India: Emergency Arbitration Under The 2021 ICC Rules Of Arbitration: An Insight

The ICC Rules of Arbitration (‘ICC Rules 2021') which came into force on 01.01.2021 provide for a provision for Emergency Arbitration under its Article 29. Emergency Arbitration provide parties to resort to immediate measures that can be availed before an Arbitral Tribunal is constituted. Emergency Arbitration has been recognized as a coveted practice throughout the world and thus, finds its existence in many international rules of arbitration. The present article gives an outline of the procedure involved in an Emergency Arbitration under ICC Rules 2021.

The procedure for filing an application and aspects related to conducting the Emergency Arbitration has been enunciated under Appendix V to the ICC Rules 2021. Any party who wishes to seek interim measure and cannot await the constitution of an Arbitral Tribunal, can make an Application for such measures in accordance with Appendix V to the ICC Rules 2021¹. According to Article 29(6) of the ICC Rules 2021, the provisions related to the Emergency Arbitrator does not apply in the following cases:

• If the arbitration agreement between the parties has been executed before 01.01.2012.
• If the parties have expressly opted out of the provisions under ICC Rules 2021 that are related to Emergency Arbitration.
• If the arbitration agreement upon which the Application based, arises form a treaty.

Filing of the Application

Any party who wishes to resort to the Emergency Arbitration may submit an Application to the Secretariat with sufficient number of copies for each party and one each for the Emergency Arbitrator and the Secretariat². The Application must contain details that include the following:

• Name, address and contact details of the parties along with such details of the person(s) representing the Applicant.
• Description of the circumstances between the parties giving rise to the Application and the underlying dispute between the parties.
• Statement of the Emergency Measures sought as well as the reasons why the Applicant cannot await the constitution of the Arbitral Tribunal.
• Any agreement that is relevant such as the arbitration agreement and the related provisions for place of arbitration, applicable laws etc.
• Proof of payment of cost of Emergency Arbitration.
• Any request of arbitration or other submissions that have been made to the Secretariat prior to filing of the Application for Emergency Arbitration.³

The President of the Court, after considering the content of the Application, decides whether the Emergency Arbitration provisions shall apply or not and thereafter, serves a copy of the Application to the other party. The President may also decide that the Emergency Arbitration proceedings shall not apply with respect to one or more parties and after making such a decision, the President has to forward the copy of the Application to such parties as well.⁴

The Emergency Arbitration shall be terminated by the President if the Request for Arbitration has not been sent to the Secretariat within 10 days from Secretariat's receipt of the Application.⁵

Appointment of the Emergency Arbitrator

An Emergency Arbitrator shall be appointed by the President within two days from the Secretariat's receipt of the Application⁶ and no Emergency Arbitrator shall be appointed after the Arbitral Tribunal has been constituted and the files have been transmitted to such Arbitral Tribunal as per Article 16 of the ICC Rules 2021⁷.

Before the appointment, the Emergency Arbitrator shall sign a statement related to its availability, acceptance for appointment, independence and impartiality.⁸

After the appointment, all the communications related to the Emergency Arbitration shall be done directly with the Emergency Arbitrator with a copy of such communication to be sent to the other party⁹. An Emergency Arbitrator is precluded from acting as an arbitrator in any arbitration relating to the dispute that gave rise to the Application for Emergency Arbitration¹⁰.

Conducting the Emergency Arbitration

The Emergency Arbitrator shall decide and setup a procedural timetable within 2 days from the receipt of the files transmitted to such Emergency Arbitrator as per Article 2(3) of Appendix V to ICC Rules 2021¹¹. The Emergency Arbitrator may conduct the proceedings as it deems appropriate while keeping all the factors relating to urgency into consideration¹².

The Emergency Arbitration shall take at the place as agreed by the parties and if there is no such agreement, the President shall fix the place of the Emergency Arbitration¹³. The proceedings for Emergency Arbitration may either be conducted through a meeting in person at any location the Emergency Arbitrator deems appropriate or through modes of communication such as video conference, telephone etc.¹⁴.

Passing of Order by the Emergency Arbitrator

An Emergency Arbitrator shall make an Order within 15 days from the day when all the files were transmitted to the Emergency Arbitrator in accordance with Article 2(3) of Appendix V to ICC Rules 2021. Such time can be extended on the request of the Emergency Arbitrator or upon President's own volition if the President thinks that it is necessary to do so.¹⁵

The said Order is binding upon the parties¹⁶ but shall cease to be binding in the following circumstances¹⁷:

• If the President terminates the proceedings on account of non-sending of the Request of Arbitration within 10 days from Secretariat's receipt of the Application.
• If the appointment of the Emergency Arbitrator is challenged under Article 3 of Appendix V to ICC Rules 2021 and the same has been accepted by the Court.
• If the Arbitral Tribunal passes its final award unless the Arbitral Tribunal decides otherwise.
• If all the claims have been withdrawn or the arbitration proceedings have been withdrawn before rendering the final award.

The Emergency Arbitrator may annul, suspend or modify its Order upon a request by a party to the proceedings, provided that such request has been made before the transmission of files to the Arbitral Tribunal as per Article 16 of the ICC Rules 2021.¹⁸

Challenge to the Appointment of the Emergency Arbitrator

A party can challenge the appointment within 3 days from either the receipt of the notification of appointment or the receipt of the information relating to the facts and circumstances for appointment of the Emergency Arbitrator, whichever is later¹⁹. Such a challenge will be decided by the Court after giving reasonable time to the parties and the Emergency Arbitrator to provide their comments in writing, if any²⁰.

Cost of Emergency Arbitration

For the purpose of getting the Application notified, the Applicant is required to pay a total amount of US $ 40,000 (US $ 10,000 for ICC administrative expenses US $ 30,000 for Emergency Arbitrator's fees)²¹ and the same may also be increased by the President during the proceedings, if it feels it is required on the basis of the nature of the case and the amount of work done by the Emergency Arbitrator²². If the Emergency Arbitration proceedings does not take place on account of the President's decision under Article 1(5) of Appendix V to ICC Rules 2021, amounts paid as cost for proceedings shall be reimbursed by the President except for the non-refundable of amount of US $ 5,000 for ICC administrative expenses²³.

Footnotes

1 Article 29(1) of the ICC Rules 2021

2 Article 1(1) and Article 1(2) of Appendix V to ICC Rules 2021

3 Article 1(3) of Appendix V to ICC Rules 2021

4 Article 1(5) of Appendix V to ICC Rules 2021

5 Article 1(6) of Appendix V to ICC Rules 2021

6 Article 2(1) of Appendix V to ICC Rules 2021

7 Article 2(2) of Appendix V to ICC Rules 2021

8 Article 2(5) of Appendix V to ICC Rules 2021

9 Article 2(3) of Appendix V to ICC Rules 2021

10 Article 2(6) of Appendix V to ICC Rules 2021

11 Article 5(1) of Appendix V to ICC Rules 2021

12 Article 5(2) of Appendix V to ICC Rules 2021

13 Article 4(1) of Appendix V to ICC Rules 2021

14 Article 4(2) of Appendix V to ICC Rules 2021

15 Article 6(4) of Appendix V to ICC Rules 2021

16 Article 29(2) of ICC Rules 2021

17 Article 6(6) of Appendix V to ICC Rules 2021

18 Article 6(8) of Appendix V to ICC Rules 2021

19 Article 3(1) of Appendix V to ICC Rules 2021

20 Article 3(2) of Appendix V to ICC Rules 2021

21 Article 7(1) of Appendix V to ICC Rules 2021

22 Article 7(2) of Appendix V to ICC Rules 2021

23 Article 7(5) of Appendix V to ICC Rules 2021

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.