siac releases new arbitration rules
TRANSCRIPT
Briefing
SIAC releases new arbitration rules 02 April 2013
The Singapore International Arbitration Centre (SIAC) has released a 5th edition of the
SIAC Arbitration Rules, which entered into force on 1 April 2013. The new rules apply to
all SIAC arbitrations commenced after 1 April unless the parties agree otherwise.
Lucy
Reed
Mark
Mangan
Establishment of the Court of Arbitration of SIAC
The most noteworthy change made under the 2013 SIAC Rules, and the one
inspiring the development of new rules, is a new governance structure. The
Board of Directors will no longer have functions under the rules, and will
instead be solely responsible for corporate and business development
functions.
The Court of Arbitration of SIAC, as it will be known, will oversee the case
administration work of the SIAC Secretariat, perform quasijudicial functions
(such as deciding challenges to arbitrators and objections to the prima facie
jurisdiction of SIAC), and determine matters of arbitration policy. The
President of the Court will perform the roles previously assigned under the old
rules to the SIAC Chairman. The former Chairman of SIAC, Professor Michael
Pryles, has been named as the first President of the Court. Mr Lucien Wong
will chair the Board of Directors.
Unlike the International Court of Arbitration of the ICC, the Court will not be
responsible for the scrutiny of awards (which will remain the responsibility of
the Registrar), nor will it appoint arbitrators (which will be done by the
President, in consultation with Court members) or fix the costs of an
arbitration (which will continue to be done by the Registrar).
Rule changes
The 2013 SIAC Rules also introduce a number of important procedural
changes, as described below.
Investment treaty cases. The jurisdiction of SIAC has been extended
expressly to cover disputes arising under an investment treaty or other
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instrument conferring jurisdiction upon SIAC.
Tribunal powers. Consistent with the recent Singapore Court of Appeal
decision in PT Prima International Development v. Kempinski Hotels SA
[2012] SGCA 35, tribunals may now decide any issue expressly or
impliedly raised in the parties’ submissions.
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Prima facie review of jurisdiction. The Registrar will now first
determine whether an objection to the existence or validity of an
arbitration agreement or the competence of SIAC to administer an
arbitration should be referred to the Court (previously, a Committee of the
Board of Directors). If the Registrar determines that the objection has
sufficient merit to be considered by the Court, the Court will then
determine if it is prima facie satisfied that a valid arbitration agreement
under the SIAC Rules may exist.
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Advance on Costs. Separate advances on costs may be fixed for the
claimant and respondent when a counterclaim is filed.
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Postaward interest. In line with recent amendments made to the
Singapore International Arbitration Act allowing tribunals to grant post
award interest, the prohibition on postaward interest in the 2010 SIAC
Rules has been removed.
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Publication of redacted awards. Consistent with SIAC’s recent
practice, the new rules expressly provide that SIAC “may publish any
award with the names of the parties and other identifying information
redacted.”
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Decisions of the President, Court and Registrar. All decisions of the
President, the Court and the Registrar are now binding upon the parties
and the tribunal, and the parties agree to waive any right of appeal or
review in respect of such decisions.
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Retrospective amendments to the 2007 and 2010 SIAC
Rules
The new rules make certain retrospective amendments to the 2007 and 2010
SIAC Rules. As the Chairman of the Board under the new structure will not
necessarily be an arbitration specialist, ‘Chairman’ is redefined to mean
‘President’. Similarly, the term ‘Committee of the Board’ is redefined to mean
‘Court’.
There should be little difficulty applying the rule changes to any new
arbitrations commenced under the 2007 or 2010 SIAC Rules (see Black &
Veatch Singapore Pte Ltd v. Jurong Engineering Pte Ltd [2004] SGCA 30 and
Car & Cars Pte Ltd v. Volkswagen AG et al [2009] SGCA 233).
As a matter of principle, changes to procedure can also apply to pending
arbitrations. The English Court of Appeal once noted: “No suitor has any
vested interest in the course of procedure, nor any right to complain, if during
the litigation the procedure is changed, provided, of course, that no injustice
is done”: Republic of Costa Rica v. Erlanger 1874 C. 113 at 69 (Mellish LJ).
The application of that proposition in an arbitration context was considered in
Rizhao Steel Holding Group Co Ltd v. Koolan Iron Dre Pty Ltd and Mount
Gibson Mining Limited [2012] WASCA 50. The Commercial Arbitration Act of
Western Australia was the lex arbitri at the time the arbitration began. During
the course of the arbitration, however, the International Arbitration
Amendment Act 2010 was introduced which, among other things, significantly
reduced the grounds for challenging an award. The Court held that “it is to be
presumed that the amended law does not apply so as to alter the contractual
rights and obligations of the parties to agreements entered into before its
commencement, at least where those rights have crystallised by the
commencement of arbitral proceedings, in which the parties have vested
rights and interests”. (Emphasis added.)
The changes made to the 2007 and 2010 SIAC Rules, however, are of a
vastly different nature to those considered in the Rizhao Steel case. Indeed,
changes to the titles of those performing functions under the 2007 and 2010
SIAC Rules could hardly be said to 'fundamentally alter' the procedure or lead
to 'capricious results', which the Western Australian Court of Appeal feared
would be the case if the entire arbitral regime applicable to an existing
arbitration were to change.
Conclusion
SIAC’s new organisational structure reflects its success. The new Court will
allow the SIAC Secretariat and President to call upon a broader range of
arbitration expertise when performing their functions under the SIAC Rules.
The new structure, combined with finetuning of the rules, will also ensure that
users receive an improved service with greater flexibility, thereby reinforcing
SIAC’s position as the most widely used institution for international arbitration
in South East Asia and the fifth most popular globally. We will be providing a
full analysis of the 2010 and 2013 SIAC Rules in our forthcoming book, A
Guide to the SIAC Arbitration Rules, by Lucy Reed, Mark Mangan and John
Choong to be published by Oxford University Press.