September 26, 2022

London Chamber of Arbitration and Mediation Publishes New Rules

The London Chamber of Commerce and Industry launched the London Chamber of Arbitration and Mediation (LCAM) in May 2020. This was a relaunch of the chamber of commerce’s original London Chamber of Arbitration, founded in 1903. The LCAM published its new arbitration rules on 1 September 2022.

Arbitration is often said to be a faster and cheaper method of dispute resolution. As the LCAM puts it, arbitration is favourable as compared to court-based litigation. The LCAM puts that efficiency at the heart of its new rules “owing to the ‘four Es’ of Economy, Efficiency, Expediency and Enforceability. In short, a swifter, cheaper, reliable process for all.”

A few features of the new LCAM arbitration rules stand out from other arbitration institutions:

Article 5: Request for Further Details

Article 5 of the LCAM’s new arbitration rules allows the arbitral board to ask the parties for further information about any part of their submission. If a claimant refuses to provide further details, the arbitration can be dismissed, and the same goes if a respondent refuses to provide further details about their counterclaim.

This feature is comparable to the court’s power under the English Civil Procedure Rules to order a party to clarify any matter which is in dispute in the proceedings, or give additional information in relation to such matter. One purpose of such a court request is to narrow the issues in dispute between the parties, saving both time and costs, which may also be the intention of the LCAM.

Article 23: Early Dismissal of Claims and Defences

Article 23 provides for applications to be made to the tribunal for early dismissal or manifestly unmeritorious claims and defences. This bears a resemblance to the court’s power to give summary judgement if there is no real prospect of bringing or defending a claim or issue under the English Civil Procedure Rules.

Although it is not unprecedented — as similar rules are already utilised by the Singapore International Arbitration Centre (Article 29) and the Arbitration Institute of the Stockholm Chamber of Commerce (Article 12) — the LCAM is amongst the few commercial arbitration institutions to expressly adopt such a provision. This feature reflects the institution’s renewed emphasis on procedural ‘Efficiency’ and ‘Expediency,’ in an effort to reduce claims that lack any merit.

Fees

The LCAM offers a fixed administrative fee depending on the amount in dispute. For instance, if the amount disputed is less than £100,000, the administrative fee is £2,000 per party. The administrative fee for disputes valued at more than £10,000,000 would be £10,000 per party.

This differs from some of the more established arbitration institutions, who calculate their administrative fees based on a percentage of the amount in dispute (the International Court of Arbitration of the International Chamber of Commerce) or based on an hourly rate (the London Court of International Arbitration).

From this perspective, the LCAM arbitration rules offer more predictability to the parties in terms of administrative costs.

Conclusions

These developments are reflective of the progressive trends in arbitration procedure aimed at promoting the efficient conduct of arbitration. The LCAM is amongst other arbitral institutions increasingly expanding the case management toolbox at the tribunals’ disposal. The new rules appear to incorporate some of the powers traditionally available in litigation into the attractive arbitration framework, promoting the LCAM’s ability to deliver faster decisions at a lower cost.

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