On 3 August 2021, the International Chamber of Commerce (the ICC) published its annual Dispute Resolution Statistics for 2020 which can be accessed here. The report echoes key developments highlighted in reports from other arbitral institutions (e.g. see our summary of the LCIA’s 2020 Annual Casework Report here). In January 2021, the ICC launched its updated Arbitration Rules aimed to promote greater efficiency, flexibility and transparency. Despite the challenges posed by COVID-19, new referrals to the ICC International Court of Arbitration (the ICC Court) have continued to grow, with the number of cases being administered by the institution reaching a record high in 2020. The ICC's caseload remains highly international in nature and there is increased diversity in the parties and arbitrators involved.
We outline some of the key takeaways from the ICC’s 2020 Statistics below.
Increase in caseload – The ICC Court registered 929 new filings in 2020. This increased the total number of cases administrated under the ICC Arbitration Rules to 1,833, the total number of parties to 2,507 and the total number of appointments or confirmations of arbitrators to 1,520. The ICC’s International Centre for ADR has also seen an increase of 77 new cases, including a record number of 45 mediation requests.
Rules update – A new version of the ICC Arbitration Rules came into force on 1 January 2021. Along with an updated Note to Parties and Arbitral Tribunals on the Conduct of Arbitration (the ICC Note), the 2021 Rules sought to address recent developments in international arbitration such as virtual hearings in the wake of the pandemic, repeat arbitral appointments and conflicts of interest, third party funding, and the increasing prevalence of multi-party arbitrations (for a summary of the most significant changes, please see our article on the topic here). In addition, in April 2021, the ICC Court published a COVID-19 Guidance Note (the COVID-19 Guidance Note) which considers specific measures that may help mitigate the adverse effects of the pandemic on ICC arbitrations, particularly in relation to the organisation and conduct of virtual hearings.
Diversity of arbitrators – The ICC’s 2020 Statistics show that 355 female arbitrators were confirmed and/or appointed in 2020, which means that women now feature in 23.4% of ICC arbitral tribunals. This increased from 21.1% in 2019. Of all women confirmed/appointed as arbitrators in 2020, 42% were nominated by the parties, 40% were appointed by the ICC Court, and 18% were nominated by the co-arbitrators to act as chair of the arbitral tribunal. Moreover, arbitrators appointed/confirmed in the past year came from 92 jurisdictions, representing the widest geographical spread recorded by the ICC to date. It is clear that ICC tribunals have become more diverse than ever, which is a testament to the institution's commitment to gender balance, diversity and inclusion, as exemplified by the appointment of the first female President of the ICC Court, Claudia Salomon, effective from 1 July 2021.
Parties – Of the 2,507 parties involved in cases filed in 2020, approximately a third of the cases filed (31%) involved multiple parties. Parties in the 2020 filings came from 145 countries and independent territories worldwide: as in previous years, parties from the Americas accounted for about 25% of the overall number of parties, European parties almost 40% and parties coming from Asia and the Pacific approximately 25%. Notably, there was a 17% increase in the number of parties from the Middle East (296, up from 252 in 2019), with the ICC Secretariat opening its fifth overseas case management office in Abu Dhabi in December 2020.
Places of arbitration and choice of law – In 2020, ICC arbitrations were seated in 113 different cities in a total of 65 countries, which represents the highest number of jurisdictions to date. While the geographical spread of arbitral seats expanded, the most popular locations remained Switzerland, France, the United States and the United Kingdom. Choice of law clauses were included in the underlying contracts in 95% of all newly-registered cases, representing the highest number in ICC arbitrations to date. Of the laws of 127 nations, states, provinces and territories selected, unsurprisingly English law remained the most popular choice, followed by Swiss law, French law and the laws of Brazil.
Nature of disputes – In previous years the ICC has seen cases arising from a wide range of industry sectors, with the construction/engineering and energy sectors usually generating the largest numbers of disputes, and 2020 was no different. Together, these two sectors accounted for approximately 38% of all the ICC’s new cases in 2020. Other sectors representing 5-7% of the newly-registered cases include health/pharmaceutical, general trade and distribution, industrial equipment and services, and financing and insurance. Although the ICC has provided no year-on-year data or sector breakdown, it appears that some of these sectors (e.g. health and pharmaceutical, international trade, and distribution and transport) are starting to see the impacts of the pandemic translating into legal disputes.
Proceedings, arbitral awards and delays – The average duration of proceedings in cases that reached a final award in 2020 was 26 months, with the median duration being 22 months. In 2020, the ICC Court approved a total of 564 awards (142 partial awards, 383 final wards and 39 awards by consent). While the vast majority of draft awards were approved (save for certain points for consideration by the arbitral tribunal, 47 draft awards (7% of the total awards scrutinised in 2020) were not approved when first scrutinised by the ICC Court and were returned to the arbitral tribunal for further consideration.
The ICC Note provides that sole arbitrators and three-member tribunals are expected to submit draft awards within two and three months, respectively, of the end of the final merits hearing or the filing of the last substantive submissions (whichever is later). In 2020, a total of 152 draft final awards (representing 26.9% of the total number of awards) were submitted for scrutiny beyond the above timeframe and a reduction of arbitrators' fees was applied in 49 of those cases where the ICC Court considered that the delay was significant and could not be attributable to factors beyond the arbitrators’ control or to exceptional circumstances. The ICC's 2020 Statistics note that the number of final awards submitted with a delay of three to six months (25 awards in 2020) has decreased by half since the practice of fee reduction was implemented in 2016. However, the fact that almost 27% of draft awards submitted to the ICC Court in 2020 did not meet the time limits laid down in the ICC Note suggests that there is still some room for improvement.
Overall, the ICC’s 2020 Statistics demonstrate the continued popularity of the institution to parties from a wide range of industries and across the globe. The ICC’s efforts to prioritise diversity and inclusion within the ICC Court and Secretariat are commendable and its commitment is also reflected in its approach to arbitral appointments. The ICC’s new Rules of Arbitration (together with the updated ICC Note) and its COVID-19 Guidance Note have provided users with a timely and much-needed resource in the face of the global pandemic and demonstrate the institution's continued drive towards more flexible and efficient dispute resolution.
If you would like to discuss the Report or have any questions on arbitration under the ICC Rules more generally, please do not hesitate to contact a member of our leading international arbitration team.