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Copyright © International Chamber of Commerce (ICC). All rights reserved. ( Source of the document: ICC Digital Library )
I. Introduction
1. The issue of interest in international arbitration has not been given the full attention it deserves. In arbitral awards, it is rare to find an in-depth and detailed treatment of the question, maybe - as Yves Derains has suggested 2 - due to the prohibition of interest-bearing loans by the Church in the past and still today by Muslim law. In practice, however, interest may constitute a significant part of the total amount awarded to a party, especially in the case of long-term contracts.
2. Arbitration case law, a sample of which is published hereafter, shows that there are no uniform rules regarding the treatment of interest by arbitral tribunals. This is most likely due to the wide latitude given to arbitrators in determining the rules applicable to the awarding of interest, its rate and when it begins to run.
3. Interest serves a number of different purposes. It can be to compensate a party because it did not have the use of money. Post-award interest can encourage the losing party to pay and discourage frivolous appeals. 3 In some systems a distinction is drawn between 'moratory' interest and compensatory interest. 4
4. In this commentary we will highlight certain aspects of interest and point out the practical and theoretical debates to which they have given rise. We will start by considering the different sources of authority on which arbitral tribunals base their decisions with regard to interest. We will then analyse the issues with which arbitrators are faced when applying interest: the period during which interest is payable, the rate of interest and whether the interest is compound or simple. [Page54:]
II. Sources of authority to grant interest
5. When an arbitral tribunal is called upon to award interest, it has no other choice but to begin by examining the provisions of the contract, so as to ascertain whether the parties have agreed on the way in which interest should be awarded or on an applicable law enabling them to rule on the question of interest. 5
6. The awards published hereafter show that arbitral tribunals seek to identify the source - be it contractual (A) or legal (B) - giving them authority justifying their decision with regard to interest. Some awards also show that in certain circumstances arbitrators decide not to apply the law strictly (C).
A. The contract
7. It can be seen from the published ICC awards that arbitral tribunals look for the intention of the parties and apply such intention if the contractual provisions are unambiguous (i). If, however, the contractual clause providing for payment of interest is challenged by one of the parties or is not clear, arbitral tribunals endeavour to interpret the clause so as to provide a basis for their decision regarding the awarding of interest (ii).
8. In ICC case 10696 6 the arbitral tribunal bases its decision to award interest to the claimant on the intention of the parties as expressed in their contract, stating that it has a duty to abide by the parties' agreement.
9. It is interesting to note in ICC case 7373 7 that, in spite of the fact that the parties' contract contained an agreement on the payment of interest, thereby entitling the arbitral tribunal to award interest to the claimant, the tribunal decides sua sponte that the law applicable to the contract must be analysed in order to ascertain that the parties' agreement is not contrary thereto.
10. ICC case 5082 8 provides an example of interpretation of the contract by the arbitral tribunal in order to determine whether the contract authorizes the tribunal to award interest to the claimant. The arbitral tribunal finds that, in spite of the presence of a clause providing for the payment of interest in one of the four contracts between the parties, such clause cannot be extended to the other contracts, as requested by the claimant, since the parties' intention in these other three contracts is expressed by the absence of clauses providing for the payment of interest. The arbitral tribunal also makes a factual analysis and concludes that it is not possible to deduce from the parties' correspondence any agreement whatsoever regarding the payment of interest, since the respondent did not expressly agree to this.
11. In ICC case 7622 9 the parties had provided in their contract for the payment of interest in the event of the respondent's failure to pay the amounts due. The respondent alleged that the claimant's acceptance of late payment amounted to a waiver of interest. The arbitral tribunal here adopts a strict construction of the contract, stating that since the contract did not contain any such stipulation, the claimant could not be deemed to have waived its right to interest.
12. When there are no contractual stipulations indicating agreement between the parties on the issue of interest, arbitral tribunals look for a legal basis for their decisions with regard to interest.
B. The law
13. Several possibilities are available to arbitrators when it comes to applying a law. They may use the law applicable to the contract (i), conflict of laws rules (ii), or the law at the place of arbitration (iii). [Page55:]
14. ICC case 7987 10 provides an example of an arbitral tribunal that takes the law applicable to the contract as the basis on which to award interest. The sole arbitrator states that, in accordance with the law applicable to the contract (law of the State of New Jersey),the respondent has an obligation to pay 'incidental damages' owing to its failure to perform the contract.
15. Sometimes, however, when using the law applicable to the contract as the basis for their decisions, arbitral tribunals are confronted with a legal prohibition on awarding interest. In this connection, the Islamic shari'a merits special attention.
<i>a. The principle of prohibition</i>
16. Islamic shari'a is based on the Koran and is applicable in Moslem countries. It prohibits interest known as riba. 11 The influence of shari'a varies depending on the country. For example, in Saudi Arabia, its influence is very strong and disregard of shari'a can constitute a basis for setting aside an award. 12
<i>b. Arbitrators' approaches when confronted with a prohibition</i>
17. In ICC case 7063 13 the arbitral tribunal, in a majority decision, awards compensatory interest to the claimant even though the Saudi law applicable to the contract prohibits the awarding of interest. In order to do so, the arbitral tribunal states that the doctrine of riba prohibits usury, unjustly acquired interest and compound interest, but asserts that it does not prohibit the awarding of interest whose purpose is to indemnify a party that was unable to dispose of its own capital due to late payment by the other party. In order to support its interpretation of the doctrine of riba, the arbitral tribunal mentions that local banks provide for interest in their loan agreements and that the standard public works contract approved by the Council of Ministers affords the general contractor the possibility to seek financial compensation if the owner fails to perform the contract.
18. In ICC case 7373 14 the arbitral tribunal takes the same position as in the aforementioned case. Although the parties had here agreed that interest should be awarded if one of the parties defaulted, the tribunal interprets Iranian law and applies shari'a in order to avoid any contradiction between the contract and the law applicable to it. In order to support its liberal interpretation of shari'a the arbitral tribunal cites and analyses Iranian law, in particular, noting that such law authorizes compensatory interest in the event of late payment. The arbitral tribunal also bases itself on equity, stating that it would be unfair in international commercial relations not to award interest to the claimants. Lastly, taking a pragmatic line of argument, the tribunal refers to cases decided by the Iran-US Claims Tribunal in The Hague and by ICC arbitral tribunals and asserts that the general practice of arbitral tribunals of awarding compensatory interest is not prohibited by the doctrine of riba.
19. Unlike the previous two cases, in ICC case 5082, 15 the arbitral tribunal strictly applies Iranian law - the law applicable to the dispute - and does not rely on equity to establish its authority to award interest. The arbitral tribunal makes a detailed analysis of Iranian law noting, firstly, that the Iranian Constitution prohibits riba and that a decision of the Council of Guardians has confirmed such prohibition. It then cites [Page56:] several decisions of this same Council and of the Supreme Court of Iran that awarded interest. Lastly, the arbitral tribunal refers to the Iranian Civil Code, which allows courts to order debtors to pay an indemnity to creditors for losses incurred due to late payment if such indemnity is provided for in the contract or if, in accordance with customary law, it is implied in the contract. In order to ascertain whether the conditions laid down in the Iranian Civil Code apply to the case at hand, the arbitral tribunal notes that the term customary law, as used by the Iranian Civil Code, includes international usages and customs, and thus the obligation to indemnify the other party in the event of late payment.
20. Finally, it is interesting to note that in ICC case 7263 16 the arbitral tribunal decides not to award interest to the claimant, of Iranian origin, which maintained that it alone, and not the respondent, could claim interest. The claimant relied, in particular, on an opinion of the Iranian Council of Guardians authorizing the payment of interest on overdue amounts by foreign companies, institutions and governments. Considering this opinion to be contrary to the principles of equality and non-discrimination asserted by the Iranian Constitution of 1979 and not in compliance with the general principles of international public policy, the arbitral dismisses the claim for interest.
21. When the parties have not selected any applicable law or when several laws may be applied by arbitral tribunals, the tribunals may have recourse to conflict of laws rules in order to determine the law on which they shall base their decision.
22. In ICC case 8175 17 the law applicable to the contract is Indian law. Nevertheless, the arbitral tribunal indicates that, according to the applicable legal system, claims for payment of interest are governed either by the law applicable to the merits, or by the law applicable to procedure. The arbitral tribunal chooses the conflict of laws rules of the place of arbitration, which happens to be in France. It states that French law regards issues concerning interest to be part of substantive law, so the law applicable to the contract must be applied. Hence, the arbitral tribunal takes Indian law as the basis on which to award interest to the claimants.
23. It is interesting to note that in ICC case 8123, 18 in which the law applicable to the contract is the law of the Province of Quebec, the arbitral tribunal chooses to apply the French legal rate since Paris is the place of arbitration. It states that this rate would be more in keeping with the parties' expectations as reflected in their choice of the place of arbitration.
24. In ICC case 10079 19 the parties had agreed that the applicable rate was that of the place of arbitration (Sri Lanka). 20 After the sole arbitrator found that the rate at the place of arbitration was excessive in relation to the currency of the award (US dollars), the parties agreed that the arbitrator himself would decide the issue of the rate of interest. Thus, the arbitrator decides to apply the rate of interest applicable by the banks to the currency of the award. 21[Page57:]
25. The aforementioned case illustrates that a strict application of the law may sometimes lead to ill-fitting results. It is for this reason that some arbitrators decide not to rely on the applicable law when it seems unsuited to the situation.
C. Discretion given to arbitral tribunals not to apply the law strictly
26. It is important to note that it has been asserted, at least with regard to the rate of interest, that arbitrators should be free not to apply the law of the contract, or the law of the place of arbitration, or even a rate of interest they consider to be fair, but that the rate of interest applicable to the currency of the award should be applied. 22
27. In ICC case 8123, 23 despite its decision to apply the French legal rate, the arbitral tribunal states that it agrees with the position of the arbitral tribunal in another ICC case - 6219 24 - which had asserted that arbitrators were not bound to use a national legal interest rate. 25
III. Starting point of interest
28. Particularly in arbitrations involving long-term contracts, the period during which interest is payable can make an enormous difference to the amount which must be paid at the end of the arbitration. The key date will normally be that on which interest starts to run. Of course, it would be possible for the parties to agree on this date. However, this would be unlikely in practice because any agreement would need to be reached after the breach occurred. Nevertheless, in certain circumstances, parties may reach an agreement. For example, in ICC case 6896 26 the arbitral tribunal finds there was a tacit agreement of the parties as to the sum due on 29 April 1989. However, the sum tacitly agreed did not include interest prior to that date. Thus, the arbitral tribunal concludes that the claimant waived its right to interest prior to that date and grants the claimant interest from 1 May 1989. 27
29. Arbitral tribunals seem to have focused on four different dates: the date of the non-payment or other breach (A), the date when payment is requested (B), the date of the commencement of the arbitration (C) and the date of the award (D).
A. Date of the non-payment or other breach of the contract
30. This date can be chosen because it reflects the date on which the defaulting party should have made the payment. Thus, the non-defaulting party should have had the use of the money from that date.
31. ICC case 7114 28 shows an interesting approach to this issue. In that case, the claimant alleged that the respondent had failed to fulfil a disclosure obligation. The arbitral tribunal notes that it could not award default interest prior to the date of the award because 'the debtor of such obligation cannot be late in paying a debt the [Page58:] amount of which is not known to it until the award is made'. However, the arbitral tribunal goes on to state that the claimant's claim could be seen as a claim for additional damages for 'the purpose of present valuing' the claimant's claim for damages. Thus, the arbitral tribunal concludes that, in principle, the claimant would be entitled to interest in the form of damages from the date of the breach. However, the arbitral tribunal notes that the claimant delayed for some time before initiating the arbitration and thus concludes that the claimant thereby contributed to the amount of prejudice caused to it. Consequently, the arbitral tribunal reduces by half the amount of interest in the form of damages that the respondent is ordered to pay to the claimant.
32. In ICC case 7373 29 the contract stated that failing payment the claimant 'may' charge interest at a certain rate. The claimant claimed interest at the contractual rate from the date of its demand for payment. However, the arbitral tribunal finds that there are two problems with the claimant's claim. First, the contractual provisions actually provided that interest was not payable as from the due date but as from 60 days after the due date. Second, the contractual provision granted the claimant discretion to claim interest. During the relevant period, the claimant continued to demand the principal sum from the respondent but did not claim interest. The arbitral tribunal therefore acknowledges that the respondent may have been led to conclude that the claimant was not claiming interest.
B. Date of the request for payment
33. ICC case 7078 30 is a very clear example of the arbitral tribunal's use of the date of request for payment. In that case, the claimants wrote various letters of demand with regard to various payments due. One claim was first raised in the request for arbitration. The claimants are awarded interest on the respective claims from the date the claim was first made, either by the letters of demand or the request for arbitration.
C. Date of filing of the claims
34. ICC case 5082 31 illustrates a straightforward application of this approach. The arbitral tribunal holds that pursuant to the applicable law (Iranian law), and in the circumstances, interest shall run only from the date of the commencement of the arbitration.
35. ICC case 7388 32 highlights a more complex situation requiring more in-depth analysis by the arbitral tribunal. The arbitral tribunal finds that the law applicable to this issue is Tunisian law, which provides that interest is payable from the moment the creditor clearly indicates its decision to demand payment and requests the debtor to comply. The arbitral tribunal treats the principal claim and the counterclaim separately. With regard to the principal claim, it chooses a date shortly after introduction of the claimant's request for arbitration. However, with regard to the counterclaim, it considers two different dates: the date when the respondent filed its answer and counterclaim and the date when the respondent filed its memorial in support of its counterclaim. The arbitral tribunal notes that answers provided in ICC arbitrations are often summary in nature and that parties provide further details as to their claims [Page59:] either in the Terms of Reference or in subsequent memorials. However, it notes that the request for arbitration is often of the same, summary nature. Thus, it concludes that, by analogy, interest is payable on the counterclaim from the date on which the answer and counterclaim were filed. 33
D. Date of the award
36. The latest of the four starting points is the date of the award itself (i.e. no pre-award interest is granted). In ICC case 8264 34 the arbitral tribunal rejects the claimant's claim for pre-award interest, stating that the respondent's delay in payment could have been explained by the claimant's reticence to provide certain information to the respondent. The arbitral tribunal decides that interest shall run from 30 days after the notification of the award.
IV. Rate of interest
37. Obviously, the rate of interest is one of the key factors in deciding the total amount of interest that must ultimately be paid. Arbitrators have based their decisions as to the rate of interest on a number of different factors.
38. It might be noted that arbitrators are sometimes faced with the unenviable position that a party claims interest but does not state what interest rate would be appropriate. 35 In this case, the arbitrators can either reject the claim or try to find an appropriate rate in the law applicable. An example of this is ICC case 10681. 36 In that case, none of the parties made submissions with regard to the rate of interest that should be used. With regard to pre-award interest, the sole arbitrator considers legislation in this regard in certain states of the United States (Dallas, Texas being the place of arbitration). He concludes that 9% per annum would be appropriate in light of the legislation considered. With regard to post-award interest, he awards interest in accordance with the law at the place of arbitration.
39. Generally, arbitrators have looked to either the parties' contract (A) or the applicable law (B). However, as noted above, some arbitrators have suggested that in certain circumstances they have discretion not to apply the law applicable to the rate of interest strictly (C).
A. Contract
40. If the contract between the parties provides a rate of interest that shall be paid in the relevant circumstances, the arbitral tribunal is generally bound by the parties' agreement. If the contractual provisions are sufficiently clear, there is no decision to be taken by the arbitrators. 37
41. As noted above, ICC case 7622 38 shows an innovative approach to this issue. The relevant contract provided that interest shall be payable by the respondent to the claimant on late payments at a certain rate as from the 31st day following receipt of the [Page60:] claim. The claimant made claims against the respondent for interest on late payments as well as on other claims. The arbitral tribunal applies the contractual provision strictly with regard to the claimant's claim for late payment. 39 However, with regard to the claimant's other claims, the arbitral tribunal follows the same approach, stating that it applies the relevant contractual provision 'analogously'.
42. It is not always the case that the agreement of the parties is contained in the original agreement between them. In ICC case 7878 40 the sole arbitrator finds that pursuant to the relevant applicable law, interest would have been payable at a rate of 5% per annum. However, both parties claimed interest on their respective claims at 10% per annum or higher. Thus, the arbitrator concludes that the parties had reached a 'tacit' agreement that 5% per annum was not acceptable and that a rate of 10% per annum should be applied. This approach may be of some practical value when there are both claims and counterclaims.
B. Applicable law
43. If the parties have not come to an agreement, the arbitral tribunal must normally turn to the applicable law. However, as noted above, even deciding which law is applicable can be problematic.
44. ICC case 6896 41 demonstrates a straightforward application of Swiss law regarding interest. 42 The relevant provisions provide that an arbitral tribunal can only award interest higher than a certain statutory rate if the party claiming such interest proves that it actually paid interest at such a rate. The arbitral tribunal considers the evidence submitted by the claimant and concludes that it had not proven that it had paid interest at the claimed rates over the whole of the relevant period. Therefore, it grants interest to the party at the statutory rate.
45. It should also be noted that some applicable laws distinguish between pre- and post-award interest. ICC case 8632 43 is a good example. In that case, the place of arbitration was London. The arbitral tribunal applies the law applicable to the contract (New York law) to the question of pre-award interest. However, with regard to post-award interest, the arbitral tribunal finds that it is bound by the law at the place of arbitration to award interest at the local legal rate.
C. Discretion given to the arbitral tribunal not to apply the law strictly
46. ICC case 8123 44 provides what is perhaps the most innovative approach to the rate of interest. In that case, the arbitral tribunal quotes with approval the final award in ICC case 6219 45 which stated: 'The Arbitrator is not obliged to refer to the legal rate of any national system, whether that of the law of the contract or the lex fori of the place of arbitration.' The arbitral tribunal goes on to state that it chooses to exercise its discretion to use the French legal rate (Paris being the place of the arbitration). However, it notes that it would not be inclined to use such a rate if it were 'hopelessly inapposite' to a debt in US dollars. [Page61:]
47. While this award did not do so, such reasoning opens the door to the application of transnational law, at least to the rate of interest. Article 7.4.9(2) of the UNIDROIT Principles of International Commercial Contracts of 1994 states: 'The rate of interest shall be the average bank short-term lending rate to prime borrowers prevailing for the currency of payment at the place for payment, or where no such rate exists at that place, then the same rate in the State of the currency of payment. In the absence of such a rate at either place the rate of interest shall be the appropriate rate fixed by the law of the State of the currency of payment.' It has been argued that arbitrators should, at least with regard to the rate of interest, apply neither the law applicable to the contract nor the law applicable at the place of arbitration, applying instead a rate appropriate to the currency of the disposition. 46
48. This is taken one step further in ICC case 8521. 47 Here, the place of arbitration was Zurich, the claimant was French, the respondent was Spanish and the amount awarded was in Spanish pesetas. The arbitral tribunal holds that the discount rate referred to in Article 104(3) of the Swiss Code of Obligations is not the local rate but the rate applicable to the currency which 'is in general use and published daily'. Thus, the arbitral tribunal applies the MIBOR (Madrid Interbank Offered Rate) and states that application of such a rate is 'now general practice in international arbitration and may be considered as a relevant trade usage within the meaning of Article 13(5) of the ICC Rules'. 48
49. Another application of a similar principle can be seen in ICC case 10079. 49 In that case, the place of arbitration was Colombo, Sri Lanka. The counsel for the parties initially argued that the rate applicable would be that at the place of arbitration. However, damages were to be assessed in US dollars. Therefore, it appeared that both parties agreed that the local rate was not appropriate for a disposition in US dollars. Thus, the sole arbitrator decides to award on the approximate rate applicable to accounts held in US dollars. While in this case the parties agreed to grant the sole arbitrator discretion, this case again highlights difficulties that can be encountered in the strict application of an applicable law to the rate of interest.
V. Compound or simple interest
50. Obviously, the difference between simple and compound interest can be significant depending on the period during which interest is payable and the rests on which the interest compounds. However, despite the relative importance of this issue, the excerpts from awards published hereafter reveal a broad range of approaches to this issue, some being diametrically opposite.
51. In ICC case 8644 50 the arbitral tribunal decides that the claimant is entitled to interest pursuant to Article 78 of the United Nations Convention on Contracts for the International Sale of Goods (CISG). The claimant claimed compound interest. The arbitral tribunal simply states that '[c]ompound interest is not customary in international trade'. A similar sentiment is expressed in ICC case 7373. 51 In ICC case 10696 52 the arbitral tribunal comes to the opposite conclusion, stating that compound interest is 'quite customary in the commercial field and certainly well recognized in international arbitration practice'. However, in that case, because compound interest would have been contrary to the law applicable to the contract (Thai law), the arbitral [Page62:] tribunal grants only simple interest. Likewise, in ICC case 5082 53 the arbitral tribunal declines to grant compound interest because such interest is not permissible pursuant to the applicable law (Iranian law). By contrast, in ICC case 10681 54 the arbitral tribunal awards compound interest in accordance with the applicable law (Texas law).
VI. Conclusion
52. We can see from the above that there are many questions relating to interest in international arbitration which remain unresolved. The awards highlight that there are a number of ways of approaching interest, even with regard to key issues such as the law applicable. While these differences may reflect certain flexibility with regard to interest, they may also lead to a lack of predictability. For example, the fact that there are at least three fundamentally different laws which can be applied to the question of interest 55 shows that more uniformity in this regard might be desirable.
1 Neither the ICC International Court of Arbitration nor its Secretariat should be considered bound by any of the opinions expressed in this article, which are those of the authors alone.
2 Y. Derains, 'Intérêts moratoires, dommages-intérêts compensatoires et dommages punitifs devant l'arbitre international' in Etudes offertes à Pierre Bellet (Paris: Litec, 1991) 101.
3 See e.g. ICC case 10681, hereinafter pp. 92 ff.
4 For an interesting discussion of this distinction see H. Schönle, 'Intérêts moratoires, intérêts compensatoires et dommages-intérêts de retard en arbitrage international' in Etudes de droit international en l'honneur de Pierre Lalive (Basel: Helbing & Lichtenhahn, 1993) 649.
5 See Article 17 of the ICC Rules of Arbitration: '1. The parties shall be free to agree upon the rules of law to be applied by the Arbitral Tribunal to the merits of the dispute. In the absence of any such agreement, the Arbitral Tribunal shall apply the rules of law which it determines to be appropriate. 2. In all cases the Arbitral Tribunal shall take account of the provisions of the contract and the relevant trade usages.'
6 See hereinafter, pp. 94 f.
7 See hereinafter, pp. 72 ff.
8 See hereinafter, pp. 63 ff.
9 See hereinafter, pp. 79 f.
10 See hereinafter, pp. 81 f.
11 The definition of riba and the limits of its prohibition are very much debated. The term riba literally means surplus. See H. Benmansour, L'Islam et le riba - pour une nouvelle approche du taux d'intérêt (Paris: Dialogues, 1995).
12 P. Sanders, Quo Vadis Arbitration? Sixty Years of Arbitration Practice, A Comparative Study (Kluwer Law International, 1999) at 50.
13 See (1997) XXII Y.B. Comm. Arb. 87.
14 See hereinafter, pp. 72 ff.
15 See hereinafter, pp. 63 ff.
16 See hereinafter, pp. 71 f.
17 See hereinafter, pp. 83 ff.
18 See hereinafter, pp. 82 f.
19 See hereinafter, p. 92.
20 The law of Sri Lanka was also applicable to the merits of the dispute; however, the award states that the relevant rate would have been applicable because is was applicable 'locally'.
21 This case will be dealt with in more detail below in relation to the rate of interest.
22 J.O. Rodner, 'The Applicable Interest Rate in International Arbitration (UNIDROIT Principles, Article 7.4.9)', see hereinabove, pp. 43 ff.
23 See hereinafter, pp. 82 f.
24 (1992) 3:1 ICC ICArb. Bull. 22.
25 The question of interest rates will be discussed in section IV below.
26 See hereinafter, pp. 66 ff.
27 The arbitral tribunal does not explain why it chose the date of 1 May 1989 and not 30 April 1989.
28 See hereinafter, pp. 70 f.
29 See hereinafter, pp. 72 ff.
30 See hereinafter, pp. 68 f.
31 See hereinafter, pp. 63 ff.
32 See hereinafter, pp. 76 ff.
33 It might be noted that the arbitral tribunal does not award interest from the actual dates of the request for arbitration and the answer thereto, but rather from the end of the month in which the documents were filed with the Secretariat. The arbitral tribunal does not provide any particular explanation as to why this is done.
34 See hereinafter, p. 86.
35 This might arise because the lawyers are familiar with their own local courts which grant interest in a certain manner automatically and there is no need to make a submission.
36 See hereinafter pp. 92 ff.
37 See e.g. ICC case 10696, hereinafter, pp. 94 f.
38 See hereinafter, pp. 79 f.
39 With regard to the rate of interest, the arbitral tribunal states that it finds '5% as an average rate reasonable in the light of the contractual clause', although it is not clear why it makes such an approximation.
40 See hereinafter, pp. 80 f.
41 See hereinafter, pp. 66 ff.
42 viz. Articles 104-106 of the Swiss Federal Code of Obligations.
43 See hereinafter, pp. 89 ff. This case is also interesting because the claimant is granted post-award interest on legal costs.
44 See hereinafter, pp. 82 f.
45 (1992) 3:1 ICC ICArb. Bull. 22.
46 See supra note 22.
47 See hereinafter, pp. 88 f. This case also highlights the variability of interest rates. It is noted that the relevant rate (MIBOR) over a period of two years varied between 10.7% per annum and 7.96% per annum.
48 Article 13(5) of the 1988 ICC Rules Arbitration is the equivalent of Article 17(2) of the 1998 ICC Rules of Arbitration.
49 See hereinafter, p. 92.
50 See hereinafter, pp. 91 f.
51 See hereinafter, pp. 72 ff. The arbitral tribunal states: 'The Tribunal is convinced that the general practice of arbitral tribunals to award simple interest (and not compound interest) is consistent with modern municipal and international tribunals.'
52 See hereinafter, pp. 94 f.
53 See hereinafter, pp. 63 f.
54 See hereinafter, pp. 92 ff.
55 The law applicable to the contract, the law of the currency and the law of the place of arbitration.