International Commercial Arbitration and COVID-19
Author: Swetalika Das
There are lots of changes happening due to the COVID-19 pandemic especially resulting in no physical interactions.This change was brought by the pandemic both in our usual life, and our professional life. The same thing goes with the domestic and international arbitrations, the pandemic has changed the usual practice and the format of hearings.
Situation before the pandemic:
Before the pandemic, both ininternational and commercial arbitration, the parties presented their cases in oral form. There were also written proceduresthat covered all the details of the case, parties’ submission and, primary issues in the judgment, but oral hearings were more valued than the written format because it signifies the “right to be heard”.
There are more benefits in oral hearings than in writing because the parties are able to submit their pleadings, objections, and, substantial evidence in a more effective way. The hearings also includetestimonies, and cross examinations of witnesses. This involves arguments by exchanging their pleadings, and opinions, even the tribunals ask direct questions to the parties, counsels, and witnesses were asked by the experts. This is the reason why oral hearings were considered more effective.
This procedure was followed until the COVID-19 pandemic. Due to the pandemic, most hearings areheld through telephonicconversations or video conferences. These hearings are governedby some arbitration rules like ICSID Arbitration rules and, ICC rules.
Arbitration rules for regulation of oral hearings are as follows:
i. Rule 32(1) of the ICSID states that “ the oral procedure shall consist of hearing by the Tribunal of the parties, their agents, counsel and advocates and of witnesses and experts”.
ii. Article 26(1) of ICC rules provides that “when a hearing is to be held, the arbitral tribunal giving reasonable notice shall summon the parties before it to appear before it on the day and at the place fixed by it”.
iii. Article 26(4) states that “the parties may appear in person or through duly authorised representatives”.
Effects of COVID-19 on International Arbitration:
Generally, the hearings happenin a different country from the native country of both the parties or in the place of arbitration tribunal where the parties,counsels and witnesses need to be present there in person.Hence, it takes a lot of effort to assemble in COVID-19 situation.
It becomes more difficult to participate in meetings during the pandemic because of travel restrictions. There arealso certain restrictions imposed for the sake of safety and to overcome this pandemic which needs to be followed by everyone. Therefore, in these situations parties are requiredto participate through virtual oral hearings or they postpone the oral hearings.
Other ways of Oral hearings in COVID-19 pandemic:
In arbitration, the parties are required to submit the soft copies of the materials required in arbitration proceedings. Due to the pandemic, there are no submissions of printed copies, rather, they need to provide all the statements, documents, memorials ,etc. only by email or through any electronic devices.
2. Practice through video conferences:
When it’s time of pandemic, the most common thing we gotused to is video conferencing. Just like this, in the practices of International Commercial Arbitrations, video conferences arethe most usual thing, since it is followed by almost all the law firms, counsels, and Tribunals.
Apart from video conferencing, there are no other ways thatseem to be useful in this pandemic period. There are lots of cases thatneed to be finalised and video conferences are the only way to proceed with further hearings. To the contrary, there is a need to take care of confidentiality and protection of the proceedings. There are some arbitration institutions which have certain provisions in relation to the arbitration procedures such as:
i. Article 14(1) of the LCIA Arbitration Rules states that “ The parties and the arbitral tribunal are encouraged to make contract whether by a hearing in person, telephone conference call, video conference as soon as practicable”.
ii. It is also provided in article 14(4) of the LCIA arbitration rules that “ a duty to adopt procedures suitable to the circumstances of the arbitration, avoiding unnecessary delay and expense so as to provide a fair and efficient final resolution to the parties.”
iii. Article 19 of LCIA Arbitration Rules, it is provided that video conferences are the most effective way of arbitral proceedings.
Undeniably, COVID-19 pandemic has caused a lot of hindrances in arbitral proceedings and all the legal proceedings. There are arbitration institutions that take necessary steps to reduce the difficulties in proceedings. Still, the proceedings of International Commercial Arbitration in person is the most efficient and best way to deal with the oral hearings because in cases like investor state arbitration cases requires examination of witnesses which can only happen in physical interactions. It would be practically difficult to conduct cross examination of witnesses, oral hearings in virtual mode.
ICSID Worldbank Oral Procedure - ICSID Convention Arbitration, available at https://icsid.worldbank.org/en/Pages/process/Oral-Procedure-Convention-Arbitration.aspx, last seen on 11.04.2021  The Effect Of Covid-19 Outbreak On International Arbitration Hearings, available at https://www.mondaq.com/turkey/arbitration-dispute-resolution/1017000/the-effect-of-covid-19-outbreak-on-international-arbitration-hearings, last seen on 13.04.2021 The Effect Of Covid-19 Outbreak On International Arbitration Hearings, available at https://www.mondaq.com/turkey/arbitration-dispute-resolution/1017000/the-effect-of-covid-19-outbreak-on-international-arbitration-hearings, last seen on 13.04.2021