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Mediation and Arbitrage in IP: a response to the weaknesses of the African judicial system - Inventa International (press release)

Google International ADR News - Thu, 2018-09-27 06:42

Inventa International (press release)

Mediation and Arbitrage in IP: a response to the weaknesses of the African judicial system
Inventa International (press release)
Arbitration is a form of alternative dispute resolution in which the decision is entrusted, by agreement of the parties, not to a court, but to one or more arbitrators. It binds the parties and it is susceptible of forcible execution. The main features ...

Interview With The Korea IP Office's Acting Commissioner - Intellectual Property Watch

Google International ADR News - Thu, 2018-09-27 02:10

Intellectual Property Watch

Interview With The Korea IP Office's Acting Commissioner
Intellectual Property Watch
Korean Intellectual Property Office (KIPO) Acting Commissioner Kim Tae Man is attending the annual World Intellectual Property Organization General Assembly this week. In that context, he sat down with Intellectual Property Watch, and in a mutually ...

Advance Waivers of Conflicts of Interest – Changing the Dimensions of Arbitrator Challenges

Kluwer Arbitration Blog - Thu, 2018-09-27 00:11

Alefiyah M Shipchandler

Arbitrator neutrality remains an imperative prerequisite in international commercial arbitration. After all, the primary advantage of arbitration is that parties have the ability to choose their own decision-makers.  The issue of advance waivers typically arises at the time of appointment, when the arbitrator reserves the right to continue as an arbitrator despite the occurrence of certain potential conflicts, that would normally give rise to justifiable doubts about the arbitrator’s impartiality and independence. Thus, what the parties end up ‘waiving’ is their future right to challenge the arbitrator on the basis of the previously disclosed potential conflict.

However, can such advance waivers of conflicts of interest supersede the mandatory right of challenging an arbitrator? There exists limited guidance in terms of the validity and enforceability of such waivers and its ultimate impact on the right to have an impartial and independent tribunal. Given that there do not exist any formal Rules or Guidelines on the same, this article aims at pointing out certain practices that have begun to gradually emerge amongst arbitral institutions, in their treatment of advance waivers.

Advance Waivers of Potential Conflict of Interests

In recent times, two kinds of advance waivers are generally used by arbitrators in their declarations of independence and impartiality,

  1. Arbitrators may seek an advance waiver by which parties to the dispute ‘waive’ their right to challenge the said arbitrator at a future time, on the basis of certain potential conflicts. For example,

 “… I would however make a reservation that the other partners of my law firm may be free to continue with current or take up new instructions, involving the parties to this dispute or their affiliates.”

  1. Arbitrators may also seek a ‘waiver’ by the parties, by which the arbitrator is no longer bound by his duty to make continuous disclosure of conflicts. For example,

“The parties are requested to accept that current or future member firms of [the prospective arbitrator’s group of firms] are free … to accept instructions from or against any of the parties to this arbitration … without any duty on my part to make any disclosure in connection with any such instructions.”

Interestingly, the IBA Guidelines on Conflicts of Interest, 2014 (“IBA Guidelines“) only recognizes the use of advance waivers. It does not take any conclusive position on their validity, and leaves this question to be determined by “the specific text” of the waiver, the applicable rules and law. Similarly, even the Report of the International Commercial Disputes Committee of the New York City Bar Association simply states that, “the Committee neither endorses nor rejects the use of advance waivers, but rather seeks to encourage further dialogue and consideration of an existing trend”.

Due to a lack of uniformity on the issue, different arbitral institutions seem to follow different procedures when it comes to advance waivers. A question that needs to be answered is whether parties can in exercise of their autonomy, do away with the arbitrators’ continuous duty of disclosure, which under most procedural rules is mandatory. The UNCITRAL Model Law, for example, omits any grounds for parties to contract out of Article 12’s impartiality standards.

In fact, the IBA Guidelines specifically mandate in General Standard 3(b) that, “advance declaration or waiver in relation to possible conflicts of interest arising from facts and circumstances that may arise in the future does not discharge the arbitrator’s ongoing duty of disclosure”. Given the soft law status of the IBA Guidelines it only remains to be seen whether notwithstanding such advance waiver, an arbitrator shall nevertheless be required to disclose conflicts of interest that may arise in the future.

A practice in point, followed by the ICC is rooted in the supervisory role the Secretariat plays in arbitrations administered by it. According to the current practice, the Court is not bound by the arbitrator’s statement relating to future conflicts of interest. This essentially means that the parties are not precluded from challenging an arbitrator. The Court consequently allows challenges against arbitrators notwithstanding advance waivers. Further, the arbitrator’s duty of continuous disclosure is also not discharged.

There is also a growing tendency of arbitral institutions to refuse the appointment of an arbitrator who requires an advance waiver. For example, when an arbitrator is to be proposed by an ICC National Committee pursuant to Article 13(3) of the ICC Rules, the Court ordinarily does not appoint arbitrators who request advance waivers. A similar practice is also followed by the SCC, where the arbitrator requesting a waiver is required to revise his/her declaration before sending it to the parties.

Proposed Practice

In consonance with the IBA Guidelines and the practice of the ICC Secretariat, the validity of an advance waiver may be evaluated on the basis of the following:

  1. Limited scope of the waiver.

An overly broad waiver covering a variety of potential conflicts, is incompatible with the fundamental principle, that parties to an arbitration have a legitimate interest in being fully informed of all circumstances that ensure that an arbitrator is and remains independent and impartial. Therefore, arbitral institutions such as LCIA do not accept waivers that are overly broad.

  1. Informed consent of the parties and constructive knowledge.

For a waiver to be valid, it must be necessary that the parties are aware of the exact nature of the potential conflict and the implications that that waiver could have on proceedings. The validity of waivers must thus be evaluated on the touchstone of ‘you cannot waive what you do not know’.

  1. Continuing obligation of the arbitrator to disclose conflicts.

Waivers by which an arbitrator attempts to do away with his continuing duty of disclosure should not be accepted at all.

  1. Possibility of challenging the arbitrator despite the advance waiver.

In unison with the mandatory right to challenge an arbitrator, parties should be permitted to challenge an arbitrator despite an advance waiver, in exceptional circumstances. Such leave may be given by the supervisory institution or the arbitral tribunal as the case may be.

  1. Effect on the enforcement of the award vis-à-vis the advance waiver.

Since an arbitral award can be set aside by national courts on the grounds of partiality of an arbitrator, the validity of advance waivers may also be determined on the basis of its general treatment in the jurisdictions from which the parties to the dispute belong. For example, according to the dictum of Justice White in Commonwealth Coatings Corp. v. Continental Cas. Co, arbitrators are not automatically disqualified by a business relationship with the parties before them if both parties are informed of the relationship in advance. Thus, the United States appears amenable to enforce advance waivers.

Path Ahead

Another question that must also be answered is as to what impact the advance waiver might have on a challenge to the arbitrator. Could an arbitrator rely on the advance waiver as a defence in such case? And to that extent, can the advance waiver be used to draw conclusions on some form of acquiescence or can it be used to increase the objective standard necessary to uphold a challenge against an arbitrator?

Advance waivers thus affect various elements which are at play in commercial arbitration, including party autonomy, standards of impartiality and independence, duty of disclosure and even enforceability.  In light of the uncertainty surrounding them, it is necessary to formulate a set of rules, even if in the form of soft law, to regulate the use and ensure uniformity in the enforcement of advance waivers and address the effect they have on arbitral proceedings.

 

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
€ 240


The post Advance Waivers of Conflicts of Interest – Changing the Dimensions of Arbitrator Challenges appeared first on Kluwer Arbitration Blog.

Serial Podcast Shows How Much You Can Learn From a Single Case

ADR Prof Blog - Wed, 2018-09-26 20:15
The first episode of the Serial podcast’s new season is a dramatic illustration of how much you can learn from a single case.  The case involves a young white woman who was prosecuted for her participation in a bar fight.  The Serial team are incredible storytellers, so this podcast is not “just” educational, but it … Continue reading Serial Podcast Shows How Much You Can Learn From a Single Case →

Challenging arbitral awards - International Law Office

Google International ADR News - Wed, 2018-09-26 10:17

Challenging arbitral awards
International Law Office
In any case, the Greek courts are reluctant to set aside arbitral awards or refuse their enforcement, thus indicating that recourse to arbitration for local and international cases is a valuable instrument in alternative dispute resolution, especially ...

The Contents of b-Arbitra, Issue 2018-1

Kluwer Arbitration Blog - Tue, 2018-09-25 17:33

Annet van Hooft and Jean-François Tossens

We are pleased to present you with this new issue of b-Arbitra, which is once more filled with thought provoking articles and new developments. This issue is published as part of our cooperation with Wolters Kluwer. As announced, our journal is now also accessible in digital form on Jura in Belgium and in the Kluwer Law Arbitration database.

In this issue you will find Marie Stoyanov, Werner Eyskens, Valentin Bourgeois and Michaël Fernandez-Bertier’s in-depth review of the impact that the presence, or absence, of criminal proceedings or complaints may have on the treatment of corruption allegations in investor-state arbitrations. They also look at how the arbitral proceedings and criminal proceedings may interfere with one another.

We then have Michael Neumeier and Miroslav Georgiev’s article exploring whether mass claims in arbitration in Europe, and in particular in Germany, could one day become a reality. They look into existing impediments and options to give form to such proceedings, against the background of U.S. and Australian law.

With respect to recent case law, we are very pleased to offer you two annotations by Alexander Hansebout regarding two Yukos decisions. The first annotation (concerning Civ. Bruxelles, 9 December 2016, published in b-Arbitra 2017/2) focusses on the existing confusion regarding the exequatur procedure that applies in Belgium to awards rendered in the Netherlands and provides an overview of the various existing exequatur regimes in Belgium. The second annotation concerns the seizure of assets (Civ. Bruxelles, 8 June 2017, published in b-Arbitra 2017/2), the intervention of the Belgian state and the relevance of current status of the title that the seizures were based on.

We then include the CJEU’s decision in the Achmea matter and AG Wathelet’s opinion. A comment on this opinion and the Court’s decision will be published in a future issue of our journal.

We also publish, without annotation, two decisions of the Court of First Instance of Brussels regarding third party opposition to arbitral awards. They are related to the decision of the Constitutional Court of 16 February 2017 No. 21/2017 (published with annotation by Olivier Caprasse and Maxime Malherbe in b-Arbitra 2017/2). The first judgment Civ. Bruxelles (Fr.), of 29 January 2016 concerns the proceeding up to the posing of the preliminary question to the Constitutional Court. The second judgment Civ. Bruxelles (Fr.), of 12 April 2018 concerns the Court’s decision to annul two ICC awards on the basis of third party opposition, after having obtained a confirmative answer from the Belgian Constitutional Court that the Belgian Code of Civil Procedure’s limitation of the availability of third party opposition to judgments from state courts only, violated the Constitution.

We have several book reviews, notably of Philippe De Bournonville’s (posthumous) title “L’arbitrage, tiré a part du Répertoire notarial” by Caroline Verbruggen, and of Sigvard Jarvin and Corinne Nguyen’s “Compendium of International Commercial Arbitration Forms,” by Herman Verbist. We conclude with a book review by Jean François Tossens of Jacques Herbot’s “ Contracts in the People’s Republic of China.”

We hope you enjoy this issue and always welcome further views, exchanges and suggestions from our readers.

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
€ 240


The post The Contents of b-Arbitra, Issue 2018-1 appeared first on Kluwer Arbitration Blog.

Real-Life Account of Litigation Stress in Bill Cosby Case

ADR Prof Blog - Tue, 2018-09-25 15:18
I just wrote a post describing “litigation stress” that parties experience during litigation, noting that this can be particularly painful in some cases like those involving sexual assault allegations. Allegations of sexual assault by Judge Brett Kavanaugh have been in the news a lot lately.  While these allegations aren’t being litigated in court, the process … Continue reading Real-Life Account of Litigation Stress in Bill Cosby Case →

Katie Mazurek Has Been Recognized Among the Top in Her Industry by Noticed© - Digital Journal

Google International ADR News - Tue, 2018-09-25 10:20

Katie Mazurek Has Been Recognized Among the Top in Her Industry by Noticed©
Digital Journal
Since earning her law degree in 2010, Mazurek has been at the forefront of the Collaborative law and alternative dispute resolution movement in the state. She was even the first attorney in Montana to be certified by the International Academy of ...

and more »

Ann Joo gets additional RM25m award on arbitration against China blast furnace supplier - The Edge Markets MY

Google International ADR News - Tue, 2018-09-25 08:53

The Edge Markets MY

Ann Joo gets additional RM25m award on arbitration against China blast furnace supplier
The Edge Markets MY
Under the award, Ann Joo said the arbitration respondent — Tangshan Iron & Steel International Engineering Technology Co Ltd — has to pay RM24.1 million for additional cost of production or losses due to late start-up of the Pulverized Coal Injection ...

What Star Hollywood Mediator Lee Jay Berman Can Tell Lawyers About The Power of Mediation and Achieving the ... - Lawfuel (blog)

Google International ADR News - Tue, 2018-09-25 04:51

Lawfuel (blog)

What Star Hollywood Mediator Lee Jay Berman Can Tell Lawyers About The Power of Mediation and Achieving the ...
Lawfuel (blog)
It has also grown increasingly popular in most jurisdictions as an alternative dispute resolution (ADR) tool, in part due to the prohibitively expensive costs of litigation, along with the delays and complexities of handling disputes in the traditional ...

The Material Scope of the 1958 New York Convention: Russian Courts Make It Broader

Kluwer Arbitration Blog - Tue, 2018-09-25 03:00

Mikhail Samoylov

The Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”) has its own scope – it states that it “shall apply to the recognition and enforcement of arbitral awards”. Only decisions made by arbitrators are to be considered “awards” within the meaning of the New York Convention1)UNCITRAL Secretariat Guide on the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958) (2016) para 22. jQuery("#footnote_plugin_tooltip_8658_1").tooltip({ tip: "#footnote_plugin_tooltip_text_8658_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });, rather than decisions handed down by judges. As one prominent academic notes: “[t]here is no universal international treaty governing the recognition and enforcement of foreign court judgments.”2)Gary B. Born, International Arbitration and Forum Selection Agreements: Drafting and Enforcing (Fifth Edition) (Kluwer Law International 2016) p. 129 jQuery("#footnote_plugin_tooltip_8658_2").tooltip({ tip: "#footnote_plugin_tooltip_text_8658_2", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); Despite that, Russian courts are invoking the New York Convention in the exequatur proceedings of foreign court judgements.

This blog post will first briefly reveal the results from the research conducted by the author on the issue (I). The next part of this contribution then discusses some possible reasons why Russian courts apply the New York Convention erroneously (II), and some consequences of such practices (III). The author summarizes conclusions in a final part (IV).

I. A Case Study of Erroneous Practice

Research carried out by the author shows that in at least 81 cases, which were considered in recent years, Russian courts invoked the New York Convention in the exequatur proceedings of foreign court judgements.

The table below reveals (i) the countries where foreign court judgements were rendered (the nationality of a foreign court judgement); and (ii) the number of exequatur proceedings in Russian courts in which the New York Convention was applied to such judgements:

N The nationality of a foreign court judgement The number of exequatur proceedings in Russia 1. Belarus 6 2. Cyprus 3 3. China (Hong Kong) 1 4. Finland 2 5. France 2 6. Georgia 1 7. Italy 2 8. Japan 2 9. Kazakhstan 29 10. Kyrgyzstan 2 11. Lithuania 4 12. Moldova 4 13. Mongolia 1 14. Netherlands 1 15. Poland 1 16. Ukraine 17 17. United Kingdom of Great Britain and Northern 2

Moreover, Russian courts apply the New York Convention even in cases where a foreign judgement was rendered in a State (a territory) that is not a party to the New York Convention. For instance, in case No А41-55167/16, the New York Convention was invoked for the recognition and enforcement of the Nampkhosky court on sea matters of the Democratic People’s Republic of Korea in Russia.

II. Prerequisites for Erroneous Practice

There might be several possible explanations for such erroneous practice. First, there is a dual meaning of the word “arbitrage” in the Russian language. The word “arbitrazh” in Russian comes from “arbitrage” in French. While in French, “arbitrage” is an alternative method of dispute settlement (“[r]èglement d’un différend ou sentence arbitrale rendu par une ou plusieurs personnes, auxquelles les parties ont décidé, d’un commun accord, de s’en remettre.” 3)Le Nouveau Petit Robert. Dictionnaire alphabétique et analogique de la langue française ; texte remanié et amplifié sous la direction de Josette Rey-Debove et Alain Rey (Dictionnaires Le Robert, Paris 2009), p. 129 jQuery("#footnote_plugin_tooltip_8658_3").tooltip({ tip: "#footnote_plugin_tooltip_text_8658_3", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });), in the terms of Russian law and the language, the word has a dual meaning, and it means :

(i) dispute resolution by a state court – an arbitrazh court;

(ii) dispute resolution by arbitral tribunals.

This dual meaning confuses Russian courts and foreign courts. For example, a Sweden court in the exequatur proceedings, confused by a translation of “an arbitrazh court” from Russian to Swedish, applied Sections 54-55 of the Swedish Arbitration Act (which correspond to Article V of the New York Convention) and declared the ruling of a Russian arbitrazh court enforceable.4) Eric Johnson, ‘The “Award” Not Recognized – and Rightfully So’ (10 April 2017). jQuery("#footnote_plugin_tooltip_8658_4").tooltip({ tip: "#footnote_plugin_tooltip_text_8658_4", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); However, the Swedish Supreme Court corrected the lower court, clarified that in the case at hand, the enforcement was sought for a court ruling, rather than for an arbitral award (Swedish Supreme Court decision on 30 March 2017, Case No. Ö 5209-13).

Further misunderstanding can be possibly caused by the wording of Russian procedural law. Article 241 (1) of the Arbitrazh Procedure Code of the Russian Federation reads as follow:

foreign courts judgements <…>, and awards of arbitral tribunals and international commercial arbitration courts are recognized and enforced in the Russian Federation by arbitrazh courts, if the recognition and enforcement of such decisions are stipulated in an international treaty of the Russian Federation and in federal law.” (emphasis added).

In 1996, the Supreme Arbitrazh Court of the Russian Federation clarified that the New York Convention deals only with arbitral awards, whereas the recognition and enforcement of foreign court judgements are governed either by an international treaty to which Russia is a party to, or by Russian law. The notion of “a foreign court judgement” is not equal to the notion of “an arbitral award”.

Article 241 (1) of the Arbitrazh Procedure Code of the Russian Federation, which became law in 2002, rests upon the mentioned rationale. One would say that the same approach should have been true regarding its application by Russian courts. Notwithstanding the clarification of the highest court, Russian courts often consider the notions “a foreign court judgement” and “an arbitral award” as the synonyms of a common notion – a court judgement. For example, in case No А40-187536/2015 the Arbitrazh court of the city of Moscow threated a LCIA award as a foreign court judgement. Opposite, in case No A53-11372/2017, the Arbitrazh court of the Rostov region treated a foreign court judgement as an arbitral award, and stated:

Grounds for refusing the recognition and enforcement of a decision of the Economical court of the Kharkov region [Ukraine] <…> providing for Article V of the [New York] Convention are not established <…> the petition [for the enforcement] shall be satisfied.”

Finally, recognizing that Russia may not have an international treaty on the recognition and enforcement of court judgements with a country where a court judgment was rendered, Russian courts often use the New York Convention instead of such an international treaty, or use the New York Convention simultaneously with an international treaty (see, e.g., the decision of the Arbitrazh court of the Pskov region dated 16 February 2017 in case No A52-2950/2016).

III. The Consequences of Erroneous Application

The erroneous application of the New York Convention in the exequatur proceedings of foreign court judgements may, and, in fact, leads to the adverse effects to judgment creditors. At the outset, in 23 of 81 examined cases, Russian courts refused the recognition and enforcement of foreign court judgements and based its conclusions on the provisions of the New York Convention. Articles V(1)(b) and V(2)(b) of the New York Convention were the article most frequently applied by Russian courts in those cases.

(a) Proper Notice

Article V(1)(b) of the New York Convention requires that the party against whom the award is invoked was properly notified of the appointment of the arbitrator and of the arbitral proceedings. Although Russian procedural law contains similar provisions regarding foreign court judgements, Russian courts apply Article V(1)(b) of the New York Convention instead of a relevant provision of a procedural law. For example, in case No А47-2947/2010, the Arbitrazh court of the Orenburg region refused the enforcement and recognition of a Kazakhstan court judgement having established that the judgement debtor was not properly notified of a court proceeding in Kazakhstan.

(b) Public Policy

The public policy defence is one of the most often invoked by the parties against whom arbitral awards, or foreign courts decisions, are invoked.

Russian procedural law entitles Russian courts to refuse the enforcement of a foreign court judgement if the enforcement of such judgement would violate of the Russian public policy (Article 244 (1)(7) the Arbitrazh Procedure Code the Russian Federation). Hence, recourse to the New York Convention is not needed. Nevertheless, Russian courts invoke Article V(2)(b) of the New York Convention, instead of a relevant provision of the Arbitrazh Procedure Code of the Russian Federation. One among numerous examples of such application is the following statement given by the Arbitrazh court of the city of Moscow in the case No А40-29792/15:

“[t]he court considers that consideration on the territory of the Republic of Moldova of a dispute that falls under the exclusive competence of a Russian arbitrazh court, violates sovereignty of the Russian Federation, Article V(2)(b) of the New York Convention, <…>, therefore the recognition and enforcement of such decision should be rejected due to violation of the public order of the Russian Federation.

IV. Conclusion

The application of the New York Convention to foreign court judgments is undoubtedly an erroneous practice of Russian courts, and such practice should be discontinued by the Russian Supreme Court. Until that moment, the following guidance may be useful for a party seeking enforcement of a foreign court judgment in Russia:

  1. All procedural requests submitting to Russian courts shall be drafted clearly, stressing that enforcement of the foreign court judgment is the aim of exequatur, rather than enforcement of an arbitral award;
  2. The party shall keep in mind that Russian courts can invoke Article V (1) of the New York Convention by its own discretion. For example, in case No А51-14965/2016, the Arbitrazh court of the Primorsky Krai faced with the recognition and enforcement of a court judgement rendered by a Hong Kong court. Despite the fact that a judgement debtor had no objections to the enforcement of the judgement, the court, guided by Article V(1)(b) of the New York Convention, examined whether the judgement debtor was properly notified of a court proceeding at the Hong Kong court;
  3. Legal arguments showing to a court that the New York Convention is not applicable in the exequatur proceedings shall be put into the case at an early stage of the proceedings. A reference to the Russian Supreme Arbitrazh Court letter of 1996 is a useful argument.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Egorov Puginsky Afanasiev & Partners, its affiliates, or its employees.

References   [ + ]

1. ↑ UNCITRAL Secretariat Guide on the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958) (2016) para 22. 2. ↑ Gary B. Born, International Arbitration and Forum Selection Agreements: Drafting and Enforcing (Fifth Edition) (Kluwer Law International 2016) p. 129 3. ↑ Le Nouveau Petit Robert. Dictionnaire alphabétique et analogique de la langue française ; texte remanié et amplifié sous la direction de Josette Rey-Debove et Alain Rey (Dictionnaires Le Robert, Paris 2009), p. 129 4. ↑ Eric Johnson, ‘The “Award” Not Recognized – and Rightfully So’ (10 April 2017). function footnote_expand_reference_container() { jQuery("#footnote_references_container").show(); jQuery("#footnote_reference_container_collapse_button").text("-"); } function footnote_collapse_reference_container() { jQuery("#footnote_references_container").hide(); jQuery("#footnote_reference_container_collapse_button").text("+"); } function footnote_expand_collapse_reference_container() { if (jQuery("#footnote_references_container").is(":hidden")) { footnote_expand_reference_container(); } else { footnote_collapse_reference_container(); } } function footnote_moveToAnchor(p_str_TargetID) { footnote_expand_reference_container(); var l_obj_Target = jQuery("#" + p_str_TargetID); if(l_obj_Target.length) { jQuery('html, body').animate({ scrollTop: l_obj_Target.offset().top - window.innerHeight/2 }, 1000); } }More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
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The post The Material Scope of the 1958 New York Convention: Russian Courts Make It Broader appeared first on Kluwer Arbitration Blog.

Arbitration Could Benefit From Litigation Rules: Ex-Judge - Law360

Google International ADR News - Mon, 2018-09-24 17:52

Arbitration Could Benefit From Litigation Rules: Ex-Judge
Law360
Many practitioners within international commercial arbitration have a preconceived notion that arbitration must be more informal than litigation, and that certain methods of discovery commonly used in litigation, such as depositions, have no place in ...

Is Third-Party Funding Responsible for NY's Thriving International Arbitration Market? - Law.com

Google International ADR News - Mon, 2018-09-24 13:35

Law.com

Is Third-Party Funding Responsible for NY's Thriving International Arbitration Market?
Law.com
Recent reports and surveys confirm two trends in international dispute resolution: Commercial arbitration is thriving in New York, and the use of third-party funding is on the rise. Are the two phenomena related? Arguably yes, as third-party funding ...

Resolving Ambiguities in the Arbitration Agreement - Law.com

Google International ADR News - Mon, 2018-09-24 13:14

Law.com

Resolving Ambiguities in the Arbitration Agreement
Law.com
Accordingly, he resorted to the default arbitration forum under the Federal Arbitration Act (FAA), 9 USC Section 4, as it related to international arbitration agreements under Chapter 2, which provides that “if the parties agreed to arbitrate but ...

Patents in Luxembourg - Lexology

Google International ADR News - Mon, 2018-09-24 10:11

Patents in Luxembourg
Lexology
Moreover, in a preliminary ruling (International Stem Cell Corporation, Case C-364/13) on the patentability of stem cells under the EU Biotechnology Directive (98/44/EC), the ECJ held that parthenogenically derived stem cells are not 'human embryos ...

The New York Law Journal Readers Have Spoken. NAM Voted #1 ADR Firm. Again. - Business Wire (press release)

Google International ADR News - Mon, 2018-09-24 08:01

Business Wire (press release)

The New York Law Journal Readers Have Spoken. NAM Voted #1 ADR Firm. Again.
Business Wire (press release)
NEW YORK--(BUSINESS WIRE)--NAM (National Arbitration and Mediation) is proud to announce that it has been ranked the #1 Alternative Dispute Resolution (ADR) Provider in New York State by the New York Law Journal Annual Reader Rankings Survey for ...

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Stephen Goldie: You don't have to go to court to get a happy ending - The Scotsman

Google International ADR News - Mon, 2018-09-24 01:10

The Scotsman

Stephen Goldie: You don't have to go to court to get a happy ending
The Scotsman
Clients often choose from the suite of alternative dispute resolution (ADR) processes to fit with the types of contract they are entering. We are often involved in advising clients during contract formation on dispute clauses which include escalation ...

Peace attainable in Nigeria despite threats – Osinbajo - The Punch

Google International ADR News - Sun, 2018-09-23 21:36

The Punch

Peace attainable in Nigeria despite threats – Osinbajo
The Punch
Sesan Olufowobi. Nigeria's Vice President, Prof. Yemi Osinbajo, has said the country can achieve peace despite its many challenges. Osinbajo spoke on Friday at an event in Lagos to mark the 2018 International Day of Peace, organised by the Lagos State ...
Peace attainable despite threats, says OsinbajoThe Nation Newspaper

all 3 news articles »

Reality-Testing Questions for Real Life and Simulations – and Ideas for Stone Soup Assignments

ADR Prof Blog - Sun, 2018-09-23 20:22
Litigation offers many potential benefits.  It can help people solve difficult problems, make relationships and institutions function properly, and promote justice.  It enables people to enlist legitimate, independent government officials to resolve disputes when the parties can’t resolve disputes themselves.  Indeed, litigation provides mechanisms for structuring dispute resolution processes that enable most parties to ultimately … Continue reading Reality-Testing Questions for Real Life and Simulations – and Ideas for Stone Soup Assignments →

Snapshot on Litigation Finance in Latin America

Kluwer Arbitration Blog - Sun, 2018-09-23 17:23

Zachary Krug and Helena Eatock

Litigation finance continues expand rapidly on a global basis, including in Latin America. The region’s code-based civil systems generally permit litigation funding and the continued growth in arbitration make it an attractive market for funding. Brazil, as the region’s largest economy, and with a well-developed and sophisticated legal system, is leading the way.  Moreover, local practitioners emphasize that third party funding is not only growing, but that it may be developing in a uniquely Latin American way.

Growing Demand for Funding

Practitioners familiar with the legal market report a growing interest in funding.  Erika Levin, a partner at a law firm with deep ties to the region notes that “parties in Latin America have been warming up to the idea of litigation finance over the last few years.” Likewise, Marcela Kohlbach de Faria and Marianna Marra, lawyers at Brazil’s leading litigation funder, report that interest has “been growing rapidly,” which has been driven by the “well-known advantages of litigation funding, such as access to justice and better control of companies’ allocation of costs.”

They report that the bulk of inquiries come from civil engineering and construction matters.  That is largely “due to the high costs regarding expert determinations and the (usually long) hearings of expert witnesses.”  However, inquiries come from all sectors—from mergers and acquisitions to intellectual property matters—reflecting an increasing demand throughout the legal sector.

An Uptick in Funded Matters

Now, it appears that that interest is beginning to translate into an uptick in actually funded matters—at least for certain types of disputes.

Interestingly, there is an important distinction between arbitration and litigation. Thus far, the demand for funding of arbitration has far outpaced the demand for funding in litigation. Kohlbach de Faria and Marra believe that is not surprising given the relatively low costs of litigation compared to arbitration: “Since tribunal costs are not high, so, compared to arbitration, in most cases the amount of money that must be spent to litigate in the Brazilian judiciary does not justify a funding contract.”

Thus, unlike common law jurisdictions, where the high costs of litigation are one of the main drivers of funding, in Brazil at least for now, funding is primarily being requested for arbitration matters.

While specific details remain elusive and the overall number remains small relative to other jurisdictions with a longer experience using funding, anecdotally, there appears to be a steady uptick in the number of arbitrations involving third party funding.  For example, in November 2017, Brazilian law firm Atelier Jurídico conducted a survey of Brazilian arbitration institutions on their practices with regard to third party funding.  Interestingly, the survey reports at least four cases involving third party funding, whereas there were none in the prior year.

Notably, because disclosure of funding is not generally required, this may well underreport the number of arbitrations that are third party funded.  To be sure, the numbers remain relatively small, but the trend seems evident.

Disclosure of Funding

Disclosure of funding is, of course, a topic of continued debate globally.  As funding remains new, there are few, if any, rules around funding, let alone disclosure. However, in Brazil, the CAM-CCBC (Brazil Canada Chamber of Commerce), a leading arbitral centre, issued guidelines in July 2016 recommending the disclosure of funding so that any potential conflicts can be considered.

Interestingly, since CAM-CCBC publication of its funding guidelines, other Latin American arbitral institutions have followed with similar rules or recommendations. Perhaps this suggests that concerns over potential conflicts (the main issue generally driving disclosure) are overblown, or simply a cautious approach as the centres evaluate whether the actual number of funded cases warrants promulgations of new rules.

In any event, Kohlbach de Faria and Marra note that the bulk of funding inquiries they receive for arbitration dispute involve arbitration clauses referring to Cam-CCBC (40%), followed by the ICC (16.8%).  Thus, as funding grows, the CAM-CCBC’s disclosure recommendation will have an impact even if it is not followed by other centres.

Lex Mercatoria of Latin American Funding

From the Calvo doctrine to today, Latin America often goes its own way and litigation funding may be no different.

Kohlbach de Faria and Marra emphasize that this lack of specific rules and regulations should not be seen as a sign of funding’s uncertain footing in the region. Indeed, quite the contrary:  “In Latin America, for instance, there are only a few guidelines over TPF and the institute lacks governmental regulation, but those who think such fact implements an obstacle for litigation funding may be mistaken.”  Rather, they note that “the Latin American regional market, in the absence of regulation, tends to stipulate its own application methods and limitations – a kind of lex mercatoria – whereas legislation in a market that is still blossoming could undermine its development.”

Time for a Brazilian ALF?

Nevertheless, some practitioners predict that with the growth of funding, some type of regulatory body will eventually be desirable.  For example, Carlo Verona, a partner at Demarest focused on international arbitration and cross-border litigation, argues that “self-regulation is key” because a robust “litigation funding market cannot operate without trust, transparency and suitability.”  Verona notes that the UK’s Association of Litigation Funders provides a potential model: “ALF’s Code of Conduct, set of procedural rules and stellar list of funder members is perfect adequate to the expanding Brazilian market, currently boosted by the wide spread use of arbitration for complex disputes and recent amendments regarding enforcement of judgments and awards in the Code of Civil Procedure.”

Looking to the Future

Looking ahead, litigation funding will no doubt continue to grow, particularly in arbitration, as practitioners and claimants become more familiar with its substantial advantages in offsetting risk and leveling the playing field in contentious disputes.  Of course, regional economic and political uncertainty may also play a role in the growth of funding.

For example, Brazil’s economic slump and the lingering impacts of the Lava Jato revelations likely portend a number of disputes that will eventually find their way into arbitration. Indeed, Kohlbach de Faria and Marra note that Lava Jato has had “enormous impacts” and “its unfolding affected the vast bulk of Brazilian construction and engineering companies.” Thus, funding may be particularly attractive now, “especially in the current scenario of economic crisis and difficulties in various branches of Latin America economy, such as the construction field.”

Hermes Marangos, a partner at a disputes-centred law firm in London with a cross-border practice that frequently involves Latin American matters, reflects that “the effect of new regulations to speed up justice, provide opportunities for claims by shareholders, investors in infrastructure, suppliers and consultants and many others who suffered losses in Brazil.” But Marangos notes that because many of the current disputes “involve sensitive claims for the local market and raise potential conflicts,” which provides an “opportunity for local teams which are not conflicted as well as international experts and funders come together to pursue these claims.”

Finally, “while the majority of financing has occurred with respect to arbitrations in Brazil and Mexico,” Erika Levin predicts “a continued rise in its use throughout the region with respect to arbitrations as well as litigations.”

However funding grows in Latin America, it will be particularly interesting to see how it develops differently from the common law jurisdictions where it is more deeply established.

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