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ASA Conference - 10 Years of the Swiss Rules of International Arbitration

24.02.2014 - ASA dedicated its annual conference on 31 January 2014 to the Swiss Rules of International Arbitration (the Swiss Rules) on the occasion of their 10th anniversary.

ASA President, Elliott Geisinger of Schellenberg Witmer in Geneva, opened the conference by stating that “ten years is a good time to reflect on the Swiss Rules”.  The first speaker to do so was Wolfgang Peter of Python Peter, Geneva, who was part of the working group that drafted the Swiss Rules in 2004 and focused on the background of the Swiss Rules.  He reminded the audience that, initially, the rules were based on the 1976 UNCITRAL Rules and were to entail a “light touch administration”.  For Peter, the “Swiss Rules are a good product”, but the economic competition makes it necessary to “be ready for change”.  Peter, somehow radically, suggested that a step forward could be the merger between the Swiss Chambers and ASA, so as to form a single Swiss arbitration institution.  Elliott Geisinger, addressing this proposal on behalf of ASA, explained that this subject had been raised only very recently and would inevitably give rise to lively debates, the key question being “What does ASA want to be?” 

Christoph Müller, Professor at the University of Neuchâtel, then turned to the 2012 revision of the Swiss Rules.  He explained that the main objectives of the 2012 revision were to strengthen the supervisory powers of the institution through the creation of the Arbitration Court, including for the purpose of cost control, to increase the flexibility and speed of the proceedings, to facilitate consolidation, and to introduce a mechanism for emergency relief.  According to Müller, the 2012 Swiss Rules have achieved their main objectives.  Addressing a question from the floor, Müller said that it was not an obstacle in terms of speed and efficiency that each Swiss Chamber had its own secretariat, most decisions being made within a few days only, adding that it takes time to achieve a fully centralized institution.

The next two panels, which were chaired by Rolf Trittman of Freshfields Bruckhaus Deringer, Frankfurt, and Vera van Houtte, from Leuven, respectively, looked at certain distinctive features of the Swiss Rules.  Ruth Stackpool-Moore, Managing Counsel at the Hong Kong International Arbitration Centre (HKIAC), provided a comparative analysis of the provisions dealing with consolidation and joinder under the Swiss Rules, the HKIAC Rules and the ICC Rules, pointing to the difference in the way in which they deal with claims under different arbitration agreements or between different parties. In her view, the most notable features of the Swiss Rules on joinder relate to the procedural requirements and scope of applicability.   

Vladimir Pavić, Associate Professor at the University of Belgrade and the current Vice-President of the Belgrade Arbitration Centre, then explained that, whilst the arbitral tribunal’s jurisdiction over counterclaims relies on a basic consent paradigm, several problems arise in relation to set-off claims.  He stressed that one of the unique features of the Swiss Rules is their emphasis on the substantive nature of set-off by providing for the arbitral tribunal’s jurisdiction for such claims (Article 21.5). 

The next speaker, Thomas Rohner of Pestalozzi, Zurich, outlined the main characteristics of the expedited procedure under the Swiss Rules, which was not significantly amended by the 2012 revision and remains as successful. He gave some practical advice to ensure time and cost efficiency and meet the six-month deadline to render the award, such as initiating the process immediately, minimising surprises by identifying early the relevant issues or fixing the second round of briefs, and recording the hearing with an MP3 recording device.   

Christopher Boog of Schellenberg Wittmer, Zurich, then addressed provisional measures.  Although the admissibility of ex parte relief is disputed internationally, he considers that they do have their legitimate place in the Swiss Rules and are unproblematic provided the necessary safeguards are in place.  Turning to the provisions on the emergency arbitrator, he explained that the decisions of the emergency arbitrator had the same binding effect as an interim measure; they are not enforceable under the New York Convention, but are covered by specific enforcement provisions in many countries.  For Boog, the Swiss legislator should consider regulating this issue.

The topic of confidentiality was presented by Pascal Hollander of Hanotiau & van den Berg, Brussels. After touching on the issue of the law applicable to confidentiality, he then examined what was covered by confidentiality. He noted that the Swiss Rules are silent on whether the dispute itself is covered, an indicator that it is not. He then looked at who was bound by confidentiality, and at possible exceptions. He explained that the setting aside of the award should not be the sanction in case of breach. He then raised the question of whether the conditions set out in the Swiss Rules for the publication of the award would prevent the arbitral tribunal from ordering publication as part of the relief.

Markus Wirth of Homburger, Zurich, addressed the topic of settlement facilitation.  He commented that the Swiss Rules contain “supportive but cautious rules” on settlement facilitation.  His practical advice was for the arbitrators to specifically mention the possibility of settlement facilitation and offer to include such a step in the timetable, e.g. after the first or second exchange of briefs, when it could be combined with the pre-hearing conference.  He warned arbitrators never to conduct settlement facilitation without the key representatives of parties and encouraged parties to ask the arbitral tribunal for settlement facilitation.

This session was followed by the award of the ASA Prize for Advocacy in International Commercial Arbitration to Bredin Prat partner Raëd Fathallah.  The award was presented by ASA President Eliott Geisinger, vice-presidents Bernhard Meyer and Berhard Berger, and immediate past president Michael E. Schneider and was followed by a laudatio by Franz T. Schwarz of Wilmer Cutler Pickering Hale, London, which is available on the ASA website.

The afternoon session was opened by a panel chaired by Ignacio de Castro, Deputy Director at the WIPO Arbitration and Mediation Centre, Geneva.  This panel provided an insiders’ view into how the Swiss Chambers’ Arbitration Institution is handling its cases.  Michael Fischer, Legal Counsel at the Swiss Chambers’ Arbitration Institution, Zurich, first provided a glimpse behind the institution and the Secretariat’s case handlingJoya Raha, Legal Counsel at the Swiss Chambers’ Arbitration Institution, Geneva, then addressed the issue of costs, in particular the advance on costs, advance payment of the arbitrator’s fees and reimbursement of expenses and the approval of the costs.  She explained that the expedited procedure was 45% less expensive than the ordinary procedure and that, in all cases, the institution’s costs represent only 2 % of the arbitration costs, the arbitrator fees and expenses 18% and the parties’ fees 80%.  Philipp Habegger, partner at Lalive, Zurich, and President of the Arbitration Court of the Swiss Chambers’ Arbitration Institution, then gave a presentation on the workings of the Arbitration Court and the Special Committee. He announced that the Special Committee’s administrative decisions, including on challenges of arbitrators, would soon be published on the website of the Swiss Chambers. He also shared his personal vision for the future, which includes the diversification of the Court members by adding foreign members, mixed teams and an increase in the marketing and transparency of the Court’s work. He concluded with a possibly more radical proposal, that of opening offices outside Switzerland as other institutions have done, including in Asia.

The last panel, chaired by Markus Wirth, discussed the perspectives of the users, the arbitrators and counsel and the way forwardFrançois Naef of Merck Serono, Darmstadt, and Marco Villiger of FIFA, Zurich, shared their experiences from the user’s perspective.  Naef stressed that, in his view, the success of the Swiss Rules in the future depends on three factors: the continuous attractiveness of Swiss laws and their ability to cope with modern technologies; the continued attractiveness of Switzerland in terms of political stability, quality of legal services and access to facilities, and the promotion of the Swiss Rules as a product.  Villiger explained that FIFA relies on the Swiss Rules for all commercial matters, such as sponsorship, broadcasting, licensing agreements and bidding procedures because they provide for confidential, rapid and cost-efficient procedures.  Bennar Balkaya of CIArb, Istanbul, and Daniele Favalli of Vischer, Zurich, then gave their views from a counsel’s perspective.  Balkaya said that the efficiency and flexibility of the Swiss Rules are their main advantages, in particular in tight markets such as the commodity market.  She also spoke in favour of more promotion of the Swiss Rules.  Favalli noted that the Swiss Rules provide for a lot of party autonomy in comparison with other rules.  Rudolf Fiebinger of Fiebinger, Polak, Leon & Partners, Vienna, commented on the accessibility, procedural efficiency and cost control from an arbitrator’s perspective.  According to Fiebinger, procedural efficiency does not only depend on how light the administration is but on how speedy the arbitration process is and a centralised administration would not, in his view, necessarily have a significant impact in terms of procedural efficiency and cost control.  Frank Spoorenberg of Tavernier Tschanz, Geneva, concluded this panel by discussing the possible way forward. He praised the efficiency of the institution, in particular the reasonable administrative costs and reactivity. He raised the question of whether an increase of the number of cases was to be anticipated and what to do in order to involve more non-Swiss members in the composition of the Court.

The Conference Chair, Nathalie Voser of Schellenberg Wittmer, Zurich, concluded the conference with her wishes for a successful new decade for the Swiss Rules.

Catherine A. Kunz, LALIVE.

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