31 January 2018
On 19 December 2017, the Singapore International Arbitration Centre (“SIAC”) issued a proposal on cross-institution cooperation for the consolidation of international arbitral proceedings (“Proposal”). The SIAC called for feedback to be submitted by 31 January 2018.
The SIAC notes that a number of arbitral institutions do allow the consolidation of related disputes and/or the joinder of additional parties. It is, however, unusual to have provisions allowing the consolidation of arbitrations that are subject to different sets of institutional arbitration rules. This is what the Proposal seeks to effect in Singapore. The Proposal involves the adoption of a protocol permitting the cross-institution consolidation of arbitrations subject to different institutional arbitration rules. The SIAC states that if the proposed protocol is adopted, it would result in significant gains in efficiency and fairness for parties that seek to resolve their disputes through arbitration.
The SIAC states that the lack of any existing mechanism for “cross-institution” consolidation of arbitrations subject to different institutional arbitration rules substantially limits the types of disputes that can be consolidated. It is relatively common for related contracts to contain agreements to arbitrate under different institutional arbitration rules which, with the current system, cannot be consolidated.
The protocol outlines a cross-institution approach to consolidation in international arbitration. It is hoped that leading arbitral institutions would adopt and incorporate the protocol into their institutional arbitration rules and utilise it for administering consolidated arbitration.
The protocol seeks to set out a new, standalone mechanism for cross-institution consolidation. It further proposes that applications for consolidation would be decided by a joint committee appointed from members of the courts or boards of the concerned arbitral institutions. The arbitral institutions’ rules would be amended to incorporate the consolidation protocol, giving the protocol the same contractual force as other provisions of the institutional rules. By expressly selecting the institutional rules, the parties consent to the application of the consolidation protocol. Institutions would have the option of making the protocol applicable only to arbitration agreements concluded after the date the protocol enters effect or making the protocol an opt-in mechanism for a transition period.
The following materials are available on the SIAC website www.siac.org.sg: