Ethical Rules for International Arbitrators - 7
Ramon Mullerat OBE
9. Reinforcing arbitrators' disclosure standards
In the interest of the arbitration reputation, the general tendency is to strengthen the disclosure obligation for arbitrators.
In the US, California has enacted Ethical Standards substantially expand an arbitrator's disclosure requirements that increases a party's ability to disqualify an arbitrator based on such disclosures. Unlike existing voluntary standards, the California rules will have the force of law. The rules establish a floor of required enforceable disclosures and ethical conduct, not an aspirational listing of best practices. Among the most detailed provisions under the Ethical Standards are the categories of information that must be disclosed by arbitrators prior to appointment. In the commercial arbitration arena, there are 14 separate categories, including the existence of family relationships with a party or a lawyer in the arbitration, a "significant persona! relationship" with any party or lawyer for a party, and prior service as an arbitrator for a party or one of the lawyer in the last 5 years. If a proposed arbitrator has served on multiple occasions for a party or one of the lawyers, the arbitrator must disclosure the results of each case submitted to arbitration, including the amount of damages. A potential arbitration must also disclose whether he has served as a "ADR neutral" other than an arbitrator in a prior case in the last 2 years or has any current arrangement for prospective neutral service. In addition, a proposed arbitrator must disclose a range of professional relationships and any financial interest he or she may have in the underlying dispute, the parties or their lawyers. Finally, the standards require disclose of membership in any organisation that practices discrimination on the basis of race, sex, religion, national origin, or sexual or sexual orientation 20.
10. Developing international standards
In an effort to introduce some international uniformity and provide guidelines both for arbitrators and institutions, Committee D of the IBA has established a Working Group on Conflict of Interest in International Commercial Arbitration. In August 2003, the Working Group has issued a draft IBA Guidelines on Impartiality, Independence and Disclosure in International Commercial Arbitration. The Guidelines identify lists (Red, Orange and Green List) intended to set out circumstances giving rise to justifiable doubts as to an arbitrator's independence and impartiality. In situations falling within the Red List, the arbitrator must decline tire appointment. The Green List is intends to itemise specific situations where there is no appearance of a lack of independence and impartiality and no conflict of interest exists. In such cases, arbitrators would not required to make disclosures. The Orange List enumerates situations likely to give rise to justifiable doubts as to the arbitrator's impartiality or independence. Arbitrators finding themselves in a Orange List situation are required to make full disclosure and the parties are free to waive any potential conflict of interest, thereby allowing the arbitrator to be appointed.
Following the publication of several drafts of the Guidelines, the Working Group has received many conflicting comments about which situations should fall within the different lists Whilst judicial independence can remain, in large part, a matter for national jurisdictions to address taking into account local customs, culture and legal history, the formulation of universal standards for independence and impartiality in international arbitration requires the balancing of many different interests. The draft will be debated at the IBA Conference in San Francisco in September this year.
IV. Competence and qualification
In order to make a good designation, it is important to determine whether the arbitrator to be appointed has the level of knowledge and experience on the relevant legal field.
Ethical rules generally provide that an arbitrator has the duty no to accept an appointment beyond his competence for the specific case. In many arbitration agreements the parties stipulate the characteristics and qualities that the arbitrator must have. Principally, they revolve around their ability and competence in relation to the case they are going to arbitrate on. In the event of this provision not being included, many arbitration regulations impose on their arbitrators requisites in relation to their competence and qualification in the matter to be adjudged, which are normally satisfied by the CV's of the future arbitrators.
Art. 5 of the Vienna Rules of Arbitration states that arbitrators should have specific knowledge and experience in legal, commercial or other pertinent matters. Art. 5 of CIARB Guides of Good Practice states that the prospective arbitrator must inform if he is competent to determine the issues in dispute. Art. 2.2 of the Rules of Ethics for International Arbitration of the IBA states that a prospective arbitrator shall accept the appointment only if he is fully satisfied that he is competent to determine the issues in dispute, and have an adequate knowledge of the language of the arbitration.
Some jurisdictions require that, unless otherwise agreed, arbitrators must be members of the Bar, with a determined number of years of legal experience (Ethical Principles for the National Arbitration Forum), attend a number of hours in certain programmes agreed by the courts, and similar conditions.
20 James M. Schurz, "California's pioneering spirit", ICC United Kingdom, vol. VI. back