and Speedy Arbitration: A substantial number of new provisions have been inserted into the LCIA Arbitration Rules to pressure and incentivize arbitrators, the parties, and their legal representatives to conclude arbitrations as efficiently and swiftly as possible. A number of new procedural rules have also been put into place to speed-up arbitration proceedings.
• New “Emergency Arbitrator” Process: A new procedure has been introduced into the LCIA Arbitration Rules to allow parties to a dispute to apply to the LCIA for the appointment of an “emergency arbitrator” prior to the constitution of a tribunal to conduct emergency proceedings. This enables a party to obtain urgent interim relief (such as the preservation of an asset) prior to the constitution of a full tribunal without having to resort to local courts.
• New Code of Conduct for Legal Counsel in LCIA Proceedings: The new LCIA Arbitration Rules have attempted to resolve an ongoing debate among arbitration practitioners regarding whether a professional code of conduct should be developed for lawyers practicing international arbitration. The new rules introduce “General Guidelines for the Parties’ Legal Representatives” which attempt to set out ethical guidelines for legal representatives involved in LCIA arbitrations, and LCIA tribunals are now empowered to enforce those guidelines and sanction lawyers directly in the event they fail to follow them.
• New Rules Facilitating Consolidation of Multiple Arbitrations: The 1998 version of the LCIA Arbitration Rules was silent on whether multiple arbitrations could be consolidated. The new rules include detailed provisions allowing for the consolidation of arbitrations where (i) all the parties to the arbitrations have agreed to consolidation, and (ii) multiple arbitrations have been commenced under the same agreement or under compatible agreements between the same parties.

As the new rules come into force, it will be interesting to see whether and to what extent LCIA arbitrations improve and evolve.

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