Part I Commentary on the ICDR International Rules, 36 Article 36—Deposits

Subject(s):

Arbitration — Counterclaims — Costs and expenses

This chapter assesses Article 36 of the ICDR Rules. Article 36 sets out the basic rules for when deposits are to be paid as an advance on the costs of the arbitration, the consequences for non-payment, and the Administrator’s duty to account to the parties for how the deposits have been used. The advance on costs is strategically important because, unlike in litigation, it requires the parties to ‘front’ potentially significant sums in order to continue to have the dispute resolved by arbitration. This can be used by either party to try to gain leverage. The text of Article 36 was the subject of several revisions with the 2014 amendments to the ICDR Rules. A new paragraph was added to the Article, making explicit that a party’s failure to pay a required deposit can be treated as a withdrawal of the party’s claim or counterclaim.