Back to Arbitration Committee publications >>

Sungjean Seo
Kim & Chang, Seoul
sjseo@kimchang.com

 

Report on a session by the Arbitration Committee at the 2019 IBA Annual Conference in Seoul

Friday 27 September 2019

 

Session co-chairs

Xavier Favre-Bulle Lenz & Staehelin, Geneva

Sae Youn Kim Yulchon, Seoul

 

Speakers

Christian Conejero Roos Philippi Prietocarrizosa Ferrero DU & Uria, Santiago

James Hosking Chaffetz Lindsey LLP, New York

Kshama Loya Nishith Desai Associates, Mumbai

Jacqueline Lule Bowmans, Kampala

Cosmin Vasile Zamifirescu Racoti Vasile & Partners, Bucharest

 

The IBA Arbitration Committee conducted a broad survey in 2015 and 2016 to gather feedback on the IBA Rules on the Taking of Evidence in International Arbitration, last revised in 2010 (the Rules). The results of the survey were included in the ‘IBA Report on the Reception of the IBA Arbitration Soft Law Products’, published in September 2016.

The Report found that the Rules had gained wide acceptance, with nearly 50 per cent of the arbitrations known to the respondents worldwide referencing the rules, with no significant disparities between civil and common law jurisdictions. The majority view was that the Rules should remain unchanged and less than 10 per cent of the respondents believed that the Rules needed amendments. Respondents from Africa ranked the highest in terms of those favouring changes, indicating that they would wish to have the Rules reflect a regional compromise.

Of the respondents that said changes were needed, the Report identified the following areas for potential amendment:

• document production;

• burden of proof;

• privilege;

• sanctions; and

• fact witnesses and expert testimony.

Each of the panelists took turns discussing these issues.

Document production and burden of proof

According to the Report, Article 3 of the Rules on document production was most often cited as the rule that needs amendment, in particular regarding the scope of disclosure, objections, and electronic evidence.

In terms of scope, there were complaints from respondents that document production allowed under Article 3 was ‘too broad’ or ‘too American,’ making the process too burdensome and expensive. Respondents suggested that the Rules should provide specifics on what is meant by ‘sufficient detail’ (for example, details regarding presumed authors/recipients, content and time frames), clarify the meaning of ‘relevant to the case and material to its outcome’ in Article 3.3(b), or limit the requirement to the materiality standard only (and remove the relevance standard altogether).

There is also a debate as to how standards regarding document requests interface with burden of proof issues – whether tribunals should disallow requests calling for production of documents concerning facts that the requested party has the burden of proving (ie, requests for documents relevant and material to ‘disprove’ allegations). The Rules do not currently provide guidance on burden of proof issues.

The view expressed on the panel was that these suggested changes are probably not required: the ‘material and relevant’ standard is not overly broad and tribunals have the discretion to assess what ‘sufficient detail’ would be appropriate in the context of individual requests. Also, the tribunal is guided by the proportionality requirement under Article 9.2(g), which can be a very powerful tool for the tribunal.

In terms of electronic documents, most respondents said that revisions aimed at facilitating the exchange of e-documents between the parties were needed, as well as new rules on secure internet storage. Those on the panel observed that while rule amendments may not be necessary, guidance in the form of commentary in these areas may be helpful.

Privilege

The majority of respondents from Asia, Europe and North America indicated that, while Articles 9.2(b) and 9.3 recogniseprivilege as a basis for excluding documents, the Rules are unclear on the issue of privilege and fail to describe a standard.

The panel view was that specifying a trans-national standard in the Rules would not be appropriate. Among other things, doing so may interfere with national obligations. Instead, adopting a most favoured nation (MFN) standard (ie, the highest standard) amongst the parties should accord with the requirement to ‘maintain fairness and equality as between the Parties’ under Article 9.3(e) of the Rules.

Regarding the issue of legal impediments that prevent production, the view expressed on the panel was that further guidance can be provided, especially regarding the EU’s General Data Protection Regulation (GDPR), and that the current Article 9.2(b) may not be explicit enough. The work currently being conducted by the ICCA-IBA Joint Task Force on Data Protection in International Arbitration is expected to provide useful input in this regard.

Sanctions

The Report indicated that some respondents suggested introducing into the Rules provisions sanctioning non-cooperating parties and fact witnesses, and mandating the tribunal to draw adverse inferences when parties fail to produce evidence that has been requested and/or ordered. The panel view was that the current rules are sufficient in view of the tribunal’s broad case management powers, and that it would be sufficient to consider the consequences at the cost award stage of the arbitration.

Witness testimony

According to the Report, there were a series of recommendations concerning amendments regarding fact and expert witness testimony including:

• specifying clear boundaries between witness interviews and preparations;

• including provisions on standards of independence and impartiality of experts;

• including a provision on presumption with regard to sequestration of witnesses; and

• removing Article 4.8 (which states that if the appearance of a witness has not been requested, none of the other parties shall be deemed to have agreed to the content of the witness statement) for concern that the party that does not call the witness could nevertheless seek to undermine their credibility through written submissions.

There was also discussion regarding the proper scope of cross examination, in particular whether it is appropriate to limit cross examination to:

• the witness’s written testimony;

• any relevant fact; or

• a combination of the witness’s written statement(s) and documents relating thereto.

Lastly, the panel considered whether additional guidelines are needed on expert evidence and the role of experts, including any changes to Article 5.1 of the Rules regarding party-appointed experts.

The panel’s view was generally that no amendments were needed to the Rules regarding witness testimony as the tribunal has wide discretion in these areas and there are other rules that the tribunal can utilise if it wishes (such as the Chartered Institute of Arbitrators Protocol for the Use of Party-Appointed Expert Witnesses in International Arbitration). The panel did consider that commentary to the existing Rules may be helpful in certain areas including terms related to the work of tribunal-appointed experts and examples of ‘improper’ witness preparation.

 

Back to Arbitration Committee publications >>