Among the very first things that anyone new to international arbitration learns is the phrase 'Tant vaut l'arbitre, tant vaut l'arbitrage.'

The most perfect arbitration rules in the world would be meaningless if the cases which they govern are confided to persons without the requisite qualifications to be arbitrators in international commercial disputes, such as independence, appropriate linguistic abilities, availability, professional competence, an international outlook and managerial skills.

So, too, even the ideal arbitrator can only fulfill his or her responsibilities once appointed and confided with the case file. This should be done as rapidly as possible.

Then again, because human beings are fallible, confirmation of a prospective arbitrator may have to be refused, or an arbitrator once confirmed may have to be removed. Such actions should be taken as rapidly as possible, while ensuring a fair procedure.

And, of course, in regard to every step concerning the constitution of the Arbitral Tribunal, care must be taken by the arbitral institution concerned to respect the requirements of the pertinent arbitration clause as well as the arbitration law of the place of arbitration, in order to avoid giving rise to one of the few grounds recognized in most national laws and the New York Convention for setting aside or refusing to enforce an arbitral award.

For these reasons, the general objectives of the Rules revision, in particular the reduction of delays and uncertainties in the arbitral procedure, improving defective Rules and filling lacunae in the Rules, were equally the objectives sought in regard to the ICC Rules relative to the constitution of the Arbitral Tribunal.

Articles 7 through 12 are the articles of the 1998 Rules relating directly to the constitution of the 'Arbitral Tribunal' (which is now a defined term in Article 2 (i), meaning 'One or more arbitrators, as the case may be'). It will first be observed that the presentation of these articles is more 'user friendly' than are the 13 sections of Article 2 of the current Rules. The changes, however, run far deeper than mere form.

Article 7: General Provisions

Article 7 of the 1998 Rules, entitled 'General Provisions,' would appear, at first glance, to be simply a reorganization of elements already in the current Rules. This is true to a certain extent, but there are also rewards for the attentive reader, who will notice that Article 7 (6) is the pivot around which all of the Articles relating to the Arbitral Tribunal turn.

Thus, pursuant to Article 7 (6), Articles 7 (1)-(5) may clearly not be modified by agreement of the parties; they are part of what may be termed 'fundamental public policy' of the ICC Rules. For example, whether an arbitrator is nominated by a party, appointed by the ICC Court, or, as very occasionally happens, by a third-party appointing authority such as the President of the International Court of Justice, every arbitrator must be independent and must complete the ICC's statement of independence. Every arbitrator, no matter how appointed, is also subject to the challenge and replacement procedures of Articles 11 and 12, respectively.

On the other hand, the parties are free to 'provide otherwise' in regard to what is set out in Articles 8, 9 and 10 regarding such matters as the number of arbitrators, their nomination and appointment, and how to deal with multi-party situations. Of course, liberty is not license. For example, I doubt very much that the new ICC Rules would allow for the parties to organize an English-style 'umpire' procedure, with an 'umpire' being brought in [Page23:] to decide a case only if the two party-proposed arbitrators cannot agree. In any event, in the vast majority of cases, Articles 8, 9 and 10 will not be modified by agreement of the parties, but will apply in full.

Article 8: Number of Arbitrators

Article 8 is essentially composed of language from the current Rules. However, a problematic issue has now been resolved in Article 8 (2). In the current Rules, if the ICC Court has to decide on the number of arbitrators and decides on three, both parties must nominate an arbitrator within the same 30-day period. Under the new Rules, the Claimant must nominate an arbitrator within 15 days of receipt of the Court's decision, and the Defendant subsequently nominates its arbitrator within the next 15 days, thereby restoring the sequential nomination process that would have been followed had the arbitration clause originally required three arbitrators.

Article 9: Appointment and Confirmation of Arbitrators

Article 9(1) expands upon the elements to which the Court shall have regard in confirming or appointing arbitrators. It now includes mention of the prospective arbitrator's 'availability and ability to conduct the arbitration in accordance with these Rules.' This addition, together with the new text of Article 7 (5), which provides that 'By accepting to serve, every arbitrator undertakes to carry out his responsibilities in accordance with these Rules,' makes more clear than before that the ICC Court has the right to take into account many elements in addition to an arbitrator's 'independence' in deciding whether to confirm or appoint an arbitrator or, indeed, to replace an arbitrator upon a challenge or on its own initiative. (See below)

Article 9 (2) gives the Secretary General of the ICC Court the discretion, in carefully defined circumstances, to confirm arbitrators when no problems are present regarding this independence. This new article was added after a careful analysis done by Yves Derains, Chairman of the Working Party on Revision of the ICC Rules, revealed that, taking into account the various interventions required by the Committees of the ICC Court to confirm

party-proposed arbitrators, to select a National Committee and then to confirm the chairman, almost three months could be required for the constitution of a three-person arbitral tribunal, and about half of this time could result from the need to obtain decisions from the ICC Court, even when there were no problems relating to any of the prospective arbitrators.

This change, as well as the possibility allowed by Article 9 (6) for the Secretariat to present its recommendations to the ICC Court as to the identity of a prospective National Committee and, at the same time, following upon informal consultations between the Secretariat and the prospective National Committee, to provide the Court with the name of the arbitrator that would be proposed by that National Committee, should result in the Arbitral Tribunal being constituted in most instances far more rapidly than is presently the case, without in any way diluting the ultimate authority of the ICC Court over these decisions.

Article 10: Multiple Parties

Article 10 is, of course, the ICC's response to the Dutco decision of the French Cour de Cassation. This decision held that, when three arbitrators were to be appointed, the ICC practice of obliging multiple defendants, even over their objection, to nominate or otherwise have appointed for them a common arbitrator was a violation of the principle of equality of treatment of the parties in the appointment of arbitrators. The Cour de Cassation declared this principle to be a matter of public policy that cannot be waived until after the dispute has arisen.

Article 10 (1) sets out the general ICC policy, which remains what it was prior to Dutco, while Article 10 (2) provides that, in the absence of a joint nomination by multiple claimants or defendants and where there is no agreement as to how to constitute the Arbitral Tribunal, the ICC Court 'may appoint each member of the Arbitral Tribunal and shall designate one of them to act as chairman.'

I find this solution to be perfectly satisfactory. It fully meets the standards of the Dutco decision, which did not require that each party [Page24:] have the right to designate an arbitrator but, rather, that all parties be treated with equality as regards the nomination of arbitrators. While Article 10 (2) does mean that, on occasion, a claimant may be denied the possibility of nominating 'its' arbitrator, the Claimant would have been able to avoid this in most instances had it refrained from naming multiple defendants in the same case.

Please note, however, the key word 'may' in Article 10 (2). The ICC Court is not obligated to apply Article 10 (2) in every Dutco-type case; it retains the discretion to apply its pre-Dutco practice of requiring a common arbitrator for multiple defendants while allowing a claimant to nominate an arbitrator.

The reason for this is twofold. First, the Dutco decision has not been echoed in any other jurisdictions. Thus, where there are no French elements in a case, the ICC Court may not consider that French jurisprudence should automatically be determinative of the matter. Moreover, in a particular case the multiple defendants may not have different interests from each other, as was the situation in Dutco, but, for example, may be parent and subsidiary.

Article 11: Challenge of Arbitrators

Article l1 is, again, a mixture of the old and the new. Among the 'old' elements is one often overlooked by users and commentators, namely that, as set out in Article 11 (1), an arbitrator may be challenged 'whether for an alleged lack of independence or otherwise.' The 'otherwise' covers a multitude of sins not necessarily related to 'independence,' such as an arbitrator not acting 'fairly and impartially' or not ensuring that 'each party has a reasonable opportunity to present its case,' which is now explicitly required by Article 15 (2).

This is the appropriate place to explain why the new ICC Rules do not take up the boiler-plate language found in so many other sets of rules, which require that arbitrators 'shall be impartial and independent.'

As the debate in the ICC Commission on International Arbitration brought out, 'impartiality' was considered to be a state of mind which can never truly be known or determined as such, in contrast to 'independence,' which can be inferred by reference to objective facts. On the other hand, should an arbitrator act in a partial manner, he may then be challenged, as just described.

Article 11 (3) contains new procedures regarding a challenge which are aimed at meeting certain long-standing objections to one aspect of the current ICC Rules, which are also present in almost every other set of arbitration rules.

Specifically, under the current Rules, a challenge to an arbitrator by a party is notified to the arbitrator concerned, any other arbitrators and the other parties, each of whom may then comment on the challenge. However, the comments by arbitrators are not generally provided to anyone but the ICC Court and Secretariat. The challenging party, for example, has no idea what response, if any, has been made by the challenged arbitrator, unless that arbitrator chooses to send out copies of his response.

This procedure has the significant advantage of allowing the arbitrators to comment freely, without fear of revealing information relating to the inner workings of the Arbitral Tribunal or the attitude of the arbitrators toward the conduct of the challenging party or their fellow arbitrator.

However, the current procedure has its frustrating aspects and criticism of it has been harsh, giving rise to complaints about 'star chamber' justice and a denial of due process. Accordingly, the 1998 Rules now provide that comments to a challenge by the arbitrator concerned, any other arbitrators and the other parties 'shall be communicated to the parties and to the arbitrators.'

It will have to be seen whether the advantage of transparency in the challenge procedure outweighs the risks of a lengthier challenge procedure, violation of the 'secrets du délibéré' and frank comments giving rise to disharmony within the Arbitral Tribunal.

I would predict that the ICC Court will have to develop internal procedures to avoid giving the parties comments by arbitrators that reveal the [Page25:] inner workings of the Arbitral Tribunal or the thinking of the tribunal on substantive issues before it.

Article 12: Replacement of Arbitrators

Article 12, concerning the replacement of arbitrators, contains both small improvements and significant changes in practice.

It is now explicit, in Article 12 (1), that an arbitrator must be replaced upon the request of both parties, a provision already found in most other sets of arbitration rules.

Article 12 (2) is not new, but is so often misunderstood that a word on it is worthwhile. This article is highly unusual, if not unique, among international arbitration rules. It concerns the replacement of an arbitrator not upon a challenge initiated by a party, but upon the initiative of the ICC Court itself, based upon information that has come to its attention. This allows the ICC Court to act on information which the parties themselves may not possess, such as the long-term illness of an arbitrator or a violation of the ICC Rules that the Court alone becomes aware of or, as in one case, where the dissension between two arbitrators becomes so great that they threaten each other with criminal proceedings. It is a procedure rarely used, but constitutes an additional safeguard for the parties and for the integrity of ICC arbitration.

Article 12 (4), to my mind, will turn out to be one of the ICC Court's most powerful weapons against non-independent arbitrators. It permits the ICC Court to refuse to follow the original nominating process when replacing an arbitrator. Thus, in egregious cases of non-independence, for example, the ICC Court would be free to appoint directly the replacement arbitrator rather than seek another nomination from the party which had nominated a blatantly non-independent arbitrator. Once again, such a procedure would rarely be used, but its very existence may well help to dissuade parties from appointing non-independent arbitrators.

Finally, Article 12 (5) provides for the possibility of a 'truncated tribunal,' a subject that will be addressed by Marc Blessing in this volume.

In sum, I believe that it would be fair to say that the provisions of the new Rules dealing with the constitution of the Arbitral Tribunal successfully meet the objectives sought.

The tribunal may now, in a great number of cases, be constituted more rapidly than before. The ICC Court has greater flexibility to reject arbitrators that are not suitable for a particular case and to dissuade parties from appointing non-independent arbitrators. The ICC Court and its Secretariat may work more closely than ever before with National Committees to ensure the rapid appointment of qualified arbitrators. Parties are accorded great flexibility in deciding upon the procedures for the constitution of the Arbitral Tribunal. The Rules are fully capable of dealing with multi-party arbitrations insofar as the constitution of the Arbitral Tribunal is concerned. The challenge and replacement procedures have been substantially improved.

The 1998 Rules should ensure that the ICC Court is well positioned to meet and overcome problems related to the constitution of the Arbitral Tribunal through the first decade of the 21st century.