The Path Forward – The IBA Updates its Rules on the Taking of Evidence in International Arbitration

Background

On February 15, 2021, the International Bar Association (“IBA”) released its latest update on the “IBA Rules on the Taking of Evidence in International Arbitration” (the “2020Rules”).[1] This update follows the hard work of the 2020 Review Task Force, which, as past review subcommittees have done[2], strived to clarify the existing rules and alter any rules warranting reflection, in consideration of the shifting procedural ground and public comments of practitioners and counsel alike.

Such reflection on a periodic basis is important. The IBA Rules on the Taking of Evidence in International Arbitration were designed to harmonize the procedures commonly used in international arbitration and provide a framework for arbitration which parties can adopt in whole, in part, or utilize to create alternative rules.

The Amendments within the 2020 Rules

Behind their modest appearance, the 2020 Rules are designed to ensure greater clarity and to support the current practice of arbitration practitioners. The amendments of note fall into the following three categories:

  1. Virtual or remote evidentiary hearings;
  2. Document and evidence considerations; and
  3. Authority of the Tribunal.

Virtual / Remote Evidentiary Hearings

The 2020 Rules now define the term “Remote Hearing”. The concept, not to confuse with an entirely “virtual” hearing, refers to international arbitrations conducted, in whole or in part, by utilizing technology (such as videoconferencing) to allow certain participants from more than one location to attend, or allow specific portions of the hearing to be held virtually.

Further, Article 8.2 of the 2020 Rules allows the Arbitral Tribunal to order, at the request of a party or on its own motion, after consultation with the parties, that the evidentiary hearing be conducted as a remote hearing. In such a case, the 2020 Rules require that the Arbitral Tribunal and the parties consult on the development of a remote hearing protocol, which may address the technology to be used, testing in advance of the hearing, time zones of the parties and scheduling of the hearing days, use of documents, and measures to ensure witness testimony remains objective. 

Document and Evidence Considerations

A. Document production provisions

Many of the 2020 amendments relating to the treatment of documents and evidence simply codify the standard practices already in use within the international arbitration community.

Article 3.5 now allows for the party requesting documents which are subject to objection from the opposing party to, where directed by the Arbitral Tribunal and within the time ordered, respond to the objection. This allows the Arbitral Tribunal to then consider the objection and the response in its deliberation while setting aside any “consultation with the parties” as noted by the removal of such language for Article 3.7.

Further, Article 3.10 provides that any party (whether or not subject to a request for documents from the Arbitral Tribunal) may object to the request for any of the reasons set out in Articles 9.2 or 9.3.

Article 3.12 of the 2020 Rules provides clarity around translation of documents both requested for production and relied upon before the Arbitral Tribunal. Article 3.12(d) states that documents produced in response to a request need not be translated, whereas Article 3.12(e) provides that documents in any language other than the language of the arbitration that are being submitted to the Arbitral Tribunal and relied upon must be accompanied by a translation. This allows parties to meet the obligations of the request to produce without extensive and often costly translation services. The party relying on the documents must then be responsible for the costs associated with such translations.

B. Additional witness statements and expert evidence

Under Articles 4.6(b) and 5.3(b) of the 2020 Rules, the parties are allowed to provide additional witness statements and/or expert reports where new factual information and/or developments have arisen that could not have been addressed in the initial witness statements or expert reports.

C. Data protection and cybersecurity

Of particular importance to document and evidence considerations are the updates made regarding data protections and cybersecurity. The 2020 Rules now contain a new Article 2.2(e) designed to highlight for the parties and the Arbitral Tribunal the importance of considering and discussing (at the earliest appropriate time) the need for data protection and cybersecurity.

In addition, the 2020 Rules have extended Article 9.5 to allow the Arbitral Tribunal, where appropriate, to make necessary arrangements to permit “Documents to be produced, and evidence to be presented or considered subject to suitable confidentiality protection.” The previous confidentiality provision was far narrower, applying only to evidence to be presented to or considered by the Tribunal.

Tribunal Authority / Powers

In response to commentary from practitioners, the 2020 Review Task Force amended Article 6.3 dealing with the authority of the Tribunal-Appointed Expert to request information, documents, and other materials for inspection. The previous rules (updated in 2010) provided the Tribunal-Appointed Expert with the same authority as the Tribunal itself to request information. This equivalency of authority was highly questionable in the context of the rest of the rules or in practice. The 2020 Rules remove this notion of equivalency and make clear that the Tribunal’s authority supersedes that of the Tribunal-Appointed Expert.

The amendments have included a new Article 9.3 which provides the Arbitral Tribunal, at the request of a party or on its own motion, with the ability to exclude any evidence obtained illegally. The 2020 Rules do not provide guidance for the Arbitral Tribunal on what constitutes “evidence obtained illegally” and leave the interpretation and application of the relevant laws to the Arbitral Tribunal itself.

Implications of the 2020 Rules for Arbitration Practitioners

The 2020 Rules are a welcome development for arbitration practitioners.

The most notable change to the rules relates to the detailed provision in Article 8.2 regarding remote hearings. This change is consistent with recent amendments to the ICC and LCIA Rules. Our commentary on the ICC amendments can be found here, and our commentary on the LCIA Rules amendments here.

Significantly, the revised IBA Rules include guidance on remote hearing protocols and the types of issues that such a protocol should address. This will no doubt provide assistance to parties as they prepare for remote hearings in the future. Moreover, even if post-COVID-19 arbitrations return to a more in-person setting, it is foreseeable that many arbitrations will see at least a portion of the hearing conducted virtually. In any event, this will require the parties to carefully contemplate a protocol addressing these modalities.

In relation to the changes regarding additional witness and expert evidence, in many ways, these rules address a dispute that often arises during the life of the arbitration and on which the parties often need a ruling from the Tribunal. Parties may still dispute whether there is new factual evidence and/or developments, but to the extent that issue can be agreed and the 2020 Rules are incorporated into the arbitration, this may reduce the time and costs of a further hearing.

Finally, the amendments to the 2020 Rules relating to document production issues appear to reflect common practice of arbitration practitioners. While such issues have often been dealt with in an order from the Tribunal in the early stages of the arbitration, parties will now have the benefit of solving these matters within the 2020 Rules. Moreover, the amendments regarding data protection and cybersecurity are in keeping with the requirements of the General Data Protection Regulation, applying to many parties or otherwise impacting the arbitration in some way.

Although the 2020 Rules have not been overhauled, the changes made reflect the latest practice in international arbitration that has developed over the preceding decade, and will help facilitate the conduct of arbitrations in the years to come. 

[1] IBA Rules on the Taking of Evidence in International Arbitration 2020.

[2] The Supplementary Rules Governing the Presentation of Evidence in International Commercial Arbitration, 1983 was updated by a working committee of the IBA Arbitration Committee resulting in the IBA Rules on the Taking of Evidence in International Arbitration, 1999. Recognizing the need for continued updates, the IBA Rules of Evidence Review Subcommittee was formed in 2008 and proposed a revision which was adopted by the IBA Council on May 29, 2010.

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