Information Technology in International Arbitration- Report of the ICC Commission on Arbitration and ADR

The concept of information technology (“IT”) is broad enough to encompass all electronic means to produce, modify, capture, store, transmit, and display information.

In international arbitration, the use of IT can include, for example, (i) email and other electronic communications between and among the parties, the arbitrator or arbitrators (the “tribunal”), and the administering body; (ii) storage of information for access by the parties and the tribunal using portable or fixed storage media (e.g. flash drives, DVDs, hard drives, and cloud-based storage); (iii) software and media used to present the parties’ respective cases in an electronic format, rather than a paper format; and (iv) hearing room technologies (e.g. videoconferencing, multimedia presentations, translations, and “real time” electronic transcripts). When used – and especially when used effectively – IT can help the parties in international arbitration to save time and costs and to ensure that the arbitration is managed and conducted efficiently. On the other hand, if poorly managed, IT can increase time and costs, or – in the worst case – even result in unfair treatment of a party.

Since the ICC Commission on Arbitration and ADR’s Task Force on the Use of Information Technology in International Arbitration first reported on this subject in 2004, the use and acceptance of IT in international arbitration has substantially increased, and advances in technology have led to solutions that previously were not readily available or technically mature. For example, in 2004, although correspondence among the parties, the tribunal, and the administering body was exchanged by email, duplicate correspondence often was sent by post or overnight courier service. Today, once the tribunal has been constituted, written communication takes place predominantly, if not exclusively, in electronic format. As predicted in 2004, PDF is the electronic format generally used for written submissions. In 2004, parties rarely used file transfer protocol (“FTP”) servers (whether controlled by a party or a commercial third party service) to transfer large submissions to the other parties and the tribunal, principally because setting up the required environment was too demanding. Today, transferring information via readily-available bulk file hosting services using the FTP protocol (e.g. Dropbox; Google Drive) is more common.

In 2004, users in international arbitration seemed to place much more emphasis on having a secure, confidential, flexible online “virtual data room” (e.g. a dedicated online file repository) with complex additional functionalities where the parties, arbitrators, and (if involved) arbitral institution could access all pleadings, correspondence and other submissions continuously and in real time, much as the ICC envisioned when it launched its innovative case management product, “NetCase”, in 2005. Today, while the ICC is working to develop an updated internet-based case management product, some parties use general purpose services, such as Google Documents and similar services, to exchange and store documents. Although often free, these services are subject to acceptance of certain general terms and conditions that give the service provider many rights of use and analysis.

Either users of these products are unaware of these terms and conditions, or concerns about confidentiality, security and data integrity are less important to them than ease of accessibility and simplicity of use.

As work on this report progressed, the lack of reliable and statistically significant information concerning the frequency and sophistication of IT use in international arbitration became apparent. Despite the availability of “war stories” and anecdotes (which are often interesting but might have been shared to show that the arbitrator or lawyer who shared them is “IT savvy”), “hard” data was scarce. Ironically, this dearth of information is probably good news. Given that bad experiences are often reported immediately to the arbitration community, the absence of negative data and anecdotes in relation to IT use suggests that IT is not disruptive and has not created new procedural hurdles or difficulties that would be worth mentioning. Indeed, some issues that were identified in the 2004 report have thus turned out to be merely potential issues, without much impact in the “real world”. These issues still exist, but they have materialised less often and – seemingly – with lesser impact than might have been the case. Other issues, such as the fully enforceable, fully electronic award, remain as barriers still to be conquered.

With this background in mind, this report is intended to provide arbitrators, outside counsel, and in-house counsel with an updated overview of issues that may arise when using IT in international arbitration and how those issues might be addressed. The Task Force enthusiastically recommends the use of IT in international arbitration whenever appropriate. At least based on anecdotal evidence, our sense is that generally-available IT solutions probably are not used to save time and costs as effectively as they could be. For example, despite the advent of readily available means of videoconferencing (e.g. Skype; FaceTime), some tribunals and parties remain reluctant even for minor witnesses to testify by video. Accordingly, we hope that this report will encourage arbitrators and counsel to analyse, as a matter of routine and not exception, whether and how IT might be used.

At the same time, we acknowledge that use of specific IT is a matter for the parties and the tribunal to decide. The ICC Rules of Arbitration (the “ICC Rules”), like virtually all other arbitration rules, do not require, forbid, or address the use of IT. Whether and how IT may be appropriate to a particular case will depend on many factors, including, for example, communication and storage security requirements, the parties’ agreements and preferences, the tribunal’s preferences, the amount in dispute, the parties’ respective budgets, the disputed issues in the case, and the technology available to the parties and the tribunal. Thus, the Task Force does not suggest whether, when, or how IT should be applied in any particular case, and this report does not attempt to define “rules” concerning IT.

Rather, the goal of the report is to provide an analytical framework that we hope will assist parties, counsel and arbitrators when they evaluate whether a particular form of IT should be used and (if so) how it can be used in a cost effective, fair and efficient manner. Where we believe that a particular approach may be helpful we say so, but we encourage (and would be delighted to see) readers of this report improve upon the Task Force’s suggestions and develop even better “best” practices.

Along with the report, we have provided an appendix with sample language concerning IT use that might be included in procedural orders. This sample language is for purposes of illustration only, and is intended to highlight the sorts of issues that are discussed in this report. Any procedural order necessarily must be tailored to the needs of the particular case.

Although the Task Force tried here and in its previous report to articulate principles that we believe will continue to apply as IT continues to change, we undoubtedly have not envisioned every scenario that may arise, especially as technology progresses. In this regard, we ask not only for your patience, but also for your comments and suggestions regarding additional issues to consider.

Contents:

Introduction

1. Agreeing to use IT

1.1 Agreement to arbitrate

1.2 After the dispute has arisen

1.3 IT and the selection of arbitrators

2. Issues during arbitral proceedings

2.1 Role of the parties

2.2 The tribunal’s role

3. Other specific issues that may be relevant to parties and tribunals at any stage of the arbitration

3.1 Compatibility issues

3.2 Electronic exchange of exhibits and other submissions

3.3 Data integrity issues

3.4 Proof of service

3.5 Confidentiality and data security

3.6 Intellectual property

4. Issues relevant to the hearings

Appendix

Examples of Wording that Might be Used for Directions for the Use of IT

A. Sample wording for pre-dispute agreement on IT use

B. Sample wording for Terms of Reference

C. Sample wording for first procedural orders

D. Sample wording for pre-hearing orders

E. Other sample wording for the procedural timetable / procedural orders