When arbitration is used as a method for resolving a cross-national dispute, the parties must agree on an arbitration centre where the process will take place, also known as an arbitration seat. An arbitration centre’s desirability can depend on many factors, such as which arbitration conventions the parties’ nations are signatory to, alongside the seat nation. This may guarantee that the courts in all the nations will honor the arbitral ruling, or on the other hand that there is some uncertainty that the ruling will be upheld. Also, the ability to use arbitration under the UNICITRAL Arbitration rules is a considerable factor when parties choose a seat for arbitration.

The Top Four Centre’s for Arbitration Worldwide

According to the 12^th International Arbitration study by the Queen Mary University of London in 2021, the top four preferred seats for arbitration worldwide are London (LCIA) with 54%, Singapore (SIAC) at 54%, Hong Kong (HKIAC), 50 % and Paris (ICC) at 35%.

1. London Court of International Arbitration

Procedural rules

The current procedural rules for the LCIA are the LCIA Arbitration Rules 2020 which can be found on their website. They cover key procedural areas such as how to make a request for an arbitration at LCIA (Article 1), responding to a request (2) and the procedure for when an emergency arbitrator is required(9b). The rules also cover the duty for the arbitral tribunal to act impartially and adopt procedures most suitable for conducting the arbitration (14).

Venue for Arbitration

The location of the London Court of International Arbitration is at the International Dispute Resolution Centre in Central London, England. Hearings may also take place virtually, or in a hybrid configuration.

Model Clauses

The LCIA recommends that enterprises or individuals who wish to resolve contractual disputes within a contract through arbitration at the LCIA should insert a particular clause. The clause states that any dispute arising out of the contract including existence or validity of the contract shall be resolved by Arbitration under LCIA rules. Also, the clause should state the number of arbitrators that shall preside, the preferred seat, language and what the governing law of the contract should be. Featured is also a clause for parties to which a dispute has already started, and one party would like to vary a dispute resolution clause so that it provides for LCIA arbitration.

Arbitration Fees

As listed on their website, costs for arbitrations conducted under LCIA rules are calculated in a number of ways.

• A registration fee of £1,950(equiv. 60579711 VND) is paid alongside request for arbitration.
• Charges for times spent by LCIA Secretariat administrating arbitration – £190 – £300 an hour.
• Hourly rates, set by LCIA Court including a Sum of 5% of arbitral tribunal fees, for LCIA general overheads.
• Fees and expenses of an arbitral tribunal is calculated with reference to work done, ranging from £250 to £650 an hour.
• A number of other fees contingent on such factors as urgency or are contingent on decisions made by the parties regarding the agreed form/substance of the arbitration.

2. Singapore International Arbitration Centre

Procedural rules

The current procedural rules are the SIAC Rules 2016. Contained within is much of the same regulations as found in the LCIA rules. However, there are some differences. One is with regard to confidentiality, where the LCIA rules implore the parties to keep all details regarding the arbitration private, SIAC only requires confidentiality for arbitration proceedings and awards. Therefore, parties could post documents/information vital to the arbitration unless agreed amongst the parties to not do so

Venue for Arbitration

The venue for SIAC arbitrations is located at Maxwell Chambers, on Maxwell Road in Singapore. The building is Singapore’s old Custom House which has been turned into a state-of-the-art alternative dispute resolution facility. Hearings may also take place virtually or in a hybrid format.

Model Clauses

For parties who wish to have their contractual disputes decided through arbitration at SIAC under SIAC rules, a model clause is given on the SIAC website. The clause should state that any dispute which arises with or in connection to the contract including questions of existence, validity or determination shall be referred to and resolved finally by SIAC administered arbitration, in accordance with SIAC rules. Also, the clause should include preference for number of arbitrators, language, seat selection as Singapore and further additions depending on specifics of the contract.

Also given is a clause for if parties want to use UNCITRAL rules.

Arbitration Fees

The current SIAC fees are listed on the Website. When a case for arbitration is first submitted to SIAC, parties pay an administrative fee that varies from S$3,800 – S$95,000 depending on the size of the parties’ claim. For arbitrator’s fees., the payment scheme is different to the hourly rate used in LCIA. Instead SIAC use a ‘quantum-based scale’ also related to the size of the disputed sum. Fee’s may very from S$6,250 for a sum up to S$50,000, up to S$605,000(+0.040% excess if over up to S$2million) when sum is above S$500,000,000.

Further fees may apply in cases of urgency or if a party wants to oppose the appointment of an arbitrator. The Website also features a calculator to work out how much an Arbitration will cost.

3. International Chamber of Commerce, International Court of Arbitration in Paris

Procedural rules

The Current procedural rules are the ICC rules 2021. They contain the regulations which apply to cases received by the International Court of Arbitration. These include amongst many others the procedure for requesting arbitration and answering it. (Article 4,5). Also, provisions for cases where multiple parties or contracts are involved (7-10), and a description of arbitral proceedings (16-30).

A key difference with ICC Arbitrations when compared to most other centres is that the ICC may scrutinize the form of the award and draw attention to potential issues. SIAC has something similar where a registrar may scrutinize the award. The London Court and Hong Kong Centre however have no provision for any institutional scrutiny of arbitral awards

Venue for Arbitration

Until recently in person ICC Arbitrations in Paris were taking place at the ICC Hearing Centre. However, the facility has closed, and will reopen at another location in 2024. Therefore, hearings are currently virtual and hybrid only (as of early 2024).

Model Clauses

According to the ICC website, parties who wish contractual disputes to be resolved through arbitration under ICC rules should list a specific clause within the contract. The clause should state that all disputes arising out of or in connection to the present contract shall be settled under the Rules of Arbitration of the International Chamber of Commerce by one or more arbitrators, appointed in accordance with ICC rules. Parties may provide preference as to number of arbitrators, language, or other particular preference. Additional parties must pay the same fee if they wish to join the arbitration (Article 7).

Arbitration Fees

ICC arbitration fees, as listed on their website include to start a non-refundable US$5000 administrative fee at the time of the party’s request for arbitration. This payment of this fee is a requirement for the ICC secretariat to notify the respondent of the pending arbitration proceeding.

Interestingly in an ICC arbitration, costs for the entire arbitration are calculated as a fixed advance, which takes into account the claimants payment of the administrative fee. The advance may be revised at any time during the arbitration. If a claimant pays its share of the advance costs and the respondent refuses to do so, the claimant will be invited to pay the respondents share.

The ICC website provides a calculator which can generate prospective costs for resolving a dispute through ICC arbitration.

4. Hong Kong International Arbitration Centre

Procedural rules

HKIAC procedural rules are found on their website, particularly the 2018 HKIAC Administered Arbitration Rules. Section 1 covers the general scope of the rules, for example the rules apply to all parties who have selected to resolve a contractual dispute through HKIAC. Section 2 concerns the commencement of arbitration proceedings detailing the procedure for a complainant to submit a notice of arbitration to HKIAC, as well as to the opposing party in a synchronous manner.

Other sections include Section 3 which considers the arbitral tribunal, section 4 concerning conduct and Section 5 deals with orders of the tribunal.

Venue for Arbitration

Arbitrations for HKIAC are held at the HKIAC facility at Two Exchange Square in Central, Hong Kong. Virtual and hybrid hearings are possible.

Model Clauses

Parties who wish to have contractual disputes resolved through arbitration at HKIAC may insert an arbitration clause which provides that any dispute/controversy or difference arising or relating to the contract shall be referred to the HKIAC.

The dispute should be then resolved with finality, subject to the HKIAC rules in place at the time that the notice of arbitration is submitted. Parties may specify within the clause such details as that the law of the clause should be Hong Kong law, the seat be Hong Kong, and the intended language for the process.

Arbitration Fees

The fees for an arbitration process are stated in the 2018 HKIAC Administered Arbitration Rules displayed on the HKIAC website in the ‘Schedule of Fees’. The administrative fee for HKIAC arbitrations is similar to the SIAC style of calculation as it is based on the size of the disputed sum. A sum up to HKD$400,000 will incur a $19,800 administrative fee. The scale rises up to a maximum HKD$400,000 administrative fee, if the disputed figure is over HKD$400,000,000.

Fees for the Arbitral Tribunal also vary in the same format. When the disputed amount is up to HKD$400,000, the fee will be 11% of the total amount. This rises significantly up. When an arbitration proceeding features a disputed figure of over HKD$4,000,000,000, the arbitrators fee will be HKD$3,482,400 + 0.025 of the sum (max HKD$12,574,000)

A fee calculator is available on the website.

Time of writing: 31/01/2024

The article contains general information which is of reference value, in case you want to receive legal opinions on issues you need clarification on, please get in touch with our Lawyer  at  info@cdlaf.vn

You can refer for more information:

• Foreign investors doing business in mining and purchasing minerals in Vietnam
• When is an Arbitration Agreement Unenforceable?
• Procedures for Vietnamese Enterprises Regarding Outward Investment
• Transferring Profits to Vietnam and  how to handle Violations in Outward Investment Activities