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Part I Fundamental Principles and the Legal Framework within which the Arbitral Tribunal Operates, Ch.2 Scope of Application, General Provisions, and Place of Arbitration

From: The UNCITRAL Arbitration Rules: A Commentary (2nd Edition)

David D Caron, Lee M Caplan

Content type:
Book content
Product:
International Commercial Arbitration [ICMA]
Series:
Oxford Commentaries on International Law
Published in print:
07 March 2013
ISBN:
9780199696307

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2023. All Rights Reserved. Subscriber: null; date: 06 June 2023

Subject(s):
Settlement of disputes — UNCITRAL Arbitration Rules — Arbitral tribunals

(p. 14) (p. 15) Chapter 2  Scope of Application, General Provisions, and Place of Arbitration

  1. 1.  Introduction 16

  2. 2. Scope of Application—Article 1 16

    1. A. Text of the 2010 UNCITRAL Rule 16

    2. B. Commentary 17

      1. (1)  General comments 17

      2. (2)  Scope of application—Article 1(1) 18

      3. (3)  No writing requirement for agreement to arbitration—Article 1(1) 18

      4. (4)  Party autonomy and modification of the Rules—Article 1(1) 19

      5. (5)  Presumptive scope of application—Article 1(2) and (3) 20

      6. (6)  Future transparency rules for investor–state arbitration 23

      7. (7)  Model arbitration clause 24

      8. (8)  Comparison to the 1976 UNCITRAL Rules 24

    3. C. Extracts from the Practice of Investment and other Tribunals 26

      1. (1)  Article 1(1) (1976 Rules)—scope and modification 26

      2. (2)  Article 1(2) (1976 Rules)—non-derogation from mandatory law 28

  3. 3.  General Provisions—Article 17 29

    1. A. Text of the 2010 UNCITRAL Rule 29

    2. B. Commentary 30

      1. (1)  Basic principles—Article 17(1) 30

        1. (a)  Arbitral autonomy and its limits 30

        2. (b)  Confidentiality in UNCITRAL arbitration 36

        3. (c)  Non-disputing party (amicus) participation in UNCITRAL arbitration 39

        4. (d)  The nature of the proceedings before the Iran–US Claims Tribuna 141

        5. (e)  Concluding comments 45

      2. (2)  Provisional timetable and modification of time periods—Article 17(2) 46

        1. (a)  Provisional timetable 46

        2. (b)  Modifications of time periods 47

        3. (c)  Issues of general application 49

        4. (3)  Right to a hearing—Article 17(3) 49

        5. (a)  Scope of hearings 49

        6. (b)  Timing of hearing requests 51

        7. (c)  Preliminary meetings 52

      3. (4)  Communication of documents—Article 17(4) 53

      4. (5)  Joinder of third persons—Article 17(5) 54

      5. (6)  Consolidation of claims 57

      6. (7)  Comparison to the 1976 UNCITRAL Rules 58

    3. C. Extracts from the Practice of Investment and other Tribunals 59

      1. (1)  Article 15(1) (1976 Rules)—general 59

      2. (2)  Article 15(1) (1976 Rules)—amicus submissions 65

    4. D. Extracts from the Practice of the Iran–US Claims Tribunal 69

      1. (p. 16) (1)  General and Tribunal Rules (1983), Article 15(1) 69

      2. (2)  Tribunal Rules (1983), Article 15(2) 74

  4. 4.  Place of Arbitration—Article 18 77

    1. A. Text of the 2010 UNCITRAL Rule 77

    2. B. Commentary 78

      1. (1)  Meaning of “place of arbitration” 78

      2. (2)  Selection of the place of arbitration—Article 18(1) 80

        1. (a)  Considerations to be taken into account 80

        2. (b)  Decision on place of arbitration not procedural; consultation with the parties 91

      3. (3)  Where the award is “deemed to have been made” —Article 18(1) 92

      4. (4)  The location of tribunal deliberations and meetings “for any other purpose, including hearings”—Article 18(2) 93

      5. (5)  Comparison to the 1976 UNCITRAL Rules 95

        1. C. Extracts from the Practice of Investment Tribunals 96

        2. D. Extracts from the Practice of the Iran–US Claims Tribunal 109

1. Introduction

This chapter addresses those rules that generally frame arbitration under the UNCITRAL Rules. The 2010 UNCITRAL Rules address in Article 1(1) the general scope of application of the Rules, in Article 1(2) the applicable version of the Rules (2010 or 1976), and in Article 1(3) the relationship between the proceedings and the mandatory norms of law of the place of arbitration. The focus of Article 1(3) is closely related to the principle, expressed in Article 17(1), that “the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, … ” In addition, Articles 17(2) and 17(3) concern the right to a hearing and the communication of documents, respectively. The actual role in concrete arbitrations of some of the basic principles expressed in Articles 1 and 17 is largely dependent on the place of arbitration, the subject matter of Article 18.

2. Scope of Application—Article 1

A. Text of the 2010 UNCITRAL Rule1

Article 1 of the 2010 UNCITRAL Rules provides:

  1. 1. Where parties have agreed that disputes between them in respect of a defined legal relationship, whether contractual or not, shall be referred to arbitration under the UNCITRAL Arbitration Rules, then such disputes shall be settled in accordance with these Rules subject to such modification as the parties may agree.

  2. (p. 17) 2. The parties to an arbitration agreement concluded after August 15, 2010 shall be presumed to have referred to the Rules in effect on the date of commencement of the arbitration, unless the parties have agreed to apply a particular version of the Rules. That presumption does not apply where the arbitration agreement has been concluded by accepting after August 15, 2010 an offer made before that date.

  3. 3. These Rules shall govern the arbitration except that where any of these Rules is in conflict with a provision of the law applicable to the arbitration from which the parties cannot derogate, that provision shall prevail.

MODEL ARBITRATION CLAUSE FOR CONTRACTS (Located in the Annex to the Rules)

Any dispute, controversy or claim arising out of or relating to this contract, or the breach, termination or invalidity thereof, shall be settled by arbitration in accordance with the UNCITRAL Arbitration Rules.

Note—Parties should consider adding:

  1. (a)  The appointing authority shall be … (name of institution or person);

  2. (b)  The number of arbitrators shall be … (one or three);

  3. (c)  The place of arbitration shall be … (town and country);

  4. (d)  The language(s) to be used in the arbitral proceedings shall be …

B. Commentary

(1)  General comments

Arbitration is a form of dispute settlement based on agreement between parties who may wish for various reasons to avoid proceedings before domestic courts.2 The parties may select an arbitral institution to oversee the resolution of their dispute, in which case the procedural rules of that institution are applied. They may, however, also wish to arrange their arbitration on an ad hoc basis outside any institution. In doing so, they are, in principle, free to create their own rules of procedure. As agreeing on such rules for a particular case may pose many difficulties, it is useful to have a ready-made set of procedural rules to which the parties may resort if they so agree. The UNCITRAL Rules are such a set of procedural rules.3 The 1976 UNCITRAL Rules have proven to be so useful that many arbitration institutions have based their own rules of procedure on them,4 and the same is almost certainly to be the case for the 2010 version of the Rules as they gain widespread acceptance.

(p. 18) (2)  Scope of application—Article 1(1)

According to Article 1(1), the 2010 UNCITRAL Rules apply to disputes between the parties “in respect of a defined legal relationship, whether contractual or not.” This broad language contrasts with the narrower scope of the 1976 UNCITRAL Rules, which cover only disputes “in relation to [a] contract.”5 Indeed, the phrase “defined legal relationship” in the 2010 Rules is meant to encompass a wide range of both contractual and non-contractual disputes.6 For example, the Rules may be utilized to resolve not only claims of contract breach, but also claims of third-party interference with contractual relations, trademark infringement, or other unfair competition.7 The Rules may also be used in resolving disputes arising under investment treaties in which non-contractual questions of state responsibility under international law are at issue.8 Further, nothing in Article 1(1) prevents the Rules from being utilized in purely domestic arbitration, even though they were developed specifically with international commercial arbitration in mind.9

The broader formulation in Article 1(1) also promotes consistency with Article II(2) of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards,10 and Article 7(1) of the UNCITRAL Arbitration Model Law, both of which contain identical language.11

(3)  No writing requirement for agreement to arbitration—Article 1(1)

Article 1(1) does not require that the arbitration agreement be in writing in contrast to the 1976 UNCITRAL Rules, which contained such a requirement to “avoid uncertainty as to (p. 19) whether the Rules have been made applicable” and to ensure conformity with Article II(1)–(2) of the New York Convention.12 This omission in the 2010 Rules thus represents a significant departure in approach. During Working Group discussions, some delegates cautioned against the change, citing some of the same reasons as the original drafters of the Rules, clarity and conformity.13 Others proposed new justifications for a writing requirement, including that, in the absence of uniform practice under national arbitration laws,14 a writing requirement would remind the parties that the arbitration agreement might be valid only if in writing.15

Elimination of the writing requirement ultimately attracted a consensus, however. Many delegates believed the form of the arbitration agreement was a question that was better addressed by the applicable arbitration law, particularly since approaches varied across jurisdictions.16 In addition, it was noted that if the Rules contained a writing requirement, it would conflict with the laws in jurisdictions that no longer imposed such a requirement; thus, the absence of the requirement would better harmonize international arbitration law.17 Option II for Article 7 of the Model Law, as amended, does not contain a writing requirement, for example.18 Still others pointed out that the question of whether the writing requirement had been met had given rise to substantial amounts of litigation.19

(4)  Party autonomy and modification of the Rules—Article 1(1)

In conformity with the contractual nature of arbitration and the principle of party autonomy, the UNCITRAL Rules do not require that they be adopted as a “package.” Under Article 1(1), the parties may agree to modify the Rules to the extent they are not inconsistent with the law of the place of arbitration.20 In a typical ad hoc arbitration, modifications to the UNCITRAL Rules can be made in the arbitration agreement or in a separate agreement which can be concluded between the parties even after the commencement of the arbitral proceedings. Unlike the 1976 UNCITRAL Rules, Article 1(1) of the 2010 UNCITRAL Rules does not require that modification of the Rules be in writing. While some Working Group delegates supported the requirement as necessary to confirm the existence and scope of a modification agreement,21 others pointed out that arbitration practice had (p. 20) developed toward a more flexible approach.22 For example, Article 19(1) of the Model Law, as amended, and many institutional procedural rules do not include a writing requirement.23 In addition, Paulsson and Petrochilos, in their advisory report to UNCITRAL, noted that “the parties are better placed to evaluate whether the modifications they desire are of such importance or detail as to call for a written agreement or document.”24 Like the writing requirement for an arbitration agreement, the writing requirement for modification of the Rules was deemed to be outmoded and thus was dropped from the Rules.

While the freedom of the parties to modify the Rules and the discretion of the arbitral tribunal in their application25 is considerable, Article 1(3) contains an important limitation to be taken into account in both respects. According to that provision, the UNCITRAL Rules “shall govern the arbitration except that where any of these Rules is in conflict with a provision of the law applicable to the arbitration from which the parties cannot derogate, that provision shall prevail.” Article 1(3), which requires the respect of mandatory norms of the applicable procedural law, reflects the fact that arbitration is in many ways circumscribed by laws pertaining to it,26 whether of domestic or international origin.27 The scope and meaning of the requirement, and its relation to certain other fundamental principles concerning arbitration, will be further discussed in the next section.28

(5)  Presumptive scope of application—Article 1(2) and (3)

The existence of two versions of the UNCITRAL Rules, the original 1976 version and the revised 2010 version, may raise important questions as to which version of the Rules applies in a dispute.29 If the parties have agreed to apply “a particular version of the Rules,” (p. 21) then the inquiry is straightforward: Article 1(2) indicates that their choice shall be determinative.30 In other cases where the agreement of the parties is not express or otherwise clear—namely where the arbitration agreement contains only a general reference to the “UNCITRAL Arbitration Rules”—it falls to the arbitral tribunal to decide which version of the Rules is operative.31 With the aim of assisting the tribunal's analysis, Article 1(2) offers two presumptions of applicability for disputes arising either out of a contract or under an investment treaty.

These presumptions are clearly not binding on the arbitral tribunal or the parties. Indeed, at the stage of the proceedings when it would be useful to refer to them, the tribunal's determination as to whether the 2010 Rules apply has yet to be made. Thus, the presumptions contained in Article 1(2) do not replace traditional techniques of contract or treaty interpretation used to determine which version of the Rules the parties intended to have apply. For example, in the context of interpreting a general reference to the “UNCITRAL Arbitration Rules” in an investment treaty, the arbitral tribunal may be required, where the text itself is ambiguous, to examine whether the negotiating history or subsequent practice of the state parties to the treaty inform the meaning of the reference.32 In many cases, however, the disputing parties’ intent will be difficult, if not impossible, to ascertain, leaving the presumptions in Article 1(2) as useful guides.

The first sentence of Article 1(2) establishes a presumption that the parties have agreed to adopt the 2010 Rules if their arbitration agreement was concluded after August 15, 2010, the date on which UNCITRAL adopted the 2010 Rules.33 As Castello notes, this presumption reflects the Working Group's belief that, unless otherwise specified, the disputing parties “want the most recent version of the Rules to apply to any arbitration that arises under [the arbitration] agreement ….”34 Thus, a general reference to the “UNCITRAL Arbitration Rules” after adoption of the revised Rules is understood to mean the 2010 UNCITRAL Rules. The benefit of this approach is that it respects the consent-based nature of arbitration by assuming that the disputing parties could only agree to apply a version of the Rules that was in effect at the time the arbitration agreement was concluded.35 Some Working Group delegates supported retroactive application of the Rules, whereby in the absence of party agreement the applicable version of the Rules would be the latest version of the Rules in effect when the arbitration commenced, ie, the 2010 UNCITRAL Rules, even if the arbitration agreement was concluded before adoption of that (p. 22) version of the Rules.36 However, in the end, retroactive application was disfavored as it was inconsistent with the contractual nature of arbitration.37

The second sentence of Article 1(2) governs the special case where offer and acceptance of an agreement to arbitration are not simultaneous, namely in the context of investor–state arbitration. A state party to an investment treaty, for example, often provides foreign investors a standing offer to arbitrate disputes, though it is not sometimes until many years later that an investor accepts the offer by filing its arbitration claim against the state party. In this situation, the 2010 UNCITRAL Rules are presumed to apply only if both offer and acceptance occur after adoption of the 2010 Rules. Thus, for example, the 2010 Rules would not apply if an offer to arbitrate was made in an investment treaty concluded before August 15, 2010, even if an investor filed a claim—and accepted the arbitration agreement—after that date. Like the first sentence of Article 1(2), the second sentence proceeds on a theory of consent and avoids retroactive application of the 2010 Rules where both parties could not have reasonably assented to their application.38 That said, the terms of some investment treaties expressly allow for retroactive application of the 2010 Rules (thus superseding any contrary presumption), such as where the standing offer to arbitrate is with respect to the version of the UNCITRAL Rules “in effect on the date the claim or claims were submitted to arbitration.”39 While the freedom of the parties to modify the Rules and the discretion of the arbitral tribunal in their application40 is considerable, Article 1(3) contains an important limitation to be taken into account in both respects. According to that provision, the UNCITRAL Rules “shall govern the arbitration except that where any of these Rules is in conflict with a provision of the law applicable to the arbitration from which the parties cannot derogate, that provision shall prevail.” Article 1(3), which requires the respect of mandatory norms of the applicable procedural law, reflects the fact, touched upon in the introduction to the present chapter, that arbitration is in many ways circumscribed by laws pertaining to it,41 whether of domestic or international origin.42 The scope and meaning of the requirement, and its relation to certain other fundamental principles concerning arbitration, will be further discussed in the next section.43

(p. 23) (6)  Future transparency rules for investor–state arbitration

Users of the UNCITRAL Rules in the context of investor–state arbitration should be aware of UNCITRAL's work to develop rules of transparency for investor–state arbitration, a project nearing completion at the time of this writing. The precise scope of application of the transparency rules is still under debate. Throughout Working Group discussions, two distinct camps emerged. The majority of delegations supported the “opt in” approach. They favored application of the transparency rules only by express agreement of the parties in a future treaty or through some other instrument of consent. Thus, the transparency rules would take the form of a stand-alone set of procedural rules, either specific to UNCITRAL arbitration or more generally applicable, into which the parties to an investment treaty could opt if they so desired. According to those favoring the “opt in” direction, this approach would ensure that parties to an investment treaty could not be surprised by a tribunal as to application of the transparency rules to a particular investor–state arbitration.44

A minority of delegations expressed strong support for the “opt-out” position. The “opt out” proponents supported inclusion of the transparency rules as part of the UNCITRAL Rules, either as an annex to those Rules or as an addition to the main body of the Rules. They also advocated for a presumption in the transparency rules, according to which a general reference to the “UNCITRAL Arbitration Rules” in a future investment treaty would mean, subject to rules of treaty interpretation, that the transparency rules would apply (since they are part of the UNCITRAL Rules), unless the parties to an investment treaty expressly opted out of their application. The “opt out” camp believed that such a presumption of application under future treaties, along with no express limitation of application under existing treaties, furthered the aims of transparency better, particularly because it did not limit the possibility that thousands of existing investment treaties might therefore involve the application of the transparency rules.45

The question of the scope of application of the transparency rules was heavily debated at the Working Group's fifty-sixth session, with the outlines of a compromise slowly emerging. The compromise proposal provided generally that the transparency rules would apply only when the parties to an investment treaty or the disputing parties in an investor–state arbitration had expressly agreed to their application.46 It further provided that a generic reference to the UNCITRAL Arbitration Rules in a treaty concluded after the date of adoption of the transparency rules would be presumed to include the transparency rules.47 Thus, the basis of the compromise was the “opt out” approach, but only with respect to future investment treaties concluded after the transparency rules come into effect. If such a compromise is ultimately adopted by UNCITRAL, it may very well require a revision to (p. 24) Article 1(1) of the 2010 UNCITRAL Rules to clarify the relationship between those Rules and the transparency rules. Or it may even result in a re-issuing of the UNCITRAL Arbitration Rules to include the general procedural rules, adopted in 2010, and the transparency rules in one instrument.

(7)  Model arbitration clause

The Rules also include a model arbitration clause to assist the parties in drafting a complete and enforceable agreement to arbitrate. Despite the wide scope of application of the Rules themselves (“in respect of a defined legal relationship, whether contractual or not”), the model arbitration clause applies only with respect to “any dispute, controversy, or claim arising out of or relating to this contract, or the breach, termination or invalidity thereof ….”. The Working Group tasked with revising the Rules considered whether to delete the reference to contract, but ultimately concluded that the purpose of the clause was “precisely to provide a recommendation for the parties wishing to include a clause in their contract.”48 A note to the model arbitration clause identifies key information that the parties should consider including in their arbitration clause. This information includes: (a) the name of the institution or person that is to act as appointing authority,49 (b) the number of arbitrators (one or three), (c) the town and country that is to serve as the “place,” or legal seat, of arbitration,50 and (d) the language(s) to be used in the proceedings.51

(8)  Comparison to the 1976 UNCITRAL Rules

Article 1 of the 2010 UNCITRAL Rules bears similarities to corresponding Article 1 of the 1976 UNCITRAL Rules, but with certain notable differences.

Article 1(1) of the 2010 Rules applies to disputes “in respect of a defined legal relationship, whether contractual or not,”52 whereas Article 1(1) of the 1976 Rules only covers disputes in relation to a “contract.”53 Thus, the scope of application of the 1976 Rules is decidedly narrower than the 2010 Rules. Despite their more limited scope of application, the 1976 Rules have proven to be highly adaptable to a wide range of both contractual and (p. 25) non-contractual disputes for two primary reasons. First, Article 1(1) does not limit application of the 1976 Rules to commercial transactions of only an international nature.54 Although the Rules were developed with international commercial arbitration in mind, nothing prevents them from being utilized in purely domestic arbitration. Second, because Article 1(1) affords the parties substantial flexibility to modify the Rules, they may in many cases agree to expand the scope of application to cover disputes involving non-contractual issues, such as issues of tort or public international law.55 The Iran–US Claims Tribunal, for example, expanded the scope of Article 1 of the 1976 Rules to include claims permitted within the framework of the Algiers Declarations, ie, “debts, contracts …, expropriation or other measures affecting property rights.”56 One ad hoc arbitral tribunal applying the Rules found that the parties were free to adapt the UNCITRAL Rules to apply to their dispute over the annexation of the Hawaiian Kingdom by the United States.57

Another significant difference is that the 2010 Rules no longer require, as the 1976 Rules did, that an agreement to arbitrate under the Rules be made in writing. While the desirability of this requirement under the 1976 Rules drew differing views during UNCITRAL's preparatory discussions, it was ultimately concluded that “[w]riting is required in order to avoid uncertainty as to whether the Rules have been made applicable.”58 Delegates believed that by guaranteeing both certainty and compliance with most national (p. 26) laws of the day, as well as with the New York Convention, a written arbitration agreement would enhance acceptance and enforceability of any award resulting from the proceedings.59 Similarly, there is a requirement that any “modification [of the 1976 Rules] must be in writing in order to ensure certainty as to its existence and precise ambit.”60 For reasons explained in the preceding section, Article 1 of the 2010 Rules no longer includes any writing requirements.

Article 1(2) of the 2010 Rules provides presumptions for determining which version of the Rules is applicable to a particular dispute where there is no agreement between the disputing parties. No such provisions appear in the 1976 Rules, although the 1976 model arbitration clause anticipates new versions of the Rules, providing that resolution of a contractual dispute will be in accordance with the UNCITRAL Rules “as at present in force.”61 Thus, parties that have incorporated the model clause into their contracts, even prior to adoption of the 2010 Rules on August 15, 2010, have agreed to apply the revised Rules to any dispute arising thereafter.

Article 1(3) of the 2010 Rules is identical to Article 1(2) of the 1976 Rules.

The 2010 and 1976 model arbitration clauses are substantially similar, with minor differences. The 1976 model clause, as noted, contains the phrase “shall be settled by arbitration in accordance with the UNCITRAL Arbitration Rules as at present in force,”62 whereas the 2010 model clause drops “as at present in force.” Instead, the 2010 Rules contain separate provisions on applicability of a particular version of the Rules.63 A second change is the strengthening of the suggestion to include additional provisions. The note to the 1976 model clause provides that the parties “may wish to consider” including certain key information in their arbitration clause, whereas the 2010 Rules changes this to “should consider.” The 1976 model clause also encourages the parties to identify the “town or country” when designating the place of arbitration. In contrast, the 2010 Rules include the words “town and country” to encourage greater specificity in the parties’ designation.64 Finally, the reference to “language(s)” of the arbitration in the 1976 Rules is replaced by “language” in the 2010 Rules in order not to unnecessarily encourage dual-language arbitration.

C. Extracts from the Practice of Investment and other Tribunals

(1)  Article 1(1) (1976 Rules)—scope and modification

Lance Paul Larsen and Hawaiian Kingdom, Award (February 5, 2001) (PCA administered, 1976 UNCITRAL Rules, Special Agreement), reprinted in (2001) 119 Intl L Rep 566, 585–86:

(p. 27)

  1. 10.7  … When regard is had to the non-prescriptive and non-coercive nature of the [1976] UNCITRAL Rules as a standard regime available for parties to apply to resolve disputes between them, however, there appears no reason why the [1976] UNCITRAL Rules cannot be adapted to apply to a non-contractual dispute. For example, the parties could agree that a dispute as to tort, or occupier's or environmental liability might be determined in an arbitration applying the [1976] UNCITRAL Rules. Moreover they could so agree in relation to a dispute which had already arisen independently of any contractual relationship between them. In this manner the parties to an arbitration may specifically or by implication adopt or apply the [1976] UNCITRAL Rules to any dispute.

  2. 10.8  Further, although the [1976] UNCITRAL Rules were primarily drawn for the purposes of the arbitration of contractual disputes between parties or corporations, a State entity, or a State itself, may become a principal party to an agreement to arbitrate subject to [1976] UNCITRAL Rules. A State may agree to arbitrate under the [1976] UNCITRAL Rules before or after a dispute arises. Indeed, State parties commonly agree to apply the [1976] UNCITRAL Rules, modified as may be appropriate, to disputes that they have agreed to arbitrate with a non-state party. In the context of international arbitration this often enough occurs in disputes over procurement or “build, operate and transfer” contracts and other transactions involving a State and a non-State foreign party.

    …

  3. 10.10  For these reasons the Tribunal approaches the issue of the applicable rules on the basis that the [1976] UNCITRAL Rules may be applied to an agreement to arbitrate a non-contractual dispute, including a dispute where one of the parties is or is said to be a State. The Tribunal finds that the parties to this arbitration effectively have agreed to apply the [1976] UNCITRAL Rules with such necessary adaptations as arise from the terms of the Arbitration Agreement and the nature of the issues referred to arbitration.

Glamis Gold Ltd and United States of America, Agreement on Certain Procedural Matters (January 20, 2004) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 1:

3. As contemplated by Article 1.1 of [1976] UNCITRAL Arbitration Rules, the disputing parties hereby agree to modify Article 39 of the [1976] UNCITRAL Arbitration Rules to provide as follows: “Compensation for the arbitration tribunal shall be at the rates specified in the International Centre for Settlement of Investment Disputes (ICSID) Schedule of Fees, and administered as provided in ICSID's Administrative and Financial Regulation 14.”

Canfor Corp and United States of America, Decision on the Place of Arbitration, Filing of a Statement of Defence and Bifurcation of the Proceedings (January 23, 2004) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 2:

8. By letter of November 18, 2003, the parties advised the Tribunal that they had agreed, pursuant to Article 1(1) of the [1976] UNCITRAL Arbitration Rules, to modify Article 16(1) of those Rules to provide that, “[u]nless the parties have agreed upon the place where the arbitration is to be held, the Tribunal shall fix the place of arbitration at a city in Canada or the United States of America, having regard to the circumstances of the arbitration.”

(p. 28) Econet Wireless Ltd and First Bank of Nigeria, et al, Award (June 2, 2005) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Contract), reprinted in (2006) XXXI Ybk Commercial Arb 49, 57–58, 63:

  1. [18]  The Claimant argues that by adopting an alternative appointment procedure to replace Art. 7(1) of the UNCITRAL Rules, the Parties implicitly agreed to modify Art. 7(2) and 7(3) as necessary to make these provisions consistent with the procedure they chose. According to the Claimant, the Parties made this ‘implicit’ modification to ensure the same outcome as would arise where one of the parties fails to appoint under the standard UNCITRAL Rules: the vacancies on the Tribunal are filled by an appointing authority selected by the PCA.

  2. [19]  Through their arbitration agreement, the parties have the power to alter the UNCITRAL Rules as they see fit. As already noted, this is expressly authorised in Art. 1(1) of the Rules. While the UNCITRAL Rules require that modification be ‘in writing’, this requirement is interpreted broadly in modern arbitration practice. The Parties indeed modified the UNCITRAL Rules ‘in writing’, through Art. 25.1 of the Shareholders’ Agreement; the question remains as to the contours of the arbitration procedure so modified.

  3. [20]  The Tribunal's task is to enforce the Parties’ bargain, reconstructing as closely as possible the dispute resolution structures that the Parties contemplated when they signed their agreement. Total Nigeria Plc v. Morkah, (2002) 9 NWLR 492 at 519. This is no simple matter now that a dispute has arisen between them, perhaps changing each side's view of what the optimal arbitration procedure should have been. The difficulty in deciding a case such as this one is not that one must choose between a logical and an illogical interpretation, but rather between two logical but inconsistent interpretations.

  4. [21]  The implicit modification of UNCITRAL Rules Art. 7 suggested by the Claimant would require substantial wordsmithing to be effective … . . .

    [40]We find there to be insufficient evidence as to the ex ante expectation of the Parties with regard to whether NACA Sect. 7(3) would serve as a reliable backstop provision to complement their agreed system for composing the arbitral tribunal. More importantly, there is insufficient evidence to support the notion that, regardless of their view of the NACA's sufficiency in this regard, the Parties agreed to the PCA as the appropriate alternative recourse. As explained above, to accept this assumption the Tribunal must substantially alter the Parties’ express contractual agreement, as expressed in the UNCITRAL Rules. This the Tribunal cannot do, in the absence of persuasive evidence that this change was indeed the Parties’ intent. While the Parties may have signed an imperfect arbitration agreement, and one which leads to an undesired result for the Claimants in the present specific circumstances, it is not for us to repair it for them after the fact.

(2)  Article 1(2) (1976 Rules)—non-derogation from mandatory law

Wintershall AG, et al and Government of Qatar, Partial Award on Liability (February 5, 1988) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Concession Agreement), reprinted in (1989) 28 ILM 798, 801:

By the second sentence of paragraph 1 of its Order of March 18, 1987, the Tribunal provided that the procedure of the arbitration shall be governed by the [1976] UNCITRAL Arbitration Rules, as agreed by the Parties in the Agreement of October 22, 1986, subject to any mandatory provisions of the Netherlands Arbitration Law, which, in the event of conflict with any of the [1976] UNCITRAL Rules shall prevail. The Tribunal has concluded that its Partial Award on Liability, determining the substance of the claims on both jurisdiction and the merits, and proposed Final Award (See XX hereof) are consistent with the [1976] UNCITRAL Arbitration Rules and in no respect in conflict with any of the mandatory provisions of the Netherlands Arbitration Law.

(p. 29) Himpurna California Energy Ltd and PT (Persaro) Perusahaan Listruik Negara, Final Award (May 4, 1999) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Concession Agreement), reprinted in (2000) XXV Ybk Commercial Arb 13, 26:

[44]  With respect to matters of procedure, the Arbitral Tribunal is bound to follow the agreement of the Parties, which in this case means the [1976] UNCITRAL Arbitration Rules to which their contract refers. The Arbitral Tribunal is not required to apply any national rules of procedure unless a Party has shown that the application of such a rule is mandatory. This is the consequence of Art. 1(2) of the [1976] UNCITRAL Rules which provides:

These Rules shall govern the arbitration except that where any of these Rules is in conflict with a provision of the law applicable to the arbitration from which the parties cannot derogate, the provision shall prevail.

Econet Wireless Ltd and First Bank of Nigeria, et al, Award (June 2, 2005) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Contract), reprinted in (2006) XXXI Ybk Commercial Arb 49, 57–58, 63:

[25]  But this is not the end of the analysis. The Parties’ reference to Nigerian law as the procedural system applicable to their dispute only serves to reinforce the gap-filling function served by the lex arbitri where the parties have not chosen another procedural regime. The NACA, along with any relevant jurisprudence interpreting the statute, is therefore the Tribunal's next port of call, since neither the Shareholders’ Agreement nor the UNCITRAL Rules provide a satisfactory answer to the question at hand.

3. General Provisions—Article 17

A. Text of the 2010 UNCITRAL Rule65

Article 17 of the 2010 UNCITRAL Rules provides:

General provisions

  1. 1. Subject to these Rules, the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, provided that the parties are treated with equality and that at an appropriate stage of the proceedings each party is given a reasonable opportunity of presenting its case. The arbitral tribunal, in exercising its discretion, shall conduct the proceedings so as to avoid unnecessary delay and expense and to provide a fair and efficient process for resolving the parties’ dispute.

  2. 2. As soon as practicable after its constitution and after inviting the parties to express their views, the arbitral tribunal shall establish the provisional timetable of the arbitration. The arbitral tribunal may, at any time, after inviting the parties to express their views, extend or abridge any period of time prescribed under these Rules or agreed by the parties.

  3. (p. 30) 3. If at an appropriate stage of the proceedings any party so requests, the arbitral tribunal shall hold hearings for the presentation of evidence by witnesses, including expert witnesses, or for oral argument. In the absence of such a request, the arbitral tribunal shall decide whether to hold such hearings or whether the proceedings shall be conducted on the basis of documents and other materials.

  4. 4. All communications to the arbitral tribunal by one party shall be communicated by that party to all other parties. Such communications shall be made at the same time, except as otherwise permitted by the arbitral tribunal if it may do so under applicable law.

  5. 5. The arbitral tribunal may, at the request of any party, allow one or more third persons to be joined in the arbitration as a party provided such person is a party to the arbitration agreement, unless the arbitral tribunal finds, after giving all parties, including the person or persons to be joined, the opportunity to be heard, that joinder should not be permitted because of prejudice to any of those parties. The arbitral tribunal may make a single award or several awards in respect of all parties so involved in the arbitration.

B. Commentary

Article 17 contains “General Provisions” and is one of the most important articles of the UNCITRAL Rules. It spells out certain fundamental principles which must be taken into account in the application of the more specific rules “during the arbitral proceedings,” that is, until the issuance of the award or other termination of the proceedings.66 Although at first reading Article 17 may not appear to provide answers to so many concrete questions, it does in fact provide the key to a variety of problems not regulated elsewhere in the Rules. Therefore, Article 17 should be carefully studied prior to commencement of the arbitral proceedings.

(1)  Basic principles—Article 17(1)

(a)  Arbitral autonomy and its limits

Article 17(1) has rightly been referred to as the “heart” of the UNCITRAL Rules.67 By providing that “the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate” the provision reflects the procedural flexibility which is generally regarded as one of the main advantages of arbitration.68 Tribunal practice evidences the wide application of this authority.69 In international cases there is also a special need for freedom from (p. 31) unfamiliar local standards and requirements.70 The desire for flexibility, however, must be balanced against other interests, such as the need for some ultimate control of procedural fairness and legal certainty concerning the international acceptance of the award.71 Thus, the ostensibly wide discretion of the arbitrators is subject to certain limitations; some follow directly from Article 17(1), while others flow from other provisions in the Rules.72

The first limitation is that the freedom of the arbitral tribunal is “[s]ubject to these Rules,” ie, limited by the more specific provisions of the UNCITRAL Rules regarding the conduct of the arbitration.73 The UNCITRAL Rules in many cases provide a limiting framework for the exercise of arbitral discretion.74 For example, Article 27(3) provides that “[a]t any time during the arbitral proceedings the arbitral tribunal may require the parties to produce documents, exhibits or other evidence within such a period of time as the tribunal shall determine.”75 In other cases, however, the Rules provide almost no structure at all and it is the arbitrators who must develop the particulars in accordance with the general principle enunciated in Article 17(1). For example, the question of whether a tribunal applying the Rules has the power to accept amicus submissions from third parties arose in various investor–state arbitrations.76 In these cases, it was found that allowing third parties to make amicus submissions fell within the tribunal's powers to conduct the arbitration in an appropriate manner.77 Whenever the Rules impose more definite limitations on arbitral (p. 32) discretion, these should be taken into account. A major departure from them could provide a ground for setting aside the award78 or endanger an award's enforceability under the New York Convention.79

A second fundamental limitation on the discretionary powers granted by Article 17 is found in the principle of equality,80 a concept closely connected with the principle of audiatur et altera pars.81 The Preliminary Draft of the 1976 UNCITRAL Rules required that the parties be treated “with absolute equality.”82 The abolition of the word “absolute” from the rule as finally adopted indicates that the provision aims to guarantee not so much formal equality as equality in the sense of justice and fairness.83 The arbitral tribunal may, for example, deviate from a “mechanical” application of equality84 as between the respective national languages of the parties (assuming both are used in arbitration), provided it does not prejudice any party's right to present its case and receive justice on the basis of material equality.85 On the other hand, a party's rights would unavoidably be prejudiced should its opponent be consulted ex parte by the arbitrators,86 or be “permitted to present an extensive Memorial and additional exhibits, without providing an opportunity for the other party to file a memorial in response.”87 This understanding of equality is reflected in the wording of Article 17(1), which does not include the word “absolute.” Arbitral tribunals have drawn on the principle of equal treatment to address a number of procedural matters.88

The principle of equality has been closely tied with the requirement “that at an appropriate stage of the proceedings each party is given a reasonable opportunity of presenting (p. 33) his case.” This requirement not only prohibits relative differences in treatment of the parties with respect to the presentation of their cases, but also establishes an absolute prohibition against depriving a party of the right to present its case, even if the tribunal's treatment affects both parties “equally.” Even “equal treatment” in some cases can amount to arbitrariness when it benefits one party to the detriment of another, ie, by negating equality in the material sense discussed earlier.89 At the same time, a party's right to present its case is not without limits. According to Article 17(1), a party is entitled to a reasonable opportunity to present its case “at an appropriate stage of the proceedings,” as opposed to any stage of the proceedings.90 The arbitral tribunal thus retains significant discretion in determining when the parties should have an opportunity to present their cases.91

In the practice of international tribunals, the issue of equality has mainly arisen as a question concerning the right to present one's case, most particularly in connection with orders and other decisions on written submissions.92 The delicate and difficult questions that the requirement of equality may raise are reflected in some of the dissenting opinions of party-appointed arbitrators.93

A party who feels that its right to equal treatment has been violated is advised to object promptly. Failure of timely protest may not only deprive the arbitral tribunal of the opportunity to reconsider the matter immediately, but also, in subsequent court proceedings, it may be regarded as indirect proof that the requirement of fair treatment of the parties was in fact fulfilled.94 Denial of a party's reasonable opportunity to present its case may lead to (p. 34) the non-enforcement of the award,95 as was the case with the award in Avco, discussed later in section 3(B)(1)(d).

A third limitation is rooted in the arbitral tribunal's duty to conduct the proceedings “so as to avoid unnecessary delay and expense and to provide a fair and efficient process for resolving the parties’ dispute.”96 The negotiating history reports that some delegations found express reference to the duty to be unnecessary, presumably because they believed it was implied.97 Nevertheless, such a duty may serve as a useful reminder that the parties have a right—in addition to the right to equal treatment and an opportunity to present their cases—to an arbitral process that is conducted expeditiously, cost-effectively, fairly and efficiently.98 Failure to comply with this duty may expose the tribunal to criticism by the parties or in some cases even litigation by the parties.99

A fourth limitation on the discretion of the arbitrators stems from Article 1(1), according to which the UNCITRAL Rules govern arbitration “subject to such modifications as the parties may agree.” Thus, the parties have freedom to modify the rules, and the arbitral tribunal should afford due respect to such modifications.100 The proceedings before the Iran–US Claims Tribunal exemplify the application of the UNCITRAL Rules in a modified fashion. Such modifications have been created through article-by-article specifications in the “Tribunal Rules.” Furthermore, the provisions of the Algiers Accords (insofar as they relate to the Tribunal proceedings) amount to written modifications of the UNCITRAL Rules which the Tribunal must respect.101

A fifth basic limitation to be taken into account in the application of Article 17(1) follows from Article 1(2). It provides that the UNCITRAL Rules (whether intended to apply as such or in a version modified by the parties) prevail only to the extent that they are not “in conflict with a provision of the law applicable to the arbitration from which the parties cannot derogate.”102 This means, on the one hand, that the parties cannot (p. 35) agree to modifications which are in conflict with mandatory provisions of the law applicable to the arbitration, nor is it possible for the arbitrators to derogate from such provisions. On the other hand, the combined effect of Articles 17(1) and 1(2) is that “a choice of the UNCITRAL Rules is to be understood as an exclusion of all national arbitration law, except for its mandatory provisions.”103 In other words, unless the parties have agreed to abide by a given law, or the arbitral tribunal has decided, in accordance with Article 17(1), to apply procedural norms of a designated national law, the arbitrators are not obliged to follow any domestic law in solving procedural problems not covered by the UNCITRAL Rules.104 They must, however, ensure that the mandatory norms of “the law applicable to the arbitration” are not circumvented.

If no national procedural law has been specifically designated, “the law applicable to the arbitration” presumptively is the law of the place of arbitration (lex loci arbitri).105 Even when another law has been chosen as the procedural law of the arbitration, any mandatory norms of the law of the place prevail by virtue of the sovereignty of the territorial state,106 or—to put it differently—“an international arbitral tribunal is only free of the constraints of local law if the local law itself allows it to be so.”107 In order to avoid confusion, and also practical difficulties caused by applying different domestic norms, an arbitral tribunal should avoid designating a law other than the lex loci arbitri as the applicable procedural law.108

The normal sanction for non-observance of the mandatory norms of the local law is that the award may be set aside by the courts of the seat of arbitration. This, in turn, may prevent the award from being recognized and enforced in other countries.109 The contents of typical mandatory norms are discussed later in this chapter in connection with Article 18(1) in section 4.

While, at least as a general principle, the mandatory provisions of the law of the place of arbitration must be respected, the question remains whether exceptions to this rule are ever (p. 36) possible. In other words, do the UNCITRAL Rules envisage the possibility of “a-national” arbitration, detached from any control exercised by the local law?110

The relevant wording allows the interpretation “that Article 1(2) only provides for national law ‘if applicable,’ and, thereby does not exclude the possibility that none is applicable.”111 Although the sovereignty aspect usually does exclude such a possibility, this is not the case where the territorial state has accepted the non-applicability of its own mandatory norms, or where it has no mandatory norms. In the latter, perhaps somewhat theoretical112 case, it is clear that Article 1(2) has no practical relevance. If, on the other hand, the territorial state does have mandatory norms from which derogations are permitted (eg in international arbitrations), the detachment of the proceedings from the national law is conceivable, provided the parties, in accordance with Article 1(1), or the arbitral tribunal, by virtue of Article 17(1), are in agreement. However, in the absence of a clear agreement between the parties, the tribunal should not detach the proceeding from national law. The very existence of Article 1(2) in the applicable procedural rules might be understood by courts to signify the parties’ intention to keep the arbitration under the control of the local law. Further, as indicated earlier, non-observance of the party agreement may, in turn, have harmful consequences.113

(b)  Confidentiality in UNCITRAL arbitration

Privacy is a long-established hallmark of international commercial arbitration. One of the principal attractions of arbitration is the ability to resolve commercial disputes discreetly, without exposure to the public scrutiny often associated with national court proceedings.114 In most arbitrations, the discretion of the parties is enough to prevent sensitive information from being disclosed to the public. However, privacy, even if deeply established in custom, does not equate to confidentiality, which implicates a legal obligation to avoid public disclosure of sensitive information. Thus, it is not imprudent to expect that international arbitration will take place in a completely closed environment in which all sensitive information and documents remain private and confidential. As we will explain, the degree of disclosure may depend on other important factors, such as the existence and scope of a confidentiality agreement and/or confidentiality order, and the mandatory provisions of any governing law on confidentiality. Further, the participation of non-disputing parties in the arbitral process, namely as amicus curiae, may be determined by the public character of the arbitration.

The UNCITRAL Rules address only a handful of issues relating to the exclusivity of the arbitral process. Article 28(3) requires that the hearings “be held in camera.” According to (p. 37) Article 34(5), the award may be published “only with consent of both parties.” However, other important issues regarding confidentiality are not addressed, such as the extent to which written submissions or supporting materials, such as witness statements, expert reports, or documentary evidence, may be made public. The arbitration rules of various arbitral institutions have addressed these issues with notably greater specificity and depth than the UNCITRAL Rules.115 The limited approach of the Rules toward confidentiality matters raises two important issues: (1) whether a general duty of confidentiality can be inferred from the existing provisions of the Rules or from the arbitral process in general; and (2) whether, in the absence of such a general duty, confidentiality can be preserved through a confidentiality agreement by the parties or a procedural order by the arbitral tribunal.

Since Articles 28(3) and 34(5) of the Rules affirmatively address discrete aspects of the arbitral process (the hearing, the deliberations, and the award), we conclude that they alone cannot give rise to a general duty of confidentiality. Whether a duty of confidentiality can be inferred from the arbitration agreement (perhaps along with the UNCITRAL Rules as incorporated into that agreement) is a more relevant question that has divided many national courts.116 The common view in English law is that the parties’ arbitration agreement gives rise to an implied duty of confidentiality.117 In contrast, Australia, the United States, and Sweden have taken the view that a party to the arbitral proceedings is not bound by an inherent duty of confidentiality.118 For example, in Panhandle Eastern Corporation, a US district court ruled that absent express provisions on confidentiality in the arbitral rules of procedure “parties to arbitration proceedings or the independent arbitration tribunal which conducts those proceedings” are not bound to keep documents confidential.119 Some arbitral institutions have followed this approach.120

Given the divergence of national law approaches toward confidentiality, the parties to arbitration are well advised to research carefully the lex arbitri. The Model Law does not contain any provisions on confidentiality. At least one jurisdiction has adopted a modified version of the Model Law that includes provisions providing for significant protections (p. 38) against public disclosure.121 In addition to the lex arbitri, the laws on confidentiality of other relevant jurisdictions should be considered, such as the law of a jurisdiction in which the award might be enforced, since enforcing courts are likely to address claims of confidentiality in accordance with local rules on disclosure.122

The best protection against disclosure of sensitive information relating to the arbitral process is a precise and comprehensive agreement by the parties on all confidentiality matters. A confidentiality agreement may assume many forms with equal effectiveness. It may be fashioned as part of the arbitration agreement,123 as a modification of the Rules, in accordance with Article 1(1), or as a separate agreement reached by the parties during the early phase of arbitration. Regardless of the agreement's form, the arbitral tribunal may wish to issue a procedural order, pursuant to Article 17(1), which endorses any agreed-upon terms of confidentiality or, if agreement has not been reached with respect to one or more terms, establishes such terms to the extent necessary. Once embodied in a procedural order, the terms of confidentiality are binding on the parties and enforceable by the tribunal, if necessary, in accordance with the relevant provisions of the UNCITRAL Rules.124

As to the substance of a confidentiality agreement, the UNCITRAL Notes recommend inclusion of one or more of the following matters:

[1]  the material or information that is to be kept confidential (e.g. pieces of evidence, written and oral arguments, the fact that the arbitration is taking place, identity of the arbitrators, content of the award); [2] measures for maintaining confidentiality of such information and hearings; [3] whether any special procedures should be employed for maintaining the confidentiality of information transmitted by electronic means (e.g. because communication equipment is shared by several users, or because electronic mail over public networks is considered not sufficiently protected against unauthorized access); [4] circumstances in which confidential information may be disclosed in part or in whole (e.g. in the context of disclosures of information in the public domain, or if required by law or a regulatory body).125

(p. 39) A party often will find it necessary to disclose confidential information to a third party who is involved in the arbitration, such as counsel, officials or employees of a party, experts or witnesses. Accordingly, to elaborate on matter [2] above, it is good practice to require each such individual to execute a separate confidentially agreement which establishes the terms of confidentiality and the obligation to return all original documents and copies to the relevant parties when the arbitration concludes.126

Even where the duty of confidentiality is firmly established by a confidentiality agreement, a confidentiality order, or by national law, that duty is typically not absolute. Information or materials designated as confidential in arbitration may be subject to disclosure for various reasons. For example, disputing parties may be subject to competing or superseding contractual obligations to disclose information relating to a dispute to shareholders, creditors, insurance companies or auditors. In addition, where one of the disputing parties is a sovereign nation, that party's national laws on public access to government documents may compel disclosure of confidential information.127

During revision of the Rules, the issue arose whether to include a general provision on the confidentiality of the proceedings. Proponents highlighted the risks of not containing such a provision, as demonstrated by the opinion of the English Court of Appeal in City of Moscow v Bankers Trust, which held that an award challenged in English courts could be made public despite one party's expectation of privacy.128 Opponents cautioned that a general confidentiality provision in the Rules would limit the flexibility of the tribunal and the parties to respond to a complex and evolving area of the law and practice.129 They also saw drafting a general provision as “extremely problematic,” noting the difficulties in addressing issues such as “when the duty of confidentiality arose and ended, whether that duty extended to persons other than the parties, such as witnesses and experts, and what exceptions should be made to that duty.”130 Some also believed a general provision would contravene the current trend toward greater transparency in international proceedings. Thus, according to the prevailing view in the Working Group, the issue of confidentiality was left to be addressed on a case-by-case basis by the tribunal and the parties.131

(c)  Non-disputing party (amicus) submissions in UNCITRAL arbitration

Another issue regarding the openness of the arbitral process is the level of participation in proceedings by non-parties (other than counsel, experts, and witnesses). Non-parties have no standing to bring claims before the arbitral tribunal as interveners if they are not (p. 40) contractually bound by the arbitral agreement. The participation of non-disputing parties as amicus curiae in special circumstances is another matter, however. The UNCITRAL Rules contain no express provision on amicus curiae participation. Investor–state arbitral tribunals, however, have concluded that they may accept submissions by non-disputing parties as amicus curiae under their general authority to conduct the proceedings in the manner deemed appropriate.132 This conclusion is consistent with the practice of the Iran–United States Claims Tribunal, according to which outside involvement by non-disputing parties has been deemed acceptable.133

The arbitral tribunal's authority to accept amicus submissions is circumscribed by other important provisions of the Rules. The arbitral tribunal's procedural powers under Article 17(1) are tempered by that same provision's requirement to treat the parties with equality. Accordingly, amicus submissions may not be used in a way which is unduly burdensome for the parties in terms of time and cost or which complicates or substantially lengthens the arbitral process. An arbitral tribunal thus may wish to place restrictions on the scope and length of any submissions made by non-disputing parties.134 Moreover, the acceptability of amicus submissions does not imply any higher level of participation by non-disputing parties. Article 28(3) expressly bars all non-parties from attending the hearings, unless the parties agree otherwise.135 Further, with respect to access to confidential information, amicus curiae would obtain no greater access to confidential materials than any other member of the public would in accordance with an applicable confidentiality agreement, procedural order, or national law provision.

While generally permissible under the UNCITRAL Rules, amicus submissions are unlikely to be utilized in most arbitrations. Traditional resistance by the parties in a commercial arbitration to disclosing any information about their dispute to the public may likely stymie any outside participation.136 In a more public forum, such as investor–state arbitration, the presence of a sovereign party and “the important public character of the (p. 41) matters in issue” are clearly more conducive to the acceptance of amicus submissions.137 This is not to say, however, that non-disputing party participation could not occur in international commercial arbitration where the arbitration arises under a national statute with a public purpose or the issues bear heavily upon the public interest.

Users of the UNCITRAL Rules should also bear in mind the work of the Working Group on rules of transparency in investor–state arbitration.138 At the time of this writing, the Working Group was close to reaching consensus on a rule on amicus submissions. The current draft of the rule incorporates elements of Rule 37(2) of the ICSID Arbitration Rules on non-disputing parties and the NAFTA's Statement of the Free Trade Commission on Non-disputing Party Participation dated October 7, 2004.139 When requesting leave to file an amicus submission, a third person must provide information regarding its identity, its affiliation with any disputing party, its interest in the arbitration, and the issues of fact or law it wishes to address. In determining whether to accept such a submission, the tribunal should consider whether the third person has a significant interest in the arbitration and whether the submission would assist the tribunal in determining issues of fact or law by bringing knowledge, insights, or perspectives that are different from that of the disputing parties.140

(d)  The nature of the proceedings before the Iran–US Claims Tribunal

The status of the arbitral proceedings before the Iran–US Claims Tribunal, and their relation to the local (ie Dutch) law, is not easily characterized. The ambiguity primarily concerns the “private” element of the Tribunal proceedings, that is, the commercial cases involving private parties on one side. As to the public international arbitration between Iran and the United States, it appears that the proceedings are governed solely by the Algiers Accords and the Tribunal Rules.141

The Tribunal's work which resembles private arbitration is filled with ambiguity. On the one hand, factors such as the specification of The Hague as the place of arbitration, the practice according to which the Tribunal deposits its awards with the District Court of The Hague and the adoption of Article 1(2) of the 1976 UNCITRAL Rules in the 1983 Tribunal Rules may be taken to suggest that the proceedings are subject to mandatory Dutch law.142 On the other hand, all of these factors can be explained otherwise: the specification of The Hague as the place of arbitration was made only in order to provide a neutral seat; the practice concerning deposit can be explained by practical considerations; and Article 1(3) of the 2010 UNCITRAL Rules (formerly Article 1(2) of the 1976 Rules) in itself does not exclude the possibility of no national law being “applicable.”143

(p. 42) Given these circumstances, guidance should be sought from the Tribunal's practice. The fact that the Tribunal has never referred to the mandatory norms of Dutch law is hardly alone decisive.144 It is conceivable that, when applying the 1976 UNCITRAL Rules, as modified, the Tribunal takes for granted that any mandatory requirements of the arbitration law of the Netherlands are automatically complied with. A somewhat more forceful argument supporting the “a-national” characterization of the Tribunal proceedings is found in the Chambers’ orders emphasizing that the proceedings are governed “by the Tribunal Rules and by no national procedural system,”145 or “by the Declaration of the Government of the Democratic and Popular Republic of Algeria and by the Tribunal Rules of Procedure.”146 These statements clearly reflect an understanding that the arbitration before the Tribunal is in no way controlled by Dutch law.

Whether or not this view of the nature of the Tribunal proceedings can be taken as the Tribunal's final word on the issue, it certainly could not overrule any contrary conclusion drawn by the territorial state, the Netherlands, or by courts in the Netherlands. Neither the Dutch courts nor the Dutch government have taken a definite stand. In 1983 the Dutch government proposed a “Bill regarding the Applicability of Dutch Law to the Awards of the Tribunal Sitting in The Hague to Hear Claims between Iran and the United States,”147 which would have declared the Tribunal's awards rendered in cases involving private parties to be Dutch, and made it possible to challenge them before Dutch courts (though only on very limited grounds). The legislative process, however, was frozen, largely due to criticism leveled against the Bill by Iran.148 Iran, in turn, agreed to withdraw ten lawsuits filed in 1983 at the District Court of the Hague against the Tribunal's awards allegedly rendered in breach of the Dutch arbitration law.149

Thus, the relationship between the Tribunal proceedings and Dutch law remains untested by the courts and authorities of the Netherlands. Opposite views have been put forward in Dutch legal writing,150 and the following passage from the preamble to the Dutch Bill also shows the ambiguity surrounding the question: “It is by no means clear that the decisions and awards of the Tribunal concerning private claims would be characterized, by Dutch courts, as arbitral decisions or awards under the relevant provisions of the Dutch Code of Civil Procedure.”151

Faced with this problem, a court of another country should take into account the possibility of the Tribunal awards being “a-national,” that is, not under the control of the procedural law of the Netherlands. It is in connection with efforts to enforce Tribunal (p. 43) awards outside the Netherlands that the issue may arise—indeed, has arisen. According to some experts, “the primary international Convention in the field, the New York Arbitration Convention of 1958, does not apply to awards which are not governed by a national arbitration law.”152 However, an equally eminent author has noted that “[t]his is not the black letter of the Convention—in fact, to many it is an impermissible reading.”153

Such differences of opinion indicate that the enforceability of “a-national” awards under the New York Convention is at least uncertain. Indeed, one of the side effects expected from the Dutch Bill was to guarantee the enforceability of the awards under the Convention.154

The question whether the awards of the Iran–US Claims Tribunal fall under the New York Convention arose in connection with the Gould case, in which the Tribunal awarded US$3.6 million to the Iranian Respondent on the basis of its counterclaim.155 It will be recalled that the payment mechanism with a special Security Account works only in favor of US claimants.156 As Gould refused to comply with its payment obligation, the Iranian party had to seek the enforcement of the award through other avenues. After the Full Tribunal confirmed in Case A/21 that the United States government was not directly responsible for the implementation of the awards rendered against its nationals,157 the Iranian party commenced enforcement action in the United States. The case first came before the District Court of the Central District of California158 and then before the Ninth Circuit Court of Appeals.159 Both courts substantially agreed on the applicability of the New York Convention.160

(p. 44) Thus it was held that the requirement concerning a written arbitral agreement161 had been met, despite the fact that the agreement had been concluded by the governments of the respective parties, and not by the parties themselves.162

Gould's remaining objection to the jurisdiction was that the New York Convention allegedly contained “an implicit requirement that the Convention applies only to arbitral awards made in accordance with the national arbitration law of a Party State.”163 To this the Ninth Circuit Court of Appeals responded as follows:

Section 203 does not contain a separate jurisdictional requirement that the award be rendered subject to a “national law.” Language pertaining to the “choice of law” issue is not mentioned, or even alluded to, in Article 1, which lays out the Convention's scope of applicability. In addition, although it is a close question, the fairest reading of the Convention itself appears to be that it applies to the enforcement of non-national awards.164

The Court then concluded “that an award need not be made ‘under a national law’ for a court to entertain jurisdiction over its enforcement pursuant to the Convention.”165

In 1992, the applicability of the New York Convention to Tribunal awards was confirmed by the United States Court of Appeals for the Second Circuit in Avco.166 In the circumstances of that case, however, the enforcement of an award made in favor of Iran was refused on the ground that, before the Tribunal, Avco had been “unable to present [its] case” within the meaning of Article V(I)(b) of the New York Convention.167 The Court held that, while enforceable under the Convention, the Tribunal awards are also “subject to the defences to enforcement provided for in the Convention.”168 According to the Court, Avco had been denied due process before the Tribunal in such a way as to justify the non-enforcement of the award rendered against the company.169

The Gould and Avco cases set important precedents regarding both the scope of the New York Convention in general and the enforcement of Tribunal awards in particular. Avco, in particular, shows that the New York Convention provides the competent court with power to exercise certain ultimate control over the fairness of the Tribunal (p. 45) proceedings.170 However, in the absence of Dutch judicial pronouncements, the cases discussed do not definitively settle the question concerning the relationship of the Tribunal proceedings to Dutch law.171

Another remaining question is whether the Tribunal has inherent power to reopen its proceedings in exceptional circumstances.172 In one decision the Tribunal, while leaving the question open, cautiously suggested in an obiter-like manner that “it might possibly be concluded that a tribunal, like the present one, which is to adjudicate a large group of cases and for a protracted period of time would by implication, until the adjournment and dissolution of the tribunal, have the authority to revise decisions induced by fraud.”173

(e)  Concluding comments

Whatever the nature of the Tribunal proceedings or Tribunal awards, a completely a-national arbitration under the UNCITRAL Rules does not seem practically possible or desirable in normal ad hoc arbitration. In such proceedings the effect of Articles 1(3) and 17(1) is to subject the arbitration to at least the mandatory procedural norms of the lex loci arbitri. Normally this is not likely to hamper the proceedings in any substantial way, as the concurrent observance of the UNCITRAL Rules guarantees that no non-derogable national norms are circumvented. On the other hand, considering the uncertainties and differing attitudes among various jurisdictions concerning the applicability of the New York Convention to “a-national” awards, this kind of connection with a national legal system is likely to facilitate the enforcement of the award in other jurisdictions. These questions are explored further when the place of arbitration is discussed under Article 18. In this connection a few final comments on the scope of Article 17(1) are due.

Subject to the limitations discussed above, “the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate.” Except for the mandatory norms of the lex loci arbitri, it does not have to follow any national rules; on the other hand, if they deem it useful, the arbitrators can choose a specific national law of procedure.174 As already noted, if they do choose a specific national law, the arbitrators should give preference to the law of the place of arbitration. General reliance on any national law, however, can (p. 46) be dispensed with, as the UNCITRAL Rules themselves contain a rather comprehensive procedural order.175 Any lacunae that the rules may leave can be filled by creative application of discretion, whereby procedural models may be borrowed from various legal systems. For example, without selecting any procedural system as a whole, the arbitral tribunal may follow common law or civil law principles, or a mixture of both, concerning witnesses and evidence, depending on which kind of legal system with which the parties are most familiar.176 They may also establish specific procedural devices, such as the possibility, provided for in Note 5 to the Tribunal Rules of the Iran–US Claims Tribunal, of utilizing non-parties as a kind of amicus curiae.177 As the Rules contain no provision on power of attorney, it is (unless the mandatory provisions of the lex loci arbitri provide otherwise) up to the arbitral tribunal to decide whether this is required of counsel of the parties. By virtue of its wide discretion under Article 17(1), the tribunal is also free to use the administrative and technical services of an arbitral institution.178

(2)  Provisional timetable and modifications of time periods—Article 17(2)

(a)  Provisional timetable

Once constituted, the arbitral tribunal has principal responsibility for directing the progress of the arbitration, including the timing of the proceedings. Beyond the exchange of the notice of arbitration and the response to the notice (which is likely to occur before constitution of the tribunal), the Rules recommend only that the time period for submitting written pleadings should not exceed 45 days.179 While such matters would in any event fall within the tribunal's discretion under the Rules to conduct the proceedings, the first sentence of Article 17(2), which is new to the 2010 Rules, expressly requires the arbitral tribunal to establish a “provisional timetable of the arbitration.”180

The addition of Article 17(2) principally aims to enhance the efficiency of the proceedings,181 a goal confirmed by the requirement that the tribunal create the provisional timetable “as soon as practicable after its constitution.” Without a provisional timetable, the parties would unquestionably be at a loss as to how to organize themselves and when to apply their resources in order to meet the demands of the arbitration.182 Article 17(2) thus serves the goal of efficiency by requiring (“shall”) the arbitral tribunal to establish a (p. 47) provisional timetable, leaving no discretion under the Rules to do otherwise, and by ensuring that it take this step as one of its first orders of business.183

At the same time, the provisional timetable cannot be established without first “inviting the parties to express their views.” Thus, the Rules seek to strike a careful balance between efficiency of the proceedings and fairness to the parties. Consultation with the parties on the provisional timetable is certain to yield practical information, such as the existing of scheduling conflicts or the occurrence of holidays. Moreover, it may serve to provide the arbitral tribunal with an understanding of the parties’ capabilities (or limitations) with respect to their participation in the arbitral proceedings, thus allowing for consideration of how best to schedule the proceedings in a manner consistent with the principles of equal treatment and reasonable opportunity to present a case established in Article 17(1).184

Article 17(2) does not specify the mode or venue for establishing the provisional timetable. These matters are left to the arbitral tribunal's discretion under Article 17(1). In practice, issues of scheduling are commonly addressed, along with other preliminary matters, at an initial procedural conference of the parties.185

Finally, the provisional timetable is, by its own terms, only “provisional.” As explained below, the second sentence of Article 17(2) affords the arbitral tribunal discretion to modify not only the agreed schedule established in the provisional timetable, but also any other time period applicable to the arbitration.

(b)  Modifications of time periods

The second sentence of Article 17(2) is also new to the UNCITRAL Rules and authorizes the tribunal at any time to “extend or abridge” any time periods applicable to the arbitration.186 Inclusion of the provision in the 2010 Rules aimed to ensure that the arbitral tribunal, where necessary, could modify any time period in the interest of a “fair and efficient process of resolving the parties’ dispute.”187 The prevailing view of the Working Group was that a new provision was necessary to achieve this goal because the arbitral tribunal's general authority to conduct the proceedings under Article 15(1) of the 1976 Rules (now Article 17(1)) was cabined by the phrase “subject to these Rules”;188 thus, it was believed that express time periods could not be changed, except by mutual agreement of the parties.

(p. 48) The power to extend or abridge time periods extends to two situations. First, the tribunal may modify any time period prescribed under the Rules, such as the express 30-day time periods for replacing an arbitrator in Article 14 or for requesting an interpretation or correction of an award or an additional award in Articles 37, 38, and 39 of the Rules. Second, it may modify any time periods “agreed by the parties,” such as in the arbitration agreement or in an order or agreement memorializing the time periods established by the provisional timetable discussed. The latter power to modify, of course, does not extend beyond questions of time periods.189

Ultimate authority to extend or abridge a time period under the Rules resides with the arbitral tribunal.190 However, Article 17(2) prevents a tribunal from acting before “inviting the parties to express their views.” This precondition thus presupposes the existence of a proposal for modification on which the parties can comment. Though Article 17(2) does not expressly address who may make a proposal for modification, the absence of any restrictive language in Article 17(2) (eg “at the request of a party”) clearly leaves it to either the parties or the arbitral tribunal. Indeed, in most cases, it will be a party who needs more time that will request an extension of a deadline. At the same time, the arbitral tribunal may propose sua sponte to change a time period, eg, where the arbitral tribunal legitimately requires more time than the 45 days allotted under the Rules to render an interpretation of the award.

The notion that the arbitral tribunal would have authority under Article 17(2) both to propose and decide a change to the time periods under the Rules gave many in the Working Group pause. One specific concern was that the arbitral tribunal might modify the parties’ agreement on time periods, such as to complete the arbitration within a specified period of time.191 The concern about unilateral action by the tribunal prompted numerous proposals to include language in Article 17(2) that guaranteed that the tribunal's powers would apply only “if necessary,” “in exceptional circumstances,” or, similar to the approach in Article 25 of the Rules, “on justified grounds.”192 No such language ultimately appears in the final version of the rule, as it appears that the requirement of “inviting the parties to express their views” was seen as an adequate check on abuse by a tribunal.193 Further, the arbitral tribunal's powers of modification are also prescribed by the arbitral tribunal's Article 17(1) duties to treat the parties with equality, to provide them a reasonable opportunity to present their cases, to avoid unnecessary delay and expense, and to provide a fair and efficient arbitral process.

(p. 49) (c)  Issues of general application

Article 17(2) contains new express consultation requirements (“inviting the parties to express their views”) that do not appear elsewhere in the Rules. Some Working Group delegations raised concerns that their inclusion in Article 17(2) might create a negative inference with respect to other provisions of the Rules that lacked the requirement.194 The travaux préparatoires thus make clear that express reference to consultation in Article 17(2) is for purposes of emphasis only; it is merely meant to “signal to the arbitral tribunals the significance of not amending periods of time without the parties being involved in that decision-making process.”195 Consultation is consequently no less appropriate in other contexts under the Rules where the rights of the disputing parties may be directly affected, and where hearing from the parties may assist the tribunal in reaching a decision that is less susceptible to criticism that a party was mistreated.

Like all provisions of the Rules, the arbitral tribunal's powers to establish a provisional timetable and extend or abridge time periods is subject to any non-derogable provisions of the applicable arbitration law, in accordance with Article 1(3).196 Thus, any mandatory time periods established under a national arbitration law or an international investment agreement cannot be modified.

(3)  Right to a hearing—Article 17(3)

Article 17(3) elaborates upon the “reasonable opportunity” of each party to present its case. According to paragraph 3, the tribunal shall hold hearings at the request of either party “at an appropriate stage of the proceedings.” Hearings may be held for “the presentation of evidence by witnesses, including expert witnesses” or “oral argument.”

(a)  Scope of hearings

In the Preliminary Draft of the 1976 Rules, the hearing requirement was intended to apply only to hearings for the production of evidence by witnesses, whereas hearings for the presentation of oral argument were to be discretionary, unless requested by both parties.197 The New Delhi Arbitration Congress, at which the Draft was discussed, “disclosed a preponderant opinion that the presentation of oral argument was a right generally available in [domestic] legal proceedings which should also be available in arbitral proceedings at the request of either party.”198 Hence, under Article 15(2) of the 1976 UNCITRAL Rules, like Article 17(3), any party has the right to have hearings not only for the presentation of witness evidence, but also for oral argument.

The scope of hearings under the UNCITRAL Model Law is broader on its face. Instead of referring to the presentation of evidence by “witnesses,” Article 24(1) of the Model Law (p. 50) provides for hearings “for the presentation of evidence” in general.199 This wording “was intended to ensure that the provision would not be interpreted to bar types of evidence that might be deemed in some systems not to be “testimony of witnesses,” such as cross-examination or the testimony of a party.”200 While the clarification may be welcomed, it is submitted that in the UNCITRAL Rules, intended for worldwide use, the concept of “witness” can and should be interpreted in a broad, non-technical sense. This has been the practice of the Iran–US Claims Tribunal where, on the one hand, a distinction has been made between witnesses in a strict sense and “party witnesses,” but where, on the other hand, both categories of witnesses have been allowed to testify at hearings.201 The practice of investor–state arbitration tribunals is similar.202

The limits on the right to a hearing guaranteed by Article 17(3) are not entirely clear, however. At face value, the provision appears to include the right to request hearings not only on the merits, but also on jurisdictional and other preliminary questions and even procedural matters. On the other hand, the participants of the New Delhi Congress, when referring to a right “generally available in legal proceedings,” plainly did not contemplate a right to have a separate hearing on any kind of preliminary issue. Further, the inclusion of the phrase “any stage of the proceedings” in the 1976 Rules (which was not included in the Preliminary Draft) does not contradict this conclusion. The quoted phrase was added in response to the suggestion of the representative of the Soviet Union who “proposed an amendment to the effect that a party might request an oral hearing at any stage in the proceedings, not just at the beginning.”203 Thus the altered wording was not intended to have any bearing on the question of whether there is a right to a hearing on procedural and other issues, but only to clarify when a hearing can be requested. (As explained below, the phrase “any stage of the proceedings” was replaced by “an appropriate stage of the proceedings” in the 2010 UNCITRAL Rules.)

The Iran–US Claims Tribunal has interpreted corresponding Article 15(2) of the 1976 Rules so as to make the right to a hearing dependent on whether or not the question regards “procedural matters.”204 If it does, a hearing can be dispensed with, notwithstanding a party's request concerning it. The right to a hearing has been considered excluded, inter alia, for requests for interim measures and preliminary jurisdictional questions.205 However, in ad hoc arbitration, an arbitral tribunal is advised not to proceed from such a general distinction between substantive and procedural questions unless authorized to do so by the parties. In investor–state arbitration under the UNCITRAL Rules hearings on jurisdictional matters are commonplace.

(p. 51) In light of the questions surrounding Article 17(3), exempting procedural or jurisdictional questions from the scope of the right to a hearing could be regarded as such a departure from the agreement of the parties as to subject the award to a challenge at the place of arbitration or non-recognition in another jurisdiction.206 In this regard, the legislative history of Article 24(1) of the Model Law is illustrative. In that context a proposal was made to limit the right to a hearing to “the substance of the dispute,” to the exclusion of procedural or jurisdictional questions. From the rejection of this proposal it has been concluded that “the party's right to a hearing should not be considered limited to substantive issues.”207 There are no strong reasons why Article 17(3) of the UNCITRAL Rule should be construed differently.

The broad scope of Article 17(3) should not be interpreted as granting the parties unlimited rights to have separate hearings on all kinds of procedural or preliminary questions. To conduct the proceedings efficiently, the arbitral tribunal must have considerable control over such matters as the number of hearing days and the hearing procedure. By virtue of this control, the tribunal normally can, for example, join jurisdictional issues to the merits or decide minor procedural questions without a hearing, even if a party requests one. Whenever a decision on a preliminary question may lead to the final disposition of the rights of the parties, or to the termination of the proceedings, a hearing normally should be granted if requested by a party.

As to decisions on interim measures (those which neither affect the final disposition of the rights of the parties nor terminate the whole proceedings), the decision whether or not to grant a requested hearing should be made in light of the particular circumstances. Sometimes the urgency of the matter may not allow a hearing; in other cases, the very nature of the measure requested may require that oral argument be heard. The principle of party autonomy suggests that a hearing be granted whenever requested by both parties. Even where requested by only one of the parties, the arbitral tribunal should keep in mind that Article 17(3) provides an opportunity for a hearing. Should a party request a hearing abusively, that party may be forced to bear the costs resulting from an unnecessary hearing.208

(b)  Timing of hearing requests

The hearing can be requested at “an appropriate stage of the proceedings.” This formulation has been changed from the 1976 UNCITRAL Rules, which allowed a party to request a hearing “at any stage of the proceedings.” As already noted, the original wording was chosen in order to clarify that the right does not necessarily have to be exercised in the beginning of the proceedings. It was not a license for the parties to demand a hearing whenever it pleased, as this would open up the possibility for disruptive requests made, for example, very late in the proceedings. In applying corresponding Article 15(2) of the 1976 Rules, the Iran–US Claims Tribunal has held that the hearing requirement “should be interpreted, in the light of the particular circumstances of each case, to mean that hearings are to be held upon reasonable request of a party at an appropriate stage of the proceedings.”209 Similarly, (p. 52) Article 24(1) of the Model Law provides a right to request a hearing “at an appropriate stage of the proceedings.”

In revising the UNCITRAL Rules, the Working Group was cognizant of the need to clarify when a disputing party could request a hearing. The issue arose first in discussions regarding the arbitral tribunal's general discretion to conduct the proceedings. In that context, it was suggested that “to avoid a situation where a party would insist on submission at an inappropriate stage of the arbitration,” the phrase “at any stage of the proceedings,” as used in the 1976 Rules, should be replaced by the words “at an appropriate stage of the proceedings.”210 On the same rationale, the latter phrase was also adopted in Article 17(3).211 The arbitral tribunal can, whenever it intends to proceed without a hearing, inform the parties and invite them to exercise their right to request a hearing by a certain date.212

(c)  Preliminary meetings

In addition to hearings for the presentation of evidence and oral argument, the arbitral tribunal, by virtue of its power to “conduct arbitration in such manner as it considers appropriate” under Article 17(1), may summon the parties for more informal meetings according to the needs of the particular arbitration. The practice of holding “preliminary meetings,” also known as “preliminary conferences,” in international arbitration has been described as follows:

[E]specially where the parties and their representatives come from different cultural backgrounds, or from different legal systems, it is sensible for the arbitral tribunal to convene a meeting with the parties as early as possible in the proceedings. This ensures that the arbitral tribunal and the parties have a common understanding of how the arbitration is to be conducted and enables a carefully designated framework for the conduct of the arbitration to be established.213

The UNCITRAL Notes provide a useful list of matters for possible consideration in organizing arbitral proceedings, many of which can be addressed in the context of preliminary meetings. In investor–state arbitration under the UNCITRAL Rules, preliminary meetings have been a matter of course. In the practice of the Iran–US Claims Tribunal, meetings with basically similar functions have been institutionalized in the form of “pre-hearing conferences” mentioned in note 4 to Article 15 of the 1983 Tribunal Rules.214 The arranging of such preliminary meetings is within the discretion of the arbitrators.215 In the early years of the Iran–US Claims Tribunal they were very common in more substantial cases. Generally, these conferences served the purpose of clarifying and narrowing issues, especially jurisdictional questions. They also provided an opportunity to examine the possibilities of a settlement and to discuss the further proceedings, as well as settle questions such as (p. 53) production of documents.216 There are differing views on the usefulness of the pre-hearing conferences, and their utility at the Tribunal would appear to depend on the particular circumstances of each case. In simple cases, especially where it is clear that a hearing is going to be held, they may be unnecessary. In more complex cases they may be useful both to the parties and the arbitrators, for example, to determine whether some jurisdictional or other preliminary question deserves to be treated separately.217 While a preliminary meeting or conference is not a hearing in the sense of Article 17(3), it may help the tribunal in deciding whether and to what extent hearings are needed.218

(4)  Communication of documents—Article 17(4)

Article 17(1) requires equal treatment of the parties by the arbitral tribunal. Article 17(4) extends the principle of “[e]qual treatment and equal opportunity for both parties”219 to the conduct of the parties themselves by requiring them to submit all communications supplied to the arbitral tribunal simultaneously to all other parties.220 Such elaboration of the principle of audiatur et altera pars creates an important safeguard against unenforceability of the arbitral award on the ground that it has been based on documents not communicated to the losing party.221 Article 2 sets forth the details concerning the mode of communication of documents to the other party.222

In its overall control of the arbitral proceedings, the tribunal should see to it that the parties act in accordance with Article 17(4). Therefore, if it ascertains that certain documents or other pieces of information supplied to it have not been communicated to the other party, then the Tribunal should, if necessary, convey the information to the other party itself.

Indeed, the parties may consider the possibility of modifying Article 17(4) so as to entrust the arbitral tribunal with the task of acting as a “clearinghouse” to which the (p. 54) documents and other information are first supplied, and which then transmits them to the other party.223

The obligation to simultaneously transmit communications to all parties is potentially subject to an important exception in the case of preliminary requests for interim measures.224

(5)  Joinder of third persons—Article 17(5)

An arbitration may already be in progress when a disputing party realizes it needs to bring an additional person or entity into the proceedings.225 This situation may arise, for example, in the case of a dispute involving multiple players, not all of which are before the tribunal, and it becomes evident that full resolution of the entire dispute would benefit from the participation of them all.226 By joining as many parties as possible into a single proceeding, joinder reduces the possibility of concurrent or successive proceedings, thus enhancing the efficiency of the dispute resolution process.227 Further, joinder can minimize the problem of inconsistent rulings from multiple tribunals on the same matters of law and fact. To further these aims, Article 17(5) contains a provision on joinder, which is new to the 2010 UNCITRAL Rules.228

Consent is a cornerstone principle of arbitration and is no less applicable in the case of joinder. As a rule, the parties to a dispute must agree with one another to subject themselves to arbitration; the same can be said about expanding an existing arbitration to include additional actors.229 Failure to gain the consent of all involved in a joinder may expose the award to challenges at the seat or complicate enforcement efforts.230 Article 17(5) deals with the issue of consent by allowing joinder of a third person “provided such person is a party to the arbitration agreement.” This condition limits joinder to situations in which the third person to be added is a party to the arbitration agreement pursuant to which the arbitration is (p. 55) proceeding.231 According to the travaux préparatoires, this condition is based on a theory of implied consent: by agreeing in the arbitration agreement to arbitrate under the Rules, in particular Article 17(5) on joinder, all parties to that agreement consent to any future application of the joinder provision, whether or not they are the original parties to the existing arbitration.232

Article 17(5) is thus more restrictive in scope than, for example, Article 22.1(h) of the London Court of International Arbitration (LCIA) Rules, on which an earlier proposed version of Article 17(5) was closely modelled.233 Article 22.1(h) permits joinder where any third person and the party to the arbitration that is requesting joinder “have consented thereto in writing.” That provision notably does not limit the scope of joinder only to third persons who are parties to the arbitration agreement. Thus, joinder under Article 22.1(h) may occur solely on the basis that a third person has consented in writing to a request for joinder, ie the third person is not a party to the arbitration agreement but has agreed to accept the specific request to join the existing arbitration.234 In contrast, Article 17(5) would preclude joinder under these same circumstances, as only third persons who are parties to the arbitration agreement may be joined. At the same time, Article 17(5) contains no requirement to consent in writing, as Article 22.1(h) of the LCIA Rules does. Thus, under the UNCITRAL Rules, a third party (who is also a party to the arbitration agreement) cannot veto a request for joinder by withholding its written consent.

The more conservative approach of Article 17(5), as compared to Article 22.1(h), resolved an important concern of the UNCITRAL drafters. In Working Group discussions, many delegations feared that under a broader approach a third person could be joined to the proceedings without the consent of the non-requesting parties to the arbitration. This situation was believed to “run counter to the fundamental principle of consent of the parties to the arbitration.”235 On the theory of implied consent that underlies Article 17(5), however, this problem is solved because a non-requesting party to the arbitration is deemed to have consented to any request to join a third person who is also a party to the arbitration agreement.236

The requirement that a joined person be a party to the arbitration agreement places significant limitations on the practical application of Article 17(5). Joinder may be allowed in the case of a multi-party contract, such as one between a consortium of business partners (p. 56) which contains an agreement to arbitrate under the Rules. Under these circumstances, all parties to the dispute are parties to the arbitration agreement and, thus, any who are not already before the tribunal may be joined. In contrast, joinder is precluded where there are multiple contracts between multiple parties. For example, in a construction arbitration between an employer and the main contractor, it may be desirable to join a subcontractor of the main contractor. However, if the employer and the main contractor are parties to one contract and the main contractor and the subcontractor to another (which is often the case), the subcontractor cannot be joined under Article 17(5) since it is not a party to the arbitration agreement on which the existing arbitration is based. Apart from Article 17(5), joinder can only be accomplished by amending the arbitration agreement to add a third person.

Inclusion of the term “third persons” in Article 17(5)—a term borrowed from Article 22.1(h) of the 1998 LCIA Rules—is meant to complement the requirement that the third person to be joined be a party to the arbitration agreement. The drafters of the UNCITRAL Rules preferred to use the term “third persons” over “third parties” in order to emphasize that the person to be joined was not a “third party” in the sense of a non-party to the arbitration agreement.237 In light of its intended purpose in Article 17(5), the term “third persons” should not be construed as limiting the scope of joinder to natural persons; both natural person and juridical entities may be joined so long as the conditions established under the Rules are satisfied.

A more specific problem of consent is that “third persons” that have been joined to an existing arbitration often do not have the opportunity to participate in the process of appointing arbitrators, having joined the proceedings after constitution of the tribunal. Depriving a party of this important right could expose any subsequent award to challenge on the basis of an alleged improper constitution of the tribunal.238 Article 17(5) addresses this problem in two ways. First, under the theory of implied consent, a third person so joined, having agreed to arbitrate under the Rules, is deemed to have consented to the possibility that the tribunal will be constituted without their consent.239 Second, Article 17(5) permits joinder “unless the arbitral tribunal finds, after giving all parties, including the person or persons to be joined, the opportunity to be heard, that joinder should not be permitted because of prejudice to any of those parties.” Consultation is thus meant to facilitate an exchange of views that may assist the arbitral tribunal in assessing whether any of the parties stands to suffer prejudice as a result of the joinder, particularly a third person who may be deprived of an opportunity to appoint an arbitrator.240

(p. 57) The assessment of prejudice under Article 17(5) is only one aspect to consider before joinder may occur. During Working Group discussions, a proposal was made to replace the phrase “because of prejudice to any of those parties” with the words “taking into consideration fairness to each of the parties” to ensure wider consideration of the interests at stake.241 It was noted, however, that this change was unnecessary because the general principles of equal treatment, avoidance of unnecessary delay and cost, and fair and efficient proceedings established in Article 17(1) of the Rules in any event overlay the requirements of Article 17(5).242 Further, the powers of the arbitral tribunal to join a third person under Article 17(1) are ultimately permissive; the tribunal “may” allow joinder. Thus, even if all the conditions established in Article 17(5) are satisfied, a tribunal has discretion to deny a request for joinder that fails to comport with the general principles of Article 17(1).

Article 17(5) provides that joinder of one or more third persons may be considered “at the request of any party.” This condition naturally precludes the arbitral tribunal or any third person from validly proposing joinder, as neither of these actors is a “party” to the arbitration. Further, it grants a party to the arbitration the right to request joinder unilaterally, over objections of other original parties, who are in any event deemed to have agreed to the joinder process under a theory of implied consent.

The last sentence of Article 17(5) confirms the authority of the arbitral tribunal to render awards with respect to all parties to the arbitration, including any third persons that have been joined to the proceedings.

(6)  Consolidation of claims

The UNCITRAL Rules do not contain a general provision on consolidation of claims. During Working Group discussions to revise the Rules, the issue of consolidation was discussed in some detail. Some delegations expressed support for inclusion of a consolidation provision along the lines of Article 4(6) of 1998 ICC Rules.243 It was noted that consolidation could be beneficial:

where several distinct disputes arose between the same parties under separate contracts (e.g., related contracts or a chain of contracts) containing separate arbitration clauses or to avoid a situation where a party initiated a separate arbitration in respect of a distinct claim under the same contract in order to gain a tactical advantage.244

In these situations, some delegations believed consolidation could resolve disputes more efficiently and minimize the possibility of inconsistent awards.245

(p. 58) Other delegations raised concerns about including a consolidation provision in the Rules. Unlike the International Chamber of Commerce (ICC) Rules, the UNCITRAL Rules in many cases would be applied in non-administered arbitration, and there were doubts about the feasibility of applying such a provision in this context.246 Concerns with respect to the reach of a consolidation provision were also voiced. To the extent the provision was to address new claims raised under the same contract, some believed that the provision on amendment of the statement of claim contained in the Rules might already apply. To the extent a consolidation provision would address several distinct disputes arising between the same parties under separate contracts, each with its own distinct arbitration clause, problems of consent were identified.247 For example, in consolidated proceedings, some worried that a party might be forced to participate in the arbitration on terms which differed from those in its arbitration agreement.248

To facilitate the discussion on consolidation under the Rules, UNCITRAL's Secretariat prepared the following draft provision:

The arbitral tribunal may, on the application of any party, … assume jurisdiction over any claim involving the same parties and arising out of the same legal relationship, provided that such claims are subject to arbitration under these Rules and that the arbitration proceedings in relation to those claims have not yet commenced.249

While addressing some of the concerns of the Working Group,250 the draft provision was never adopted. Instead, the Working Group turned its efforts toward drafting a provision on joinder, which was thought to deal with many of the same issues of multi-party arbitration as consolidation. Article 17(5) on joinder is discussed in section (5) Joinder of third persons—Article 17(5).

Parties involved in investor–state arbitration under the UNCITRAL Rules should be aware that some international investment agreements contain provisions on consolidation.251

(7)  Comparison to the 1976 UNCITRAL Rules

Article 17 is similar to Article 15 of the 1976 UNCITRAL Rules in many important respects, while adding new substantive provisions to the Rules.

The first sentence of Article 17(1) on the arbitral tribunal's general duties contains clarifying revisions to the 1976 UNCITRAL Rules. The opportunity for a party to present its case is no longer characterized as a “full opportunity,” but simply “a reasonable opportunity,” and under the revised rule such opportunity must be provided “at an appropriate stage” of the arbitration, as opposed to “at any stage,” as permitted under Article 15(1) of the 1976 Rules. Both changes were intended to moderate language that might cause a party (p. 59) to have unreasonable expectations concerning its rights under the Rules.252 The second sentence of Article 17(1) of the 2010 Rules is entirely new. While some Working Group delegations believed the duty to conduct the proceedings so as to avoid unnecessary delay and expense and to provide a fair and efficient process was implied under the Rules,253 others believed an express statement of the duty would afford the tribunal a certain “leverage” in relation to the parties, and possibly an arbitrator, to take action under the Rules.254 At the same time, the express duty may provide new grounds for complaining about the arbitral tribunal's conduct of the proceedings.

Article 17(2) is new to the 2010 Rules. The first sentence requires that the arbitral tribunal establish a provisional timetable for the arbitration, whereas under the 1976 Rules that task was left to the tribunal's discretion. The second sentence of the paragraph changes the Rules substantively by granting the arbitral tribunal new authority to extend or abridge any time periods under the Rules or agreed to by the parties.

Article 17(3) is identical to corresponding Article 15(2) of the 1976 Rules, save for one revision. Under the 2010 Rules a party may request a hearing “at an appropriate stage” of the arbitration, as opposed to “at any stage” of the arbitration, as permitted under the 1976 Rules. This revision was made for the same reasons as those underlying a similar revision to Article 17(1), described above.

Article 17(4) is similar to corresponding Article 15(3) of the 1976 Rules. Under the 2010 rule, the simultaneous communication requirement applies to all “communications,” whereas under the 1976 rule, it applies to “documents or information.” There is no substantive difference in the respective texts; the revision was made simply for the sake of consistency with the terminology under the Rules.255 In addition, Article 17(4) contains an exception to simultaneous communication where otherwise permitted by the applicable law.

Article 17(5) finds no analogue in the 1976 Rules. As discussed, the provision permits joinder of third persons to the arbitral proceedings in limited situations. Parties arbitrating under the 1976 Rules may wish to consider modifying those rules by including the provision on joinder, if they foresee the need to include third persons in the arbitration.

C. Extracts from the Practice of Investment and other Tribunals

(1)  Article 15(1) (1976 Rules)—general

Lance Paul Larsen and Hawaiian Kingdom, Procedural Order No 3 (July 17, 2000) (PCA administered, 1976 UNCITRAL Rules, Special Agreement, reprinted in (2001) 119 ILR 566, 577, 578:

6. The parties subsequently filed Memorials and Counter-Memorials dated respectively 22 May 2000 and 22/23 June. These were supported by a substantial number of annexes. The Tribunal has carefully considered these. However, before proceeding to the substance of the issues the parties have sought to place before it, the Tribunal wishes to raise a number of preliminary issues. In short, there are questions whether the “dispute” identified in Article 1 of the (p. 60) Arbitration Agreement is one which is capable of reference to arbitration under the [1976] UNCITRAL Rules, or which the Tribunal has jurisdiction to decide in accordance with international law. It does not matter that the parties have failed to raise these issues. The Tribunal has the power to do so, by virtue of Article 6 of the Agreement and Article 15(1) of the [1976] Rules. Indeed, the jurisprudence of international tribunals suggests that it has the duty to do so.

…

  1. 14. In accordance with Article 15(1) of the [1976] Rules, the parties must have a full opportunity to deal with these questions before the Tribunal proceeds to consider them further, or to reach any conclusion on them. The pleadings currently before the Tribunal do not consider these questions.

  2. 15. The Tribunal believes that the parties should have an opportunity to decide whether they wish to undertake a separate round of pleadings or should include an oral phase. If the parties do not wish to engage in a separate round of pleadings, the Tribunal is presently of the view that it should then proceed to consider these issues as preliminary issues and to make an award thereon.

  3. 16. The Tribunal accordingly gives the parties until 7 August 2000 to present, jointly or separately, their views on the procedure that should now be followed ….

Pope & Talbot Inc and Government of Canada, Decision on Privileges (September 6, 2000) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 2–3:

1.5  In the specific context of a NAFTA arbitration where the parties have agreed to operate by [1976] UNCITRAL Rules, it is an overriding principle (Article 15) that the parties be treated with equality. The other NAFTA Parties do not, so far as the Tribunal has become aware, have domestic law that would permit or requires them to withhold documents from Chapter 11 Tribunals without any justification beyond a simple certification that they are some kind of state secret. In these circumstances, Canada, if it could simply rely on s. 39 [of the Canada Evidence Act], might be in an unfairly advantaged position under Chapter 11 by comparison with the United States and Mexico.

Lance Paul Larsen and Hawaiian Kingdom, Award (February 5, 2001) (PCA administered, 1976 UNCITRAL Rules, Special Agreement), reprinted in (2001) 119 ILR 566, 579–80:

  1. 6.4. Following the delivery of the Tribunal's Procedural Order No 3 the parties entered into Special Agreement No 2 of 2 August 2000 and sought to raise a preliminary issue to be determined by the Tribunal in the following terms:

    Pursuant to Article 32(1) of the [1976] UNCITRAL Rules, the Parties request the Arbitral Tribunal to issue an Interlocutory Award, on the basis of the 1843 Anglo-Franco Proclamation of 28 November 1843 and the rules and principles of international law, verifying the continued existence of Hawaiian Statehood with the Hawaiian Kingdom as its government.

  2. 6.5. The Tribunal responded to the making of Special Agreement No 2 with its Procedural Order No 4 of 5 September 2000, which read as follows:

    …

    1. 3. The Tribunal set out in its Order No 3 the questions which, in its view, are raised before it can proceed to the merits of the dispute. The issue identified in Article 1 of Special Agreement No 2 is not one of these. Rather it appears to be a reformulation of the first substantive issue identified as being in dispute.

    2. 4. It is not open to the parties by way of an amendment to the Special Agreement to seek to redefine the essential issues, so as to convert them into “interim” or “interlocutory” issues. (p. 61) In accordance with article 32 of the [1976] UNCITRAL Rules, and with the general principles of arbitral procedure, it is for the Tribunal to determine which issues need to be dealt with and in what order. For the reasons already given, the Tribunal cannot at this stage proceed to the merits of the dispute; these merits include the question sought to be raised as a preliminary issue by Article I. If the arbitration is to proceed it is first necessary that the preliminary issues identified in its Order No 3 should have been dealt with.

    3. 5. If the parties are not content with the submission of the dispute to arbitration under the [1976] UNCITRAL Rules and under the auspices of the Permanent Court of Arbitration, they may no doubt, by agreement notified to the Permanent Court, terminate the arbitration. What they cannot do, in the Tribunal's view, is by agreement to change the essential basis on which the Tribunal itself is constituted, or require the Tribunal to act other than in accordance with the applicable law.

Pope & Talbot Inc and Government of Canada, Award on the Merits of Phase 2 (April 10, 2001) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), reprinted in (No 4, 2001) 13 World Trade & Arb Materials 61, 153:

193. As noted, during the course of discovery in this proceeding, Canada objected to producing certain items on the ground that, as Privy Council documents, their disclosure was prohibited by the Canada Evidence Act. The Tribunal rules that that Act by its terms did not apply to a Chapter 11 tribunal, and Canada did not contest that ruling. However, it nonetheless refused to produce or even identify the documents in order to permit the Tribunal to make a reasoned judgment as to their relevance and materiality. In the result, this refusal did not appear prejudicial to the Investor, and the Tribunal proceeded upon the basis of the materials actually before it. However, the Tribunal deplores the decision of Canada in this matter. As the Tribunal noted in its decision on this matter dated September 6, 2000, Canada's position could well be a derogation from the “overriding principle” found in Article 15 of the [1976] UNCITRAL Arbitration Rules, under which these proceedings have been conducted, that all Parties should be treated with equality. Moreover, Article 115 of NAFTA declares that there shall be “equal treatment among investors of the Parties.” As Canada's refusal to disclose or identify documents in these circumstances is at variance with the practice of other NAFTA Parties, at least of the United States, that refusal could well result in a denial of equality of treatment of investors and investments of the Parties bringing claims under Chapter 11.

Methanex Corp and United States of America, Letter from the Tribunal to the Parties (September 25, 2002) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 9–10:

  1. 20. … Methanex seeks confirmation that it is not now required to produce all evidence on which the presentation of its case on the merits will rely, thereby foreclosing the development and presentation of additional evidence at a later stage. Methanex also seeks clarification as to whether it is required to produce “essentially final reports from all its experts” within the ninety day time limit imposed by the Tribunal; and it seeks confirmation now that the Tribunal is not planning to proceed directly to a hearing on the merits.

  2. 21. It is difficult for the Tribunal to follow Methanex's apparent difficulties. As the Partial Award states in Paragraph 163 (page 69), Methanex must file with its fresh pleading copies of all evidential documents on which it relies. This direction is clear both as to the ambit of the evidence required (“as regards the USA's alleged liability”; but “we exclude evidential materials relating to the alleged quantum”) and the extent (“all evidential documents”). Similarly there is no ambiguity with respect to the Tribunal's direction on the submission of expert reports, and there is no suggestion that these should be draft reports or reports that are otherwise incomplete: see Paragraphs 163 and 165 of the Partial Award (pages 69 & 70).

  3. 22. Nonetheless, insofar as Methanex may find insuperable difficulty in complying with the ninety day limit imposed by the Partial Award, it remains open to Methanex to seek an (p. 62) extension of that deadline from the Tribunal. Moreover, if for good cause shown, Methanex is unable timeously to complete its filing of all relevant evidential materials, it remains equally open to Methanex to seek dispensation from the Tribunal in regard to missing materials; e.g. an outstanding application against a third person under 18 U.S.C. § 1782 28 (if applicable), as raised at page 6 of Methanex's letter.

  4. 23. It is the Tribunal's intention, both in the Partial Award and now, that Methanex and its legal advisers should have the best opportunity to advance Methanex's best case. It is not the Tribunal's intention to deprive either Disputing Party of its procedural rights under Article 15(1) of the [1976] UNCITRAL Arbitration Rules, or otherwise. However, as regards Methanex's present exercise, given the long history of this arbitration (on which Methanex rightly comments at page 7 of its letter), that can only be a reasonable opportunity. There must therefore be a reasonable deadline. In all the circumstances, from the Tribunal's current perspective, ninety days is a reasonable period of time. It could be extended by the Tribunal if necessary; but an extension should be sought by means of a reasoned application to the Tribunal and not by a request for interpretation of the Partial Award.

  5. 24. There is no suggestion in the Partial Award that if, at a later stage Methanex sought to submit further relevant evidence, it would be debarred automatically from doing so—nor could there be. This would be a matter for consideration by the Tribunal in the future, if and when that issue arose and after hearing both Disputing Parties.

CME Czech Republic BV and Czech Republic, Final Award (March 14, 2003) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Netherlands-Czech BIT), reprinted in (2003) 15(4) World Trade & Arb Materials 83, 100:

43. In accordance with Article 15.1 of the [1976] UNCITRAL Arbitration Rules, the Tribunal decided to conduct the arbitration in the manner it considers appropriate. For this purpose, the Tribunal decided, to the extent appropriate, to apply the IBA Rules [in Taking Evidence in International Commercial Arbitration].

EnCana Corp and Republic of Ecuador, Partial Award on Jurisdiction (February 27, 2004) (LCIA administered, 1976 UNCITRAL Rules, Canada-Ecuador BIT), at 19–20:

  1. 44  As to the question of the confidentiality of pleadings in the parallel arbitration under the United States-Ecuador Treaty, the Tribunal notes that the Respondent has chosen the same arbitrator in the two proceedings, as it was entitled to do under Article 7(1) of the [1976] UNCITRAL Rules. … The Respondent is also represented by the same legal firm, again something which is a matter for it to decide. Evidently the Respondent and its legal advisers have a synoptic view of the various disputes related to the oil industry in Ecuador which may be denied to the Claimant and its legal advisers. But that is a natural inequality as between private companies and a host State, one which arises from their respective status and roles and which cannot be reversed en tant que tel.

  2. 45  A problem of procedural equality could nonetheless arise. In this respect the Tribunal notes the requirements of Article 15(1) and (3) of the [1976] UNCITRAL Rules. Under Article 15(1) the tribunal must treat the parties with equality; under Article 15(3) all documents or information supplied to the arbitral tribunal by one party shall at the same time be communicated to the other party ….

  3. 46  … as soon as Dr. Barrera [appointed by Respondent] uses information gained from the other Tribunal in relation to the present arbitration, a problem arises with respect to the equality of the parties. Furthermore Dr. Barrera cannot reasonably be asked to maintain a “Chinese wall” in his own mind: his understanding of the situation may well be affected by information acquired in the other arbitration. The most he can be asked to do is to disclose facts so derived whenever they appear to be relevant to any issue before this Tribunal.

  4. 47  The Tribunal does not propose to deal with this question in a categorical way by ordering full advance disclosure to the Claimant of the pleadings in the other arbitration. Even assuming it (p. 63) has authority to do so, it is not persuaded that such an order is necessary. In particular it notes that the joined issues of jurisdiction and merits in the other arbitration have recently been the subject of an oral hearing, and that the decision of that Tribunal may be expected to become available before the pleadings in the present case are closed. It does however believe that the award of the other Tribunal should be made available to the Claimant as soon as may be after it is issued, and it calls on the Respondent to do what it can to ensure that this happens. If extra time is needed for the Claimant to respond to such award, it may request this.

Methanex Corp and United States of America, Final Award of the Tribunal on Jurisdiction and Merits (August 3, 2005) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), Part II, Chapter E, at 19:

33. Turning to the issue under Article 15(1) of the [1976] UNCITRAL Rules, there is nothing there to suggest that an arbitration tribunal has a broad jurisdiction to reconsider a final and binding award that it has already made. (The possible exception for fraud by a party is here irrelevant). To the contrary, both the ordinary meaning and the context of Article 15(1) lead to the opposite conclusion. Article 15(1) is located in Section III of the [1976] Rules, “Arbitral Proceedings”; and it is a general provision that regulates the conduct of the arbitral proceedings. By contrast, Article 32 is to be found in Section IV, “The Award”; and it is concerned with the form and effect of an award. Article 15(1) cannot be read as creating such a huge derogation from Article 32; it has a significantly different subject-matter. Moreover, Article 15(1) requires that a party be given a full opportunity of presenting its case “at any stage of the proceedings”. This accepts that arbitral proceedings may comprise differing stages, as also appears from Article 15(2), and a given stage in the proceedings may of course be brought to an end by a final and binding award. It would both undermine Article 32 and lead to an inequality between the parties if at any time the losing party could seek to re-litigate matters contained in an award simply by invoking Article 15(1) of the [1976] UNCITRAL Rules.

Softwood Lumber Consolidated Proceeding (Canfor Corporation, et al and United States of America, Order of the Consolidation Tribunal (September 7, 2005) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 48:

125. In making that determination, an Article 1126 Tribunal is also to consider what is “fair.” That requirement indicates that the interests of all parties involved should be balanced in determining what is the procedural economy in the given situation. For example, a balance needs to be struck between a hearing that is longer for one party but at the same time shorter for another. It may also happen that what is procedurally less efficient for one party is procedurally more efficient for another. In that respect, the procedural economy that will redound to the benefit of a disputing State Party is another relevant factor, for the reasons explained earlier. The necessary balancing further includes the consideration that all parties shall continue to receive the fundamental right of due process as it is set forth in Article 15(1) of the [1976] UNCITRAL Arbitration Rules (“ … the parties are treated with equality and each party is given a full opportunity of presenting his case”).

Glamis Gold Ltd and United States of America, Procedural Order No 8 (January 31, 2006) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 5, 7:

9. The Tribunal recognizes that the production of documents phase of this arbitration has been relatively extensive and that this process has been burdensome for the Parties, especially in light of the tight arbitral schedule ….

12. Due to the extensive nature of this document production process and the desire to have evidence available to the Parties prior to their memorial submissions, the Tribunal finds the current arbitral schedule unsustainable. Therefore, despite the desire not to delay the arbitral hearing, the Tribunal determines that the schedule must be extended to accommodate these additional production procedures. In adjusting the schedule, the Tribunal is cognizant of (p. 64) Respondent's arguments that the Parties must be treated equally with respect to the completion of submissions to the Tribunal. The Tribunal notes that Article 15(1) of the [1976] UNCITRAL Rules provides that “[s]ubject to these Rules … the parties are treated with equality and that at any stage of the proceedings each party is given a full opportunity of presenting its case.” As to the requirement that each party be given a full opportunity to present its case, the Tribunal observes that a period of approximately four months to prepare a memorial, whether that be the memorial or counter-memorial, is customarily an adequate amount of time, absent unusual circumstances. A general delay in the proceedings, which as a consequence in theory provides more time to the Claimant for the preparation of its memorial, does not require under Article 15(1), absent unusual circumstances not present in this case, the granting of an equally long extended period of time to the Respondent for the preparation of its counter-memorial. Therefore, the Tribunal amends the arbitral schedule as follows: [Schedule omitted]

Merrill & Ring Forestry LP and Government of Canada, Decision of the Tribunal on Production of Documents (July 18, 2008) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 8:

  1. 20. Canada has asserted in its letter of July 10, 2008, that claims on privileges have already been made in its submissions on refusals and there is thus no need to further elaborate on this question. But even if that were the case such claims are not specific in respect of identification and justification. Canada has also explained that at this stage it is only advising the Investor that the case may arise in its search for documents.

  2. 21. In the absence of this specific information the Investor is unable to agree or disagree with such refusal just as the Tribunal is unable to decide on a privilege which at present has no connection to specific documents or even less so justified or explained. The principle of equality in the treatment of the parties laid down by Article 15 of the [1976] UNCITRAL Arbitration Rules governing these proceedings also requires that such privileges be clearly explained so as to allow the Investor the opportunity to provide informed comments on the matter.

  3. 22. The Tribunal accordingly directs Canada that if it believes that a document will need to be protected under paragraph 6 (f) of the Document Production Order, it shall need to identify such document specifically, its date and description of its general contents. At the same time, Canada is required to provide the appropriate explanations about why it considers that the privilege must be asserted.

ICS Inspection and Control Services Ltd and Argentine Republic, Award on Jurisdiction (February 10, 2012) (PCA administered, 1976 UNCITRAL Rules, UK-Argentina BIT), at 13 (reprinting Procedural Order No 1 dated May 18, 2010):

4.2  For issues not dealt with in the [1976] UNCITRAL Rules or in the Treaty, the Tribunal shall apply the rules it deems appropriate, subject to Article 1(2) of the UNCITRAL Rules.

ICS Inspection and Control Services Ltd and Argentine Republic, Award on Jurisdiction (February 10, 2012) (PCA administered, 1976 UNCITRAL Rules, UK-Argentina BIT), at 84 (footnote omitted):

  1. 253. The Tribunal holds an inherent power over procedure. This power is implicit, but is also set out in Article 15(1) of the [1976] UNCITRAL Arbitration Rules …

  2. 254. Within the bounds of equality, due process, and the explicit stipulations of the [1976] UNCITRAL Arbitration Rules, the Tribunal has nearly unlimited discretion in relation to procedural matters. It has even been noted that under the [1976] UNCITRAL Arbitration Rules, as opposed to other procedural frameworks, a tribunal may even enjoy broad power in certain cases to overrule the parties’ agreements on procedural matters.

(p. 65) (2)  Article 15(1) (1976 Rules)—amicus submissions

Methanex Corp and United States of America, Decision on Petitions from Third Persons to Intervene as Amici Curiae (January 15, 2001) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), reprinted in (2001) 13(3) World Trade & Arb Materials 97, 109–11, 114–15, 118–20:

  1. 24. … In the Tribunal's view, there is nothing in either the [1976] UNCITRAL Arbitration rules or Chapter 11, Section B, that either expressly confers upon the Tribunal the power to accept amicus submissions or expressly provides that the Tribunal shall have no such power.

  2. 25. It follows that the Tribunal's powers in this respect must be inferred, if at all, from its more general procedural powers. In the Tribunal's view, the Petitioner's requests must be considered against Article 15(1) of the [1976] UNCITRAL Arbitration Rules; and it is not possible or appropriate to look elsewhere for any broader power or jurisdiction.

  3. 26. Article 15(1) of the [1976] UNCITRAL Arbitration Rules grants to the Tribunal a broad discretion as to the conduct of this arbitration, subject always to the requirements of procedural equality and fairness towards the Disputing Parties. It provides, broken down into numbered sub-paragraphs for ease of reference below, as follows:

    “[1] Subject to these Rules, [2] the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, [3] provided that the parties are treated with equality and that at any stage in the proceedings each party is given a full opportunity of presenting its case.”

    This provision constitutes one of the essential “hallmarks” of an international arbitration under the [1976] UNCITRAL Arbitration Rules, according to the travaux préparatoires. Article 15 has also been described as the “heart” of the [1976] UNCITRAL Arbitration Rules; and its terms have since been adopted in Article 18 and 19(2) of the [1976] UNCITRAL Model Law on International Commercial Arbitration, where these provisions were considered as the procedural “Magna Carta” of international commercial arbitration. Article 15(1) is plainly a very important provision.

    [The Tribunal turned to the issue of “whether the Tribunal's acceptance of amicus submissions falls within the general scope of the sub-paragraph numbered [2] of Article 15(1)”]

    …

    28. In addressing this issue, there are four principal matters to be considered:

  4. (i)  whether the Tribunal's acceptance of amicus submissions falls within the general scope of … Article 15(1);

  5. (ii)  if so, whether the acceptance of amicus submissions could affect the equal treatment of the Disputing Parties and the opportunity of each to present its case, under … Article 15(1);

  6. (iii)  whether there are any provisions in Chapter 11, Section B, of NAFTA that modify the application of Article 15(1) for present purposes; and

  7. (iv)  whether other provisions of the [1976] UNCITRAL Rules likewise modify the application of Article 15(1) in regard to this particular case, given the introductory words … of Article 15(1).

    It is convenient to consider each matter in turn.

    (i)  The General Scope of Article 15(1) of the [1976] UNCITRAL Arbitration Rules

    …

  8. 29. The Tribunal is required to decide a substantive dispute between the Claimant and the Respondent. The Tribunal has no mandate to decide any other substantive dispute or any dispute determining the legal rights of third persons. The legal boundaries of the arbitration are set by this essential legal fact. It is thus self-evident that if the Tribunal cannot directly, without consent, add another person as a party to this dispute or treat a third person as a party to the arbitration or NAFTA, it is equally precluded from achieving this result indirectly by (p. 66) exercising a power over the conduct of the arbitration. Accordingly, in the Tribunal's view, the power under Article 15(1) must be confined to procedural matters. Treating non-parties as Disputing Parties or as NAFTA Parties cannot be matters of mere procedure; and such matters cannot fall within Article 15(1) of the [1976] UNCITRAL Rules.

  9. 30. However, in the Tribunal's view, its receipt of written submissions from a person other than the Disputing Parties is not equivalent to adding that person as a party to the arbitration ….

  10. 31. The Tribunal considers that allowing a third person to make an amicus submission could fall within its procedural powers over the conduct of the arbitration, within the general scope of Article 15(1) of the [1976] UNCITRAL Arbitration Rules. The wording of … Article 15(1) suffices, in the Tribunal's view, to support its conclusion; but its approach is supported by the practice of the Iran-US Claims Tribunal and the World Trade Organisation.

    [The Tribunal's discussion of the practice of these institutions, as well as that of the International Court of Justice, has been omitted.]

    …

    (ii)  Safeguarding Equal Treatment

    …

  11. 36. However, at least initially, the burden in meeting the Petitioners’ written submissions would be shared by both Disputing Parties; and moreover, that burden cannot be regarded as inevitably excessive for either Disputing Party. As envisaged by the Tribunal, the Petitioners would make their submissions in writing, in a form and subject to limitations decided by the Tribunal. The Petitioners could not adduce the evidence of any factual or expert witness; and it would not therefore be necessary for either Disputing Party to cross-examine a witness proffered by the Petitioners: there could be no such witness. As to the contents of the Petitioners’ written submissions; it would always be for the Tribunal to decide what weight (if any) to attribute to those submissions. Even if any part of those submissions were arguably to constitute written “evidence”, the Tribunal would still retain a complete discretion under Article 25.6 of the [1976] UNCITRAL Arbitration Rules to determine its admissibility, relevance, materiality and weight. Of course, if either Disputing Party could not then complain at that burden: it was always required to meet its opponent's case; and that case, however supplemented, can form no extra unfair burden or unequal treatment.

  12. 37. It would always be the Tribunal's task, assisted by the Disputing Parties, to adopt procedures whereby any burden in meeting written submissions from a Petitioner was mitigated or extinguished. In theory, a difficulty could remain if a point was advanced by a Petitioner to which both Disputing Parties were opposed; but in practice, that risk appears small in this arbitration. In any case, it is not a risk the size or nature of which should swallow the general principle permitting written submissions from third persons. Accordingly, whilst there is a possible risk of unfair treatment as raised by the Claimant, the Tribunal is aware of that risk and considers that it must be addressed as and when it may arise. There is no immediate risk of unfair or unequal treatment for any Disputing Party or Party.

    (iii)  Relevant Provisions inChapter11, Section B, of NAFTA

    …

    (iv)  Other [1976] UNCITRAL Rules

  13. 40. The Claimant's reliance on Article 25(4) of the [1976] UNCITRAL Arbitration Rules to the effect that hearings are to be held in camera is not relevant to the Petitioners’ request to serve written submissions to the Tribunal. In the Tribunal's view, there are no further provisions under the [1976] UNCITRAL Arbitration Rules that modify the application of its general power under Article 15(1) to allow the Petitioners to make such submissions in this arbitration.

  14. 41. However, the Claimant's reliance on Article 25(4) is relevant to the Petitioners’ request to attend hearings and to receive copies of all submissions and materials adduced before the Tribunal. [The (p. 67) Tribunal declined to grant Petitioners these rights because the Parties had not consented in this regard pursuant to Article 25(4).] Article 25(4) provides that: “[Oral] Hearings shall be held in camera unless the parties agree otherwise … ”. The phrase “in camera” is clearly intended to exclude members of the public, i.e. non-party third persons such as the Petitioners. As the travaux préparatoires disclose, the UNCITRAL drafting committee deleted a different provision in an earlier draft which could have allowed the arbitration tribunal to admit into an oral hearing persons other than the parties. However, as discussed further below, Article 25(4) relates to the privacy of the oral hearings of the arbitration; and it does not in like terms address the confidentiality of the arbitration.

  15. 42. As to privacy, the Respondent has accepted that, as a result of Article 25(4), hearings are to be held in camera unless both Disputing Parties consent otherwise. The Respondent has given such consent. The Claimant has given no such consent. The Tribunal must therefore apply Article 25(4); and it has no power (or inclination) to undermine the effect of its terms. It follows that the Tribunal must reject the Petitioners’ requests to attend oral hearings of the arbitration.

  16. 43. As to confidentiality, the Tribunal notes the conflicting legal materials as to whether Article 25(4) of the [1976] UNCITRAL Arbitration Rules imposes upon the Disputing Parties a further duty of confidentiality (beyond privacy) in regard to materials generated by parties within the arbitration ….

    …

    46. This is however a difficult area; and for the present purposes, the Tribunal does not have to decide the point. Confidentiality is determined by the agreement of the Disputing Parties as recorded in the Consent Order regarding Disclosure and Confidentiality, forming part of the Minutes of Order of the Second Procedural meeting of 7th September 2000. As amici have no rights under Chapter 11 of NAFTA to receive any materials generated within the arbitration (or indeed any rights at all), they are to be treated by the Tribunal as any other members of the public ….

    (v)  The Tribunal's Conclusion

    47. Power: The Tribunal concludes that by Article 15(1) of the [1976] UNCITRAL Arbitration Rules it has the power to accept amicus submissions (in writing) from each of the Petitioners, to be copied simultaneously to the legal representatives of the Disputing Parties, Canada and Mexico. … The Tribunal also concludes that it has no power to accept the Petitioners’ requests to receive materials generated within the arbitration or to attend oral hearings of the arbitration. Such materials may however may be derived from the public domain or disclosed into the public domain within the terms of the Consent Order regarding Disclosure and Confidentiality, or otherwise lawfully; but that is a quite separate matter outwith the scope of this decision.

    …

    (vi)  The Tribunal's Order

    53. For the reasons set out above, pursuant to Article 15(1) of the [1976] UNCITRAL Arbitration Rules, the Tribunal declares that it has the power to accept amicus written submissions from the Petitioners.

United Parcel Service of America Inc and Government of Canada, Decision on Petitions for Intervention and Participation as Amici Curiae (October 17, 2001) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), reprinted in (2002) 14(1) World Trade & Arb Materials 41, 64–68:

[The Tribunal's discussion of the general nature of Article 15(1) of the 1976 UNCITRAL Rules in paragraphs 37 to 39 is omitted.]

The Tribunal's opinion and conclusion on the participation of amici curiae

  1. 59. The submission by Mexico raises a threshold issue: does the Tribunal have any power at all to allow third parties to participate in these proceedings? The Tribunal has already ruled that they cannot participate as parties to the proceedings. But is a less, amicus curiae role, permitted?

  2. (p. 68) 60. As all those making submissions agree, the answer is to be found in the powers conferred by article 15(1) [of the 1976 UNCITRAL Rules], read of course in its context. Those powers are limited to matters of procedure and they are constrained by other relevant rules and NAFTA provisions and by the principles of equality and fairness. They cannot be used to turn the dispute the subject of the arbitration into a different dispute, for instance by adding a new party to the arbitration. Rather, the powers are to be used to facilitate the Tribunal's process of inquiry into, understanding of, and resolving, that very dispute which has been submitted to it in accordance with the consent of the disputing parties.

  3. 61. Is it within the scope of article 15(1) for the Tribunal to receive submissions offered by third parties with the purpose of assisting the Tribunal in that process? The Tribunal considers that it is. It is part of its power to conduct the arbitration in such manner as it considers appropriate. As the Methanex Tribunal said, the receiving of such submissions from a third person is not equivalent to making that person a party to the arbitration. That person does not have any rights as a party or as a non-disputing Party. It is not participating to vindicate its rights. Rather, the Tribunal has exercised its power to permit that person to make the submission. It is a matter of its power rather than of third party right. The rights of the disputing Parties are not altered (although in exercise of their procedural rights they will have the rights to respond to any submission) and the legal nature of the arbitration remains unchanged.

    …

  4. 63. We consider that article 15(1) supports a power to allow submissions by amici curiae.

  5. 64. In support of that conclusion, we call attention to the practice mentioned by the Methanex Tribunal of the Iran-US Claims Tribunal and the WTO Appellate Body which supports a power (but not a duty) to receive third party submission: Iran v. United States case A/15 Award No 63-A/15-FT; 2 Iran-US CTR 40, 43; and Hot Rolled Lead and Carbon Steel, order of the Appellate Body of the WTO. It is true that in contentious cases in the International Court of Justice only states and in certain circumstances public international organizations may have access to the Court (the latter only to provide information relevant to cases before it.) But that limit appears to result directly from the wording of articles 34, 35 and 61–64 of the Statute of the Court which carefully regulate those matters as well as from the practice under them extending over several decades; see Shabtai Rosenne The Law and Practice of International Court, 1920–1966 (1997) chs 10 and 26.

    …

    Relevant provisions of NAFTA and the [1976] UNCITRAL Rules

    …

  6. 67. The relevant provision of the [1976] UNCITRAL rules to which attention is given in the submissions is article 25(4) under which hearings are in camera unless the parties agree otherwise. They have not so agreed. The provision does not however prevent the Tribunal receiving written submissions. But it does prevent third parties or their representatives attending the hearings in the absence of both parties agreeing.

  7. 68. Next there is the difficult question of the confidentiality of the pleadings and other documents generated in the course of the proceeding … The privacy of the hearing is perhaps to be distinguished from the confidentiality or availability of documents. Under Chapter 11 and the [1976] UNCITRAL Rules provision is made for the communication of pleadings, documents and evidence to the other disputing party, the other NAFTA Parties, the Tribunal and the Secretariat—and to no one else. The matter is also subject to any agreement between the parties or order in respect of confidentiality ….

    The requirement of equality and of the full opportunity of parties to present their case

  8. 69. The requirement of equality and the parties’ right to present their cases do limit the power of the Tribunal to conduct the arbitration in such manner as it considers (p. 69) appropriate. That power is to be used not only to protect those rights of the parties, but also to investigate and determine the matter subject to arbitration in a just, efficient and expeditious manner. The power of the Tribunal to permit amicus submissions is not to be used in a way which is unduly burdensome for the parties or which unnecessarily complicates the Tribunal process. The Tribunal envisages that it will place limits on the submissions to be made in writing in terms for instance of the length. The third parties would not have the opportunity to call witnesses (given the effect of article 25(4)) with the result that the disputing parties would not face the need to cross-examine them or call contradictory evidence. The parties would also be entitled to have the opportunity to respond to any such submissions.

    The Tribunal's assessment

  9. 70. The Tribunal returns to the emphasis which the petitioners, with considerable cogency, have placed on the important public character of the matters in issue in this arbitration and on their own real interests in these matters. It recalls as well the emphasis placed on the value of greater transparency for proceedings such as these. Such proceedings are not now, if they ever were, to be equated to the standard run of international commercial arbitration between private parties ….

  10. 71. The Tribunal does not consider that among the matters on which it is appropriate for the Petitioners to make submissions are questions of jurisdiction and the place of arbitration. On both, the parties are fully able to present the competing contentions and in significant degree have already done so. In any event it is for the respondent to take jurisdictional points and the parties themselves have the power to fix the place of arbitration by agreement between them. The Tribunal does not consider that any other procedural matters of which it is award should be the subject of amicus submissions.

  11. 72. The circumstances and the detail of the making of any amicus submissions would be the subject of consultation with the parties.

Chevron Corp, et al and Republic of Ecuador, Procedural Order No 8 (April 18, 2011) (PCA administered, 1976 UNCITRAL Rules, US-Ecuador BIT), at 5:

  1. 18. As regards the two other orders sought by the Petitioners, the Tribunal notes that the Parties agree that they do not believe that the amicus submissions will be helpful to the Tribunal and neither side favours the participation of the petitioners during the jurisdictional phase of the arbitration, in which the issues to be decided are primarily legal and have already been extensively addressed by the Parties’ submissions.

  2. 19. The Tribunal has yet to decide these issues of jurisdiction and admissibility; and it is not anticipated that the Parties will make further submissions to the Tribunal as regards these issues before the Tribunal's decision.

  3. 20. Accordingly, having considered the Amicus Petitions in all the circumstances currently prevailing in these arbitration proceedings, the Tribunal decides to exercise its discretion (inter alia) under Article 15(1) of the [1976] UNCITRAL Arbitration Rules not to permit the participation of the Petitioners as amici curiae at this stage of the arbitration.

D. Extracts from the Practice of the Iran–US Claims Tribunal

(1)  General and Tribunal Rules (1983), Article 15(1)

E-Systems, Inc and Islamic Republic of Iran, Award No ITM 13–388-FT (February 4, 1983) at 6, reprinted in 2 Iran-US CTR 51, 54 (1983-II):

Upon invitation of the Tribunal in accordance with Note 5 to Article 15 of the [1983] Provisionally Adopted Tribunal Rules the Government of the United States has submitted oral and written statements with a view to assisting the Tribunal in carrying out its task.

(p. 70) Foremost Tehran Inc and Islamic Republic of Iran, Case Nos 37 and 231, Chamber One, Order of September 15, 1983, reprinted in 3 Iran-US CTR 361, 362 (1983-II):

Article 15 of the [1983] Tribunal Rules requires that the Tribunal treat the parties equally. This is a fundamental principle of justice. In the circumstances of these cases, the delicate balance of equality would be tipped if one party were to be permitted to present an extensive Memorial and additional exhibits, without providing an opportunity for the other party to file a memorial in response. While the filing by Claimants of their Memorial on the Merits prior to the Hearing may be an advantage to the Respondents in that it informs them in detail of Claimants’ contentions and arguments and may be of assistance to the Tribunal in analyzing the case, nevertheless it cannot be accepted without providing the Respondents an equal opportunity to make a written submission.

Amman & Whitney and Ministry of Housing and Urban Development (Khuzestan Department of Housing and Urban Development), Case No 198, Chamber One, Order of January 30, 1984:

The conduct of proceedings before this Tribunal is governed by the [1983] Tribunal Rules and by no national procedural system.

Dames & Moore and Islamic Republic of Iran, Decision No DEC 36–54–3 (April 23, 1985) at 15, reprinted in 8 Iran-US CTR 107, 115 (1985-I):

It is clear from the language and context of Article 15 [of the 1983 Tribunal Rules] that its operative terms apply during the arbitral proceedings themselves, prior to the issuance of an award. Its applicability terminates with the rendering of an award. This is especially apparent when Article 15 is compared with Article 29(2), …

George W Drucker Jr and Foreign Transaction Co, Case No 121, Chamber Two, Order of May 2, 1986:

The Tribunal notes a document received by the Tribunal's Registry on 25 April 1986, submitted by M. A. Saheb, who identifies himself as the Chairman and Managing Director of South Gulf Trading and Shipping Limited of Dubai, who is not a party in this Case.

Pursuant to Note 5 to Article 15 of the [1983] Tribunal Rules and taking into consideration that the above-mentioned document may assist the Tribunal in deciding the jurisdictional issue regarding the Claimant's ownership and control of SGTC, the Tribunal decides that such document should be filed by the Registry and served on the Parties.

Watkins-Johnson Company and Islamic Republic of Iran, Case No 370, Chamber One, Order of December 3, 1987:

On 27 November 1987 the Claimants filed a request for permission to file a “Supplemental Memorial and Summary of Evidence” in response to “Respondents’ Brief and Evidence and Rebuttal Memorial” filed on 15 September 1987 (Doc. No 178). The Claimants did not allege that Respondents’ Doc. no. 178 contains improper rebuttal material and identified no new material. Together with this request, the Claimants filed the “Supplemental Memorial and Summary of Evidence” that it requested be admitted.

It has been the established practice of the Tribunal to close the exchange of written pleadings after the submission of Memorials in Rebuttal. In order to secure equal treatment of the Parties and an orderly conduct of the proceedings, the Tribunal admits further written submission close to the Hearing date only in exceptional circumstances. It finds no reason to depart from this practice in the circumstances of this Case, particularly in view of the fact that the Hearing has already been postponed once to afford the Parties another round of written pleadings.

(p. 71) General Electric Co and Islamic Republic of Iran, Case No 386, Chamber One, Order of December 10, 1987:

On 30 November 1987 the Claimant filed a Request for an Order authorizing the Parties in this Case to file simultaneous surrebuttals. In the Request it is stated that the Respondents’ rebuttal Memorial and Exhibits filed on 3 August 1987 contain new arguments and evidence. It is also stated that a round of surrebuttal pleadings would afford the Respondents a further opportunity to respond fully to Claimant's evidence and arguments.

It has been the established practice of the Tribunal to close the exchange of written pleadings after the submission of Memorials in Rebuttal. In order to secure equal treatment of the Parties and an orderly conduct of the proceedings, the Tribunal admits further written submissions close to the Hearing date only in exceptional circumstances.

The Tribunal finds no reason to allow a further round of submissions in the present Case. If any of the material filed by the Respondents on 3 August 1987 is found not to fall within the definition of rebuttal evidence, it will be ruled inadmissible and disregarded. The Claimant's request is therefore denied.

Fedders Corp and Loristan Refrigeration Industries, Case No 250, Chamber Three, Order of January 5, 1988:

On that date the Tribunal also received the documents in French language, dated 6 March, 15 April and 5 October 1987, allegedly related to the criminal proceedings at the Swiss court initiated by the Respondents. The above submissions were made in support of the Respondents’ request to “suspend the proceedings in this Case, pending determination of suit” in the Swiss court.

On 30 October 1987 the Claimant objected to the above request and to the submission of the above documents.

The Tribunal's proceedings are governed by the Declaration of the Government of the Democratic and Popular Republic of Algeria and by the Tribunal Rules of Procedure. None of these texts obliges the Tribunal to suspend the proceedings before it for the reason of an alleged initiation of the criminal proceedings in a national court by one of the Parties. Such a suspension could be only a matter of convenience.

Gloria Jean Cherafat and Islamic Republic of Iran, Decision No DEC 106–277–2 (June 25, 1992), reprinted in 28 Iran-US CTR 216, 221–23 (1992) (footnotes omitted):

  1. 19. As to the existence, or the exercise of any inherent power to reinstate a terminated Case, the Tribunal practice fails to provide conclusive guidance; indeed, the Tribunal has specifically reserved its position as to whether it has inherent power to revise an award under exceptional circumstances. See, e.g. World Farmers Trading Inc. and Government Trading Corporation, et al., Decision No DEC 93–764–1, para 3 (3 Oct. 1990), reprinted in 25 Iran-U.S. C.T.R. 186, 187 (1990-II); Dames & Moore and The Islamic Republic of Iran, Decision No DEC 36–54–3, pp. 18–21 (23 Apr. 1985), reprinted in 5 Iran-U.S. C.T.R. 107, 117–18 (1984-I); Mark Dallal and Islamic Republic of Iran, Decision No DEC 30–149–1 (12 Jan. 1984), reprinted in 5 Iran-U.S. C.T.R. 74, 745 (1984-I); Henry Morris and Government of the Islamic Republic of Iran et al., Decision No DEC 26–200–1, p. 2 (16 Sept. 1983), reprinted in 3 Iran-U.S. C.T.R. 364, 365 (1983-II).

  2. 20. Of the Decisions cited above, the Decision most on point is Dames & Moore. There, the Tribunal rejected the Respondent's request to reopen a case allegedly based on forged documents and perjured affidavits. The Tribunal concluded that even a generous reading of the Respondent's allegations of fraud did “not raise justified concern that the processes of the Tribunal [had] been subverted.” The Tribunal thus did not need to decide whether it possessed inherent authority to reopen a case procured by fraud:

    In the absence of an express grant of authority to the Tribunal to reopen and reconsider cases in the merits after issuance of an award, the question has been posed as to whether (p. 72) an “inherent power” to do so may exist “under exceptional circumstances”, at least where an award “was based on forged documents or perjury.” [citing Henry Morris and Mark Dallal, above]. The implied or inherent power of an international claims tribunal in this area is an issue which has been subjected to learned analysis and limited judicial scrutiny, with wholly inconsistent results. [ … ] The instant request for reopening and reconsideration, however, falls well short of justifying any such effort to ascertain the precise balance struck between finality of Tribunal dispositions, on the one hand, and the integrity of its processes on the other.

  3. 21. As in Dames and Moore, the Tribunal has first to examine the request to determine whether there exists a prima facie case to justify reinstatement and if such a case exists, whether the Tribunal possesses inherent power to do so under the circumstances.

    …

    24. The evidence submitted by the Applicants falls short of establishing a prima facie case …

Dadras Intl, et al and Islamic Republic of Iran, et al, Award No 567–213/215–3 (November 7, 1995), reprinted in 31 Iran-US CTR 127, 135–36, 143–44 (1995) (footnotes omitted):

  1. 27. The Tribunal Rules grant considerable discretion to the Tribunal to admit or exclude written submissions. This discretion includes the power to accept unauthorized post-Hearing submissions, as derived from Article 15, paragraph 1; Article 22; Article 25, paragraph 6; and Article 29, paragraph 2 of the [1983] Tribunal Rules.

  2. 28. Tribunal precedent is, however, strongly against the admission into evidence of unauthorized late-filed documents. The Tribunal has expressed a particular aversion to admitting documents that are submitted not only after filing deadlines, but also after the Hearing itself. The most extensive treatment of this issue is to be found in Harris International Telecommunications, Inc. and The Islamic Republic of Iran, et al, Award No 323–409–1 (2 November 1987), reprinted in 17 Iran-U.S. C.T.R. 31, 45–50.

  3. 29. Harris emphasizes that in deciding whether to admit a late submission, it is important that the Tribunal treat the parties equally and fairly, bearing in mind that accepting late-filed documents from one party can result in prejudice to the other. A further consideration is the “orderly conduct of the proceedings.” In applying these principles to the facts of a given case, the Tribunal should consider the “character and contents of late-filed documents and the length and cause of the delay.” Late-filed submissions containing new facts and evidence “are the most likely to cause prejudice to the other Party and to disrupt the arbitral process if filed late.”

  4. 30. Thus the considerations that are generally relevant when deciding whether to admit late-filed documents are the possibility of prejudice, the equality of treatment of the Parties, the disruption of the arbitral process caused by the delay and the reason for the delay.

    …

  5. 59. The Agent of Iran also cited Article 15, paragraph 1 of the [1983] Rules as authority for the Respondents’ request to reopen [the hearing]. … The Agent of Iran argued that

    [t]here is no doubt that if an affidavit is accepted as evidence in a case while, on the other hand, the adverse party is not given the permission to orally and directly examine the said witness at the hearing session, the latter will be completely deprived of the “full opportunity” he is supposed to be given for presenting his Case. In other words, it is not possible to deprive a party of the right of examining a witness whose written testimony has been accepted and still claim that the latter party has been granted a “full opportunity” of presenting his case.

  6. 60. The Tribunal need hardly point out, however, that this Tribunal (like many others) customarily accepts affidavits into evidence and takes account of those affidavits without the opposing party necessarily being given the opportunity to cross-examine the affiant. Several examples (unchallenged by either of the Parties) are to be found in these very Cases.

  7. 61. Furthermore, the Tribunal is unpersuaded that any Party can credibly claim that it has been denied a “full opportunity of presenting [its] case” given the procedural history of these Cases. (p. 73) The key word is “opportunity”: the Tribunal is obliged to provide the framework within which the parties may present their cases, but is by no means obliged to acquiesce in a party's desire for a particular sequence of proceedings or to permit repetitious proceedings.

Vivian Mai Tavakoli, et al and Government of the Islamic Republic of Iran, Award No 580–832–3 (April 23, 1997), reprinted in 33 Iran-US CTR 206, 211 (1997):

9. Under the [1983] Tribunal Rules the Tribunal has the discretion to accept unauthorized late submissions from the Parties. See Article 15, paragraph 1, and Article 22 of the [1983] Tribunal Rules. However, in the interests of the orderly conduct of the proceedings and in order to maintain “equality of arms,” it has in general taken a restrictive approach to the exercise of this discretion. See, for example, Dadras International, et al. and Islamic Republic of Iran, et al., Award No 567–213/215–3, paras 27–28 (7 Nov. 1995), reprinted in 31 Iran-U.S. C.T.R. 127, 135–36; Edgar Protiva, et al. and Government of the Islamic Republic of Iran, Award No 566–316–2, paras 30–36 (14 July 1995), reprinted in 31 Iran-U.S. C.T.R. 89, 102–03 (“Protiva”); Reza Said Malek and Government of the Islamic Republic of Iran, Award No 534–193–3, para 12 (11 Aug. 1992), reprinted in 28 Iran-U.S. C.T.R. 246, 249–50; Harris International Telecommunications, Inc. and Islamic Republic of Iran, et al., Award No 323–409–1 (2 Nov. 1987), reprinted in 17 Iran-U.S. C.T.R. 31, 45–50. In the present Case, the Tribunal's Order of 17 April 1996 clearly restricted the scope of the submissions to be made by both Parties. In light of these restrictions and in the absence of any other justifying circumstances, the Tribunal excludes from the record items 3, 4 and 6 of the Respondent's submission of 27 June 1996, the Claimant's entire submission of 22 July 1996 and the Respondent's entire submission of 20 August 1996.

Vera-Jo Miller Aryeh, et al and Islamic Republic of Iran, Award No 581–842/843/844–1 (May 22, 1997), reprinted in 33 Iran-US CTR 272, 287–88 (1997):

  1. 48. The Tribunal notes that, according to its practice reflected in Harris International Telecommunications, Inc. and The Islamic Republic of Iran, et al., Partial Award No 323–409–1, paras 57–75 (2 Nov. 1987), reprinted in 17 Iran-U.S. C.T.R. 31, 45–52, Articles 15, 22, 23, and 28 of the [1983] Tribunal Rules are the primary rules regulating the status of late-filed documents ….

  2. 49. Furthermore, on the basis of Article 15 [of the 1983 Tribunal Rules], both parties to the case have to be treated equally. This means that both parties to the case are entitled to have an equal opportunity to present written submissions and to respond to each other's submissions. This also means that the parties must have an equal opportunity to go through the evidence and the arguments submitted by the other party, and to prepare their own position and arguments in advance of the hearing.

  3. 50. Chamber One has taken a strict stance on these matters: no new evidence is permitted prior to the hearing unless the Tribunal finds that it is justified by exceptional circumstances and is filed no later than two months before the hearing in the case. Moreover, as a matter of routine in its orders scheduling a hearing the Chamber advises the parties that any party is free to make whatever arguments it wishes at the hearing; however, parties may not introduce new documents into evidence absent the Tribunal's permission. Such permission normally is not granted except for rebuttal evidence introduced to rebut evidence produced at the hearing.

    …

    52. Typically, the practice not to allow new evidence in the record encompasses not only the two-month period directly preceding the hearing but also the post-hearing period preceding the filing of an award. The practice of Chamber One has been strict, even though the Chamber has taken into consideration the nature of these documents, the elapsed period of time, and the reasons for the delay, when deciding on the admissibility of late-filed, unauthorized documents. Usually, the Tribunal has rejected the late-filed unauthorized documents in order to prevent any party from using “tactical” filings at the hearing or thereafter.

(p. 74) (2)  Tribunal Rules (1983), Article 15(2)

The Austin Co and Machine Sazi Arak, Case No 295, Chamber Two, Order of July 30, 1982:

The Parties are hereby notified that a settlement or pre-hearing conference in this case will be held on Thursday 16 December at 9.00 am at Parkweg 13, The Hague. The Parties should be prepared to discuss the matters indicated in the schedule annexed. The Parties are requested in particular to have available all necessary authorizations and approvals in the event that a settlement should result.

ANNEX

  1. (a)  Clarification of the issues presented and relief sought;

  2. (b)  identification and clarification of any issues to be considered as preliminary questions and particularly the issue of jurisdiction;

  3. (c)  status of any settlement discussions;

  4. (d)  whether any further documents or written statements, including any reply or rejoinder, are requested by the arbitrating parties or required by the arbitral tribunal;

  5. (e)  fixing a schedule for submission by each arbitrating party of a summary of the documents or lists of witness or other evidence it intends to present at the hearing;

  6. (f)  fixing a schedule for submission of any documents, exhibits or other evidence which the arbitral tribunal may require;

  7. (g)  desirability of appointing an expert by the arbitral tribunal and, if so, the expert's qualifications and terms of reference; whether the arbitrating parties intend to present experts and, if so, the qualification of and the areas of expertise to be covered by any such expert;

  8. (h)  determining what documentary evidence will require translation;

  9. (i)  fixing a schedule of hearings;

  10. (j)  other appropriate matters.

Sylvania Technical Systems, Inc and Islamic Republic of Iran, Case No 64, Chamber One, Order of May 10, 1983:

The Tribunal intends to decide on the basis of the documents submitted (i) whether the forum selection clause in the Contract excludes jurisdiction of the Tribunal and (ii) whether the claim is a claim by a national of the United States as defined in Article VII of the Claims Settlement Declaration.

Phelps Dodge Corp and Overseas Private Investment Corp and Islamic Republic of Iran, Case No 99, Chamber Two, Order of May 8, 1984:

The Tribunal wishes to point out that, contrary to the provisions relating to Hearings, the Tribunal Rules do not contain any provision by which the Parties are entitled to a Pre-hearing Conference when they make a request to that effect. Moreover, the practice of the Tribunal to date has been to schedule Pre-hearing Conferences only when the Tribunal deems it necessary for the proper scheduling of further proceedings. In quite a number of cases this is not necessary, such as in the present case.

White Consolidated Industries Inc and Iran Compressor Manufacturing Co, Case No 126, Chamber Two, Order of December 7, 1984:

In view of the large number of pending cases and the practical limits on the number of hearings and deliberations that can be held during each year, the Tribunal cannot afford, as a general practice, to separate certain issues for preliminary hearing and decision but must normally join such issues to the merits.

(p. 75) Component Builders, Inc and Islamic Republic of Iran, Case No 395, Chamber Three, Order of February 19, 1985:

… neither the [1983] Tribunal Rules nor Tribunal practice requires that there be a Pre-Hearing Conference or that a Hearing be held on requests for interim measures or preliminary issues such as jurisdiction.

Parvin Mariam Samrad and Islamic Republic of Iran, Case No 465, Chamber Two, Order of July 28, 1986:

The Tribunal does not find that the reasons invoked by the Respondent in this submission constitute strong and compelling reasons. Nevertheless, it is prepared to grant a last extension for the filing of Respondent's submission until 21 October 1986. After that date, the Tribunal will take a decision regarding its jurisdiction on the basis of the briefs and evidence before it.

World Farmers Trading Inc and Government Trading Corp, Case No 764, Chamber One, Order of August 4, 1986:

Unless by 18 February 1987 either Party has filed a request for an oral Hearing, both the jurisdictional issues and the merits of the Case will be decided thereafter by the Tribunal on the basis of the documents submitted.

Tai, Inc and Islamic Republic of Iran, Case No 421, Chamber One, Order of August 12, 1986:

The Tribunal makes the following order pursuant to the pre-hearing conference held on 1 July 1986:

1. The Tribunal does not consider it appropriate at the present stage of the proceedings to issue an interlocutory Award disposing of jurisdictional or other preliminary issues.

It is the present intention of the Tribunal that the issues raised in paragraphs 2 and 3 above shall thereafter be decided on the basis of the documents submitted.

United States of America on behalf and for the benefit of the New York Blower Co and Islamic Republic of Iran, Case No 10418, Chamber Two, Order of September 1, 1986:

  1. 1. Considering the nature of the dispute and the amount involved in the claim in relation to the costs that will be incurred by the parties in the event of a hearing, the Tribunal is prepared to decide this claim on the basis of the documents submitted.

  2. 2. The Tribunal will decide the claim without a hearing unless a request for a hearing is filed by either party not later than 22 September 1986. In the event such a request is filed, the hearing will be held on October 20, 1986 at Parkweg 13, The Hague starting at 9.30 am.

Tchacosh Co, Inc and Islamic Republic of Iran, Award No 540–192–1 (December 9, 1992), reprinted in 28 Iran-US CTR 371, 379–80 (1992):

21. As noted above, … Iran withdrew its earlier request for a hearing on jurisdictional issues by its submission filed on 5 February 1992. As noted also in para 11, Siporex California requested in its submission filed on 22 June 1992 “a formal hearing and the presentation of evidence since the respondents have criticized and slandered the evidence presented on behalf of the claimant in support of its claim contending it is unreliable and fabricated.” This request for hearing must be denied. More than a year before Siporex California requested a hearing, the Tribunal had, by Order filed on 14 March 1991, informed the Parties that it “intends to take a decision regarding its jurisdiction on the basis of the evidence before it … ” The Tribunal notes that the Claimant was free at that time to request a hearing, but it chose not to do so. Instead, it and the Respondents filed extensive pleadings within the framework of the Tribunal's Order, without any mention of a request for a hearing. In the circumstances, the request for a hearing was not made at an appropriate time. Although Article 15, paragraph 2, of the (p. 76) [1983] Tribunal Rules states that a party may request a hearing at “any stage of the proceedings”, the Tribunal has previously held that “such provision should be interpreted, in the light of the particular circumstance of each case, to mean that Hearings are to be held upon the reasonable request of a party made at an appropriate stage of the proceedings.” See World Farmers Trading Inc. and Government Trading Corporation, et al., Award No 428–764–1 (7 July 1989), para 16, reprinted in 22 Iran-U.S. C.T.R. 204, at 209 (1989–II). Further, it is clear from its request that the Claimant seeks a hearing in order to present evidence in connection with the authenticity of certain documents that Iran asserts were fabricated. However, no hearing for that purpose is needed because, for reasons stated below, … the Tribunal decides that it has no jurisdiction in this Case regardless of the Parties’ dispute on the authenticity of those documents.

Islamic Republic of Iran and United States of America, Case Nos A3, A8, A9, A14 and B16, Full Tribunal, Order of December 3, 1992:

  1. 3. The Tribunal notes that the Parties appear to disagree about the controlling precedent in these Cases, the Claimant citing Award No 382-B 1-FT (31 Aug. 1988) and the Respondent citing Award No 529-A15 (II:A and II:B)-FT (6 May 1992). The Tribunal also notes that the Parties appear to envisage somewhat different proceedings and filings.

  2. 4. In these circumstances, the Tribunal believes that it would be desirable to have a Pre-Hearing Conference with the Parties prior to its decision on the further proceedings in these consolidated Cases.

  3. 5. Accordingly, the Parties are requested to attend a Pre-Hearing Conference in these consolidated Cases to be held at Parkweg 13 on 10 February 1993, commencing at 9:30 a.m.

  4. 6. The following matters will be considered at the Pre-Hearing Conference:

    1. (a)  identification of any issues that the Parties believe the Tribunal should consider as preliminary questions;

    2. (b)  procedures for avoiding overlap between properties at issue in these consolidated Cases and properties at issue in Case No A15 (II:A);

    3. (c)  further proceedings in these consolidated Cases, including the schedule for further submissions by the Parties:

    4. (d)  any other procedural issues relating to these consolidated Cases that the Parties or the Tribunal may wish to raise at the Pre-Hearing Conference.

Ninni Ladjevardi (formerly Burgel) and Islamic Republic of Iran, Case No 118, Chamber One, Order of March 24, 1993:

On March 1993, the Respondent filed “Respondent's Rebuttal Brief on the Issue of Claimant's Dominant and Effective Nationality”. Both Parties having now filed their rebuttals, the Tribunal takes note of the Claimant's request for “oral argument on the issue of the dominant and effective nationality” contained in her submission, filed on 31 October 1991, and in accordance with Article 15, paragraph 2 of the [1983] Tribunal Rules, orders as follows:

The Parties are requested to appear before Chamber One of the Tribunal for a Hearing, restricted to the issue of the Claimant's dominant and effective nationality, which is scheduled to take place on 11 June 1993 at Parkweg 13, The Hague, starting at 9:30 a.m.

Dadras Intl, et al and Islamic Republic of Iran, et al, Award No 567–213/215–3 (November 7, 1995), reprinted in (1995) 31 Iran-US CTR 127, 143 (footnotes omitted):

  1. 56. The Tribunal concludes that Article 15, paragraph 2 [of the 1983 Tribunal Rules] is primarily applicable to the situation where there has not yet been a hearing and one of the parties requests one. The right of the parties to request a hearing under Article 15, paragraph 2 is not, however, an absolute right. For example, in World Farmers Trading, Inc. and Government Trading Corporation, et al., Award No 428–764–1 (7 July 1989), reprinted in 22 Iran-U.S. C.T.R. 204, 209, the Tribunal held that although Article 15, paragraph 2 of the [1983] Tribunal (p. 77) Rules states that a party may request a hearing “at any stage of the proceedings,” “[t]his provision should be interpreted, in light of the particular circumstances of each case, to mean that Hearings are to be held upon the reasonable request of a party made at an appropriate stage of the proceedings.” This interpretation of Article 15, paragraph 2 was followed in Tchacosh Company, Inc., et al. and The Government of the Islamic Republic of Iran, et al., Award No 540–192–1, para 21 (9 December 1992), reprinted in 28 Iran-U.S. C.T.R. 37, 380, in which the Tribunal refused to grant the claimant's request for a hearing, saying that the request had not been made at an “appropriate time” because it was made more than one year after the Tribunal had informed the Parties of its intention to take a decision on jurisdiction on the basis of the written evidence before it.

  2. 57. Thus even where no hearing has been held, Article 15, paragraph 2 does not oblige the Tribunal to accede to any request by a party for a hearing. The applicable criteria in evaluating each request are whether the request is both reasonable and made at an appropriate stage of the proceedings. In a context such as the present, where a Hearing has already been held, the reasonableness of the request and the appropriateness of the timing become even more important because the disruption of the arbitral process is that much greater and because the parties have already had an extensive opportunity to present their cases.

  3. 58. For the foregoing reasons, the Tribunal does not consider Article 15, paragraph 2 to be capable of justifying the reopening of the Hearing in the present situation.

4. Place of Arbitration—Article 18

As the preceding discussion concerning Article 17(1) indicated, the choice of the place of arbitration is not only a practical matter, but also may involve significant legal consequences in the form of local mandatory norms. Given that such a choice may decisively affect the validity and enforceability of an award, the issue is much more important than might appear at first blush.

A. Text of the 2010 UNCITRAL Rule256

Article 18 of the 2010 UNCITRAL Rules provides:

  1. 1. If the parties have not previously agreed on the place of arbitration, the place of arbitration shall be determined by the arbitral tribunal having regard to the circumstances of the case. The award shall be deemed to have been made at the place of arbitration.

  2. 2. The arbitral tribunal may meet at any location it considers appropriate for deliberations. Unless otherwise agreed by the parties, the arbitral tribunal may also meet at any location it considers appropriate for any other purpose, including hearings.

(p. 78) B. Commentary

(1)  Meaning of “place of arbitration”

Article 18(1) includes the phrase “place of arbitration,” a term of art referring to the legal seat of the arbitration. In international arbitration, the selection of the place of arbitration typically denotes the jurisdiction whose national arbitration law, or lex arbitri, governs the arbitration and, in some cases, the concomitant supervisory jurisdiction of the courts of that jurisdiction.257 Thus, for example, where the parties choose London as the place of arbitration, that choice would translate into the application of the United Kingdom's Arbitration Act 1996 to the arbitration.258 The law of the place of arbitration may regulate matters, such as the validity of an agreement to arbitrate, the non-arbitrability of certain subject matter, interim measures, the form and validity of the arbitral award, and the parties’ respective rights to challenge and enforce the award. The terms of the lex arbitri may not always be attractive to one or both of the disputing parties.259 In addition, in some cases they may supersede the terms of the UNCITRAL Rules.260 Consequently, the law of the place of arbitration should be studied carefully before the place of arbitration is selected.

The “place of arbitration” has a significance that is sharply distinct from the “location” of certain meetings that comprise significant aspects of the arbitration, such as the hearings and deliberations. As Born notes, “It is critical to appreciate that the concept of the arbitral ‘seat’ (or ‘place’) is a legal construct, not a geographic or physical location.”261 The term “location,” as used in Article 18(2), thus refers only to the physical or geographical place of arbitral meetings.262 Consequently, under the Rules, these types of meetings may occur outside the jurisdiction of the law governing the arbitration, typically for purposes of convenience, without any legal effect on the choice of the place of arbitration. Thus, for example, if the place of arbitration is London and the hearings are held outside the UK, eg, in Paris, the arbitration remains subject to the UK Arbitration Act 1996. The bifurcation of Article 18 into two paragraphs—the first to address the place of arbitration, the second (p. 79) concerning the geographical location of meetings—is meant to reinforce this important difference in concept.263

Inclusion of the term “place of arbitration” improves the clarity of the Rules. Corresponding Article 16(1) of the 1976 UNCITRAL Rules previously contained the phrase “the place where the arbitration is to be held” to indicate the legal seat of the arbitration.264 As leading commentators observed, “[t]he existing expression in many cases creates the mistaken impression that the place chosen for occasional meetings is also the formal place of arbitration.”265 During revision of the Rules, some proposed use of the terms “seat,” “legal seat,” or “juridical seat” of arbitration,266 rather than “place of arbitration,” as clearer terminology for signaling to users of the Rules the legal, rather than geographical, implications of choosing the place whose domestic law is to govern the arbitral procedure.267 Though any of these proposed terms would serve as synonymous substitutes,268 some Working Group delegates noted that “new terminology” might complicate existing contractual practice where parties had already included the phrase “place of arbitration” in their agreements to indicate the legal place of arbitration.269 In the end, the Working Group adopted the phrase “place of arbitration” largely to ensure consistency with the terminology of the UNCITRAL Model Law.270

The Rules do not address the legal effect of the selection of the place of arbitration as a matter of domestic law. During Working Group discussions, it was proposed that the Rules should clarify that this choice determined the law applicable to the arbitral procedure, including court jurisdiction. The Working Group did not adopt this proposal, on grounds that “the legal consequences arising from the choice of the seat of arbitration might differ in different legal systems, and that the Rules were not the appropriate instrument to codify the matter.”271 This interpretation is consistent with the aim of Article 1(3) of the Rules, which clearly establishes that the Rules regulate the internal process of the arbitral proceedings, subject to the mandatory terms of the law governing the arbitration, and do not themselves speak to that law.

(p. 80) (2)  Selection of the place of arbitration—Article 18(1)

(a)  Considerations to be taken into account

Article 18(1) grants the arbitral tribunal authority, in the absence of party agreement,272 to determine the place of arbitration—an authority that helps to avoid delay in the proceedings.273 The tribunal's authority only arises “[i]f the parties have not previously agreed on the place of arbitration.” Article 18(1) thus defers to the parties’ choice as to the place of arbitration prior to the constitution of the tribunal, or even thereafter so long as the arbitrators have not yet made the determination.274 The wording of the provision, however, appears to bar the parties from determining the place of arbitration after the tribunal has decided the matter.275 Nevertheless, there is nothing to prevent the tribunal from revisiting its determination upon a unanimous request by the parties.276 Further, as the parties are the “masters” of the proceedings, that is, they can simply terminate the arbitration if their request is not complied with, the tribunal should always follow such a unanimous request.277

It is generally preferable that the parties expressly determine the place of arbitration in their arbitration clause or agreement.278 In some cases, however, this may not be advisable, as “the identity of the most suitable place of arbitration may depend on the nature and circumstances of the particular dispute that will be submitted to arbitration,”279 and the nature of the dispute may not be foreseeable at the time the agreement is concluded. In such circumstances, the parties may wish to leave the place of arbitration to be decided by the tribunal. In other cases, prior designation of the place of arbitration may not be possible, such as in investor–state arbitration where the terms of arbitration are laid out in the investment treaty, which typically does not identify the place of arbitration.

Where the parties have not agreed on the place of arbitration, the arbitral tribunal must carry out the task “having regard to the circumstances of the case.” The arbitral tribunal's analysis may be guided by the UNCITRAL Notes, which observes: (p. 81)

Various factual and legal factors influence the choice of the place of arbitration, and their relative importance varies from case to case. Among the more prominent factors are: (a) suitability of the law of arbitral procedure of the place of arbitration; (b) whether there is a multilateral or bilateral treaty on enforcement of arbitral awards between the State where the arbitration takes place and the State or States where the award may have to be enforced; (c) convenience of the parties and the arbitrators, including the travel distances; (d) availability and cost of support services needed; and (e) location of the subject-matter in dispute and proximity of evidence.280

As the Notes themselves indicate, the enumerated list of factors is non-exhaustive, nor is any one enumerated factor in the list given more weight in relation to another.281 Other factors, therefore, such as the neutrality of the place of arbitration may also be important in determining the place of arbitration, as has been the case in investor–state arbitration under NAFTA Chapter Eleven.282 The following factors relating to the place of arbitration are addressed in the following sections: the nature and suitability of the local law; the enforceability of the award; neutrality; and practical considerations.

(1)  Nature and suitability of the local law

Where a place of arbitration is chosen, “[i]t is generally accepted … that a state should insist upon the observance of a minimum standard of objectivity and justice in quasi-judicial proceedings held within its territory, whether they are the proceedings of a jockey club or of an arbitral tribunal.”283

In addition to its own legitimate interest in controlling the proceedings, the chosen jurisdiction may also be involved in providing the support of its courts for such purposes as gathering evidence and ordering interim measures of protection. The tribunal thus should take into account the contents and nature of the local law.284

As to control over the proceedings, an arbitral tribunal's wide discretion under the UNCITRAL Rules to conduct the arbitral proceedings in the manner it considers appropriate is restricted by the tribunal's duty to respect mandatory norms of the law of the place of arbitration.285 This, of course, is also the case where the country of one of the parties has been chosen as the venue. Therefore the arbitrators, as well as the parties, should carefully examine the requirements of the law of the place or proposed place of arbitration in this respect.286 This is not always an easy task, if only for the reason that the mandatory or non-mandatory character of a particular norm may be difficult to determine even for a lawyer educated in the country in question.287

(p. 82) Such local expertise or at least commentaries or other literature on the arbitration law of the country in question288 should be consulted in case of doubt. Here it suffices to outline generally the impact which the mandatory norms of the lex loci arbitri, as well as the challenge and appeal possibilities provided by it, may have on the arbitration process. In addition to the actual proceedings, mandatory requirements of the local law may also impose conditions as to what may be arbitrated and who can arbitrate.289 In a worst case scenario, the failure to comply with such requirements may lead to the setting aside of the award. This in turn may make it impossible to have the award enforced.290

Many national laws restrict what issues are arbitrable.291 Such limitations usually concern disputes on matters with public law elements, such as employment, antitrust rules, competition law and intellectual property rights. These limitations should be taken into account when selecting the place of arbitration. Fortunately for international arbitration, the trend in various countries having such restrictions has been to adopt a more flexible attitude regarding international arbitrations.292

Thus, in international cases, “most commercial disputes are arbitrable under the laws of most countries.”293 Some caution is nevertheless needed, as indicated by cases in which a party relying on an arbitration clause has been unable to enforce it on the ground of non-arbitrability of the issue according to the law of the country in question.294

Local law may also deny to certain parties, such as state entities, the capacity to arbitrate.295 Although the principle of estoppel may be applied against an entity which, in contravention of such a prohibition,296 has consented to arbitration, the other party should be aware of any limitations of this kind. If the arbitration takes place in the home country of such an entity (instead of a neutral venue), the free consent to arbitration by the entity may not cure the legal impediment in question.

(p. 83) Mandatory norms of the locale may also exclude certain categories of persons as arbitrators.297 General exclusion of foreigners by such rules may provide enough impediment not to choose the country in question as the venue of arbitration. However, a trend towards more flexibility in international, as distinct from domestic, arbitration is discernible.298

While the choice of the place of arbitration may only exceptionally have impact on the question of substantive law governing the dispute,299 the way in which the mandatory procedural norms of the lex loci arbitri control the arbitration is one of the most important considerations to be taken into account in the selection of the place.300 The more extensively the local law imposes mandatory requirements, the greater the risk of the award being set aside by a domestic court, and the greater the likelihood that the proceedings will be hampered by judicial interference.301 The extent of the possibility of such an interference is one consideration to be taken into account in the selection of the place.302 After making the choice of location, the arbitral tribunal should see to it that those norms of the venue, the non-application of which may subject the proceedings or the award to a successful attack before a court, are followed.

Insofar as non-derogable national rules are limited to such fundamental procedural principles as audiatur et altera pars, they do not present any particular problems, as strict application of the UNCITRAL Rules guarantees that universally accepted principles are observed to the extent necessary.303 The arbitral tribunal, however, should be aware that various domestic laws may contain mandatory norms which are less universal in character, but nevertheless may be in conflict with the UNCITRAL Rules. Such norms may relate to questions such as the acceptability of written affidavits as evidence,304 notice provisions contained in Article 2, dissenting opinions and the allowability of decisions ex aequo et bono.305 The power of the arbitral tribunal to decide its own jurisdiction in accordance with Article 23 is often circumscribed by the local courts’ power to determine whether the tribunal has exceeded its jurisdiction.306

As to the control which the local law and local courts exercise over arbitration proceedings, the general trend is clearly towards more autonomy of international arbitration. Thus, while violation of ordre public or public policy is frequently a ground for setting aside an (p. 84) award, a distinction is increasingly made between domestic and international public policy in the sense that mandatory norms originally based on domestic public policy considerations are not necessarily applied to international cases.307 The consequence is that:

where an arbitration under the [1976] UNCITRAL Rules is of an international character, provisions in the Rules although in conflict with national public policy for domestic arbitration, may nevertheless be upheld, when the more restrictive standard of international public policy is applied.308

As a result, the validity and arbitrability of a contract involving international sales may be upheld, even if a similar contract involving domestic sales were void,309 or a procedural practice not accepted in purely domestic contexts may be tolerated in international arbitration. The trend toward more autonomy of international arbitration is evident in recent legislative changes carried out in various countries with a view to reducing court interference—and to increasing the attractiveness of the country as a venue for international commercial arbitration. Probably the most radical step was taken by Belgium, where, in cases in which none of the parties is a Belgian national or resident, the arbitration was, by law of 1985, placed totally outside the control of national judges.310 The law, however, has been changed.311

The trend towards limitations on appeals against arbitral awards—and at the same time towards harmonization of national laws—is likely to continue in light of the increasingly broad adoption of the UNCITRAL Model Law, under which the “grounds for challenge of an arbitral award are strictly limited.”312 The setting aside procedure regulated in Article 34 of the Model Law is the sole means for recourse to courts, and it is possible only on the following narrow grounds modeled on Article V of the New York Convention.313

Legislation influenced by the Model Law has been adopted in a number of countries.314 To a varying degree, the Model Law has affected the contents of legislative reforms carried out in other countries.315

(p. 85) As the Model Law continues to proliferate, domestic laws allowing extensive court interferences during arbitral proceedings or appeals on the merits are likely to become rare. They will not disappear, however; while the Model Law has opted in favor of only limited judicial control, at the same time it firmly allows some judicial control to be exercised by domestic courts. This is the compromise the Model Law strikes between arbitral autonomy and the need for some minimum level of official control over procedural fairness, as well as between the conflicting expectations the parties may have in this respect.316 In light of recent legislative trends, which in some countries has led to more limited judicial control than the Model Law compromise, it appears that on a worldwide level, the Model Law approach will, more and more, represent the maximum of judicial control over arbitral proceedings.

The position adopted in the Model Law can also be understood to recognize that arbitration cannot completely cut off its ties with courts, but may need their support at various stages, such as for the constitution of the tribunal and gathering of evidence.317 In the application of the UNCITRAL Rules, such support is not needed so much because the Rules themselves contain complete provisions on the appointment of arbitrators and challenges against them.318 However, in certain respects, the availability of the supportive role of domestic courts should also be taken into account as a pertinent consideration in the choice of the place of arbitration for proceedings under these rules.319

The recognition in the UNCITRAL Model Law of the connection between arbitral proceedings and the legal system of the place of arbitration is also important in that it increases the enforceability of the arbitral award in other jurisdictions.320 This leads to a very important criterion to be considered when selecting the place of arbitration.

(2)  Enforceability of the award

It is rare that the losing party has assets in any neutral country which would be suitable as the place of arbitration.321 If it has, the enforcement of the award does not usually pose any particular problems but takes place in the same way as the enforcement of “purely” domestic awards.322 Normally a party to an international arbitration, however, must be prepared for the possibility of having to seek the enforcement of the award outside the place of arbitration. The selection of that place in turn influences the international enforceability of the award. This, consequently, is one factor to be taken into account in the choice of the arbitration place. This is the case notwithstanding the fact that, in an overwhelming majority of cases, an international award is complied with voluntarily.

Usually the enforcement (if any is needed) of awards rendered in international commercial arbitration takes place by virtue of international agreements, whether bilateral treaties (p. 86) or regional323 or general conventions. The most important general convention (and most important international agreement on the enforcement of arbitral awards in general) is the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.324

As the New York Convention provides the most effective mechanism for the enforcement of international arbitral awards, it is important to select the place of arbitration so as to guarantee that the award falls under the Convention. The place of arbitration is frequently determinative in this respect due to a provision according to which a state, party to the Convention, “may on the basis of reciprocity declare that it will apply the Convention to the recognition and enforcement of awards made only in the territory of another Contracting state.”325 In fact, the majority of the 137 contracting states has accepted the Convention with such a “reciprocity reservation,” and thus enforce by virtue of the Convention only awards rendered in the territory of another state party.326 Accordingly, “[c]hoosing a country that is a signatory to the New York Convention is of fundamental importance in ensuring the enforceability of an award.”327 Should this not seem practical, the existence of a bilateral treaty on the subject between the prospective place of arbitration and the likely place of enforcement should be studied.

The choice of the place of arbitration is important because enforcement may be denied on grounds related to the law of the place of arbitration. Among other reasons set out in Article V of the Convention,328 recognition and enforcement may be denied if the party (p. 87) against whom the award is invoked shows that the Convention “has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made.”329 Although not all the grounds for enforcement under the New York Convention are judged under the standards of the law of the place of arbitration, Article V of the Convention emphasizes that, to produce an enforceable award, the arbitrators should assure that the mandatory requirements of the law of the place of arbitration are respected.330 As the UNCITRAL Model Law gains acceptance, the mandatory requirements justifying the setting aside of the award at the place of arbitration, on the one hand, and those justifying the denial of recognition and enforcement, on the other hand, are likely to be harmonized. The Model Law, which was modeled after Article V of the New York Convention, defines both in substantially similar terms.331

The seat of the Iran–US Claims Tribunal was specified in the Claims Settlement Declaration. According to this declaration, the seat “shall be The Hague, The Netherlands, or any other place agreed by Iran and the United States.”332 The parties did not reach any such agreement, so the proceedings have taken place in The Hague.333

(3)  Neutrality

Even though neutrality is not a factor expressly enumerated in the UNCITRAL Notes,334 psychological considerations, as well as the principle of equality of the parties, may favor holding the arbitration “in a country that is ‘neutral’, in the sense that it is not the home country of any of the parties to the dispute.”335 As the Ethyl tribunal observed, (p. 88) “[t]raditionally arbitrating parties, desiring both the reality and the appearance of a neutral forum, incline to agree on a place of arbitration outside their respective national jurisdictions.”336 The neutrality aspect is particularly relevant in arbitrations involving parties from different socio-economic systems337 or where a sovereign party is involved.338 Although this consideration has lost much of its relevance in recent years, the tribunal (and the parties, if they make the determination) is normally recommended to follow the prevailing practice339 of choosing a neutral country as the place of arbitration.340 For example, arbitration in the country of the respondent is normally not recommended to avoid giving an unfair advantage to one party with greater familiarity with the local law.341 Although choosing a neutral location may appear reasonable, there arise potential difficulties since the arbitral proceedings may differ from those conducted in the respective home countries of both parties.342 However, the increased harmonization of national arbitration laws has (p. 89) minimized this concern. Thus, other considerations may prevail over neutrality with the consequence that the parties and the arbitrators should not always be discouraged from selecting the country of one of the parties as the place of arbitration.

The question of neutrality has played a significant role in resolving disputes regarding the place of arbitration in investor–state arbitrations under NAFTA Chapter Eleven. Article 1130(b) of the NAFTA limits the parties’ choice of the place of arbitration to the territory of a NAFTA Party that is a party to the New York Convention: in this case, the United States, Canada, or Mexico.343 In ADF, the United States argued in favor of Washington, DC as the place of arbitration. The arbitral tribunal found, in line with other tribunals, the location of ICSID in Washington, DC to be decisive in its analysis because of the fact that ICSID is “widely perceived to be … a ‘neutral’ forum and institution.”344

(4)  Practical considerations

In addition to neutrality and other important legal considerations discussed above, there are other factors to be taken into account in the selection of the place of arbitration. The place should also be suitable from a functional point of view.345 Subparagraphs (c), (d), and (e) of Paragraph 22 of the UNCITRAL Notes speak of these considerations with respect to the convenience of the place of arbitration to the parties and the arbitrators, the availability and costs of support services, and the location of the subject matter in dispute and the proximity of evidence.

Convenience of the parties and the arbitrators is often a factor in determining the place of arbitration.346 It is commonplace in international arbitration for the disputing parties to come from different countries. The makeup of international arbitral tribunals is also frequently international in character, with members originating from diverse parts of the world, especially where the parties wish to appoint arbitrators of their own nationality or where the presiding arbitrator is deliberately chosen because he or she is from a country other than that of the parties. In choosing the place of arbitration, a comparison between the ease and cost of travel to one or another proposed place of arbitration may be in order, as travel may be particularly burdensome in some cases.347 NAFTA Chapter Eleven (p. 90) tribunals have considered travel as an element of convenience in several cases,348 with tribunals finding that the convenience of counsel was also a relevant consideration.349

The availability and costs of support services, such as suitable hearing rooms and accommodation, are also factors to consider. The accommodation must be convenient and guarantee the necessary privacy for a party, its counsel, and witnesses. The availability of competent interpreters, stenographers, and the existence of a competent local bar able to advise on the requirements of the local law are factors to be taken into account when the place of arbitration is being chosen. An experienced arbitral institution that is willing to offer its facilities for arbitrations under the UNCITRAL Rules normally guarantees these practical requirements. When a particular institution of that kind has been, or is going to be, designated as appointing authority by the parties, it more often than not would be natural to have the place of arbitration coincide with the seat of the institution in question.350 On the other hand, if no appointing authority has been designated, the parties and the arbitrators should be aware that the designation of the place of arbitration will likely determine the nationality of the appointing authority, if any, designated by the Secretary-General of the Permanent Court of Arbitration.351 The costs of support services will inevitably vary in relation to the general cost of living of the city in which the support services are provided.352

Another factor for consideration is the location of the subject matter in dispute and the proximity of evidence. In construction cases, the location of the subject matter in dispute may likely correspond to the location of the physical facilities or construction project at issue. By contrast, investor–state arbitration often deals with the alleged effects of government measures on an investment. In this situation, arbitral tribunals have found that the location of the subject matter in dispute was the city where the relevant government authorities adopted the measures in question.353 The relevance of the proximity of evidence may depend on (p. 91) the necessity for witness testimony or documents or other materials that cannot be readily submitted to the tribunal. Additionally, in some situations, such as construction cases, arbitration in a country near the site may be desirable, as a visit to the site may become necessary.354

Finally, communications between the prospective place of arbitration and the outside world is another pertinent consideration. Any potential restrictions (including visa requirements) on the entry of the persons involved, and on the right of the parties to communicate with their home bases, should be carefully considered. The distances between the place of arbitration and the headquarters of the parties are important but purely geographical considerations should not be over-emphasized. Desirable as it is to minimize the costs and inconveniences caused by distances between the place of arbitration and the various participants in the arbitration process, such inconveniences can be mitigated by hearing witnesses and having other special meetings take place outside the place of arbitration.355

(b)  Decision on place of arbitration not procedural; consultation with the parties

There are several suitable places to conduct an international arbitration, and the number is increasing as states adopt the UNCITRAL Model Law and otherwise take steps to improve their attractiveness as a possible venue.356 Nevertheless, not every jurisdiction has the necessary qualifications, and so the decision should be made only after careful weighing of the various considerations involved, especially those of a legal nature.357 It is the legal consequences of the choice of the place of arbitration that have prompted leading commentators to argue that such a decision, where it is made by the arbitral tribunal, should not be regarded as a procedural matter which, in the absence of a majority, could be decided by the presiding arbitrator alone.358 Sanders, for example, observes that a rule on the place of arbitration:

not only refers to practical considerations in connection with the arbitral proceedings, such as the least possible displacement of parties, witnesses and arbitrators, but also … to the legal consequences of the choice, and more especially to the recognition and enforcement of the award.359

Accordingly, in the context of revising the Rules, Paulsson and Petrochilos recommended including an express provision that required an arbitral tribunal to select the place of arbitration by a majority decision in accordance with Article 33(1).360 Despite the merits of the recommendation, the Working Group did not adopt the recommendation.

(p. 92) In light of the legal significance of the choice of the place of arbitration, the arbitral tribunal is well advised to consult with the parties before making its determination.361 Though not expressly required by the Rules, in many cases consultation will yield useful information about the parties’ relative interest and is consistent with the tribunal's duties in Article 17(1) to afford equal treatment to the parties and provide them with a reasonable opportunity to present their case. In UNCITRAL cases under NAFTA Chapter Eleven where the disputing parties had not agreed on the place of arbitration, the disputing parties have been afforded the opportunity to brief the issue.

(3)  Where the award is “deemed to have been made”—Article 18(1)

In international arbitration, the award is frequently not signed by the arbitrators in the city or locale designated as the place of arbitration. Practical considerations often make it inconvenient and costly for the parties to return to the place of arbitration simply to deliberate and sign the award. Article 18(1) therefore provides that “[t]he award shall be deemed to have been made at the place of arbitration.” This construction, particularly the phrase “deemed to have been made” is new to the 2010 UNCITRAL Rules and replaces the phrase “the award shall be made at the place of arbitration.”362 The revision, which tracks the language of Article 31(3) of the Model Law, was clearly intended “to avoid the risk that an award be declared invalid if it was signed in a place other than the seat of arbitration.”363 As leading commentators note, by so doing the arbitral tribunal may avoid the risk of the award being regarded by a court as having been rendered in breach of the agreement by the parties.364

Article 18(1) brings needed clarity to the question of where an award is made under the Rules and rectifies the ambiguity in corresponding Article 16(4) of the 1976 UNCITRAL Rules as to whether the arbitrators are required to travel to the place of arbitration merely for a signing ceremony.365 While on the one hand, it is almost always more convenient to have the award circulated electronically from one arbitrator to another for signing, including to locations outside the place of arbitration,366 on the other hand, the clear wording of Article 16(4) of the 1976 UNCITRAL Rules (“shall be made at the place”), especially when compared to that of Article 31(3) of the UNCITRAL Model Law, could have been construed to require the signing at the place of arbitration.367 The travaux préparatoires of the 1976 Rules did not provide for a conclusive answer, although (p. 93) the preponderant view seems to have been that signing at the place of arbitration was not required.368

If the law applicable to the arbitration requires the signing at the place where the award is deemed to be made,369 it is especially important that the arbitrators meet there. The award, of course, can be drafted elsewhere. Even where the applicable procedural law allows signature of the award outside the place of arbitration, the award should always state that it has been made at the place of arbitration.370 In the practice of the Iran–US Claims Tribunal, awards have occasionally been signed by one or more arbitrators outside The Hague. The signatures of the arbitrators are nevertheless always preceded by the words: “Dated, The Hague” (the date). A similar practice has been followed by other tribunals, including investor–state arbitration tribunals.

(4)  The location of tribunal deliberations and meetings “for any other purpose, including hearings”—Article 18(2)

As explained above, the structure and terminology of Article 18 reflects the difference in concept between the legal and the physical place of arbitration. Whereas Article 18(1) uses the term “place of arbitration” to denote the legal seat of the arbitration and thus the jurisdiction whose law governs the arbitral process, Article 18(2) refers to the “location” of meetings related to the arbitration in the physical or geographical sense.371 These meetings may include conferences, hearings, and deliberations of the arbitral tribunal.372 Selection of the location of these meetings, even if outside the jurisdiction of the place of arbitration, is not meant to affect the choice of law governing the arbitral proceedings.

Article 18(2) revises the approach of corresponding Article 16(2) of the 1976 UNCITRAL Rules that provided for only “limited flexibility”373 to hold meetings outside the place of the arbitration. Article 16(2) of the 1976 UNCITRAL Rules provided:

The arbitral tribunal may determine the locale of the arbitration within the country agreed upon by the parties. It may hear witnesses and hold meetings for consultation among its members at any place it deems appropriate, having regard to the circumstances of the arbitration.374

Designation of the locale under the 1976 UNCITRAL Rules likely determined where the main oral proceedings, ie, hearing and pre-hearing conferences, if any, were to be held. In contrast to Article 16(2) of the 1976 UNCITRAL Rules, Article 18(2) eliminates the notion of selecting a “locale” of the arbitration and broadens the tribunal's discretion to (p. 94) choose the location of meetings. Under the 2010 UNCITRAL Rules, the tribunal may deliberate and, unless otherwise agreed by the parties, may hold other meetings, including hearings, “at any location it considers appropriate.”375 While in some cases this added flexibility may enhance the efficiency and convenience of an arbitration, the parties should be aware that overly attenuated ties between the legal place of arbitration and the actual proceedings may, depending on the nature of the domestic laws involved, have negative repercussions.

At first blush, eliminating the phrase “having regard to the circumstances of the arbitration” from the rule on location of meetings may seem to limit the safeguards against an abuse of tribunal discretion. As Professor Sanders has observed, emphasis on such circumstances was intended to reduce the temptation to choose “attractive meeting places such as the Riviera or the Bahamas which have no relationship whatsoever with the arbitration or the domicile of arbitrators.”376 At the same time, the arbitral tribunal's duties contained in Article 17(1) of the Rules, among others, to “conduct the proceedings so as to avoid unnecessary delay and expense” should serve to offset any frivolous or self-interested choice of the location of meetings.

The revisions reflected in Article 18(2) bring the Rules in line with Article 20(2) of the UNCITRAL Model Law,377 which deliberately increased the tribunal's flexibility in choosing the location of meetings. In the Model Law, the hearing of “experts or the parties” was added to the list of purposes for which the arbitral tribunal may meet “at any place it considers appropriate.”378 The approach under the Rules is also consistent with the procedural rules of some of the leading arbitral institutions.379

Article 18(2) affords the arbitral tribunal discretion, subject to the overriding will of the parties, to determine the location of meetings “for any other purpose.” This phrase, when read in the context of Article 18(1), plainly means for any purpose other than deliberations of the tribunal members. Article 18(2) expressly provides that “hearings,” if necessary, would fall within the scope of the rule. The rule also clearly contemplates other types of meetings, including conferences of the parties and site visits for the inspection of evidence or documents. As to the latter, the flexibility provided for in Article 18(2) is particularly relevant because it may be impossible as well as impractical to transfer items such as goods stored in a warehouse to the tribunal location of the hearings.

Should the home country of one of the parties be chosen as the place of arbitration, then as a general matter the tribunal should avoid holding the arbitral proceedings at the office (p. 95) of the party380 or of a party-appointed arbitrator.381 The premises of the law firm of the chairman may be a natural meeting, if available and otherwise suitable for the purpose. The premises of an arbitral institution situated within the designated jurisdictional area may also be desirable. Facilities provided by large hotels are often utilized for this purpose.

In exceptional cases, circumstances may compel the arbitral tribunal to move the physical venue of the proceedings from the designated place of arbitration, such as when a party engages in inappropriate conduct at the legal seat of arbitration designed to undermine the work of the tribunal. The Himpurna arbitrations provide a good example. In the first arbitration against PT Perusahaan Listruik (“PLN”), an entity controlled by Indonesia, the claimant, Himpurna, obtained a favorable arbitral award,382 which PLN failed to pay. Himpurna then brought a second arbitration against Indonesia for its failure to ensure PLN's payment of the award.383 Soon after, Pertamina, another entity controlled by Indonesia, successfully moved in a Jakarta court to enjoin the arbitral proceedings, and the court imposed a fine of US $1 million per day for any breach of the injunction. Recognizing the “exceptional circumstances,” the arbitral tribunal decided to move the hearing from Jakarta to The Hague, though without changing the legal seat of the arbitration, which remained Jakarta.384

In all cases when an arbitral tribunal, with its seat in one jurisdiction, holds a meeting in another jurisdiction for the purpose of a particular proceeding, it should respect the laws of the latter jurisdiction. If, for example, the purpose of the visit is to take witness evidence, the tribunal should follow the mandatory provisions concerning the taking of such evidence in that jurisdiction.385 Any inspection of goods, property and documents must also take place in accordance with the mandatory norms of the law of the place where the goods are situated.

(5)  Comparison to the 1976 UNCITRAL Rules

Article 18 contains a clearer, more streamlined set of rules than those in corresponding Article 16 of the 1976 Rules. In essence, however, the original and revised articles achieve the same purpose of affording the arbitral tribunal authority to determine, in certain circumstances, the legal seat of the arbitration and the location of the meetings related to the arbitral proceedings.

Article 18(1) consolidates into one provision the rules previously found in Article 16(1) and 16(4) of the 1976 UNCITRAL Rules regarding, respectively, the selection of the place of arbitration and the place where the award is made. In the first sentence of Article 18(1), (p. 96) the more concise term “place of arbitration” replaced the potentially confusing phrase “place where the arbitration is to be held.” This revision notwithstanding, it was observed in Working Group discussions that the word “place,” as used in Article 16(1) and 16(4) of the 1976 UNCITRAL Rules, referred to “the seat of arbitration, which determined the law applicable to the arbitral procedure and court jurisdiction.”386 Nevertheless, in the interest of clarity, users of the 1976 UNCITRAL Rules may wish to modify Article 16 accordingly.

As explained, Article 18(1) clarifies the rule in Article 16(4) of the 1976 UNCITRAL Rules by providing: “The award shall be deemed to have been made at the place of arbitration.” The additional language (in italics) leaves no doubt that the award may be signed outside the place of arbitration, provided the applicable procedural law allows it.387 Article 16(4) of the 1976 UNCITRAL Rules lacked the same clarity such that there were possible negative consequences for an overly literal reading of the rule.388 Parties may consider modifying, in accordance with Article 1(1), original Article 16(4) to include the language of Article 18(1) that provides the arbitrators wider discretion. When contemplating this kind of modification, however, the parties should consider that very loose ties between the legal place of arbitration and the actual proceedings may, depending on the nature of the domestic laws involved, have negative repercussions.

In simplifying and reducing the rules previously found in Articles 16(2) and 16(3) of the 1976 UNCITRAL Rules, Article 18(2) clarifies the broad scope of the arbitral tribunal's discretion in determining the location of meetings, hearings, and deliberations. Absent from the revised Rule is the notion that the arbitral tribunal may determine “the locale within the country agreed upon by the parties,” which would likely determine the location of the hearings, and the requirement that the tribunal determine the location to hold hearings and deliberations “having regard to the circumstances of the arbitration.” Rather, Article 18(2) leaves it largely to the arbitral tribunal, subject to the overriding will of the parties, to determine the location of any meetings, hearings, and deliberations “as it considers appropriate.”

Article 18(2) also omits the express rules on deciding to meet at a location to inspect goods, other property or documents and the related notice requirement previously contained in Article 16(3) of the 1976 UNCITRAL Rules. These revisions have little, if any, effect on the operation of the Rules as the arbitral tribunal has discretion under Article 18(2) to order a meeting at any location for any “other purpose,” including site visits and must in any event treat the parties equally and fairly under Article 17(1), which would include providing sufficient notice to the parties of a site visit.389

C. Extracts from the Practice of Investment Tribunals

Wintershall AG, et al and Government of Qatar, Partial Award (February 5, 1988) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Concession Agreement), reprinted in (1989) 28 ILM 795, 801: (p. 97)

B. III. Place of Arbitration

By the first sentence of paragraph 1 of its Order of March 18, 1987, the Tribunal decided that “Having regard to the circumstances of these arbitral proceedings, the place of arbitration shall be The Hague, the Netherlands.” This determination is in accordance with Article 16(1) of the [1976] UNCITRAL Arbitration Rules.

B. IV. Arbitral Law

By the second sentence of paragraph 1 of its Order of March 18, 1987, the Tribunal provided that the procedure of the arbitration shall be governed by the [1976] UNCITRAL Arbitration Rules, as agreed by the Parties in the Agreement of October 22, 1986, subject to any mandatory provisions of the Netherlands Arbitration Law, which, in the event of conflict with any of the UNCITRAL Rules, shall prevail. The Tribunal has concluded that its Partial Award on Liability, determining the substance of the claims on both jurisdiction and the merits, and proposed Final Award (See XX hereof) are consistent with the [1976] UNCITRAL Arbitration Rules and in no respect in conflict with any of the mandatory provisions of the Netherlands Arbitration Law.

Himpurna California Energy Ltd and Republic of Indonesia, Interim Award (September 26, 1999) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Concession Agreement), reprinted in (2000) XXV Ybk Commercial Arb 112, 124–26, 145–46, 168–69:

  1. [32]  The Republic of Indonesia's conduct, according to the claimant, was a “naked use of … powers to deny claimants effective representation”. The claimant accordingly asked the Arbitral Tribunal that in the absence of unequivocal assurances that the claimant's employees, witnesses, counsel and the arbitral tribunal itself will be free from harassment or arrest … we will request that the Tribunal convene the hearings at another appropriate location in accord with Art. 16 of the [1976] UNCITRAL Rules.

    …

  2. [35]  In its letter to the Parties of 12 July 1999, the Arbitral Tribunal replied as follows:

    the Arbitral Tribunal wishes first of all to remind counsel that these are extremely serious proceedings involving large financial stakes and, directly or indirectly, bilateral relations between two important countries. Your clients are entitled to a respectful debate. The claimants are part of a publicly traded company whose shareholders are entitled to a resolute defence of their economic interests; the Republic of Indonesia is equally entitled to a resolute protection of its own position. The economic problems at the heart of this case have hurt many people, and each side must understand that the other has weighty responsibilities. This is a most inappropriate forum for counsel to indulge in inflammatory rhetoric which the Arbitral Tribunal finds neither helpful nor humorous. Misplaced similes (“like wayang puppets”), ill-considered metaphors (“ever ready to rattle the government's saber”), or chatty language used for sarcastic effect (“whine to this Tribunal”, “we are not qualified in psychiatry”) have no place before this Arbitral Tribunal, and will not advance the interests of either side. The Arbitral Tribunal is interested in precise and reliable factual information, and in cogent arguments of law. Counsel would make a better impression on the Arbitral Tribunal if they resisted the temptation to speculate on the motives of opposite counsel, and did not proffer lectures on proper forensic behaviour. The Arbitral Tribunal feels it must admonish you that you are crossing the line of acceptable discourse.

This being said, the concerns raised by Messrs Lathams & Watkins are serious, and have not, behind the rhetoric, been assuaged by Messrs Karim Sani's letter of 9 July. As that letter itself recognises, there may be exceptional circumstances when the physical venue of proceeding under the [1976] UNCITRAL Rules is moved. (Of course Karim Sani does not accept that they are extant in this case, but that does not affect the principle.)

If the Republic of Indonesia fails to disprove the claimants’ contentions that, as a matter of fact:

  • —  a government-controlled entity has instituted legal proceedings in Indonesian courts designed to obstruct the implementation of the Terms of Appointment signed by the Republic of Indonesia;

  • (p. 98) —  although a party to those proceedings, the Republic of Indonesia has not only failed to oppose this attempted obstruction, but has to the contrary manifested a degree of complicity;

  • —  another government-controlled entity has threatened to bring a criminal complaint against the claimants’ counsel on account of comments on the dispute attributed to him—but denied by him—which as a matter of principle could lead to a sentence of imprisonment;

  • —  government officials have harassed the claimants, with the result that witnesses have been intimidated;

  • —  although the Republic of Indonesia says it will formally oppose the motion for injunction, it nevertheless reserves the right to initiate court actions for “fines … and/or imprisonment” if the arbitrators were to proceed in accordance with the Terms of Appointment; and ultimately

  • —  rather than use its judicial and governmental processes to implement the Terms of Reference signed by it, the Republic of Indonesia is attempting to use them to divest this Arbitral Tribunal of its jurisdiction;

    the Arbitral Tribunal must seriously reconsider the physical venue for any hearings in this case.

    Messrs Karim Sani are therefore invited to furnish any further factual information that would bear on these issues, in particular proof as to the position taken by the Republic of Indonesia in relation to the Indonesian court proceedings, such as previous pleadings; previous correspondence between the Government, on the one hand, and Pertamina and PLN, on the other hand; or any other evidence of the respondent's sincerity in seeking to implement the Terms of Appointment as signed.

    …

    [73]  After extensive deliberations among all its members, the Arbitral Tribunal delivered the following Procedural Order on 7 September 1999 [which provides in relevant part]:

    … the Arbitral Tribunal hereby decides and orders that:

    The Republic of Indonesia is in default under the Terms of Appointment.

    Hearings are hereby convened in the small Hall of Justice in the Peace Palace, The Hague, beginning at 10.30 a.m. on Wednesday 22 September and continuing as far as necessary the two following days. Given the Republic of Indonesia's default, as well as its affirmation that it will not participate in the arbitration, the convenience of its counsel, or such witnesses as it might have presented if it had not been in default, will not be taken into account. The Arbitral Tribunal will test the evidence presented by the claimants, who will be required to prove their case to the satisfaction of the arbitrators irrespective of the default of the Republic of Indonesia; and will consider all arguments raised by the Republic of Indonesia.

    The Arbitral Tribunal has chosen the place for this hearing in the exercise of its authority under Art. 16(2) of the [1976] UNCITRAL Rules without changing the legal seat of the arbitration, which, in accordance with paragraph 3(c) of the Terms of Appointment, remains Jakarta.

    In the exercise of its procedural discretion the Arbitral Tribunal hereby informs counsel to the Republic of Indonesia that in the event they formally advise the Arbitral Tribunal on or before 17 September 1999 that the injunction has been withdrawn, and that they are authorised to stipulate that the Republic of Indonesia will fully and irrevocably participate in these arbitral proceedings, then the schedule would be modified as an extraordinary accommodation to the Republic of Indonesia. If said stipulation is made to the Arbitral Tribunal, the Republic of Indonesia's submission of documentary evidence, including statements of all witnesses upon whom it intends to rely, as defined in paragraph 5(f) of the Terms of Appointment, should also be made on 17 September 1999, and the hearing would be rescheduled thereafter.

    …

(p. 99)

  1. [111]  The position of the Arbitral Tribunal is thus based on its appreciation of the facts of this case, and founded on the authority granted by the Parties when they agreed to arbitration under the [1976] UNCITRAL Arbitration Rules.

    …

  2. [114]  Nor did the decision to hear witnesses at a location outside Indonesia crystallise into any imaginary struggle between the Indonesian courts and the Arbitral Tribunal—to the contrary. The Jakarta Court's injunction purported to forbid pursuit of the arbitration. The jurisdiction of that court is perforce limited to Indonesian territory. Whether or not the Arbitral Tribunal is to be deemed to be “international”, it avoided offending the Jakarta court by convening the hearing of witnesses outside Indonesia. It did so pursuant to Art. 16 of the [1976] UNCITRAL Rules, with the compelling justification that the cause of this choice of physical meeting place was directly attributable to an event which the Republic of Indonesia could have avoided.

  3. [115]  The Republic of Indonesia is in no position to contend that the Arbitral Tribunal was precluded in principle from hearing witnesses outside Indonesia. For not only is such a possibility consistent with Art. 16 of the [1976] UNCITRAL Rules, but the Republic of Indonesia itself acknowledged, in the letter of 9 July 1999 from its counsel quoted in Paragraph [33] as well as in the further letter of 26 August 1999 (see Paragraph [65]) that Art. 16 would allow hearings in another location in the event of “extraordinary circumstances”. Moreover, as seen in Paragraph [69], on 31 August 1999 the Republic of Indonesia proposed a hearing in London devoted to the expert testimony of Professors Lalive and Rogers, to be followed by “further deliberations of the Tribunal”. Having admitted that “extraordinary circumstances” permit hearings outside Indonesia, one of the Parties is not entitled to impose its evaluation of what constitutes “extraordinary circumstances”, or to insist that the Arbitral Tribunal bow to its preference for London over The Hague.

Republic of Indonesia v Himpurna California Energy Ltd, et al (Dutch Court of First Instance (Arrondissementsrechtbank)), (September 21, 1999), translated and reprinted in (2000) XXV Ybk Commercial Arb 469, 471–73:

I. The Parties’ Position

…

[3]  Indonesia maintains that the arbitral tribunal may not hold a hearing in The Hague rather than in the contractually agreed place of arbitration, Jakarta. Indonesia alleges breach of contract (wanprestatie) or unlawful behaviour (onrechtmatige daad) under the parties’ agreements, including the Terms of Reference. The Terms of Appointment indicate Jakarta as the place of arbitration. Art. 16(1) of the [1976] UNCITRAL Arbitration Rules, which the parties declared applicable, provides that the place of arbitration is (in principle) the place chosen by the parties. It is certainly not in the Minister of Finance's interest to deviate from this general rule, since by choosing a different venue he does not escape the prohibition and the penalty of the Indonesian court's injunction, as is the case with Himpurna and Patuha, whose seat is [not in Indonesia]. On the other hand, his failure to appear at the hearing of 22 September may result in his being ordered to pay US $573 million.

[4]  Himpurna, Patuha and Paulsson maintain that the present case is an international arbitration, in which national courts play no or a very limited role. (International) arbitrators examine and ascertain their own jurisdiction according to, inter alia, the [1976] UNCITRAL Rules; proceedings are regulated by the applicable arbitration rules, as provided in the Terms of Reference and/or the Terms of Appointment, and enforcement takes place at the parties’ initiative, possibly with the assistance of the national courts. Dutch courts must refrain as much as possible from any intervention in the arbitral process, and promote the smooth flow of the arbitration. Further, Dutch courts have no jurisdiction if there are no sufficient connecting factors.

…

(p. 100) II.  The Court's Decision

  1. [7]  First, we must examine whether Dutch courts have international jurisdiction. On this issue we reason as follows. The fact that in the present international arbitration a hearing is to be held on Dutch territory is in itself a connecting factor with the Dutch legal system. The hearing shall take place in the Peace Palace in The Hague. The arbitrators apparently obtained the permission therefor from the International [rectius] Permanent Court of Arbitration [“PCA”]. This does not in itself mean that the arbitration takes place “under the auspices” of the PCA, a case which is regulated in the agreement concluded by the Netherlands on 30 March 1999 in replacement of the 1899 agreement. If this were an arbitration “under the auspices” of the PCA, defendants 3 through 5 [Jan Paulsson, Antonino Albert De Fina and Priyatna Abdurrasyid] would be, according to the new agreement as submitted, PCA arbitrators and would enjoy immunity. If this were the case, it would be logical to presume that there is insufficient connection with the Dutch legal system. [However], since the status of the arbitrators is unclear, we must presume in this summary proceedings that the arbitration at issue does have sufficient connection with the Dutch legal system and that, therefore, Dutch courts have jurisdiction.

  2. [8]  Subsequently, we must examine whether the arbitrators violated their mandate by deciding that a hearing would take place in The Hague and/or whether Himpurna and Patuha would be in breach of their contract with Indonesia by participating in this hearing. Indonesia maintains that this is the crux of the dispute.

  3. [9]  The President leaves aside the question whether the arbitration at issue must be considered a domestic arbitration according to the Indonesian legal view, as alleged by Indonesia. The parties stipulated in their Terms of Appointment that the [1976] UNCITRAL Arbitration Rules apply where the parties have not otherwise agreed. Art. 16(2) of the [1976] Rules explicitly allows the arbitral tribunal to hear witnesses and to hold meetings “at any place it deems appropriate”. This power is not limited by the [1976] UNCITRAL Rules or by the Terms of Appointment. Hence, we must conclude that the arbitral tribunal may decide that a hearing shall take place here in The Hague. The question under [[8]] must therefore be answered in the negative.

Himpurna Energy Ltd and Republic of Indonesia, Final Award (October 16, 1999) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Concession Agreement), reprinted in (2000) XXV Ybk Commercial Arb 186, 190:

  1. [22]  The session before the District Court lasted four and one-half hours. The following morning, at 9 a.m., the Court issued its judgment rejecting the Republic of Indonesia's request for injunction. The written judgment disposed of, inter alia, the two following arguments raised by the Republic of Indonesia:

    1. (i)  that the Arbitral Tribunal had violated its mandate by determining that a hearing should take place in The Hague; the District Court rejected this argument by noting that Art. 16(2) of the [1976] UNCITRAL Rules explicitly permits arbitrators to hear witnesses and to hold meetings “at any place it deems appropriate.”

Canfor Corp and United States of America, Decision on the Place of Arbitration, Filing of a Statement of Defence and Bifurcation of the Proceedings (January 23, 2004) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 3–9 (citations omitted):

13. In order to provide guidelines to the Tribunal in the determination of the place of arbitration, the parties have referred to the UNCITRAL Notes on Organizing Arbitral Proceedings (hereafter “UNCITRAL Notes”) and, in particular, Paragraph 22 of the Notes which discusses various factual and legal factors.

…

  1. 15. The Tribunal considers that it must determine the place of arbitration in light of any relevant circumstances in this arbitration and that the factors enumerated in the UNCITRAL Notes (p. 101) provide no more than non-binding guidelines, as Paragraph 2 of the Notes makes clear (“The arbitral tribunal remains free to use the Notes as it sees fit and is not required to give reasons for disregarding them”).

  2. 16. The Tribunal will therefore examine each of the factors offered for consideration by the parties, without according particular weight to any individual circumstance over another. These factors include neutrality, which is not referred to in the UNCITRAL Notes but which constitutes one of the key features of international arbitration.

    (1)  The neutrality factor

  3. 17. … [T]he Claimant contends that the factor of neutrality, or perceived neutrality, should direct the Tribunal to determine the place of arbitration in Canada. The Claimant argues that, unlike in those cases where Washington, D.C. was held to be the appropriate place of arbitration, in this case the Tribunal should consider Vancouver as an appropriate place of arbitration given its substantial connection to the proceedings; should Vancouver not be perceived as neutral, Toronto could in the alternative be determined as the place of arbitration where neutrality would be best ensured …

  4. 18. . . [T]he Claimant maintains that Washington, D.C., which is not only the seat of the United States Government but also the place where the disputed measures were taken, is the least neutral location for the place of arbitration …

  5. 19. The Respondent considers, for its part, that the venues proposed by each party are equally neutral … First, relying on the Methanex v. USA case, the Respondent argues that a neutral national venue is not possible in this case … Second, the Respondent submits that neutrality is not an important factor to be taken into consideration, given that it was excluded from the UNCITRAL Notes, that Chapter Eleven limits the place of arbitration to one of the three NAFTA Parties, and the fact that the parties have agreed to exclude Mexico as an alternative place of arbitration. Only if the five factors set forth in the UNCITRAL Notes do not result in the determination of a place of arbitration could neutrality be considered as a tie-breaking factor. Third, the Respondent submits that neutrality could be addressed by holding the hearings in ICSID's headquarters in Washington, D.C. In addition, the Respondent has emphasized that the softwood lumber issue is an important local issue in British Columbia and Ontario and that, should neutrality be weighed at all, it should not be considered a factor favoring a Canadian venue …

  6. 20. The Tribunal is not convinced by the parties’ arguments.

  7. 21. The Tribunal observes that Article 1130 of the NAFTA has limited the choice of the place of arbitration, absent an agreement between the disputing parties, to one of the three NAFTA Parties. In the present arbitration, had the disputing parties intended to ensure neutrality, they were at liberty to agree to a neutral forum outside any of the three NAFTA Parties. In the alternative, the disputing parties were at liberty to leave open the option of Mexico. Rather, the parties have chosen expressly to exclude such options and to limit the scope of the Tribunal's choice to a venue in either Canada or the United States. As a result, because of the choice made by the negotiators of the NAFTA and because of the procedural choices made by the disputing parties in this arbitration, the Tribunal considers that, with regard to the place of arbitration, a neutral venue is not available.

  8. 22. Further, the Tribunal is not persuaded, in the circumstances of this arbitration, by the argument of perceived neutrality. In particular, the Tribunal finds little assistance in the Respondent's argument that any concern of neutrality in this arbitration could be addressed by holding the hearings at the ICSID facilities in Washington, D.C. First, the Respondent's implication that the mere physical location of a building may ensure the neutrality of the place of arbitration is at odds with the distinction, on which it has laid emphasis, between the legal seat of an arbitration and the physical location of hearings. … Second, the Tribunal does not find any reason in the facts of this case to give consideration to ICSID as a weighing circumstance with respect to the determination of the place of arbitration. Absent the ratification of the Washington Convention by Canada, the guarantees offered by ICSID, including the true (p. 102) neutrality provided by a system which is genuinely independent from any national legal order, are not available to the disputing parties in this arbitration.

  9. 23. As a result, the Tribunal concludes that the neutrality factor does not favor either the United States or Canada. To the contrary, by the very choice of the disputing parties, any decision on the place of arbitration taken by the Tribunal will result in having one of the parties arbitrate in the other's forum ….

    (2)  The suitability of the law on arbitral procedure

  10. 24. The Claimant and the Respondent agree on the suitability of both U.S. and Canadian arbitral laws ….

  11. 25. The Tribunal agrees with the parties that this factor weighs neutrally, and that the laws applicable in British Columbia and in Ontario as well as the Federal Arbitration Act are equally suitable, including on questions concerning the applicable standards of review for Chapter Eleven arbitral awards ….

    (3)  The existence of a multilateral treaty on enforcement of arbitral awards

  12. [The Tribunal found that this factor was neutral because both the United States and Canada are parties to the New York Convention.]

    (4)  The convenience of the parties and the arbitrators

  13. 27. … The Claimant argues that [this factor] weighs neutrally and does not point to any one place over another since the parties have agreed, in accordance with Article 16(2) of the [1976] UNCITRAL Arbitration Rules, that the seat of the arbitration and the place of hearings need not coincide and that hearings or meetings may take place at any appropriate place, including Washington, D.C., Vancouver or Toronto. … The Respondent does not agree. It contends that holding the arbitration in Washington, D.C. would be less inconvenient than Vancouver or Toronto for the members of the Tribunal as well as for the U.S. officers from the various governmental agencies involved in this arbitration, without such venue being inconvenient for Canfor …

  14. 28. The Tribunal agrees with the Claimant and considers that this factor, which should not be accorded a great weight in this arbitration, is neutral. The Tribunal is attentive to the Respondent's argument regarding the convenience of Washington, D.C. The Tribunal is also mindful that, as emphasized by the Respondent, a distinction should accurately be drawn between the legal seat of an arbitration and the geographical location of hearings. … However, in light of Paragraph 13 of the Terms of Agreement signed by the parties at the Hearing of October 28, 2003, the Tribunal considers that the parties’ agreement, without prejudice to the legal seat of the arbitration, to hold the hearings and the meetings at any appropriate place—which may include, as need be, Washington, D.C.—adequately satisfies, in the circumstances of this arbitration, the convenience factor.

    (5)  The availability of cost and support services

  15. 29. … The Claimant argues that the availability and cost of support services is neutral, and that the cost of support services may become relevant at the time of the determination of the place where particular hearings will be held. … The Claimant further argues that the facilities of ICSID in Washington, D.C. may be compared, in terms of costs, to equivalent facilities in either Vancouver or Toronto. … The Respondent contends that this factor favors Washington, D.C. as a less costly venue. The relevant factors considered by the Respondent are travel costs for the members of the Tribunal, the parties and their attorneys, and the fact that ICSID facilities are available for use at rates that are likely more competitive than equivalent facilities in Vancouver or Toronto …

  16. 30. The Tribunal finds that this factor does not favor any venue over the other and considers that the parties’ agreement to hold the hearings and the meetings at any appropriate place allows the Tribunal to conduct the arbitration in a cost-effective manner.

    (p. 103) (6)  The location of the subject matter in dispute and the proximity of evidence

  17. 31. The final factor set forth in the UNCITRAL Notes, that of the location of the subject matter in dispute and the proximity of evidence, sharply divides the parties. The Claimant finds it to be neutral. … In particular, the Claimant disputes the Respondent's submission that the subject matter of the dispute is located exclusively in Washington, D.C.: according to the Claimant, the subject matter in dispute relates to decisions made by the United States in relation to the alleged conduct of Canadian softwood lumber companies operating in British Columbia …

  18. 32. The Respondent argues to the contrary that the subject matter in dispute is located in Washington, D.C. for the following reasons: the Claimant's allegations are based on antidumping and countervailing duty determinations which were made in Washington, D.C. by the U.S. Department of Commerce and the International Trade Commission; the significant events underlying the Claimant's allegations took place in Washington, D.C.; and most or all of the relevant evidence is located in Washington, D.C. In contrast, the Respondent finds no connection between either Vancouver or Toronto and the subject matter in dispute … The Respondent further argues that the subject matter in dispute points to a U.S. venue given that the Claimant's allegations that it has been denied national treatment or most-favored nation treatment may only be made with respect to its U.S. investments …

  19. 33. The Tribunal finds that, as regards the proximity of evidence, it is irrelevant in this arbitration given the parties’ agreement to hold hearings and meetings at any appropriate place … As regards the subject matter in dispute, the parties have not presented the Tribunal with a uniform definition of what constitutes the “subject matter”. The Claimant refers to the determination of the location of a particular hearing and considers that “[t]he ‘subject matter’ of the dispute is the treatment of a Canadian investor situate in Canada and the United States, by organs of the United States government situate in Washington, D.C.”. … The Claimant further refers to the “physical subject-matter of the dispute” which it situates in British Columbia and to “legal facts” it claims have occurred in British Columbia … The Respondent, referring to the decision rendered in ADF v. United States, considers “the ‘subject-matter’ of the dispute as ‘the issue presented for consideration; the thing in which [or in respect of which] a right or duty has been asserted’ [ … ]” …

  20. 35. The Tribunal considers that the subject matter, independently from the proximity of evidence, does not, in this arbitration, relate to the Claimant's conduct in British Columbia. It rather relates to the Respondent's measures determining the Claimant's softwood lumber importations into the United States as subsidized or dumped, which are alleged by the Claimant to have affected its investments in the United States and breached Chapter Eleven of the NAFTA ….

    …

  21. 36. The Tribunal therefore finds that, with respect to the subject matter in dispute in this arbitration, substantial connections point to a venue in the United States: the United States is the territory in which the Claimant's investments are alleged to have been made … ; it is the place where the alleged measures were taken; it also happens to be the country of the defendant's domicile in this case.

    (7)  The Tribunal's decision

  22. 37. The Tribunal has carefully balanced each of the factors discussed by the parties and has found most of these factors to weigh equally between a venue in Canada and a venue in the United States. The Tribunal finds however that the location of the subject matter in dispute is a factor pointing to a venue in the United States. As a result, the Tribunal considers that Washington, D.C. (United States) should be designated as the place of arbitration.

(p. 104) Ethyl Corp and Government of Canada, Decision Regarding the Place of Arbitration (November 28, 1997) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), reprinted in (1999) 38 ILM 702, 702–06:

… [T]he Tribunal now turns its attention to the four factors relevant under the UNCITRAL Notes, considering each of them in relation to the respective proposed places of arbitration: Ottawa (or, alternatively, Toronto) and New York City.

As to criterion (a) of the Notes—“suitability of the law on arbitral procedure”—the Tribunal concludes that all proposed fora are all equally suitable. It appears undisputed that Canada's Commercial Arbitration Act is based on the UNCITRAL Model Law on International Commercial Arbitration and by its terms would apply to this arbitration under NAFTA Chapter 11. It appears to be equally undisputed that the relevant laws of the United States, and, to the extent relevant, the State of New York, are no less suitable. The fact that the laws applicable to this arbitration, were it situated in New York City, have been in place longer than Canada's Commercial Arbitration Act, and therefore are judicially more elaborated, does not, in the view of the Tribunal, significantly affect their comparative suitability.

Criterion (c) of the Notes—“the convenience of the parties and the arbitrators, including the travel distances”—likewise seems not be significantly better served by one proposed alternative as opposed to any other. As to the Tribunal, the President, who normally is resident in Cologne, Germany, can travel with more or less equal ease to New York City, Ottawa and Toronto. Mr. Lalonde, a resident of Montreal, can travel to Ottawa or Toronto just as well as Judge Brower can from his Washington, DC residence to New York City. By the same token, Judge Brower would be no more and no less inconvenienced by travel to Ottawa or Toronto than would Mr. Lalonde be by the need to appear in New York City.

The situation of the parties is substantially similar. Canada has noted … that:

The investment which Ethyl Corporation alleges has been damaged is the wholly owned subsidiary, Ethyl Canada, which has its head office in Mississauga, adjoining the City of Toronto, in the Province of Ontario. Its blending facility, where it processes MMT, is in Coronna, in the Province of Ontario.

In response to this Ethyl simply contends … that it has “its head office in [the Commonwealth of] Virginia” and that the “location of subsidiary offices is not a relevant factor for this arbitration.” For purposes of criterion (c) alone this may well be correct. If it is, there is no significant difference in the convenience factor between Canada having to travel to New York City and Ethyl having to be present in Ottawa or Toronto. If it is not, then a degree of preference would be indicated for a Canadian venue.

Canada has introduced as a consideration the location of counsel to the parties, emphasizing that Ethyl's counsel has an office in Toronto as well as in New York City. Ethyl disputes the relevance of counsel's convenience, while nonetheless pointing out … that “The Government of Canada also maintains a large consulate in New York City as well as a Permanent Mission to the United Nations which can support the needs of the Government of Canada's legal team … ” Canada terms this latter assertion “incorrect,” as “[t]hese are diplomatic offices and are not set up to act as alternative legal offices, such as [Claimant's counsel] apparantly [sic] has available to him.”

The Tribunal is inclined to the view that the convenience of counsel is a relevant consideration, subsumed under the “convenience of the parties.” Certainly the convenience of attorneys appointed by the parties, which translates into cost factors, affects their clients. The Tribunal also believes that the availability for temporary use by government lawyers of facilities at a consular post or diplomatic mission is not comparable to a dedicated office of counsel. Accordingly, the Tribunal concludes that it is relevant to consider that fixing the place of arbitration in either Ottawa or Toronto will serve the convenience of counsel collectively better than New York City.

We now turn to criterion (d), “availability and cost of support services needed.” It is clear that all necessary support services for this arbitration are available in all three of the cities that have been proposed. The Tribunal believes it appropriate to take judicial notice of the fact that such services (p. 105) inevitably will be more costly in New York City than in either Ottawa or Toronto. This includes transportation, hotels, meal service, hearing rooms and counsel rooms, and certified stenographic reporting services. Therefore application of criterion (d) favors Ottawa or Toronto over New York City, but does not discriminate between them.

The Tribunal does not, however, take into consideration in this regard, as Canada has proposed, the presence and availability in Ottawa of NAFTA Secretariat facilities. … [T]o avail itself of such facilities could be viewed as inconsistent with at least the spirit of the requirement of the [1976] UNCITRAL Rules (Articles 9–10) that it act so as to leave no doubt whatsoever as to its complete independence of any party. This is all the more so where, as here, Ethyl has registered its objection … that the use of such facilities “would be inappropriate.”

The last criterion of the Notes—“(e) location of the subject-matter in dispute and proximity of evidence”—finally turns the Tribunal definitely to selection of a place of arbitration in Canada. Clearly the subject-matter in dispute is fixed in Canada. Ethyl charges … —that certain legislative and other acts of Canada “remov[ing] MMT [ … ] from Canadian gasoline” have resulted in breaches by Canada of Article 1102, 1106 and 1110 of NAFTA, thereby “harm[ing] Ethyl Corporation and the value of its Canadian investment, Ethyl Canada.” The “location of the subject-matter in dispute” is not subject to serious debate.

The parties have little to say as regards “the proximity of evidence.” … Thus the Tribunal is afforded little insight into just how any considerations of the proximity of evidence should affect its decision.

Traditionally arbitrating parties, desiring both the reality and the appearance of a neutral forum, incline to agree on a place of arbitration outside their respective national jurisdictions. This is especially the case where a sovereign party is involved. Where an arbitral institution or a tribunal must make the selection, this tendency is, if anything, even greater, and for the same reasons. Article 16(1) of the [1976] UNCITRAL Rules easily accommodates this consideration as one of the “circumstances of the arbitration.”

The Tribunal concludes on the basis of all of the foregoing that, on balance, the place of arbitration should be in Canada. … Most significantly, Canada indisputably is the location of the subject-matter in dispute. In addition, a Canadian venue offers less costly support services and overall would better suit the convenience of counsel for the parties. It is far less certain, but likely, that Canada overall is more convenient for the parties themselves and as regards the proximity of evidence ….

Once the Tribunal has determined to select a Canadian venue, none of the specific factors considered weighs strongly in favor of Toronto, Canada's alternative proposal, rather than Ottawa. The Tribunal has some reluctance, however, to choose Ottawa. This is due to the fact that it is the capital of Canada. The Tribunal therefore has determined to designate Toronto as the place of arbitration, for the reason that while it is no more, and no less, appropriate than Ottawa when measured by the other applicable criteria, it is likely to be perceived as a more “neutral” forum.

Methanex Corp and United States of America, Order on the Place of Arbitration (September 7, 2000) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 3, 9–15:

III  —The Tribunal's Reasons

  1. 23. In the absence of the parties’ agreement on the place of arbitration (save to exclude any place outside Canada and the USA), the Tribunal is required to choose for this arbitration a place of arbitration in either Canada or the USA in accordance with Article 1130(b) of NAFTA and Article 16(1) of the [1976] UNCITRAL Rules. Both Canada and the USA have enacted the 1958 New York Convention, satisfying the requirements of Article 1130(b); and the issue turns on the application of Article 16(1) to the particular circumstances of this arbitration.

  2. 24. Under Article 16(1) of the [1976] UNCITRAL Rules, the place of the arbitration is the legal place, or “seat”, of the arbitration; and the Tribunal here makes no decision as to the (p. 106) geographical place of any particular hearing. Any such hearing could be held at a geographical place elsewhere than the legal place of arbitration in accordance with Article 16(2) of the [1976] UNCITRAL Rules, depending upon the convenience of witnesses, the parties and their legal representatives, together with other relevant circumstances ….

  3. 26. The Tribunal begins, as did the parties, with the factors listed in the UNCITRAL Notes. As regards Factors A and B, the Tribunal accepts that there is little to choose between Toronto and Washington DC in regard to suitability of the law on arbitral procedure and enforcement. The Tribunal concludes that, for all practical purposes in regard to this arbitration, the two potential places of arbitration may be considered equally in terms of the law on arbitral procedure and enforcement.

    …

  4. 28. As to Factor C, the Tribunal considers that the convenience of the three arbitrators is irrelevant in this case when measured against other factors invoked by the Disputing Parties. As regards the convenience of the parties, the Claimant is correct in describing it here more as the balance of “inconvenience” rather than “convenience”. The Tribunal also accepts that this balancing exercise must take into account both the parties and their Counsel, because the latter's extra traveling time and expenses will be borne ultimately as costs by the parties. [The Tribunal finds that Washington, DC is not inconvenient for the Claimant, which has a substantial permanent office in that city, while Toronto is unduly inconvenient for the Respondent whose various government departments involved in the dispute are located in Washington, DC.]

  5. 32. As to Factor D relating to the availability and costs of support services, the necessary support services would be available in both Toronto and Washington DC ….

  6. 33. As to Factor E relating to the location of the subject-matter of the dispute, the Tribunal considers that it points to a place in the USA as the place of arbitration. [Noting that Claimant's arbitral claims involve actions of the State of California, the Tribunal concludes that] the subject-matter of the dispute is not located in Canada; and accordingly, whilst this factor bears only slight importance on this arbitration, the Tribunal considers that it favours Washington DC over Toronto.

  7. 34. In summary, in the Tribunal's considerations so far, the factors cited from the UNCITRAL Notes favour Washington DC over Toronto. The Tribunal now turns to the separate issue of neutrality, or perceived neutrality, which the claimant invokes to favour Toronto over Washington DC.

  8. 35. For the purpose of the present case, the Tribunal does not place any great weight on the fact that neutrality as a factor was removed from the final version of the UNCITRAL Notes. The Tribunal's discretion turns on the broad concept of “circumstances” in Article 16(2) of the [1976] UNCITRAL Rules; and there is no linguistic or logical basis for excluding neutrality as a factor in an appropriate case. Accordingly, the Tribunal has considered neutrality as a possible circumstance in this arbitration.

  9. 36. However, in assessing the significance of neutrality or perceived neutrality, the Tribunal bears in mind (i) that it was open to the NAFTA Parties to agree that in the interests of neutrality Chapter Eleven disputes should be arbitrated in the territory of any third Party not directly involved in the dispute, yet they did not do so; and (ii) that in circumstances where (as in this case) the disputing parties have further limited the choice of place of arbitration by their arbitration tribunal to one or the other's state, a neutral national venue is simply not possible ….

    …

  10. 38. For this arbitration, the Tribunal considers that the requirements of neutrality are sufficiently met if the place of arbitration lies outside British Colombia (as the home of the Claimant), California (responsible for the legislative measure in issue) and Texas (as the home of Methanex US). Once these three locations are excluded, the question then arises whether Washington DC should also be excluded on grounds of neutrality because it is the Respondent's capital city, thereby (it might be said in sporting terms) requiring the Claimant to play away from home in its opponent's home stadium.

  11. 39. As to actual neutrality, from the information currently available before it, the Tribunal can find no evidence of any difficulties for the Claimant. As to perceived neutrality, the point is (p. 107) answered by accepting ICSID's offer of the World Bank's facilities … Whilst Washington DC is of course the seat of federal government in the USA, it is also the seat of the World Bank and ICSID. The World Bank is an independent international organisation with juridical personality and broad jurisdictional immunities and freedoms … ; and ICSID similarly has international legal personality and benefits from a wide jurisdiction immunity. … The Tribunal considers that the requirements of perceived neutrality in this case will be satisfied by holding such hearings in Washington DC as the seat of the World Bank, as distinct from the seat of the USA's federal government.

  12. 40. Decision: Balancing all these factors as circumstances relevant to the exercise of its discretion under Article 16(1) of the [1976] UNCITRAL Rules, the Tribunal considers that Washington DC, USA should be designated as the place of the arbitration …

ADF Group Inc and United States of America, Procedural Order No 2 (July 1, 2001) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 5:

10. It appears to us that the “suitability” in international arbitration of the law on arbitral procedure of a suggested place of arbitration, has multiple dimensions. These dimensions include the extent to which that law, e.g., protects the integrity of and gives effect to the parties’ arbitration agreement; accords broad discretion to the parties and to the arbitrators they choose to determine and control the conduct of arbitration proceedings; provides for the availability of interim measures of protection and of means of compelling the production of documents and other evidence and the attendance of reluctant witnesses; consistently recognizes and enforces, in accordance with the terms of widely accepted international conventions, international arbitral awards when rendered; insists on principled restraint in establishing grounds for reviewing and setting aside international arbitral awards; and so on.

United Parcel Service of America Inc and Government of Canada, Decision on the Place of Arbitration (October 17, 2001) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), reprinted in (2002) 14(1) World Trade & Arb Materials 33, 34–40:

  1. 7. We consider [the five factors enumerated in Paragraph 22 of the UNCITRAL notes] in turn.

    A. Suitability of the law on arbitral procedure of the place of arbitration

  2. 8. UPS contends that the position of the Canadian government in litigation relating to another NAFTA arbitration (the Metalclad Corporation v Mexico case) and the position of the Canadian courts provide insufficient deference to the rulings of chapter 11 Tribunal. It calls attention in particular to the fact that in argument in that case Canada submitted that the leading Canadian authorities supporting deference to arbitral tribunals ought to be rejected and that

    awards of chapter 11 Tribunals “are not worthy of judicial deference and are not supposed to be protected by a high standard of review”. The submission continued that chapter 11 Tribunals are neither expert nor specialised Tribunals ….

  3. 11. The Tribunal is troubled by Canada's submission on this issue in the Metalclad case.

    [The Tribunal finds the second factor, the existence of an applicable treaty on the enforcement of arbitral awards, to be neutral because Canada and the United States are both parties to the New York Convention.]

    C.  Convenience of the Parties and the arbitrators including travel distances

  4. 13. … [T]his factor includes not just the Parties but also their counsel because their extra travelling time and expenses will ultimately be borne as costs by the disputing Parties. [Because the Canadian agencies involved in the dispute, Canada's counsel, and its investment UPS Canada are all in Canada], [t]he balance of the convenience therefore strongly favours Canada over the United States ….

    (p. 108) D.  Availability and cost of support services

  5. 14. … [UPS] calls attention to the fact that the Tribunal has … proposed that the administrative services of ICSID be used and if that decision were made this would be a strong reason in favour of Washington as a convenient location for the arbitration. Canada responds to that point by recalling that, when the Tribunal suggested to the parties that they consider ICSID as the body to provide administrative services, the Tribunal made it clear that that suggestion was without prejudice to the determination of the place of arbitration ….

    E.  Location of the subject matter in dispute and the proximity of the evidence

  6. 15. Canada argues that this factor weighs very heavily in favour of Canada and in particular Ottawa. … All the records relating to the impugned measures and the individual decision-makers implicated by the Investor in its claim are in Canada. [As to the argument that the place of arbitration should be Canada because Canada is alleged to have breached NAFTA Chapter 11, UPS states] [t]o give this criterion undue weight would lead to the result that the place of arbitration under chapter 11 arbitrations would nearly always be in the territory of the respondent party. This was clearly not the intention of the NAFTA parties and the text does not provide for that result. … So far as the evidence is concerned, although it is difficult to assess this issue at this early stage in the arbitration, it can be said with some certainty that the arbitration will be largely based on documentation and expert evidence. With modern information technology, the handling of documentation should not be an issue in this arbitration particularly given that the disputing parties have a high degree of expertise and sophistication in the handling of information. So far as witnesses and experts are concerned, there is no clear balance of convenience. Witnesses will be from throughout North America and likely from Europe. There is neither advantage nor disadvantage for either disputing party if the arbitration is located in either the United States or Canada.

    The Tribunal's assessment

  7. 16. Of the factors mentioned so far two are neutral—B and C (although in the usual course travel from New Zealand to the United States is marginally more convenient than it is to Canada); two weigh slightly in UPS's favour (A, because of the attitude of the Canadian government in the Metalclad litigation and D because the Tribunal, although without prejudice, has already suggested to the Parties that they consider ICSID as its registry); and another is in Canada's favour (E, but the importance of that factor in the arbitration is not clear at present).

  8. 17. Neutrality had been identified as a factor relevant to the place of arbitration (although it is not in the UNCITRAL list), for instance in the Methanex decision paras 35–39. Canada addressed it in its submission. That factor is plainly relevant given the broad reference to “the circumstances of the arbitration” in Article 16(1) of the [1976] UNCITRAL rules (para 2 above).

  9. 18. In one sense a neutral place is not available given that the claimant is a United States corporation and Canada is the respondent and the place of the arbitration is to be in one or other country. It is however relevant that it is Canada's measures that are in issue, even if it has been the place of arbitration in all chapter 11 investment disputes in which it has been the respondent. It is also relevant that Washington DC can be seen as having the neutrality of being the seat of the World Bank and ICSID, rather than the seat of federal government in the United States of America. And UPS's headquarters are in Atlanta, GA.

  10. 19. While the matter is finely balanced, the Tribunal considers that the balance does favour the United States of America as the place of arbitration and in particular Washington, DC. The Tribunal so decides.

(p. 109) Merrill & Ring Forestry LP and Government of Canada, Decision on the Place of Arbitration, (December 12, 2007) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 7–8:

  1. 27. Both Ottawa and Washington, D.C. end-up, after all elements having been considered, in an almost identical situation from the point of view of their suitability as the place of arbitration. In order to arrive at a determination the Tribunal thus needs to weigh further some particular arguments made by the parties in support of their respective proposals.

  2. 28. The first such argument concerns the location of the subject matter in dispute and the proximity of evidence. While these factors are likely to be more readily available in Ottawa as the place where many or most of the challenged measures have been adopted by the Canadian government and its services, a criterion accepted by several NAFTA tribunals (Ethyl (at 705), ADF (para. 20) and Canfor (para. 35), the Tribunal does not believe that this is a crucial factor in the age of electronic communications and availability of records.

  3. 29. The second argument to be taken into account relates to the travel facilities servicing one or other venue. Although this particular aspect is related more to the place of hearings than to the place of arbitration, the Tribunal will consider it for the sake of completeness, particularly in view that both the UNCITRAL Rules and the parties’ submissions refer to it in connection with the place of arbitration.

  4. 30. In consideration of the fact that one arbitrator has a residence in Washington, D.C. or will be traveling from Chicago, that another arbitrator shall be coming from either Toronto or London, that the Presiding arbitrator will be arriving either from New York or Miami as the most convenient ports of entry to the United States coming from Santiago, that one party will be traveling from Seattle and its counsel from Toronto, the Tribunal is persuaded that flight connections with Washington, D.C. are more readily available than with Ottawa. In this last case travel is many times routed through Toronto. In any event, connections between Ottawa and Washington, D.C. are also adequate enough so as not to inconvenience counsel for the Respondent.

  5. 31. In addition to the above considerations, the Tribunal also notes that Washington, D.C. is the seat of ICSID, the administering institution of this case, that it has been accepted on various occasions as the place of arbitration and that it has developed the reputation of being an independent venue for many international organizations (See UPS (para. 18), ADF (para. 21); Methanex (para. 39)). While some cases were brought under the ICSID Additional Facility Rules of Arbitration, and hence were held at and administered by ICSID itself, there are also cases brought under the UNCITRAL Rules that have been held in the ICSID facilities, just as the present case.

  6. 32. Having considered all the arguments made in favour of the different venues indicated, the Tribunal can conclude, like the UPS tribunal, that,

    While the matter is finely balanced, the Tribunal considers that the balance does favour the United States of America as the place of arbitration and in particular Washington, DC (UPS, para. 19).

  7. 33. The Tribunal appreciates, of course, that the Claimant is a national of, and distinct from, the United States, and that this factor is sufficient guarantee that the impartiality of the courts will not be in any way affected as the United States Federal judiciary is also fully independent. In this connection, Washington, D.C. is favoured, not because of being the capital of the United States but because it is the seat of ICSID and offers some advantages in terms of practical conveniences.

D. Extracts from the Practice of the Iran–US Claims Tribunal

Article VI, paragraph 1 of the Claims Settlement Declaration:

The seat of the Tribunal shall be the Hague, The Netherlands, or any other place agreed by Iran and the United States.

Footnotes:

1 

Corresponding Article 1 of the 1976 UNCITRAL Rules provides:

  1. 1. Where the parties to a contract have agreed in writing* that disputes in relation to that contract shall be referred to arbitration under the UNCITRAL Arbitration Rules, then such disputes shall be settled in accordance with these Rules subject to such modification as the parties may agree in writing.

  2. 2. These Rules shall govern the arbitration except that where any of these Rules is in conflict with a provision of the law applicable to the arbitration from which the parties cannot derogate, that provision shall prevail.

Note (*) to Article 1(1) contains the following Model Arbitration Clause:

Any dispute, controversy or claim arising out of or relating to this contract, or the breach, termination or invalidity thereof, shall be settled by arbitration in accordance with the UNCITRAL Arbitration Rules as at present in force.

Note—Parties may wish to consider adding:

  1. (a)  The appointing authority shall be (name of institution or person)

  2. (b)  The number of arbitrators shall be (one or three)

  3. (c)  The place of arbitration shall be (town or country)

  4. (d)  The language(s) to be used in the arbitral proceedings shall be …

2  For a discussion of the advantages and disadvantages of arbitration as compared to other forms of dispute settlement, see N Blackaby and C Partasides with A Redfern and M Hunter, Redfern and Hunter on International Arbitration (5th edn 2009) 31 et seq.

3  On the use of the UNCITRAL Rules, see Chapter 1.

4  “[T]he Rules are used in international commercial arbitrations administered by regional and international arbitral institutions whose rules are modelled on the Rules (such as the Australian Centre for International Commercial Arbitration (‘ACICA’), Kuala Lumpur Regional Centre for Arbitration, Cairo Regional Centre for International Arbitration, the Swiss Chambers’ Court of Arbitration and Mediation, and the Permanent Court of Arbitration (‘PCA’)).” J Levine, “Current Trends in International Arbitral Practice as Reflected in the Revision of the UNCITRAL Arbitration Rules” (2008) 31(1) U New South Wales L J 266, 267.

5  The text of Article 1(1) of the 1976 UNCITRAL Rules appears in note 1. The new language of Article 1(1) met with only minimal criticism in the Working Group. Some delegates objected to the new language “as simply replac[ing] one restriction with another, which unnecessarily limited the scope of the Rules and could raise interpretive questions that would undermine the certainty of the text.” Report of the Working Group on Arbitration and Conciliation on the Work of its Forty-Fifth Session (Vienna, 11–15 September 2006), UNCITRAL, 40th Session, UN Doc A/CN.9/614, at 8, para 33 (2007).Their preferred approach was to include no limitation at all. Others believed that a reference to “defined legal relationship” might not be accommodated in certain legal systems.Report of the Working Group on Arbitration and Conciliation on the Work of its Forty-Sixth Session (New York, 5–9 February 2007), UNCITRAL, 40th Session, UN Doc A/CN.9/619, at 6, para 22 (2007). These arguments ultimately did not persuade the Working Group.

6  Many delegates of the Revision Working Group believed that the application of the Rules should not be limited to disputes of only a contractual nature. See UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 6, para 21. As to the applicability of the New York Convention to non-commercial disputes, see I Eliasoph, “A Missing Link: International Arbitration and the Ability of Private Actors to Enforce Human Rights Norms,” (2004) 10 New England J Intl and Comparative L 83.

7  For a discussion of the meaning of the phrase “defined legal relationship, whether contractual or not” as used in the Model Law, see Seventh Secretariat Note: Analytical Commentary on Draft Text, UN Doc A/CN.9/264, para 4 (March 25, 1985), an excerpt of which is included in H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law on International Commercial Arbitration: Legislative History and Commentary (1989) 290.

8  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 8, para 33. See also J Castello, “Unveiling the 2010 UNCITRAL Arbitration Rules” (2010) 65 (2/3) Dispute Resolution J 21, 147.

9  See S Baker and M Davis, The UNCITRAL Arbitration Rules in Practice: The Experience of the Iran-United States Claims Tribunal (1992) 7; J van Hof, Commentary on the UNCITRAL Arbitration Rules: The Application by the Iran-U.S. Claims Tribunal (1991) 13–14. The adaptability of the UNCITRAL Rules is of course a separate question from limitations in law of the place of arbitration or in the New York Convention.

10  Hereinafter the New York Convention (New York, June 10, 1958; 330 TS 3 (1959)). Article II requires an “agreement in writing.”

11  New York Convention, art II.

12  Report of the Secretary General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Introduction, para 7, UN Doc A/CN.9/112 (1975), reprinted in (1976) VII UNCITRAL Ybk 157, 167.

13  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 7, para 28.

14  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 8, para 30.

15  Other proposed reasons for a writing requirement included providing a basis upon which an appointing authority could appoint arbitrators or an opportunity for parties to clarify which version of the rules would apply, UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 7–8, para 30.

16  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 7–8, para 29.

17  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 7, para 28; UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 7–8, para 29. Others said if the requirement remained it would have to be defined and that would go beyond the usual scope of arbitration rules. UNCITRAL, 40th Session, UN Doc A/CN.9/619, at 7, para 28.

18  For examples of approaches to the writing requirement in various jurisdictions see T Webster, Handbook of UNCITRAL Arbitration: Commentary, Precedents and Materials for UNCITRAL Based Arbitration Rules (2010) 20–32.

19  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 7, para 29. It was also noted that there was uncertainty as to whether the writing requirement applied to the agreement to arbitrate or to the parties’ agreement on application of the UNCITRAL Rules. Id. 29.

20  Such modification has occurred in the context of NAFTA Chapter Eleven arbitrations. See Canfor Corp (1976 Rules); and Glamis Gold Ltd (1976 Rules); both reprinted in section 2(C).

21  Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.143 at 5, para 20 (2006). “A concern was expressed that the deletion of the requirement that the arbitration agreement be in writing might create difficulties in practice, and therefore there should be convincing evidence indicating the existence of such agreement.” Report of Working Group II (Arbitration and Conciliation) on the Work of its Forty-Ninth Session (Vienna, 15–19 September 2008), UNCITRAL, 42nd Session, UN Doc A/CN.9/665, at 6, para 18 (2008).

22  UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 5, paras 21–22 (citing examples). See also 6, para 18.

23  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 7, para 28. The provision of the Model Law, as amended, provides: “Subject to the provisions of this Law, the parties are free to agree on the procedure to be followed by the arbitral tribunal in conducting the proceedings.”

24  J Paulsson and G Petrochilos, “Revision of the UNCITRAL Rules,” (A Report Commissioned by the UNCITRAL Secretariat), March 31, 2006, at 12, para 21.

25  According to Article 17(1), discussed in section 3, “[s]ubject to these Rules, the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate … ”

26  This fundamental tenet of international arbitration is widely recognized by international tribunals. See, eg Wintershall AG (1976 Rules); and Himpurna California Energy Ltd (1976 Rules); both reprinted in section 2(C)(2).

27  In the case of arbitration arising under international investment agreements, the procedural law may be circumscribed by the specific terms of the treaty. See, eg, NAFTA, Chapter Eleven, Subchapter B, art 1120(2) (“The applicable arbitration rules shall govern the arbitration except to the extent modified by this subchapter.”). The Working Group tasked with revising the Rules found the phrase “the law applicable to the arbitration from which the parties cannot derogate” to sufficiently cover cases in which international law, by way of an international investment agreement, imposed mandatory rules on the arbitration. See Report of the Working Group on Arbitration and Conciliation on the Work of its Forty-Fifth Session (Vienna, 11–15 September 2006), UNCITRAL, 40th Session, UN Doc A/CN.9/614, at 9, para 35 (2007).

28  For a general discussion, see K H Böckstiegel, “The Relevance of National Arbitration Law for Arbitrations Under the UNCITRAL Rules,” (1984) 1 J Intl Arb 223–236.

29  This question arises in the context not only of commercial arbitration, but also investment arbitration as many investment treaties contain provisions on dispute settlement that makes only general reference to the UNCITRAL Arbitration Rules.

30  The Working Group replaced the phrase “another version of the Rules” in the first line of Article 1(2) with the phrase “a particular version of the Rules” in order to “clarify that the will of the parties would in all circumstances prevail.” UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 6, para 19.

31  “It was widely felt [among Revision Working Group delegates] that, in the case of disagreement or doubt regarding the chosen version of the Rules, it would be for the arbitral tribunal to interpret the will of the parties.” UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 8–9, para 37.

32  Vienna Convention on the Law of Treaties (1969), arts 31 and 32.

33  The straightforward approach of this rule was intended to ensure “the maximum degree of clarity to avoid disputes concerning which version of the Rules to apply in a given proceeding [particularly in ad hoc arbitration where an administering institution is not available to provide guidance].” Report of the Working Group on Arbitration and Conciliation on the Work of its Forty-Eighth Session (New York, 4–8 February 2008), UNCITRAL, 41st Session, UN Doc A/CN.9/646, at 17, para 74 (2008).

34  J Castello, “UNCITRAL Rules,” in F Weigand (ed) Practitioner's Handbook on International Commercial Arbitration (2009) 1417–18.

35  UNCITRAL, 41st Session, UN Doc A/CN.9/646, n 33, at 16–17, para 72. See also UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 7, para 25 (reporting that it was observed that “[n]o version of the Rules could be considered to be ‘in force’ in and of itself outside the context of an agreement between the parties to the dispute”).

36  Proponents of this approach argued that many parties expected that the latest version of a particular set of procedural rules would apply, that many arbitral institutions adopted this approach when revising their procedural rules, and that this approach would promote application of the latest version of the UNCITRAL Rules in the greatest number of situations. UNCITRAL, 41st Session, UN Doc A/CN.9/646, n 33, at 16–17, paras. 72–73. See also UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 6–7, para 23.

37  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 7, para 25.

38  UNCITRAL, 41st Session, UN Doc A/CN.9/646, n 33, at 17, para 76.

39  See, eg, CAFTA-DR, art 10.16.5.

40  According to Article 17(1), discussed in section 3, “[s]ubject to these Rules, the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate … ”

41  This fundamental tenet of international arbitration is widely recognized by international tribunals. See, eg Wintershall AG (1976 Rules); Himpurna California Energy Ltd (1976 Rules); both reprinted in section 2(C)(2).

42  In the case of arbitration arising under international investment agreements, the procedural law may be circumscribed by the specific terms of the treaty. See, eg, NAFTA, Chapter Eleven, Subchapter B, Art 1120(2) (“The applicable arbitration rules shall govern the arbitration except to the extent modified by this subchapter.”) The Working Group found the phrase “the law applicable to the arbitration from which the parties cannot derogate” to sufficiently cover cases in which international law, by way of an international investment agreement, imposed mandatory rules on the arbitration. See UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 9, para 35.

43  For a general discussion, see K H Böckstiegel, “The Relevance of National Arbitration Law”, n 28, 223–36.

44  For the development of this position throughout the discussions, see Report of the Working Group on Arbitration and Conciliation on the Work of its Fifty-Fourth Session (New York, 7–11 February 2011), UNCITRAL, 44th Session, UN Doc A/CN.9/717, at 7, para 19–20 (2011); Report of the Working Group on Arbitration and Conciliation on the Work of its Fifty-Fifth Session (Vienna, 3–7 October 2011), UNCITRAL, 45th Session, UN Doc A/CN.9/736, at 5–7, paras 20–24 (2011); and Report of the Working Group on Arbitration and Conciliation on the Work of its Fifty-Sixth Session (New York, 6–10 February 2012), UNCITRAL, 45th Session, UN Doc A/CN.9/741, at 5–6, paras 17–23 (2012).

45  The progression of this position throughout the discussions can be found in UNCITRAL, 44th Session, UN Doc A/CN.9/717, n 44, at 7, 8, para 19, 21; UNCITRAL, 45th Session, UN Doc A/CN.9/736, n 44, at 7–8, paras 25–30; and UNCITRAL, 45th Session, UN Doc A/CN.9/741, n 44, at 6–7, paras 24–27.

46  UNCITRAL, 45th Session, UN Doc A/CN.9/741, n 44, at 8, para 33.

47  UNCITRAL, 45th Session, UN Doc A/CN.9/741, n 44, at 8, para 33.

48  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 9, para 36.

49  Note that the Working Group rejected a proposal to delete the word “person” because removal of the possibility to appoint a person [as appointing authority] would run counter to existing practice … ” UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 9, para 40.

50  The model arbitration clause contained in the 2010 Rules uses the phrase “town and country,” in contrast to the phrase “town or country” used in the model clause contained in the 1976 Rules. The change was made because it was believed that the words “town or country” failed to capture “all factual possibilities” for designating the place of arbitration and thus did not adequately convey the important legal consequences that flow from the designation of the place of arbitration. UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 9, para 41. For example, designation of a “country” alone may be insufficient where that country has more than one legal system for governing arbitral procedure, eg, in the United States arbitration law may vary at the sub-federal level from state to state.

51  The Working Group considered, but did not adopt, proposals to add a subparagraph (e) to the model arbitration clause with references to the law governing the arbitration agreement or the law applicable to the substance of the dispute, or with a clarification about the relationship between the place of arbitration on the law applicable to the arbitral proceedings. UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 9, para 41. The Working Group also did not adopt a proposal to include a reference to conciliation, possibly in the form of an optional conciliation clause, “to avoid unnecessarily complicating” the model arbitration clause. UNCITRAL, 40th Session, UN Doc A/CN.9/619 at 10, para 43. Nor did it adopt a proposal to include a footnote to the model arbitration clause bringing to the parties’ attention the possibility of including a provision on confidentiality given the absence of one in the Rules. UNCITRAL, 40th Session, UN Doc A/CN.9/619 at 25, para 132.

52  See section 2(A).

53  See text of Article 1(1) in n 1.

54  See S Baker and M Davis, The UNCITRAL Arbitration Rules in Practice, n 9, 7; J van Hof, Commentary on the UNCITRAL Arbitration Rules, n 9, 13–14. The adaptability of the UNCITRAL Rules is of course a separate question from limitations in law of the place of arbitration or in the New York Convention. As to the applicability of the New York Convention to non-contractual disputes, see I Eliasoph “A Missing Link”, n 6, 83.

55  However, they may only do so subject to “a provision of the law applicable to the arbitration from which the parties cannot derogate ….” Article 1(2).

56  1983 Rules of Procedure of the Iran–US Claims Tribunal, reprinted in Appendix 5. The 1983 Tribunal Rules constitute a modified version of the 1976 Rules. The Tribunal Rules were adopted by the Tribunal provisionally on March 10, 1982 and finally on May 3, 1983. Due to the special nature of this Tribunal, the power to make such modifications has been conferred on the two Governments and the Tribunal itself, the private parties being excluded. According to Article III(2) of the Claims Settlement Declaration, “the Tribunal shall conduct its business in accordance with the [UNCITRAL Rules] except to the extent modified by the Parties or by the Tribunal to ensure that this Agreement can be carried out.” See also Article 1(1) of Tribunal Rules, reprinted in Appendix 5. See also para 3 of the last-mentioned Article, according to which the “[t]he Claims Settlement Declaration constitutes an agreement in writing by Iran and the United States … on behalf of their nationals … ” See Chapter 10 section 2(B)(7). In these modified UNCITRAL Rules, some of the original articles have been left intact, while others have been rewritten, mainly to serve the specific needs arising from the institutional structure of the Tribunal. Several Rules have been supplemented by “Notes” indicating how the Tribunal intends to interpret and apply the Rule in question. On the drafting of the Tribunal Rules, see H Holtzmann, “Drafting the Rules of the Tribunal,” in D Caron and J Crook (eds), The Iran-United States Claims Tribunal and The Process of International Claims Resolution (2000) 75.

57  In the Larsen arbitration, the selection of the UNCITRAL Rules raised an important preliminary question for the tribunal, namely the applicability of the UNCITRAL Rules to a non-contractual dispute. The tribunal found “no reason why the UNCITRAL Rules cannot be adapted to apply to a non-contractual dispute.” See Lance Paul Larsen (1976 Rules), para 10.7, reprinted in section 2(C)(1). Noting the “non-prescriptive” and “non-coercive” nature of the Rules, the tribunal concluded that parties who agree to arbitrate under the Rules are able to adapt the terms of the Rules, either expressly or by implication, to suit their dispute, including a dispute where one of the parties is alleged to be a state. Lance Paul Larsen, paras 10.5–10.7. Specifically, the tribunal found that “[t]he parties to this arbitration effectively have agreed to apply the UNCITRAL Rules with such necessary adaptations as arise from the terms of the Arbitration Agreement and the nature of the issues referred to arbitration.” Lance Paul Larsen, para 10.10.

58  Report of the Secretary-General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Addendum 1 (Commentary), UN Doc. A/CN.9/112/Add.1 (1975), reprinted in (1976) VII UNCITRAL Ybk 166, 167. See also S Baker and M Davis The UNCITRAL Arbitration Rules in Practice, n 9, 8; J van Hof, Commentary on the UNCITRAL Arbitration Rules, n 9, 15.

59  For a discussion of the acceptance of an arbitration agreement in the course of electronic commerce or by tacit or oral conduct, see Possible Future Work in the Area of International Commercial Arbitration, UNCITRAL, 32nd Session, UN Doc A/CN.9/460 (1999), paras 20–31, reprinted in (1999) XXX UNCITRAL Ybk 395, 398–9 [hereinafter “Possible Future Work”].

60  P Sanders, “Commentary on UNCITRAL Arbitration Rules,” (1977) II Ybk Commercial Arb 177, 179. Such modification has occurred in the context of NAFTA Chapter Eleven arbitrations. See Canfor Corp (1976 Rules); and Glamis Gold Ltd (1976 Rules); both reprinted in section 2(C).

61  During the revision of the Rules, some proposed that the phrase “as at present in force” should be replaced with the phrase “as at present in effect” to “better reflect that the Rules have a contractual rather than legislative nature Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.145 at 6, para 21 (2006). Because the 2010 Rules contain a separate provision to address the applicability of a particular version of the Rules, the phrase “as at present in force” was dropped from the 2010 model arbitration clause.

62  The complete text of the 1976 model arbitration clause appears in n 1.

63  Article 1(2) states which version of the Rules will be presumed to apply unless the parties agree otherwise.

64  See J Castello “UNCITRAL Rules,” n 34, 1418.

65  Corresponding Article 15 of the 1976 UNCITRAL Rules provides:

  1. 1. Subject to these Rules, the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, provided that the parties are treated with equality and that at any stage of the proceedings each party is given a full opportunity of presenting his case.

  2. 2. If either party so requests at any stage of the proceedings, the arbitral tribunal shall hold hearings for the presentation of evidence by witnesses, including expert witnesses, or for oral argument. In the absence of such a request, the arbitral tribunal shall decide whether to hold such hearings or whether the proceedings shall be conducted on the basis of documents and other materials.

  3. 3. All documents or information supplied to the arbitral tribunal by one party shall at the same time be communicated by that party to the other party.

66  See Dames & Moore (1983 Tribunal Rules), reprinted in section 3(D)(1).

67  H Bagner, “Enforcement of International Commercial Contracts by Arbitration: Recent Developments,” (1982) 14 Case Western Reserve J Intl L 573, 577. In the Model Law, as amended, the main elements of the present provision are contained in two separate articles, Articles 18 and 19. Together they have been called the “Magna Charta of Arbitral Procedure.” See H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 550, 564.

68  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 33. See also S Baker and M Davis, The UNCITRAL Arbitration Rules in Practice, n 9, 75–6 (discussion on the “principle of flexibility” as applied by the Iran–US Claims Tribunal); UNCITRAL Notes on Organizing Arbitral Proceedings, UNCITRAL, UN GAOR, 51st Session, para 4, UN Doc A/51/17 (1996), reprinted in (1996) XXVII UNCITRAL Ybk 45, 46 [hereinafter “UNCITRAL Notes”] (“This [procedural flexibility] is useful in that it enables the arbitral tribunal to take decisions on the organization of proceedings that take into account the circumstances of the case, the expectations of the parties and of the members of the arbitral tribunal, and the need for a just and cost-efficient resolution of the dispute.”).

69  Examples of the application of powers by the Iran–US Claims Tribunal under corresponding Article 15(1) of the 1983 Tribunal Rules are reprinted in section 3(D): Watkins-Johnson Co (1983 Tribunal Rules) (rejecting submission after closure of written record); General Electric Co (1983 Tribunal Rules) (same); Gloria Jean Cherafat (1983 Tribunal Rules) (refusing to reinstate terminated case), The Austin Co (holding settlement conference) (1983 Tribunal Rules); White Consolidated Industries Inc (1983 Tribunal Rules) (refusing to hold preliminary hearing); Parvin Mariam Samrad (1983 Tribunal Rules) (granting request to extend filing deadline); World Farmers Trading Inc (1983 Tribunal Rules) (refusing to hold oral hearing unless requested by parties); New York Blower Co (1983 Tribunal Rules) (same), Tai Inc (1983 Tribunal Rules) (rejecting request to make interlocutory award); Case Nos A3, A8, A9, A14 and B16 (1983 Tribunal Rules) (holding pre-hearing conference); Dadras Intl (1983 Tribunal Rules) (refusing to admit unauthorized, late-filed documents into evidence); Vivian Mai Tavakoli (1983 Tribunal Rules) (same); and Vera-Jo Miller Aryeh (1983 Tribunal Rules) (same). Examples from investment tribunals are reprinted in section 3(C): Methanex Corp (1976 Rules), Tribunal Letter (admission of amicus submissions and establishing deadlines); United Parcel Services of America Inc (1976 Rules) (admission of amicus submissions); and CME Czech Republic BV (1976 Rules) (adopting, as appropriate, the IBA Rules on Taking Evidence). Another example from an ad hoc tribunal is found in Lance Paul Larsen (1976 Rules) (determining preliminary issues but refusing to issue preliminary award), reprinted in section 3(C)(1).

70  H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 564.

71  See J Castello, “UNCITRAL Rules,” n 34, 1465.

72  Cf ICS Inspection and Control Services Ltd (1976 Rules), Award on Jurisdiction, reprinted in section 3(C)(1) (recognizing some, but not all, limitations on a tribunal's general authority).

73  Article 17(1) grants the arbitral tribunal's discretion only with respect to the “conduct [of] the arbitration.” Thus, a NAFTA Chapter Eleven tribunal found that corresponding Article 15(1) of the 1976 UNCITRAL Rules did not authorize it to reconsider a final and binding award. See Methanex Corp (1976 Rules), Final Award, reprinted in Section 3(C)(1).

74  For a discussion on the various limitations imposed by the Rules see K P Berger, “Art. 15 UNCITRAL Arbitration Rules: The Eternal Conflict Between Arbitral Discretion and the Parties Due Process Rights” (2006) 21(4) Mealey's Intl Arb Rep 29.

75  According to the drafters of the 1976 UNCITRAL Rules, Article 24(3) of the original Rules (which is identical to Article 27(3) of the 2010 UNCITRAL Rules) is “a specific example of the general rule in article [15(1) of the 1976 UNCITRAL Rules, revised as Article 17(1) of the 2010 UNCITRAL Rules] to the effect that ‘the arbitrators may conduct the arbitration in such a manner as they consider appropriate.’” Report of the Secretary General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Introduction, para 17, UN Doc A/CN.9/112 (1975), reprinted in (1976) VII UNCITRAL Ybk 157, 160.

76  See Methanex Corp (1976 Rules); United Parcel Service of America, Inc (1976 Rules); and Chevron Corp (1976 Rules); all reprinted in section 3(C)(2).

77  Notably, both tribunals found that the scope of Article 15(1) of the 1976 UNCITRAL Rules was limited to procedural matters internal to the arbitration and thus granted no authority to treat third parties as parties to the arbitration. See Methanex Corp (1976 Rules), para 29; and United Parcel Services of America Inc (1976 Rules), para 39 both reprinted in section 3(C)(2).

78  See M Aden, Internationale Handelsschiedsgerichtbarkeit (1988) 24–5 (a violation of the procedure agreed upon by the parties may lead to the setting aside (Aufhebung) of the award under German Law).

79  According to Article V(1)(d) of the Convention recognition and enforcement may be refused, inter alia, where the “arbitral procedure was not in accordance with the agreement of the parties … ” See also W Craig, “Uses and Abuses of Appeal from Awards,” (1988) 4 Arb Intl 174, 189.

80  See generally N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 366.

81  For a discussion of the principle of audiatur et altera pars, see B Cheng, General Principles of Law as Applied by International Courts and Tribunals (1987) 290–8.

82  Report of the Secretary-General on the Preliminary Draft Set of Arbitration Rules, UNCITRAL, 8th Session, UN Doc A/CN.9/97 (1974), reprinted in (1975) VI UNCITRAL Ybk 163, 172–3.

83  See Report of the UNCITRAL, 8th Session, Summary of Discussion of the Preliminary Draft, UN Doc A/10017, para 99 (1975), reprinted in (1975) VI UNCITRAL Ybk 24, 35 (“In this context, the comment was made that what was important was not the imposition of an obligation to observe the principle of equal treatment, since in certain circumstances (such as where the parties made conflicting requests to an arbitral tribunal) such treatment was impossible; the real need was to stress that both parties should receive fair treatment. It was suggested, however, that the best course might be to modify the paragraph so as to impose an obligation on the arbitrators to treat the parties both with equality and fairness.”). For further discussion concerning the amendment in question and its legislative history, see S Baker and M Davis, The UNCITRAL Arbitration Rules in Practice, n 9, 76–7; J van Hof, Commentary on the UNCITRAL Arbitration Rules, n 9, 102. For an application of the principle of equality by a NAFTA Chapter Eleven tribunal, see Pope & Talbot Inc (1976 Rules), reprinted in section 3(C)(1).

84  Van Hof comments that equality “in this provision is not necessarily aimed at guaranteeing a mechanical application of equality in all circumstances, but rather is aimed at guaranteeing equality in the material sense of justice and fairness.” J van Hof, “UNCITRAL Arbitration Rules, Section III, Article 15 [General provisions]” in L Mistelis (ed) Concise International Arbitration (2010) 191.

85  The language of arbitration is discussed in connection with Article 19 in Chapter 11.

86  Although special circumstances may exist in the case of a preliminary request for interim measures, see Chapter 17.

87  See Foremost Tehran Inc (1983 Tribunal Rules), reprinted in section 3(D)(1).

88  Examples are reprinted in section 3(C)(1): EnCana Corp (1976 Rules) (in addressing confidentiality where the same arbitrator was appointed in two related arbitrations); Softwood Lumber Consolidated Proceeding (1976 Rules) (in consolidating multiple arbitrations); and Merrill & Ring Forestry (1976 Rules) (in considering the application of an asserted privilege).

89  It may be noted that the Revised Draft which followed the Preliminary Draft (but preceded the final text) required treatment “with equality and with fairness.” The text of the Revised Draft is reproduced in (1976) VII UNCITRAL Ybk 160. The Preliminary Draft had contained only the provision on “absolute equality.”

90  In this aspect, the differences between Article 17(1) and corresponding Article 15(1) of the 1976 UNCITRAL Rules, which includes the phrase “any stage of the proceedings,” are discussed in Section 3(B)(7) entitled “Comparison to the 1976 UNCITRAL Rules.” Note that Article 18 of the amended Model Law (“the parties shall be treated with equality and each party shall be given a full opportunity of presenting his case”) does not contain the words “at any stage.” This phrase was omitted because “it was feared that it might be relied upon to prolong the proceedings unnecessarily.” H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 552.

91  In the context of a party's right to present its case, Article 15(1) of the 1976 UNCITRAL Rules guarantees “a full opportunity,” whereas Article 17(1) of the 2010 UNCITRAL Rules ensures “an opportunity.” According to the travaux préparatoires, the word “full” was omitted out of concerns that the term could be “contentious,” apparently meaning that a party, based on its own subjective assessment, might argue that it was entitled to a fuller opportunity to present its case than it received. However, it was recognized that there was no information before the Working Group to suggest that the current text has given rise to any difficulties in practice. UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 17, para 77.

92  For examples from the practice of the Iran–US Claims Tribunal, see Foremost Tehran (1983 Tribunal Rules); Watkins-Johnson Co (1983 Tribunal Rules); and General Electric Co (1983 Tribunal Rules); all reprinted in section 3(D)(1). See generally J van Hof, Commentary on the UNCITRAL Arbitration Rules, n 9, 103–5. For examples from the practice of a NAFTA Chapter Eleven tribunals, see Methanex Corp (1976 Rules); and Glamis Gold Ltd (1976 Rules); both reprinted in section 3(C)(1).

93  See, eg, Case Nos 33, 87 and 174, Dissent of Howard M Holtzmann from Orders Permitting Post-Hearing Statements, June 20, 1983, reprinted in 3 Iran-US CTR 87–88 (1983–11); Ford Aerospace & Communications Corp and Islamic Republic of Iran, Case No 93, Dissenting Opinion of Mohsen Mostafavi to the Order of February 28, 1986, March 4, 1986, reprinted in 10 Iran-US CTR 108, 109 (1986–1).

94  See Klöckner and Cameroon, Decision of the Ad Hoc Committee, May 3, 1985, reprinted in (1986) ICSID Rev—Foreign Investment L J 90, para 88 (“it suffices to note that the Claimant has not established that it made a timely protest against the serious procedural irregularities it now complains of.”). See also J Thieffry, “The Finality of Awards in International Arbitration,” (1985) 1(3) J Intl Arb 27, 45 (“In practice, it appears that the courts will take into consideration a violation of the adversarial principle to deny enforcement of an international arbitral award only where such violation is serious in nature.”).

On the other hand, it is doubtful whether in domestic judicial proceedings, a mere lack of objection can automatically cure clearly discriminatory treatment by virtue of Article 32 of the Rules, according to which “[a] failure by any party to object promptly to any non-compliance with these Rules or with any requirement of the arbitration agreement shall be deemed to be a waiver of the right of such party to make such an objection, unless such party can show that, under the circumstances, its failure was justified.” As the principles of non-discrimination and audi alterem partem are likely to be mandatory norms in most domestic systems, courts might be reluctant to accept that their violation can be made good on the basis of the quoted provision. The same is the case with excess of jurisdiction. The question of mandatory norms is discussed later in this section.

95  See P Sanders, The Work of UNCITRAL on Arbitration and Conciliation (2001) 6 (“Non-observance of equal treatment or not giving parties a full opportunity to present their case will make the award subject to an action for setting aside.”).

96  This duty of the arbitral tribunal was added to the 2010 UNCITRAL Rules, thus bringing the Rules in line with other leading arbitration rules. See, eg, 1998 LCIA Rules, art 14.1(ii); 2010 SCC Rules, art 19(2); 2010 AAA Rules, art 16(2); 2001 WIPO Rules, art 38(c).

97  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 17, para 76.

98  In Working Group discussions, an express statement of the duty was also said to be “useful to provide leverage for arbitral tribunals to take certain steps both vis-à-vis the other arbitrators and the parties.” UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 17, para 76.

99  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 17, para 76.

100  But see M Pryles, “Limits to Party Autonomy in Arbitral Procedure,” (2007) 24 J Intl Arb 335 (noting “it would appear that the arbitral tribunal is not bound to accept an agreement of the parties as to a period of time”). On the 1976 version of the rule, see P Sanders, n 60, 179. See also section 2(B).

101  See Article 1(1) of the 2010 UNCITRAL Rules, section 2. See also J Selby and D Stewart, “Practical Aspects of Arbitrating Claims Before the Iran-United States Claims Tribunal,” (1984) 18 Intl Lawyer 211, 219, n 23 (“It is not possible … to waive mandatory requirements set forth in the Algiers Accords.”).

102  See Article 1(2) in section 2(B)(5).

103  K H Böckstiegel, “The Relevance of National Arbitration Law,” n 28, 227.

104  For a NAFTA Chapter Eleven tribunal's treatment of Canada's refusal to comply with a document production request based on Crown privilege under Canadian law, see Pope & Talbot Inc (1976 Rules), reprinted in section 3C(1). See ICS Inspection and Control Services Ltd (1976 Rules), Procedural Order, reprinted in section 3(C)(1). Despite the ICS Tribunal's recognition of the limitations on its assertion of authority, the authors regard the view expressed in this opinion as overly broad.

105  This is a generally accepted principle in international arbitration law and theory. See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 180–1; K H Böckstiegel, “The Relevance of National Arbitration Law,” n 28, 230–1; P Sanders, n 60, 195; G Sacerdoti, “The New Arbitration Rules of ICC and UNCITRAL,” (1977) 11 J World Trade L 2 (on the standard adopted in the New York Convention of 1958); W Park, “The Lex loci Arbitri and International Commercial Arbitration,” (1983) 32 ICLQ 21, 23; F Mann, “Lex Facit Arbitrum,” in P Sanders (ed), International Arbitration—Liber Amicorum for Martin Domke (1967) 157, 160–1.

106  See K Böckstiegel, “The Relevance of National Arbitration Law,” n 28, 231; F Mann, “Lex Facit Arbitrum,” n 105, 161. See also M Ferrante, “About the nature (national or a-national, contractual or jurisdictional) of ICC awards under the New York Convention,” in J Schultsz and A van den Berg (eds), The Art of Arbitration (1982) 129, 134–5; and Y Derains, “France as a Place for International Arbitration,” in The Art of Arbitration, 111, 112. See also M Aden, Internationale Handelsschiedsgerichtbarkeit, n 778, 24.

107  A Redfern and M Hunter, Law and Practice of International Commercial Arbitration (2nd edn 1991) 88. See also W Craig “Uses and Abuses of Appeal from Awards,” n 79, 180 (“The State where the arbitration takes place has the power to regulate how an arbitration procedure shall be held on its territory or, for that matter, whether it shall be held at all.”).

108  In practice this has not been frequently done either. See A J van den Berg, The New York Arbitration Convention of 1958: Towards a Uniform Judicial Interpretation (1981) 292.

109  See, eg, W Craig, “Uses and Abuses of Appeal from Awards,” n 79, 183.

110  On the concept of “a-national” (also called “floating” or “delocalised”) arbitration, as well as on pros and cons regarding that concept, see generally G Petrochilos, Procedural Law in International Arbitration (2004), Chapter 8; A Avanessian, Iran-US Claims Tribunal in Action (1993) 283–90; W Park, “Judicial Controls in the Arbitral Process,” (1991) 3 Arb Intl 230, 242–54; J Paulsson, “Delocalisation of International Commercial Arbitration; When and Why it Matters,” (1983) 32 ICLQ 53; N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 180–1; S Toope, Mixed International Arbitration (1990) 17 et seq.

111  K H Böckstiegel, “The Relevance of National Arbitration Law,” n 28, 230. This, however, is not the interpretation preferred by Böckstiegel himself.

112  But see the Belgian law on international arbitration as discussed in connection with Article 18(1). See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 191.

113  See n 78 and n 79.

114  See P Sanders, The Work of UNCITRAL on Arbitration and Conciliation (2nd rev edn 2004) 173–4; N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 33–4; W Craig, W Park, J Paulsson, International Chamber of Commerce Arbitration (3rd edn 2000) 311.

115  See, eg, 2001 WIPO Arbitration Rules, art 52; 1998 LCIA Rules, art 30.1; 2010 AAA Rules, Rule 34. For Professor Sanders's views on supplementing the Rules with provisions on confidentiality, see P Sanders, “Has the Moment Come to Revise the Arbitration Rules of UNCITRAL?” (2004) 20(3) Arb Intl 243, 266–7.

116  The UNCITRAL Notes observe: “there is no uniform answer in national laws as to the extent to which the participants in an arbitration are under the duty to observe the confidentiality of information relating to the case.” UNCITRAL Notes, n 68, para 31.

117  See Ali Shipping Corporation v Shipyard Trogir [1999] 1 Weekly L Rep 314. Limitations on the general duty of confidentiality with respect to the award are set forth in Associated Electric and Gas Insurance Ltd v The European Reinsurance Company of Zurich [2003] UKPC 11.

118  Esso Australia Resources Lt and ors v The Honourable Sidney James Plowman and ors (1995) 128 Australian L Rep 391, (1995) 183 Commonwealth Reports 10; United States v Panhandle Eastern Corp, (1988) 118 Federal Rules Decisions 346 (D Del); AI Trade Finance Inc v Bulgarian Foreign Trade Bank Ltd, [1998] Stockholm City Court, Case No T-111–98.

119  Panhandle, 118 Federal Rules Decisions at 349–50.

120  According to the NAFTA Notes of Interpretation of Certain Chapter 11 Provisions:

Nothing in the NAFTA imposes a general duty of confidentiality on the disputing parties to a Chapter Eleven arbitration, and, subject to the application of Article 1137(4), nothing in the NAFTA precludes the Parties from providing public access to documents submitted to, or issued by a Chapter Eleven tribunal. In ICSID arbitration, the ICSID system does not expressly require the parties to keep awards confidential.

Notes of Interpretation, section A(1), adopted by NAFTA Free Trade Commission on July 31, 2001, reprinted in (2001) 13(6) World Trade & Arb Materials 139. See also M Stevens, “Revisiting Confidentiality,” News from ICSID, Spring 2000 (vol 17(1)).

121  New Zealand's Arbitration law provides:

14. Disclosure of information relating to arbitral proceedings and award prohibited

  1. (1)  Subject to subsection (2), an arbitration agreement, unless otherwise agreed by the parties, is deemed to provide that the parties shall not publish, disclose, or communicate any information relating to arbitral proceedings under the agreement or to an award made in these proceedings.

  2. (2)  Nothing in subsection (1) prevents the publication, disclosure, or communication of information referred to in that subsection

    1. (a)  If the publication, disclosure, or communication is contemplated by this Act; or

    2. (b)  To a professional or other adviser of any of the parties.

122  See, eg, Panhandle, 118 Federal Rules Decisions at 349–50.

123  Such a form may also include penalties for disclosure. See L Trakman, “Confidentiality in International Commercial Arbitration,” (2002) 18(1) Arb Intl 1, 9.

124  For example, in accordance with Articles 40 and 43 of the Rules, the arbitral tribunal may apportion the costs of additional proceedings caused by a breach of confidentiality to the breaching party. See Pope & Talbot Inc and Government of Canada, Decision (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven (September 27, 2000) (investor to pay costs of pleadings caused by breach of confidentiality by investor's counsel with understanding that investor's counsel was personally to assume all costs). Where confidentiality measures are in place and a party still refuses to produce information to the tribunal on grounds that it is sensitive, the arbitral tribunal may consider drawing an adverse inference against the defaulting party pursuant to Article 30(3).

125  UNCITRAL Notes, n 68, para 32 (numbers added). For an example of a comprehensive confidentiality order which defines the scope of protected information covered by the order, establishes procedures for designating material as protected and for resolving disputes concerning proposed designations, establishes procedures for withholding protected information from another party, addresses disclosures required by law, provides rules regarding the confidentiality of hearings, among other things, see William Ralph Clayton, et al and Government of Canada, Procedural Order No 2 (May 2, 2009) (PCA administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven).

126  Even then, as leading commentators observe, “the difficulty with confidentiality agreements becomes apparent if a document does become public knowledge. It will never be easy to establish which party is responsible for the document's release, and it may be difficult for the disclosing party to prove that it suffered loss as a result of any breach by its adversary.” E Gaillard and J Savage (eds) Fouchard, Gaillard, Goldman on International Arbitration (1999) 693. The confidentiality order and the third-party confidentiality agreement used in United Parcel Services (1976 Rules) are reprinted in section 3(C).

127  In the NAFTA context, for example, disclosure may be necessary pursuant to the US Freedom of Information Act or the Canadian Access to Information Act.

128  Department of Economic Policy and Development, City of Moscow v Bankers Trust Co. And Anr. (2004) EWCA 314 (Court of Appeal of England and Wales).

129  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 19, para 85; UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 25, para 130.

130  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 25, para 129.

131  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 19, para 86. One example in support of retaining maximum flexibility under the Rules with respect to confidentiality was that “contracts relating to intellectual property demanded a high degree of confidentiality.” UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 25, para 131.

132  See Methanex Corp (1976 Rules); United Parcel Services of America (1976 Rules); both reprinted in section 3(C)(2). In another case, the tribunal exercised its discretion by not accepting amicus submissions. See Chevron (1976 Rules), reprinted in section 3(C)(2). The disputing parties also can agree to allow amicus submissions. See Glamis Gold Ltd (1976 Rules), reprinted in section 3(C)(2). For further discussion, see generally L Mistelis, “Confidentiality and Third Party Participation: UPS v. Canada and Methanex Corp v. United States” in T Weiler (ed) International Investment Law and Arbitration: Leading Cases from the ICSID, NAFTA, Bilateral Treaties and Customary International Law (2005) 183 et seq.

133  See 1983 Rules of Procedural of the Iran–US Claims Tribunal, Note 5 to art 15, reprinted in Appendix 5. In Case No A/17 between the United States and Iran, the Tribunal applied Note 5 to permit a third-party financial institution to attend Tribunal hearings. United States of America and Islamic Republic of Iran, Decision No DEC 37-A17-FT (May 13, 1985), reprinted in 8 Iran-US CTR 189, 191 n 5 (1985-I). See also United Parcel Services of America (1976 Rules), para 64, reprinted in section 3(C) (citing the practice of the WTO and distinguishing that of the ICJ). UNCITRAL has also recognized that Article 15(1) of the 1976 UNCITRAL Rules, now Article 17(1) of the 2010 UNCITRAL Rules, “could be interpreted as encompassing power of the arbitral tribunal to accept [third-party] interventions, for example in the form of amicus curiae briefs.” Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.143 at 15, para 69 (2006).

134  For example, in United Parcel Services of America, the tribunal deemed amicus submissions on the questions of jurisdiction and the place of arbitration inappropriate. United Parcel Services of America (1976 Rules), para 71, reprinted in section 3(C)(2).

135  According to UNCITRAL, “[w]hile ensuring the privacy of proceedings does not necessarily also ensure confidentiality, privacy assists by limiting the number of people who have access to the arbitration hearing.” Possible Future Work, n 59, para 63.

136  Most arbitral institutions facilitate the exclusivity of commercial arbitration by employing strict internal rules and measures on privacy.

137  United Parcel Services of America (1976 Rules), para 70, reprinted in section 3(C)(2).

138  For a general discussion of the work of UNCITRAL in this area, see Chapter 1, section 3(G).

139  Report of the Working Group on Arbitration and Conciliation on the Work of its Fifty-Fifth Session (Vienna, 3–7 October 2011), UNCITRAL, 45th Session, UN Doc A/CN.9/736, at 15, para 70 (2011).

140  Settlement of Commercial Disputes: Preparation of a Legal Standard on Transparency in Treaty-Based Investor-State Arbitration, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.169 at 12, para 37 (2011).

141  Thus the Bill on the applicability of Dutch law to the Tribunal proceedings would have governed only the cases mentioned in Article II(1) of the Claims Settlement Declaration (“ … Claims of nationals of the United States against Iran and claims of nationals of Iran against the United States, and any counterclaim which arises out of the same contract, transaction or occurrence … ”).

142  See W Lake and J Tucker Dana, “Judicial Review of Awards of the Iran-United States Claims Tribunal: Are the Tribunal's Awards Dutch?” (1984) 16 Law and Policy in Intl Business 755, 771–3.

143  See W Lake and J Tucker Dana, “Judicial Review of Awards,” n 142, 733–80; See also n 111.

144  For an example of a case (not decided by the Iran–US Claims Tribunal) in which the tribunal has explicitly addressed the question of compatibility of its proceedings with mandatory local law, see Wintershall AG (1976 Rules), reprinted in section 4(C) (under Article 18).

145  Amman & Whitney (1983 Tribunal Rules), reprinted in section 3(D)(1).

146  Fedders Corp (1983 Tribunal Rules), reprinted in section 3(D)(1).

147  An English translation can be found in (July 15, 1983) Iranian Assets Litigation Rep 6,899. On the contents of the Bill, see also W Lake and J Tucker Dana, “Judicial Review of Awards,” n 142, 783–6.

148  The Bill was criticized basically on two grounds: first, for facilitating the enforceability of the awards, as Dutch arbitral awards, under the New York Convention and, second, for limiting the grounds of challenge against the awards so as to make the setting aside of them a very unlikely possibility. Letter of Mohammed K Eshragh, the Agent of the Islamic Republic of Iran before the Iran–US Claims Tribunal to the Dutch Ministry of Foreign Affairs of February 24, 1984, reprinted in Mealey's Litigation Reporter 394 (April 6, 1984). See also W Lake and J Tucker Dana, “Judicial Review of Awards,” n 142, 778, 786–7.

149  W Lake and J Tucker Dana, “Judicial Review of Awards,” n 142, 759 et seq.

150  See L Hardenberg, “The Awards of the Iran-United States Claims Tribunal Seen in Connection with the Law of the Netherlands,” (September 1984) Intl Business Lawyer 337. See A J van den Berg, “Proposed Dutch Law on the Iran-U.S. Claims Settlement Declaration—A Reaction to Mr. Hardenberg's Article,” (September 1984) Intl Business Lawyer 341.

151  W Lake and J Tucker Dana, “Judicial Review of Awards,” n 142, 778.

152  A J van den Berg, “Proposed Dutch Law,”, n 150, 343. See also A J van den Berg, The New York Convention, n 108, 34–40. Support for this argument is believed to be found, inter alia, in Article V(1)(d) of the Convention, according to which the recognition and enforcement of an award may be refused if the “composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties, or, failing such agreement, was not in accordance with the law of the country where the arbitration took place.” See A J van den Berg, The New York Convention, n 108, 34–9 (emphasis added).

153  W Craig, “Uses and Abuses of Appeal from Awards,” n 79, 201. Indeed, Article V(1) (d) of the New York Convention relied on by the authors referred to in the previous note can also be construed as envisaging control by national law and party agreement as alternatives. Moreover, an award not subject to judicial control at the seat of arbitration as such is not excluded by the basic definition contained in Article 1(1) of the Convention: “This Convention shall apply to the recognition and enforcement of arbitral awards made in the territory of a State other than the State where the recognition and enforcement of such awards are sought ….” For views favoring the enforceability under the New York Convention of awards not subject to the law of the place of arbitration, see W Lake and J Tucker Dana, “Judicial Review of Awards,” n 142, 789 et seq.; V Saario, “Asianosaisautonomia kansainväliseen kauppaan liittyvässä välimiesmenettelyssä” (Party Autonomy in International Commercial Arbitration), in Finnish, in Juhlajulkaisu (Essays in Honor of) Matti Ylöstalo (1987) 341, 345.

154  W Lake and J Tucker Dana, “Judicial Review of Awards,” n 142, 778.

155  Gould Marketing Inc and Ministry of Defence of the Islamic Republic of Iran, Award No 136–49/50 (June 29, 1984), reprinted in 6 Iran-US CTR 272 (1984-II).

156  See Chapter 1 section 2(B)(1).

157  Islamic Republic of Iran and United States of America, Decision No DEC 62-A21-FT (May 4, 1987), reprinted in 14 Iran-US CTR 324 (1987–1). The Tribunal, however, held that it is “incumbent on each State Party to provide some procedure or mechanism whereby enforcement may be obtained within its national jurisdiction, and to ensure that the successful party has access thereto.” Para 15, 14 Iran-US CTR 331 (1987–1).

158  Ministry of Defence of the Islamic Republic of Iran v Gould, Inc, CV 87–03673 RG, Order of January 14, 1988, reprinted in (1988) Mealey's Intl Arb Rep 3.

159  Ministry of Defence of the Islamic Republic of Iran v Gould Inc, Decision filed October 23, 1989, [1989] CDOS 7832.

160  The District Court concluded that the award could not be recognized and enforced on the basis of “federal question jurisdiction.” On this question, which essentially turned on whether the Algiers Accords are “self-executing,” see the 14 January Order, n 158, 4–5, and R Lewis, “What Goes Around Comes Around: Can Iran Enforce Awards of the Iran–US Claims Tribunal in the United States,” (1987) 26 Columbia J Transnatl L 515, 528–49. The Court of Appeal did not reach the question, because it held that jurisdiction existed under section 203 of the Federal Arbitration Act concerning the New York Convention. Ministry of Defence of the Islamic Republic of Iran v Gould Inc, [1989] CDOS at 7836.

161  New York Convention, art II(1).

162  See Ministry of Defence of the Islamic Republic of Iran v Gould, Inc, [1989] CDOS at 7835. The Court of Appeal distinguished the English case Dallal v Bank Mellat, Queens Bench Division (Commercial Court), [1986] 1 All ER 239, in which what appears to be a contrary conclusion concerning the arbitration agreement was reached. In Dallal, the Tribunal award was, however, recognized on the basis of “international comity,” as a consequence of which the claim before the English Court was struck out. For the award by the Tribunal, see Dallal and Islamic Republic of Iran, Award No 53–149–1 (June 10, 1983), reprinted in 3 Iran-US CTR 10 (1983-III).

163  Gould, Inc, at 7835.

164  Gould, Inc, at 7835.

165  Gould, Inc, at 7836.

166  Iran Aircraft Industries and Iran Helicopter Support and Renewal Company v Avco Corporation, 980 F 2d 141 (US Ct of Apps 2nd Cir, 1992), reprinted in (1992) 7(12) Mealey's Intl Arb Rep A-1.

167  Avco, at A-6.

168  Avco, at A-5.

169  Certain of Avco's claims were based on a large number of invoices which were not presented to the Tribunal. At the pre-hearing conference held in May 1985 Avco was notified by the then Chairman of the Chamber, Judge Mangård, that the Tribunal was not “very much enthusiastic” (at A-3) about getting all the invoices, but that Avco should have an independent audit of the invoices. In its Award of 18 July 1988, the Tribunal, in a different composition, held—as stated with regard to one of the claims in question—that it “cannot grant Avco's claim solely on the basis of an affidavit and a list of invoices, even if the existence of the invoices was certified by an independent audit.” Avco Corp and Iran Aircraft Industries, Award No 377–261–3 (July 18, 1988), reprinted in 19 Iran-US CTR 200, 214 (1988-II). Respondents (and Counterclaimants) Iran Aircraft Industries and Iran Helicopter Support and Renewal Co were awarded $ 3.5 million (against the dissent of Judge Brower, at 231).

170  As long as awards against Iran are satisfied from the Security Account, this control, of course, may only work in favor of unsuccessful American parties before the Tribunal. This lack of balance is compensated only to a very limited extent by the control exercised in connection with payments made by the Federal Reserve to American claimants. In Gordon Williams, Award No 342–187–3 (December 18, 1987), reprinted in 17 Iran-US CTR 269 (1987-III), in which the named claimant turned out to be a fictitious entity created by an Iranian national, no payment was made. The funds were returned to The Hague after a US court had concluded that the award had been obtained by fraud. See D Bederman, “Nationality of Individual Claimants before the Iran-United States Claims Tribunal,” (1993) 42 ICLQ 119, 121.

171  Although the question is open in light of the case law, much can be said in favor of the view that the Tribunal proceedings are governed by the Dutch legal system. For an extensive analysis to this effect, see D Caron, “The Nature of the Iran-United States Claims Tribunal and the Evolving Structure of International Dispute Resolution,” (1990) 84 AJIL 104. See also Chapter 10. For further discussion on this question, see S Toope, Mixed International Arbitration, n 110, 263 et seq.; A Avanessian, Iran-US Claims Tribunal in Action, n 110, 272 et seq.; and D Jones, “The Iran-United States Claims Tribunal: Private Rights and State Responsibility,” (1984) 24 Virginia J Intl L 259.

172  The question is addressed in detail in section 5 of Chapter 26 on inherent power to reconsider.

173  Ram Intl Industries and Air Force of the Islamic Republic of Iran, Decision No DEC 118–148–1 (December 28, 1993), para 20 (footnote omitted). See also Cherafat (1983 Tribunal Rules), reprinted in section 3(D)(1). The Gordon Williams Award, n 170, has not been vacated by the Tribunal. See also A Mouri, “Striking a Balance between the Finality of Award and the Right to a Fair Judgment: What is the Contribution of the Iran-United States Claims Tribunal?” (1993) IV Finnish Ybk Intl L 1.

174  K H Böckstiegel, “The Relevance of National Arbitration Law,” n 28, 232.

175  See P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, 195; M Aden, Internationale Handelsschiedsgerichtbarkeit, n 778, 50–1.

176  In this particular respect resort may be had to the supplementary IBA Rules on the Taking of Evidence in International Commercial Arbitration. See Introduction to Chapter 18 on Article 27.

177  For the text of Note 5 of the 1983 Rules of Procedure of the Iran—US Claims Tribunal, see Appendix 5. For the application, see Drucker (1983 Tribunal Rules); and E-Systems (1983 Tribunal Rules); both reprinted in section 3(D)(1). For a general discussion of the involvement of non-disputing parties, such as amicus curiae, see section 3(B)(1)(c).

178  In 1982 UNCITRAL adopted certain guidelines for both arbitral and related institutions willing to conduct administered arbitration under the UNCITRAL Rules and those ready to take a more limited role as appointing authority and a provider of administrative services. See Recommendations to Assist Arbitral Institutions and Other Interested Bodies with regard to Arbitrations under the UNCITRAL Arbitration Rules, reprinted in (1982) XIII UNCITRAL Ybk 420, and in I Dore, Arbitration and Conciliation under the UNCITRAL Rules: A textual Analysis, Appendix 3 (1986). See also Chapter 1.

179  2010 UNCITRAL Arbitration Rules, art 25.

180  For the origins of the rule, see J Paulsson and G Petrochilos, “Revision of the UNCITRAL Rules,” (A Report Commissioned by the UNCITRAL Secretariat), March 31, 2006, at 63–4.

181  Report of Working Group II (Arbitration and Conciliation) on the Work of its Fifty-Second Session (New York, 1–5 February 2010), UNCITRAL, 43rd Session, UN Doc A/CN.9/688, at 19, para 85 (2010).

182  G Born, International Commercial Arbitration (2009) 1813–15.

183  D Kozlowska notes that a provisional timetable is important to the organization, inter alia, of issues regarding electronic evidence. D Kozlowska, “The Revised UNCITRAL Arbitration Rules Seen through the Prism of Electronic Disclosure,” (2011) 28(1) J Intl Arb 58–61.

184  However, there is an important balance: “[t]he arbitral tribunal may put pressure on the parties to tailor their presentations to fit within an agreed timetable; but each party must be allowed a reasonable period of time in which to present its case” N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 299.

185  The UNCITRAL Rules leave broad discretion to the arbitral tribunal to schedule procedural conferences. Indeed, a proposal to revise the Rules by expressly allowing the arbitral tribunal to “hold one or more procedural conferences with the parties at any appropriate stage in the arbitral proceedings, was rejected as it was said to “overregulate the matter.” Report of Working Group II (Arbitration and Conciliation) on the Work of its Fifty-Second Session (New York, 1–5 February 2010), UNCITRAL, 43rd Session, UN Doc A/CN.9/688, at 19, para 90 (2010).

186  Note that Article 25 of the Rules, discussed in Chapter 16 section 3, is more limited in scope, allowing the arbitral tribunal to extend, but not abridge, the time limits for the communication of written statements beyond 45 days.

187  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 10, para 41.

188  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 10, para 44. See J Castello, “UNCITRAL Rules,” n 34, 1469. It should be noted that some Working Group delegates believed such a provision was unnecessary because the modification of time periods under the Rules was an inherent power of the tribunal. UNCITRAL, 40th Session, UN Doc A/CN.9/614, at 10, para 43.

189  As Webster notes, Article 17(2) does not apply to the parties’ agreement on non-timing issues, such as an agreement to bifurcate issues of liability and quantum. T Webster, Handbook of UNCITRAL Arbitration: Commentary, Precedents and Materials for UNCITRAL Based Arbitration Rules (2010) 277n 28.

190  Naturally, these powers do not apply before constitution of the tribunal, as only the “arbitral tribunal” may modify time periods. One proposal before the Working Group was to grant the appointing authority the power to modify time periods pending constitution of the arbitral tribunal, but concerns were expressed that this power might create the risk of delaying the tribunal's constitution. UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 26, para 135. However, time periods relevant to the replacement of an arbitrator would be covered.

191  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 26, para 135; UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 23–4, para 124.

192  UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 23–4, paras. 124–25. See also UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 26, para 135 (noting a suggestion that the arbitral tribunal “should be required to provide reasons justifying any change to the procedural time periods”).

193  “The Working Group agreed that the Rules should establish the authority of the arbitral tribunal to modify the periods of time prescribed in the Rules but not to alter the general time frames that might be set by the parties in their agreements without prior consultation with the parties.” UNCITRAL, 40th Session, UN Doc A/CN.9/619, at 26, para 136.

194  In Working Group discussions, it was said that the right to express views “applied in many different instances under the Rules, and it might be awkward to expressly refer to that right in [Article 17(2)] only.” UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 23, paras 122.

195  UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 23, para 122.

196  For the Working Group's discussion on this issue, see UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 23, para 121.

197  See Report of the Secretary-General on the Preliminary Draft Set of Arbitration Rules, UNCITRAL, 8th Session, UN Doc A/CN.9/97 (1974), reprinted in (1975) VI UNCITRAL Ybk 163, 173 (Draft Articles 13(2) and (3) of the 1976 Rules).

198  See Report of the Secretary-General on the Preliminary Draft Set of Arbitration Rules, UNCITRAL, 8th Session, Addendum 2 (Suggested Modifications), UN Doc A/CN.9/97/Add 2, para 15 (1975), reprinted in (1975) VI UNCITRAL Ybk 182, 183. See also Summary Record of the 6th Meeting of the Committee of the Whole (II), UNCITRAL, 9th Session, UN Doc A/CN.9/9/C.2/SR.6, at 2–4, paras 9–28 (1976).

199  Article 24(1) of the Model Law, as amended, provides:

Subject to any contrary agreement by the parties, the arbitral tribunal shall decide whether to hold oral hearings for the presentation of evidence or for oral argument, or whether the proceedings shall be conducted on the basis of documents and other materials. However, unless the parties have agreed that no hearings shall be held, the arbitral tribunal shall hold such hearings at an appropriate stage of the proceedings, if so requested by a party.

200  H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 673.

201  See Chapter 19 on Article 28.

202  See, eg, Guaracachi America Inc, et al and Plurinational State of Bolivia, Terms of Appointment and Procedural Order No 1 (PCA administered, 2010 UNCITRAL Rules, US-Bolivia BIT/UK-Bolivia BIT), para 13 (establishing procedures for allowing Party witnesses to testify).

203  Summary Record of the 6th Meeting of the Committee of the Whole (II), UNCITRAL, 9th Session, UN Doc A/CN.9/9/C.2/SR.6, at 4, para 24 (1976) (Comment by Mr Lebedev, USSR).

204  See 1983 Rules of Procedure of the Iran–US Claims Tribunal, Note 2 to Article 17, reprinted in Appendix 5.

205  See Component Builders (1983 Tribunal Rules), reprinted in section 3(D)(2). But see Ninni Ladjevardi (1983 Tribunal Rules), reprinted in section 3(D)(2).

206  See n 78 and n 79.

207  H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 674.

208  See Report of the Secretary-General on the Preliminary Draft Set of Arbitration Rules, UNCITRAL, 8th Session, Addendum 2 (Suggested Modifications), UN Doc A/CN.9/97/Add. 2, para 15 (1975), reprinted in (1975) VI UNCITRAL Ybk 182, 183; see generally Chapter 27, section 4 on apportionment of costs.

209  See Tchacosh Co (1983 Tribunal Rules), reprinted in section 3(D)(2), and the other case mentioned therein. See also J van Hof, Commentary on the UNCITRAL Arbitration Rules, n 9, 107.

210  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 17, para 77.

211  J Castello notes that the changes were necessary because the Rules had been written in such a way that “parties could invoke them for an abusive purpose—for example, to delay an award by seeking an unnecessary additional hearing very late in the proceedings,” J Castello, “Unveiling the 2010 UNCITRAL Arbitration Rules,” (2010) 65(2/3) Dispute Resolution J 21, 152.

212  See Tchacosh Co (1983 Tribunal Rules), reprinted in section 3(D)(2). See Sylvania Technical Systems (1983 Tribunal Rules); and World Farmers Trading (1983 Tribunal Rules); both reprinted in section 3(D)(2).

213  N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 371.

214  1983 Rules of Procedure of the Iran–US Claims Tribunal, reprinted in Appendix 5. Although “pre-hearing conferences” or the like find their basis in Article 17(1) rather than 17(3), they can conveniently be discussed in connection with hearings.

215  See Phelps Dodge Corp (1983 Tribunal Rules), reprinted in section 3(D)(2).

216  See The Austin Co (1983 Tribunal Rules), reprinted in section 3(D)(2). See generally J Selby and D Stewart, “Practical Aspects of Arbitrating Claims,” n 101, 222–6 and S Baker and M Davis, The UNCITRAL Arbitration Rules in Practice, n 9, 123 (“The purported goals of pre-hearing conferences at the Tribunal were twofold: (1) to allow parties to exchange views; and (2) to narrow and clarify issues.”).

217 There are differing views on the usefulness of the pre-hearing conferences at the Tribunal, and their utility would appear to depend on the particular circumstances of each case. See, on the one hand, J Selby and D Stewart, “Practical Aspects of Arbitrating Claims,” n 101, 222, according to whom the utility of the conferences “is in many cases doubtful,” and, on the other, S Belland, “The Iran-United States Claims Tribunal: Some Reflections on Trying a Claim,” (1984) 1 J Intl Arb 240–41, who regards the pre-hearing conference as “a good idea” and the guidance afforded by comments made during it as “invaluable.” In simple cases, especially where it is clear that a hearing is going to be held, they may be unnecessary. In more complex cases they may be useful both to the parties and the arbitrators, for example, to determine whether some jurisdictional or other preliminary question deserves to be treated separately. See Tai Inc (1983 Tribunal Rules); and Islamic Republic of Iran and United States of America (Case Nos A3, A8, A9, A14 and B16) (1983 Tribunal Rules), Order of December 3, 1992; both reprinted in section 3(D)(2).

218  See Tai Inc (1983 Tribunal Rules), reprinted in section 3(D)(2). The additional benefits of a pre-hearing conference are described in P Sanders, The Work of UNCITRAL on Arbitration and Conciliation, n 95, 7–8.

219  See Report of the Secretary-General on the Preliminary Draft Set of Arbitration Rules, UNCITRAL, 8th Session, UN Doc A/CN.9/97 (1974), reprinted in (1975) VI UNCITRAL Ybk 163, 173 (Commentary of Draft Article 13(4)).

220  The word “communications” replaced the words “documents or information” used in corresponding Article 15(3) of the 1976 UNCITRAL Rules, but without any intended change in meaning. Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.151 at 15–16, para 36 (2008).

221  See J Thieffry, “The Finality of Awards,” n 94, 44–5.

222  See Note 3 to Article 15 of the 1983 Rules of Procedure of the Iran–US Claims Tribunal, reprinted in Appendix 5. See also Chapter 12.

223  Article 24(3) of the Model Law, as amended, reads as follows: “[a]ll statements, documents or other information supplied to the arbitral tribunal by one party shall be communicated to the other party. Also any expert report or evidentiary document on which the arbitral tribunal may rely in making its decision shall be communicated to the parties.” The wording of the first sentence differs from that of Article 15(3) of the 1976 UNCITRAL Rules “in order to accommodate the practices of some arbitral institutions, under which documents are sent first to the institution or the tribunal which then transmits them to the arbitrators and the other party.” H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 674.

224  UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 24, para 127. See also Chapter 17.

225  For a general discussion on joinder, see G Born, International Commercial Arbitration, n 182, 2073 et seq.

226  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 39.

227  Commentators have noted that “[i]n practice, an application for joinder will therefore require both a hearing and an interim award” M Skinner et al, “The UNCITRAL Arbitration Rules 2010” (2011) 7(1) Asian Intl Arb J 76.

228  In deciding to add a rule on joinder, the Working Group closely considered the practice of the International Court of Arbitration of the International Chamber of Commerce, the London Court of International Arbitration, and the Swiss Arbitration Association. There has been very little publicly available practice on joinder under the 1976 UNCITRAL Rules. For a description of an unpublished ad hoc UNCITRAL award in which the tribunal ordered joinder over the respondents’ objections, see M de Boisséson, “Joinder of Parties to Arbitral Proceedings: Two Contrasting Decisions,” in (2003) ICC Bulletin: Complex Arbitration (Special Supplement) 23.

229  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, at 105 (“The tribunal's jurisdiction derives from the will of the parties to the arbitration agreement and therefore joinder or intervention is generally only possible with the consent of all parties concerned.”).

230  See G Born, International Commercial Arbitration, n 182, 2074–5 (“In the context of recognizing arbitral awards, Article V(1)(d) of the [New York] Convention provides for the non-recognition of awards that are rendered following arbitral proceedings where consolidation, joinder, or intervention was ordered, notwithstanding an arbitration agreement that did not permit such actions.”).

231  J Castello, “UNCITRAL Rules,” n 34, 1470.

232  UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 24–25, para 130. Further, a third person to be joined need not provide its specific consent to a request for joinder. This is clear from the travaux préparatoires, which report that a proposal in which the words “provided such person is a party to the arbitration agreement” was followed by “and has consented to be joined” was rejected out of concerns that it would empower the third person to veto a request for joinder, even if it were a party to the arbitration agreement, thus hampering operation of Article 17(5).

233  Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.147/Add.1 at 3, para 5 (2007) (Draft Article 15(4)).

234  P Turner and R Mohtashami, A Guide to the LCIA Arbitration Rules (2009) 149 (commenting that Article 22.1(h) provides “an express power to join third parties who may not necessarily be parties to the arbitration agreement.”).

235  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 24, para 122.

236  Castello and Digon note also that the Working Group's conservative approach flowed from the apparent paucity of practice on joinder under the LCIA and Swiss Rules. As they explain: “[T]he cold facts about how rarely the LCIA and Swiss Rules provisions had been used gave delegates further pause about the risks of innovating too far on the subject of joinder ….” J Castello and R Digon, “Maximizing Possibilities for Joinder in International Arbitration,” forthcoming in A Rovine (ed) Contemporary Issues in International Arbitration and Mediation: The Fordham Papers (2011) (2012) 116.

237  UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 24, para 129.

238  The travaux préparatoires state: “Concerns were expressed that the absence of explicit consent of a party to be joined might entail the consequence that, at the stage of recognition and enforcement of the arbitral award, the party so joined might raise the argument that it did not participate in the constitution of the arbitral tribunal, and therefore the arbitral tribunal was not composed in accordance with the agreement of the parties.” UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 25, para 131. The source of such a challenge could be Article 36(1)(a)(iv) of the Model Law and/or Article V(1)(d) of the New York Convention. In one case, for example, an award was set aside because, pursuant to an arbitration agreement, multiple respondents had to compromise in choosing an arbitrator or have the arbitrator chosen by an appointing authority, and this arrangement was determined to violate the principle of equal treatment of the parties. See Sociétés BKMI et Siemens c/Société Dutco, Cour de Cassation (January 7, 1992), reprinted in (1993) 18 Ybk of Commercial Arb 140.

239  UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 24–5, para 130.

240  As to third persons to be joined, Castello and Digon identify multiple reasons why joinder may not cause prejudice: (1) when all parties agree to the joinder; (2) when an appointing authority has appointed the tribunal, thus putting all parties in the same position of non-participation; (3) when the new party's interests are closely aligned with those of an original party; and (4) when a respondent seeking to join a jointly and severally liable co-respondent agrees to replace a previously designated party-appointed arbitrator with a jointly-appointed new arbitrator. J Castello and R Digon, “Maximizing Possibilities for Joinder,” n 236, 118.

241  UNCITRAL, 43rd Session, UN Doc A/CN.9/688, n 181, at 19, para 88. An earlier proposal was to add language, such as “all circumstances that the arbitral tribunal deems relevant and applicable,” along the lines of Article 4.2 of the Swiss Rules of International Arbitration. UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 25, para 134.

242  UNCITRAL, 43rd Session, UN Doc A/CN.9/688, n 21, at 19, para 88.

243  For general discussion of the ICC rule, see Y Derains and E Schwartz, A Guide to the New ICC Rules of Arbitration (2005) 62–5. For recent practice of the ICC on consolidation, see A M Whitesell and E Silva-Romero, “Multiparty and Multicontract Arbitration: Recent ICC Experience,” (2003) ICC Bulletin: Complex Arbitrations (Special Supplement).

244  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 23, para 117.

245  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 23, para 117.

246  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 23, para 119.

247  It was also recognized that a respondent could raise a counterclaim under Article 19(3).

248  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 23, para 119.

249  Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.145/Add.1 at 2–3, para 5 (2006) (Draft Article 15(4)(a)).

250  Some delegations maintained that a consolidation provision “should be carefully drafted in order to clarify that consolidation would only be possible if either the claim was already subject to the UNCITRAL Rules, or the parties expressly agreed that the claim should be subject to consolidation.” UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 23, para 118.

251  See, eg, Dominican Republic–Central America–United States Free Trade Agreement (CAFTA-DR), art 10.25.

252  See J Castello, “UNCITRAL Rules,” n 34, 1468; D Kozlowska, “The Revised UNCITRAL Arbitration Rules Seen through the Prism of Electronic Disclosure” (2011), 28(1) J Intl Arb 51, 53–6.

253  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 17, para 76.

254  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 17, para 76.

255  Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.151 at 15–16, para 36 (2008).

256 Corresponding Article 16 of the 1976 UNCITRAL Rule provides:

  1. 1. Unless the parties have agreed upon the place where the arbitration is to be held, such place shall be determined by the arbitral tribunal, having regard to the circumstances of the arbitration.

  2. 2. The arbitral tribunal may determine the locale of the arbitration within the country agreed upon by the parties. It may hear witnesses and hold meetings for consultation among its members at any place it deems appropriate, having regard to the circumstances of the arbitration.

  3. 3. The arbitral tribunal may meet at any place it deems appropriate for the inspection of goods, other property or documents. The parties shall be given sufficient notice to enable them to be present at such inspection.

  4. 4. The award shall be made at the place of arbitration.

    Article 16 was adopted by the Iran–US Claims Tribunal without modification.

257  See E Gaillard and J Savage, Fouchard, Gaillard, Goldman, n 126, 651. For general discussion on the place of arbitration, see M Storme and F De Ly, The Place of Arbitration (1992); Y Derains, “The Choice of the Place of Arbitration,” (1986) Intl Business L J 109. See also Report of the Secretary-General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Addendum 1 (Commentary), UN Doc A/CN.9/112/Add.1 (1975), reprinted in (1976) VII UNCITRAL Ybk 166, 172 (Commentary on Draft Article 15(4)). Article 16(4) of the 1976 UNCITRAL Rules may be read as equating the place “where the award is made” with the “place of arbitration.”

For a general discussion on the impact that the seat of arbitration has on the lex arbitri see L Mistelis, “Reality Test: Current State of Affairs in Theory and Practice Relating to ‘Lex Arbitri’” (2006) 17 American Rev Intl Arb 172–74.

258  The choice of the law governing the procedure, of course, may be different from the law governing the substance of the dispute.

259  As one example leading practitioners identify the power of local courts or arbitrators to consolidate arbitral claims. N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 177–8 (citing Article 1046 of the Netherlands Arbitration Act 1986).

260  2010 UNCITRAL Arbitration Rules, art 1(1).

261  G Born, International Commercial Arbitration, n 182, 1248. See also A J van den Berg, “Organizing an International Arbitration: Practice Pointers,” in L Newman and R Hill (eds) The Leading Arbitrators’ Guide to International Arbitration (2004) 182.

262  See Methanex Corp and United States of America, Order on the Place of Arbitration (September 7, 2000) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 3, para 2 (observing that “[corresponding] Article 16(1)[of the 1976 UNCITRAL Rules] refers to the legal place or seat of the arbitration as distinct from the geographical place of the arbitration's hearing or hearings and deliberations by the Tribunal”).

263  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 27, para 142. See also J Castello, “UNCITRAL Rules,” n 34, 1473 (“In using the word ‘location’ to identify alternative meeting sites, the Working Group hopes to reduce confusion by reserving the word ‘place’ to designate only where the arbitration is legally seated.”); J Levine, “Current Trends in International Arbitral Practice as Reflected in the Revision of the UNCITRAL Arbitration Rules” (2007) 14(1) U New South Wales L J 266, 274.

264  In other provisions of Article 16 of the 1976 UNCITRAL Rules, the “locale” of the arbitration and the “place” for the inspection of goods are referred to, which may cause additional confusion.

265  Paulsson and Petrochilos observe that “[t]he existing expression in the many cases creates the mistaken impression that the place chosen for occasional meetings is also the formal place of arbitration.” J Paulsson and G Petrochilos, “Revision of the UNCITRAL Rules,” (A Report Commissioned by the UNCITRAL Secretariat), March 31, 2006, at 12, para 141.

266  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 19, para 88; UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 27, para 139. Similarly, Article 16 of the 1998 LCIA Arbitration Rules uses the phrase “the seat (or legal place)” of arbitration.

267  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 19, para 88.

268  See G Born, International Commercial Arbitration, n 182, 1250 (noting synonymous terms like “seat, “place,” “situs,” and “forum,” but preferring “seat” because it avoids “the arguably geographical connotation of the ‘place’ of arbitration, and instead connotes an arbitration's connection to, or rootedness in, a legal regime”).

269  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 27, para 141.

270  According to the UNCITRAL Secretariat, a draft containing the phrase “place of arbitration” aims to “distinguish between the place of arbitration (meaning the legal seat) and the location where meetings could be held, in terms similar to those adopted under article 20 of the UNCITRAL Model Law on International Commercial Arbitration.” Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.151 at 17, para 38 (2008).

271  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 27, para 143.

272  See generally L Mistelis, “Reality Test,” n 257, 155, 158 (“Only to the extent that there is no express or clear reference to the lex arbitri in the arbitrational agreement or the contract of the parties, will the tribunal lastly attempt to find rules applicable to the arbitration.”).

273  H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” in Private Investors Abroad–Problems and Solutions in International Business (1977) 183, 189. A similar provision is found, inter alia, in Article 14(1) of the ICC Arbitration Rules, which provides: “The place of arbitration shall be fixed by the Court unless agreed upon by the parties,” and in Article 20(1) of the UNCITRAL Model Law, as amended, which provides: “The parties are free to agree on the place of arbitration. Failing such agreement, the place of arbitration shall be determined by the arbitral tribunal having regard to the circumstances of the case, including the convenience of the parties.”

274  In a recent NAFTA Chapter Eleven arbitration the parties, Glamis Gold Ltd and the United States of America, agreed on Washington, DC as the place of arbitration, in their Agreement on Certain Procedural Matters, dated January 20, 2004.

275  See P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, 194; K Rauh, Die Schieds- und Schlichtungs-Ordnungen der UNCITRAL 89 (1983).

276  See P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, 194.

277  See M Aden, Internationale Handelsschiedsgerichtbarkeit, n 778, 230.

278  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 114; H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 188–91; K Lionnet, “Erfahrungen mit der internationalen Schieds-gerichtsbarkeit im Anlagenbau aus der Sicht der Partei,” in K H Böckstiegel (ed), Vertragsgestaltung und Streiterledigung in der Bauindustrie und im Anlagenbau (1984) 291, 302. See the Model Arbitration Clause in n 1. See also Report of the Secretary General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Introduction, para 17, UN Doc A/CN.9/112 (1975), reprinted in (1976) VII UNCITRAL Ybk 157, 160.

279  UNCITRAL, 9th Session, Introduction, para 17, UN Doc A/CN.9/112. See also R David, Arbitration in International Trade (1985) 282.

280  UNCITRAL Notes, n 68, para 22.

281  One investor–state tribunal applying the 1976 UNCITRAL Rules has observed that “having regard to the circumstances of the arbitration,” means having regard to “all such circumstances, including those elements offered for consideration in paragraph 22 of the Notes, and without any individual circumstance being accorded paramount weight irrespective of its comparative merits.” Ethyl Corp and Government of Canada, Decision Regarding the Place of Arbitration, (November 28, 1997) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 4 (emphasis in the original).

282  See section 4(B)(1)–(3).

283  A Redfern and M Hunter, Law and Practice of International Commercial Arbitration (2nd edn 1991) 429.

284  See G Born, International Arbitration and Forum Selection Agreements: Drafting and Enforcing (3rd edn 2010) 67–8 (observing “the arbitral seat must have both national arbitration legislation and national courts that are hospitable to and supportive of international arbitration”).

285  See discussion concerning Article 17(1) in section 3(B)(1).

286  See Wintershall AG (1976 Rules), reprinted in section 4(C).

287  See K Böckstiegel, “The Relevance of National Arbitration Law,” n 28, 223–34.

288  Surveys on various domestic arbitration laws and regimes are conveniently located in the ICC publication Arbitration Law in Europe and in the ICCA publication, Ybk Commercial Arb, which cover national reports on the subject from 1976 to 1988, and The International Handbook on Commercial Arbitration, where the national reports are covered since 1989.

289  See H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 183.

290  See section 4(B)(2)(a)(2).

291  In general, see N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 123–35; H Arfazadeh, Ordre public et arbitrage international à l’épreuve de la mondialisation (2005) 79–109; H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 198–204; K Böckstiegel, “The Relevance of National Arbitration Law,” n 28, 234.

292  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 124; W Park, “Judicial Controls in the Arbitral Process,” (1991) 3 Arb Intl 230, 253–4. An important US decision confirming, in principle, the arbitrability of international antitrust disputes was rendered by the Supreme Court in 1985 in Mitsubishi v Soler, 473 US 614 (1985). For a comment, see S Jarvin, “Arbitrability of Anti-Trust Disputes: The Mitsubishi v Soler Case,” (1985) 2(3) J Intl Arb 69. See also PD O’Neill, Jr, “Recent Developments in International Commercial Arbitration: an American Perspective,” (1987) 4(1) J Intl Arb 7. See also R Brand, “International Trade Law and the Arbitration of Administrative Law Matters: Farrel Corp v US International Trade Commission,” (1993) 31 Columbia J Transnatl L 181.

293  N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 135.

294  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 135 (references to two cases involving an exclusive distributorship agreement and an international employment contract respectively).

295  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 109–10.

296  See n 340.

297  See H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 204–6.

298  Thus under the general rule of Saudi Arabian law an “arbitrator shall be a Saudi national or Muslim expatriate.” According to an authority on that law, what in this respect “is applicable in national arbitration is not necessarily so in international arbitration.” A El-Ahdab, “Arbitration in Saudi-Arabia under the New Arbitration Act, 1983 and its Implementation Rules of 1985,” Part One, (1986) 3(3) J Intl Arb 27 and Part Two, and at (No 4, 1986) 23. See also N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 259.

299  Further, see Chapter 3 on Article 35(1).

300  If no particular procedural law has been designated for the arbitration, the law of the place presumptively is also the law applicable to the interpretation of the UNCITRAL Rules. See M Aden, Internationale Handelsschiedsgerichtbarkeit, n 78, 34–5. This aspect, however, is likely to be of such a limited importance as not to play a role in the choice of the place.

301  As will be discussed later in this section, non-compliance with the mandatory rules of the law of the place of arbitration may also negatively influence the chances of having the award enforced in other jurisdictions.

302  For a comparative analysis of the appeal and review possibilities under the arbitration laws of selected countries, see D Kolkey, “Attacking Arbitral Awards: Rights of Appeal and Review in International Arbitrations,” (1988) 22 Intl Lawyer 693.

303  See K Böckstiegel, “The Relevance of National Arbitration Law,”n 28, 233. See also M Aden, Internationale Handelsschiedsgerichtbarkeit, n 78, 24, 50.

304  See Chapter 18 on Article 27(2).

305  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 575 and Chapter 3, section 2(B)(2) on Article 35(2).

306  N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 358. See Chapter 14 on Article 23.

307  The underlying philosophy behind this distinction is well illustrated in the following example by Craig: “Think of the difference between the criminal procedure that the Anglo-American observer is familiar with and criminal proceedings in any other country. If judged by these standards, any Japanese, French … case, for example, would be found to have numerous ‘errors.’ However, we can still look at the same case and say it was procedurally just. When we do, we are making a judgment about procedural fairness that is no longer tied to our own national standards.” See W Craig, “Uses and Abuses of Appeal from Awards,” n 79, 197–8.

308  P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, 179–80. “More restrictive” here denotes the narrower scope of public policy considerations which in international cases, as distinct from domestic cases, may affect the validity of the award.

309  See W Craig, “Uses and Abuses of Appeal from Awards,” n 79, 197, and the French cases referred to therein.

310  Law of March 27, 1985 amending Article 1717 of the Code of Civil Procedure. For the text in English with an Introductory Note by E Gaillard, see (1986) 25 ILM 725. The Belgian solution has been the subject of criticism. Thus the shifting of all judicial control from the place of arbitration (a neutral site) to the courts of the country of enforcement (usually the home country of one of the parties) may run counter to the very purpose why the neutral place was selected. See W Craig, “Uses and Abuses of Appeal from Awards,” n 79, 201–2. As to the argument that this kind of “non-national” award is not enforceable at all under the New York Convention, see section 3(B)(1).

311  Now the parties to an international arbitration are allowed to opt out of local control. See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 191. See B Hanotiau and G Block, “The Law of 19 May 1998 amending Belgian Arbitration Legislation,” (1999) 15, 1 Arb Int 97–102.

312  N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 595–617.

313  Model Law, as amended, Article 34(2). See H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 911 et seq. See also M Kerr, “Arbitration and the Courts: the UNCITRAL Model Law,” (1985) 34 ICLQ.

314  This is the case, for example, with the Spanish arbitration law adopted in 2003. See F Mantilla-Serrano, Ley de Arbitraje: Una Perspectiva International (2005) 31–3.

315  See generally P Binder, International Commercial Arbitration and Conciliation in UNCITRAL Model Law Jurisdictions (3rd edn 2010) 12–19.

316  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 191 n. 103, who point out that while a claimant may be interested in speedy proceedings which are not interrupted by court, the respondent may formulate his priorities quite differently.

317  N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 441–2.

318  See Chapters 4–6.

319  See discussion on Article 26(9) concerning interim measures ordered by a court in Chapter 17, section 2(B)(10).

320  As noted in connection with Article 17, there is some uncertainty as to the international enforceability of a-national awards.

321  See N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 630.

322  It is for this reason that arbitration in the respondent's home country, instead of in a neutral place, is recommended in some cases. See UNCITRAL, Legal Guide on Drawing Up International Contracts for the Construction of Industrial Works (1988) 317 (“The enforcement of an award against a party in his own country that was rendered in that country would not encounter the problems associated with the enforcement of a foreign award.”).

323  See, eg, the Inter-American Panama Convention of 1975, reproduced in (1978) III Ybk Commercial Arb 15.

324  330 UNTS 3 (New York, June 10, 1958). On the “predecessor” of this Convention, the Geneva Convention of 1927, see N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 70–2. A thorough commentary is provided by A J van den Berg The New York Convention, n 108. See also H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 195–7. As to the New York Convention and a-national awards, see, n 152–153, section 3(B)(1) dealing with Article 17.

325  Article 1(3). According to this provision, a state may also declare that it will apply the Convention only to differences arising out of legal relationships, whether contractual or not, “which are considered commercial under the national law of the state making such declaration.” A “commercial reservation” is rarely likely to hamper the enforcement of an award rendered by a tribunal applying the UNCITRAL Rules. See generally N Blackaby and C Partasides Redfern and Hunter on International Arbitration, n 2, 636–7.

326  States which have not made any of the two reservations mentioned apply to the main rule of Article I(1) according to which:

This convention shall apply to the recognition and enforcement of arbitral awards made in the territory of a State other than the state where the recognition and enforcement of such awards are sought, and arising out of differences between persons, whether physical or legal. It shall also apply to arbitral awards not considered as domestic awards in the State where the recognition and enforcement are sought.

327  A Redfern and M Hunter with N Blackaby and C Partasides, Law and Practice of International Commercial Arbitration (4th edn, 2004) 326. See also H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 196; J van Hof, “UNCITRAL Arbitration Rules, Section III, Article 16 [Place or Arbitration],” in L Mistelis (ed) Concise International Arbitration (2010) 193.

328  Article V reads as follows:

  1. 1. Recognition and enforcement of the award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the competent authority where the recognition and enforcement is sought, proof that:

    1. (a)  the parties to the agreement referred to in article II were, under the law applicable to them, under some incapacity, or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made; or

    2. (b)  the party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present his case; or

    3. (c)  the award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration, provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be recognized and enforced; or

    4. (d)  The composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties, or, failing such agreement, was not in accordance with the law of the country where the arbitration took place; or

    5. (e)  the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made.

329 Article V(1) (e). As indicated earlier in the application of the UNCITRAL Rules, law other than the lex loci arbitri should never be designated as the applicable procedural law (lex arbitri). For discussion of the requirement in Article V(1)(e) that an award be binding on the parties, see Chapter 24, section (2)(B)(2) on Article 34(2) of the UNCITRAL Arbitration Rules. See also A J van den Berg, The New York Convention, n 108, 333 et seq.

330  For more detailed discussion concerning Article V of the New York Convention, see A J van den Berg, The New York Convention, n 108, 275 et seq.; N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 638–62.

331  UNCITRAL Model Law, as amended, arts 34, 35 and 36. See H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 1006 et seq.

332  Article VI(1), reprinted in section 4(D).

333  Initially there had been some discussion about locating at least one Chamber in London, but these plans never materialized. S Baker and M Davis, The UNCITRAL Arbitration Rules in Practice, n 9, 78.

334  As the Ethyl tribunal noted:

The fact that the UNCITRAL Notes omitted the “perception of a place as being neutral” from its list of criteria for selection of a place of arbitration because it was “unclear, potentially confusing” does not mean that such criterion cannot be considered. UNCITRAL, in taking this step, itself indicated “that the arbitral tribunal, before deciding on the place of arbitration, might wish to discuss that with the parties.”

Ethyl Corp and Government of Canada, Decision Regarding the Place of Arbitration (November 28, 1997) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 10, n 12.

335  N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 173. See also, eg, Y Derains, “France as a Place for International Arbitration,” n 106, 111–12; K Lionnet, “Erfahrungen,” n 278, 303. The Final Act of the Conference on Security and Cooperation in Europe, signed in Helsinki in 1975, urges the participating states, inter alia, to “[r]ecommend, where appropriate, to organizations, enterprises and firms in their countries, to include arbitration clauses in commercial contracts … and permit arbitration in a third country … ” (1975) 14 ILM 1292, 1304.

336  Ethyl Corp and Government of Canada, Decision Regarding the Place of Arbitration, November 28, 1997 (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 9.

337  H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 187.

338  Ethyl Corp and Government of Canada, Decision Regarding the Place of Arbitration, November 28, 1997 (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 9.

339  See, eg, N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 173; Y Derains, “France as a Place for International Arbitration,” n 106, 111.

340  In some cases, however, the parties may have difficulties in agreeing on a neutral venue. Thus certain developing countries may refuse, or at least be very reluctant, to submit disputes involving their governmental entities or agencies for settlement outside their own boundaries. See J McLaughlin, “Arbitration and Developing Countries,” (1979) 13 Intl Lawyer 211, 217–19. This attitude used to be shared by some Eastern European countries, but the situation has changed decisively. In certain Latin American countries arbitration concerning investment and related contracts is prohibited unless it takes place in the country which received the investment. H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 201–2. On investment arbitration and Latin America, see also G Naón, “Arbitration in Latin America: Overcoming Traditional Hostilities,” (1989) 5 Arb Intl 131, 141–2. It should be noted, however, that where a state or state entity has, in derogation from its domestic law, consented to arbitration in a neutral venue, it should be regarded as estopped from relying on the national rules in order to get rid of its commitment. See G Delaume, “The Finality of Arbitration Involving States,” (1989) 5 Arb Intl 21, 26 and the cases mentioned therein. Note also that in maritime cases the parties’ freedom to choose a neutral place may be curtailed by international regulations such as the Hamburg rules. See H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 595.

341  For example, in an arbitration initiated by a Dutch corporation against the Czech Republic the place of arbitration was determined to be Stockholm. See CME Czech Republic BV and Czech Republic, Partial Award (September 13, 2001) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Netherlands-Czech Republic BIT), reprinted in (No 3, 2002) 14 World Trade & Arb Materials 109, 121.

342  Thus “[t]he legal rules applicable to arbitral proceedings in the respective countries may differ, and they could be more burdensome or otherwise less satisfactory to a party in one country than in the other. In addition, arbitral proceedings conducted in the respective countries will be controlled by different courts, which may exercise differing degrees of control over the proceedings.” UNCITRAL, Legal Guide, n 322, 317. See also I Hertzfeld, “Applicable Law and Dispute Settlement in Soviet Joint Ventures,” (1988) 3 ICSID Rev-Foreign Investment L J 249, 258, which provides:

[S]uch split jurisdictional clauses, which leave doubt as to the ultimate forum for litigation, may pose certain problems in practice. They may, for example, cause a party to act in such a manner as to oblige the opposing party to commence an action, in order that the action be brought in the first party's home jurisdiction. They may also give rise to multiple actions in different jurisdictions with the rise of contradictory decisions.

The author refers to agreements concluded between the former USSR Chamber of Commerce and certain foreign chambers in which arbitration in the respondent's country is recommended.

343  That provision provides: “Unless the disputing parties agree otherwise, a Tribunal shall hold an arbitration in the territory of a Party that is a party to the New York Convention, selected in accordance with: (a) the ICSID Additional Facility Rules if the arbitration is under those Rules or the ICSID Convention; or (b) the UNCITRAL Arbitration Rules if the arbitration is under those Rules.”

344  See ADF Group Inc (1976 Rules), at 15, reprinted in section 4(C). See also United Parcel Service of America Inc and Government of Canada, Decision of the Tribunal on the Place of Arbitration (October 17, 2001) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 8, para 18; Methanex Corp and United States of America, Written Reasons for the Tribunal's Decision of September 7th, 2000 on the Place of the Arbitration (December 31, 2000) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 14, para 39.

345  In general, see H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 206–10; A Redfern and M Hunter with N Blackaby and C Partasides, Law and Practice of International Arbitration (4th edn 2004) 322.

346  While potentially important, convenience is not the only factor to consider when determining the place of arbitration. The Working Group that revised the Rules recognized this fact when it agreed to delete the last clause of the phrase “having regard to the circumstances of the case, including the convenience of the parties” in an earlier version of Article 18(1). The Working Group concluded that “mentioning one circumstance only was not justified and there were other circumstances which might be more important.” UNCITRAL, 49th Session, UN Doc A/CN.9/665, n 21, at 25 para 136.

347  In the ADF case, the arbitral tribunal recognized that in investor–state arbitration a state party could be inconvenienced if multiple governmental agencies were required to travel to a foreign location. See ADF Group Inc and United States of America, Procedural Order No 2 (July 1, 2001 (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 13, para 18.

348  See, eg, Merrill & Ring Forestry LP and Government of Canada, Decision on the Place of Arbitration (December 12, 2007) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 4–5; Canfor Corp and United States of America, Decision on the Place of Arbitration, Filing of a Statement of Defence and Bifurcation of the Proceedings (January 23, 2004) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 6;United Parcel Service of America, Inc and Government of Canada, Decision of the Tribunal on the Place of Arbitration (October 17, 2001) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 6; Methanex Corp and United States of America, Written Reasons for the Tribunal's Decision of September 7th, 2000 on the Place of the Arbitration (December 31, 2000) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 11–12; ADF Group Inc and United States of America, Procedural Order No 2 (July 1, 2001) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 12–13; all reprinted in relevant part in section 4(C).

349  See, eg, Ethyl Corp and Government of Canada, Decision Regarding the Place of Arbitration (November 28, 1997) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 7 (finding “[c]ertainly the convenience of attorneys appointed by the parties, which translates into cost factors, affects their clients”).

350  See P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, at 194–5.

351  In two relevant cases, the Secretary-General has acted in the way just indicated. He appointed the President of the Supreme Court of the Netherlands as Appointing Authority for the Iran–US Claims Tribunal at The Hague, and the principal arbitral institution of the Federal Republic of Germany as Appointing Authority for an arbitration in which the parties had chosen the Federal Republic as the place of arbitration. See A Redfern and M Hunter, Law and Practice of International Commercial Arbitration (2nd edn 1991) 482–5; see generally N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 257–8; and the Commentary of Article 9 in Chapter 4 section 5.

352  Ethyl Corp and Government of Canada, Decision Regarding the Place of Arbitration (November 28, 1997) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 7 (noting the cost difference between New York City and Ottawa or Toronto). One exception may be arbitration in Washington, DC at ICSID because of ICSID's comparatively cheaper fee schedule and administrative expenses.

353  See, eg, ADF Group Inc and United States of America, Procedural Order No 2 (July 1, 2001) (ICSID administered, 1976 UNCITRAL Rules, NAFTA Chapter Eleven), at 15, para 20.

354  UNCITRAL Legal Guide, n 322, 317. See also section 4(B)(3).

355  See UNCITRAL Notes, n 68, para 23 (geographical flexibility allows the “arbitral proceedings to be carried out in a manner that is most efficient and economical”); K Lionnet, “Erfahrungen,” n 278, 302 and the commentary on para 2 of Article 18 in section 4(B)(3).

356  As to certain concrete indications, see G Born, International Arbitration and Forum Selection Agreements: Drafting and Enforcing (3rd edn 2010) 67–9; see also H Holtzmann, “The Importance of Choosing the Right Place to Arbitrate an International Case,” n 273, 211–21, who tests (with positive results) the suitability of Sweden and the United States as places of arbitration according to the various relevant criteria.

357  For example, there are clear limitations on the place of arbitration in UNCITRAL Model Law jurisdictions. See P Binder, International Commercial Arbitration and Conciliation in UNCITRAL Model Law Jurisdictions (3rd edn 2010) 288–9.

358  P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, 194. Similarly see K Rauh, Die Shieds-und Schlichtungs-Ordnungen der UNCITRAL, n 275, 80, and M Aden, Internationale Handelsschiedsgerichtbarkeit, n 78, 230. Aden indicates—correctly, it is believed—that the presiding arbitrator can only decide “purely procedural questions” (reine Verfahrensfragen). Decision-making is dealt with in Article 33 of the UNCITRAL Rules discussed in Chapter 23. See also N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 570.

359  P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, 194.

360  J Paulsson and G Petrochilos, “Revision of the UNCITRAL Rules,” (A Report Commissioned by the UNCITRAL Secretariat), March 31, 2006, at 12, para 142.

361  See UNCITRAL Notes, n 68, para 21.

362  Corresponding Article 16(4) of the 1976 UNCITRAL Rules provided that “[t]he award shall be made at the place of arbitration.”

363  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 19, para 90.The UNCITRAL Secretariat described the provision as designed “to avoid the uncertainty as to the jurisdiction of courts regarding the award if it was signed in a place other than the seat of arbitration”: Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.145/Add.1 at 2–3, para 10 (2006).

364  A Redfern and M Hunter with N Blackaby and C Partasides, Law and Practice of International Commercial Arbitration (4th edn 2004) 328; see generally G Born, International Arbitration and Forum Selection Agreements, n 356, 2408–9.

365  See J Waincymer, “The New UNCITRAL Arbitration Rules: An Introduction and Evaluation,” (2010) 14 Vindobona J Intl Commercial L and Arb 223, 238–9.

366  See A J van den Berg, n 108, 295; N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 187.

367  See F Mann, “Where is an Award ‘made’?” (1989) 5 Arb Intl 107, 108 (while arguing that, regardless of the actual place of the signing of the award, an award is “made” at the place of arbitration admits that “the view suggested … attributes a somewhat strained meaning to the word ‘made’”).

368  See Summary Record of the 6th Meeting of the Committee of the Whole (II), UNCITRAL, 9th Session, UN Doc A/CN.9/9/C.2/SR.6, at 8–10, paras 70–89 (1976). See also P Sanders, The Work of UNCITRAL on Arbitration and Conciliation, n 95, 9 (“An award may be circulated to the arbitrators for signing at their convenience.”).

369  See M Aden, Internationale Handelsschiedsgerichtbarkeit, n 78, 231–2.

370  H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 596.

371  UNCITRAL, 40th Session, UN Doc A/CN.9/619, n 5, at 27, para 139. As an alternative, the term “venue” was also proposed but not adopted. See para 137.

372  An earlier version of Article 18(2) included a broad, but closed list of “consultations, hearings, meetings and deliberations.” Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.151 at 17 (draft article 16(2) (2008). The Working Group deleted the word “consultations” as redundant of “meetings and deliberations.” UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 26, para 138. The final version of the rule maintains maximum flexibility by referring to meetings “for any other purpose, including hearings.”

373  See Report of the Secretary-General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Addendum 1 (Commentary), UN Doc A/CN.9/112/Add.1 (1975), reprinted in (1976) VII UNCITRAL Ybk 166, 172 (Commentary on Draft Articles 15(2) and (3)).

374  1976 UNCITRAL Arbitration Rules, art 16(2).

375  The formulation of Article 18(2) leaves no doubt that tribunal members have complete discretion to decide where to meet for deliberations as opposed to the location of other meetings, which are at the tribunal's discretion “[u]nless otherwise agreed by the parties.” UNCITRAL, 42nd Session, UN Doc A/CN.9/665, n 21, at 25–6, para 137 (noting concerns regarding an earlier draft of Article 18(1) (A/CN.9/WG.II/WP.151 (draft article 16(2)), which was not clear on this matter).

376  P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, 196.

377  Article 20(2) of the UNCITRAL Model Law, as amended, reads as follows: “Notwithstanding the provisions of paragraph (1) of this article, the arbitral tribunal may, unless otherwise agreed by the parties, meet at any place it considers appropriate for consultation among its members, for hearing witnesses, experts or the parties, or for inspection of goods, other property or documents.”

378  See H Holtzmann and J Neuhaus, A Guide to the UNCITRAL Model Law, n 7, 595–6.

379  Under the 1998 LCIA Rules, Article 16.2 provides: “The Arbitral Tribunal may hold hearings, meetings and deliberations at any convenient geographical place in its discretion … ” Similarly, Article 18(2) of the 2012 ICC Rules of Arbitration provides: “The Arbitral Tribunal may, after consultation with the parties, conduct hearings and meetings at any location it considers appropriate, unless otherwise agreed by the parties.”

380  Failure to do this is about the only conceivable situation in which the determination of the locale (as distinct from the place) of arbitration could entail legal consequences (because of breach of the principle of equality of the parties).

381  P Sanders, “Commentary on UNCITRAL Arbitration Rules,” n 60, 196.

382  See Himpurna California Energy Ltd and PT (Persero) Perusahaan Listruik Negara, reprinted in (2000) XXV Ybk Commericial Arb 13.

383  See Himpurna California Energy Ltd and Republic of Indonesia, (2000) XXV Ybk Commercial Arb 112.

384  See Himpurna California Energy (1976 Rules), Interim Award, reprinted in section 4(C). In an effort to block the tribunal's decision, Indonesia unsuccessfully sought in the Dutch court to enjoin the arbitral tribunal from holding the hearing in The Hague. See Himpurna California Energy (1976 Rules), Dutch Decision; Himpurna California Energy (1976 Rules), Final Award; both reprinted in section 4(C).

385  N Blackaby and C Partasides, Redfern and Hunter on International Arbitration, n 2, 183. Similar respect for the sovereignty of the territorial state, which always makes it incumbent on the arbitral tribunal to pay due respect to the mandatory norms of the place of arbitration, should also be taken into account where a part of the proceedings are conducted outside the principal place.

386  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 5, at 19, para 87.

387  See P Viscasillas, “Place of Arbitration (Article 16) and Language of Proceedings (Article 17) in the UNCITRAL Arbitration Rules: Some Proposals for a Revision,” (2006) 13 Croatian Arb Ybk 205, 215.

388  However, the few countries that contained strict provisions requiring physical presence at the place of arbitration to make the award, in practice, were rarely chosen as the place of arbitration. Summary Record of the 6th Meeting of the Committee of the Whole (II), UNCITRAL, 9th Session, UN Doc A/CN.9/9/C.2/SR.6, at 10, para 81 (Comment by Mr Melia, Austria) (1976).

389  Note, however, that by accepting Article 16(3) of the 1976 UNCITRAL Rules without modification, the party with control over the goods to be inspected is generally understood to waive any right to deny access to the goods.