ICC Arbitration Statistics Reflect Strong Arbitration Trends Worldwide
V&E International Dispute Resolution Update, July 2, 2019
The International Chamber of Commerce (“ICC”), the world’s most prominent arbitral institution, recently released statistics on its cases for the past year. While the statistics are unique to the ICC, they likely reflect broader trends as the ICC is a global arbitration leader. Notable highlights of 2018 include the continuing popularity of arbitration and the significant diversity in disputes, parties and arbitrators in ICC arbitration proceedings.
Arbitration remains popular.
Despite commentary deriding so-called secret tribunals over the past several years (aimed primarily at investor-state dispute settlement), parties entering commercial contracts continue to select arbitration as their method for resolving disputes. In 2018, 842 new cases were registered with the ICC, involving 2,282 parties from 135 countries and territories. The vast majority of parties were commercial entities; in addition, the number of state or state-owned parties involved in ICC arbitrations has steadily increased in recent years, hitting 150 in 2017 and 143 in 2018. In another measure of its caseload, the ICC approved the record-breaking number of 599 arbitral awards – including 407 final awards – in 2018.
Headquartered in Paris, the ICC continues to expand its global reach. The institution opened its fourth regional case management office in 2018 – in Singapore. In 2017, the ICC opened a regional case management office in São Paulo, Brazil, adding to offices previously established in Hong Kong and New York. Predictably, numbers of newly registered cases have grown in regions where the ICC has established case management offices. Brazil now ranks third for registered cases, behind France and the United States.
In addition to establishing regional case management offices, the ICC has engaged in other efforts to reach potential parties and arbitrators around the world. In 2018, the ICC established two formal programs aimed at resolving disputes in Africa and Asia: The newly formed Africa Commission is coordinating ICC activities in sub-Saharan Africa, and the Belt and Road Commission is supporting resolution of disputes arising out of China’s Belt and Road development initiative.
Arbitration becoming more inclusive.
The ICC statistics for 2018 show increasing diversity in parties and arbitrators. ICC arbitration remains dominated by European parties, with 40.8% of all parties to disputes filed with the ICC based in Europe (31.6% from North and West Europe and 9.2% from Central Europe). Participation of parties from Asia increased notably, with Asian parties involved in about 40% of all ICC cases filed in 2018. Though arbitrators from North and West Europe continue to dominate ICC panels (52.6% of all appointments), arbitrators from other regions are increasingly appointed. In recent years, arbitrators from Latin America and the Caribbean have held over 13% of appointments. Younger arbitrators are also making significant gains, with 35% of arbitrators appointed in 2018 under the age of 50. The number of women acting as arbitrators remains low, at 18.4% of confirmed appointments in 2018, but slow progress continues.
Room for improvement in efficiency of proceedings.
The average duration of ICC cases that reached final award in 2018 was two years and four months. Of course, every case is unique, and oftentimes parties agree to suspend proceedings – for instance, to attempt to reach settlement. Nevertheless, the ICC is actively working to limit delays by offering Expedited Procedures and by implementing “delay measures” to incentivize arbitrators to draft awards expeditiously after hearings. The Expedited Procedures, adopted in 2017, provide for final awards to be rendered within six months of the case management conference. The Expedited Procedures are the default method for resolving disputes that do not exceed $2 million, and parties to disputes above that monetary threshold can opt into the procedures. In 2018, 19 cases proceeded under the Expedited Procedures by default, and parties to disputes submitted 96 requests to opt into the procedures.
In another effort to improve timeliness, the ICC relies on recently implemented “delay measures” to incentivize arbitrators to draft awards quickly. These measures allow the ICC to reduce arbitrators’ fees when awards are not submitted within two months by sole arbitrators or within three months by three-member panels. The ICC reports some success in reducing the number of late awards: While 54% were late in 2016, only 38% were late in 2018.
V&E’s International Dispute Resolution & Arbitration (IDR) practice assists clients in all aspects of dispute resolution, from drafting contractual arbitration clauses to resolving disputes through mediation, arbitration, and litigation. Consistently recognized in Global Arbitration Review’s GAR 100 (2008-2019), V&E’s IDR team of over 40 members located in Washington, Houston, London and Dubai has handled disputes related to projects around the world in over 80 countries, in virtually every arbitral venue, and under all major international and regional rules systems.