Introduction

It is an honour and pleasure to pay tribute to the institutional cooperation between ICC and UNCITRAL in the field of dispute resolution, a cooperation that actually pre-dates the establishment of UNCITRAL in 1966, and one to which we can safely predict a bright future. The UNCITRAL Secretariat is particularly indebted to the many ICC practitioners and scholars who, over the years, have continuously brought their expertise, wisdom, and friendly support to UNCITRAL, an inter-governmental organization, the successes of which rely heavily on the sustained interest and participation of actual participants in international trade.

This article illustrates the interactions of ICC and UNCITRAL in their respective roles as makers of norms in international arbitration and considers the differences and complementarities in their work.

I. Norm-making in international arbitration

The procedural framework of international arbitration is comprised of many different types of norms that have been formulated by a wide range of actors through diverse processes. Such norms do not easily fall under the traditional categories of international or domestic law, nor under those of public or private law. In fact, they do not easily fall under the traditional notion of ‘law’.

Party autonomy – inasmuch as the concept may refer to the doctrine of freedom of contract – forms the basic principle on which the procedural aspects of international arbitration are, or at least should be, built. Just as parties agree on arbitration as their dispute resolution method, the procedure to be followed is also subject to determination by the parties; procedural flexibility being one of the advantages of arbitration. This may sound too obvious but may not be universally shared, as one travels around the world to promote arbitration.

While the actors involved in the making of norms, and processes leading thereto, have differed, contemporary norm-making in international arbitration has generally aimed at addressing, and maintaining a careful balance between, the integrity and procedural efficiency of the arbitration. Norms responding to the practical needs of international arbitration were formulated by international inter-governmental (‘IGOs’) and non-governmental organizations (‘NGOs’) through a dynamic and recursive cycle. This cycle usually entailed a preparatory stage where the desirability and feasibility of norms were considered, followed by substantive deliberations and public consultations. The resulting norm was formally adopted by the respective international organization, and feedback sought from users so as to facilitate subsequent updates to the norms.

A. Historical perspective: ICC and the United Nations

One of the most significant achievements in the development of international arbitration was the adoption of the 1958 New York Convention by the United Nations Conference on International Commercial Arbitration based on discussions at the United Nations (UN) Economic and Social Council (‘ECOSOC’). ICC played a significant role in that process as one of its committees prepared a draft of the convention, which was submitted to ECOSOC in October 1953. This is not only a striking example of long-standing cooperation between ICC and the UN, but also a landmark in the history of UNCITRAL as, in the aftermaths of the 1958 diplomatic conference, ICC played a prominent role in the creation of UNCITRAL. Once established by the UN General Assembly in 1966, UNCITRAL became the legal body within the UN system in charge, inter alia, of filling the blanks left open by the New York Convention with respect to legislation and providing any necessary guidance with respect to arbitration.

While ICC launched its first arbitration rules immediately after its establishment in 1923, efforts were also made early in the history of the UN to codify arbitral procedure. In 1949, the International Law Commission (‘ILC’) selected arbitral procedure as one of the topics for codification and appointed Georges Scelle as the special rapporteur.¹ In 1958, the Model Rules on Arbitral Procedure were adopted by ILC to apply to inter-State arbitration.² The Model Rules had a dual aspect: they codified existing law in international arbitration and, at the same time, formulated developments which were considered as ‘desirable’ in the field.³

The UNCITRAL Arbitration Rules were adopted in 1976 to provide a comprehensive set of procedural rules upon which parties may agree for the conduct of arbitral proceedings.⁴ The preparation of the UNCITRAL Arbitration Rules took three years and involved extensive consultations with experts representing different legal traditions, key arbitral institutions (like ICC), and drew upon the experience of existing arbitration regimes.⁵ By incorporating procedures from both common and civil law systems, the UNCITRAL Arbitration Rules struck a balance between providing sufficient guidance and procedural protections to the disputing parties and providing sufficient flexibility for particular circumstances of the disputes.

The idea that the UNCITRAL Arbitration Rules were intended to only be used in ad hoc arbitration is a rather mischievous misconception. Such statement, which may have been voiced in a spirit of friendly competition, misses the target. It is too evident that the UNCITRAL Arbitration Rules are not intended to establish the level of institutional sophistication reached by the ICC Arbitration Rules (supported by the ICC Court system) or other institutional arbitration frameworks in various parts of the world. Indeed, the drafters of the UNCITRAL Arbitration Rules (often also admirers of ICC arbitration) did not intend to create the best or the most elaborate out-of-court dispute resolution device. Rather, their objective was to offer a basic, generic, all-purpose, yet detailed and practical set of rules that could serve as a reference to parties and other participants in dispute resolution, with or without the support of dedicated legislation or presence of an administering arbitral institution. The UNCITRAL Arbitration Rules were meant to be a survival kit for newcomers in a seemingly new hostile form of out-of-court dispute resolution.

During the revision of the 1976 UNCITRAL Arbitration Rules, the Working Group considered that their original structure and spirit as well as their generic nature should be preserved.⁶ In fact, more than forty years after their initial adoption, it can be said that the UNCITRAL Arbitration Rules form the backbone of international arbitration by providing a comprehensive and universal set of rules for ad hoc commercial arbitration as well as for investor-State and State-to-State disputes.⁷ Furthermore, the UNCITRAL Arbitration Rules provide a useful benchmark to arbitral institutions for the development of their own arbitration rules.⁸ For this purpose, UNCITRAL also issued a set of recommendations to assist arbitral institutions and other interested bodies with regard to arbitration under the UNCITRAL Arbitration Rules, which also involved valuable contribution of ICC.⁹

B. The changing norm-making environment: Declining role of the States and increasing role of international organisations

ICJ Judge Higgins once noted:

States are, at this moment of history, still at the heart of the international legal system.¹⁰

That statement may not be so accurate, particularly with respect to norm-making in the field of international arbitration.

A traditional approach to international arbitration is to consider the law of the place of arbitration (lex arbitri) as the sole source of legitimacy and validity of the international arbitration (the territorial approach). With this approach, States play the most important role in norm-making through lex arbitri.

Another approach is to consider international arbitration as an autonomous legal order. According to this transnational perspective, States collectively (rather than individually or pluralistically) recognize the legitimacy and validity of international arbitration as rooted in the views developed jointly by the community of States through collective norm-making. The New York Convention and the UNCITRAL Model Law on International Commercial Arbitration (the ‘Model Arbitration Law’) illustrate this approach. Such a delocalized conception of international arbitration does not necessarily mean that arbitration proceedings exist on their own, but rather that they are attached to national legal order of the jurisdiction where enforcement of the award is sought.

While the second approach better explains the wide-ranging norm-making by non-State actors, the increasing liberalization in international arbitration may suggest that neither of these approaches is relevant when it comes to procedural aspects.¹¹ With an almost universal adoption of the New York Convention and an harmonization of national arbitration laws achieved through the Model Arbitration Law, the significance of lex arbitri and the role of State as norm-makers have somewhat declined.¹²

Although it is understood that States ultimately bring legitimacy to international arbitration, individual or collective norm-making, particularly with regard to the procedural aspects of international arbitration, does not fall within the exclusive authority of States. Moreover, the trend shows that non-State actors have been the most active in contemporary norm-making.

States will nonetheless continue to play a role in norm-making as they have both the legitimacy and the ability to influence the establishing of norms. While harmonization of national arbitration legislation may have been achieved, some States have attempted to create a more favourable regime for parties, on the basis of Article VII(1) of the New York Convention (often referred to as the ‘more-favourable-law provision’),¹³ or to introduce innovative provisions not foreseen in the Model Arbitration Law. Such efforts (e.g. with regard to expedited procedures, emergency arbitration and third-party funding) have typically aimed at attracting international arbitration in their jurisdiction.

Public international law scholars acknowledge the diversity of participants in the contemporary international law making. They note the growing importance of non-State actors in certain specific areas and refer to IGOs, NGOs, global economic players and the media.¹⁴ Michael Reisman asserted the importance of actors, who lack formal decision-making competence but nevertheless influence decisions.¹⁵ It is inevitable that non-States actors have contributed in different ways to the emergence of different international norms,¹⁶ and the field of international arbitration provides a very good example.

Among the IGOs, International Centre for Settlement of Investment Disputes (ICSID), Permanent Court of Arbitration (PCA) and UNCITRAL stand out with their orientation for norm-making in the field of international arbitration. IGOs provide a platform for multilateral norm-making where States and, to the extent permissible, non-State actors engage in the preparation of such norms.¹⁷ Considering that norm-making at IGOs involves a collective process involving mainly States, it could be questioned whether these IGOs can be construed as ‘non-State’ actors.¹⁸ While member and observer States of UNCITRAL and contracting Parties to the ICSID Convention continue to play an essential role in the norm-making process, norms formulated do not necessarily have a binding effect on States participating in the norm-making process and are generally presented as norms formulated by the autonomous IGO rather than by a group of States. In other words, it is not so much about the norm-making ‘through’ IGOs but more ‘by’ IGOs.

Arbitral institutions, the number of which currently exceeds 200, are, in fact, the most active in norm-making, which generally involves promulgating their own institutional rules and other guidance texts specific to their proceedings. These texts take various forms (notes, recommendations, guidelines, checklists, standards or best practices) and are updated regularly. More recently, norm-making by arbitral institutions have focused on introducing innovative features to improve the procedural efficiency of arbitration under their rules. A few arbitral institutions have been more ambitious with the aim of assuming a more prominent role in setting industry standards and practices. ICC is one particularly important example and the probably unparalleled list of guidance text prepared by the ICC illustrates its prominence.

While recognizing the well-known quality and quantity of these texts, the question of their normative status in international arbitration requires further consideration. After all, we are used to acknowledging the normative value of certain ICC standards issued in other areas of global business practice. Various iterations of the Incoterms and the Uniform Customs and Practice for Documentary Credits (UCP) come to mind as examples of standards that have achieved customary value and, while not generally binding, can only be ignored at great risk.¹⁹

Is it conceivable that any ICC text in the field of arbitration would achieve a comparable status? In the field of arbitration, as opposed to the carriage of goods or banking for instance, ICC runs its own operation through the ICC Court as a de facto competitor to other arbitral institutions. This fact somewhat blurs the perspective as to whether ICC texts in this field could acquire normative status. Even so, it is important to note that ICC was recently granted full observer status by the UN General Assembly,²⁰ and the UNCITRAL Secretariat was pleased to accompany the process behind the scenes. While it is both too early and too far from the topic of this article to discuss the consequences thereof, it may not entail much change, at least from the perspective of UNCITRAL as it simply allows for an extension of UNCITRAL’s own established practice (which recognizes a degree of prominence in the role played by ICC as the world business organization) to the entire circle of General Assembly bodies.

II. A comparative analysis of the ICC and UNCITRAL norm-making

A. Organizational difference

UNCITRAL is a commission established by the UN General Assembly in 1966 and is responsible for law-making in the field of international trade law. As an inter-governmental body, it is composed of 60 member States elected for a six-year term and is potentially open to participation by all other UN member States as well as invited IGOs and NGOs. Contrary to a widely held misconception, UNCITRAL does not administer arbitration or provide any service in relation to case management.²¹

In contrast, ICC is a non-governmental global business organization whose mission is to promote international trade, responsible business conduct and a global approach to regulation in order to accelerate inclusive and sustainable growth to the benefit of all. The ICC Court is the independent arbitration body of ICC established in 1923 (Article 1(1), ICC Arbitration Rules). Its function is to supervise and administer ICC arbitrations (i.e. conducted under the ICC Arbitration Rules) throughout all stages of the process. The ICC Court is the only body empowered and authorized to administer arbitrations under the ICC Arbitration Rules (Article 1(2), ICC Arbitration Rules).

The ICC Court consists of a President, 17 Vice-Presidents as well as 176 members (as of 1 July 2018) from 104 countries (including jurisdictions such as Hong Kong, Chinese Taipei and Palestine), all of whom are appointed for three-year terms.²² The plenary sessions of the ICC Court are taken by a majority vote, with the President or the Vice-President, as the case may be, having a casting vote in the event of a tie (Article 4 of Appendix I to the ICC Arbitration Rules). In its work, the Court is assisted by the Secretariat of the Court that issues notes and other documents for the information of the parties and the arbitrators, or as necessary for the proper conduct of the arbitral proceedings.

B. Actors and processes involved

The distinct processes within the two institutions may be best illustrated through the revision process of the UNCITRAL Arbitration Rules (2010) and the ICC Arbitration Rules (2017).

UNCITRAL Arbitration Rules (2010)

In 2006, UNCITRAL initiated the revision of the UNCITRAL Arbitration Rules in order to reflect the changes in arbitral practice and to enhance the efficiency of arbitration under those Rules. Like the 1976 version, the 2010 UNCITRAL Arbitration Rules cover all aspects of the arbitral process, from procedural rules on the appointment of arbitrators and the conduct of arbitral proceedings to rules in relation to the form, effect and interpretation of the award.

The call for the need to revise or update the 1976 version was raised not only within UNCITRAL but also by arbitration practitioners. In 2003, the Commission proposed the revision as a topic for future work.²³ It continued to be mentioned as possible future work along with other topics by both the Commission ²⁴ and the Working Group on Arbitration.²⁵ Within the UNCITRAL structure, substantive deliberations on specific topics are undertaken by a working group (consisting of the same members as the Commission), which reports to the Commission of its progress and results.

As the year 2006 marked the thirtieth anniversary of the 1976 version, conferences were organized in different regions to exchange information on the application and possible areas of revision. At a conference held in Vienna (6-7 April 2006) in cooperation with the International Arbitral Centre of the Austrian Federal Economic Chamber,²⁶ suggestions were made to better align a number of articles with current international arbitration practice and relevant provisions of the Model Arbitration Law. A brief overview of those suggestions was presented to the Commission in 2006.²⁷ During this period, a study was conducted by Jan Paulsson and Georgios Petrochilos in conjunction with the UNCITRAL Secretariat to suggest possible revisions to the 1976 version.²⁸

At its 2006 session in New York, the Commission agreed that priority should be given to the revision of the 1976 UNCITRAL Arbitration Rules, which was recognized to be a very successful text adopted by many arbitral institutions and used in many different instances.²⁹ The Commission also stated that any revision of the UNCITRAL Arbitration Rules should not alter the structure of the text, its spirit or its drafting style, and should respect the flexibility of the text rather than make it more complex.³⁰

Once mandated, the Working Group on Arbitration and Conciliation commenced its work on the revision at its forty-fifth session in September 2006. The substantive discussions were held at the biannual working group sessions based on draft texts prepared by the Secretariat and proposals made by State members. In carrying out its work, the working group discussed the revisions article-by-article completing its third reading prior to the adoption. In two occasions, informal drafting groups were formulated to prepare re-drafts and to ensure consistency between the various language versions. Appointed by the Working Group as its chairperson, Michael Schneider (Switzerland) chaired all eight sessions of the Working Group leading to the revision, and twelve different State representatives functioned as rapporteurs.³¹

The UNCITRAL Secretariat prepared preparatory documents, collected relevant background information for discussion, including rules of arbitral institutions which initially followed the 1976 version and were subsequently revised, and undertook consultations with practitioners, in particular arbitral institutions including the ICC.

Number of States, IGOs and NGOs participating in

the Arbitration and Conciliation Working Group

This table reflects a survey of the reports and the list of participants of the eight Working Group sessions. It indicates that the number of States participating in the revision process gradually increased with the largest attendance at the forty-eighth session when the issue of transparency in investor-State arbitration was discussed (77 States). During the entire process, 30 States were represented in all eight sessions³² and 17 other States were represented at least during six sessions. IGOs were also active in the revision process with PCA being represented in all eight sessions. ICC was also among the 43 NGOs that participated in the revision process.

Composition of State delegation participating in

the Arbitration and Conciliation Working Group

The table above illustrates how member and observer States composed their delegation during the eight sessions. Interestingly, the process leading the revision of the UNCITRAL Arbitration Rules attracted 54% more State delegations than the 2006 amendments to the Model Arbitration Law, most likely as it closely related to the arbitration practice. Overall, ‘practitioners’ constituted about 17% of the State representatives and the ‘academics’ 8 %.

The revision process took almost four years and involved eight sessions of the Working Group. Following the fifty-second session in February 2010, the Secretariat prepared a note containing the annotated draft of the revised UNCITRAL Arbitration Rules.³³ In response, 19 States, two IGOs and eight NGOs submitted comments on the revised draft.³⁴ Based on such material, the Commission, during its forty-third session held in New York in 2010, focused its discussion on articles which have not been fully discussed or where consensus had not been achieved at the Working Group. After five days of deliberations in June 2010, the Commission was able to adopt the 2010 UNCITRAL Arbitration Rules, which came into effect on 15 August 2010.³⁵

ICC Arbitration Rules (2017)

In November 2016, ICC announced amendments to its Rules of Arbitration (the ‘ICC Arbitration Rules’) with the aim of increasing the efficiency and transparency of arbitrations administered by the ICC Court. The revised rules entered into force on 1 March 2017. With regard to the amendment, the ICC Court President Alexis Mourre stated: ‘Disputes will now be resolved on a very expeditious and cost-effective manner, providing an effective answer to the legitimate concerns of the business community as to time and costs…This is an increased measure of transparency and accountability to our users’.³⁶ The expedited procedure seeks to achieve efficiency and economy and follows the path by other arbitration institutions.

Article 7 of Appendix I to the ICC Arbitration Rules provide:

Any proposal of the Court for a modification of the Rules is laid before the Commission on Arbitration and ADR before submission to the Executive Board of the ICC for approval, provided, however, that the Court, in order to take account of developments in information technology, may propose to modify or supplement the provisions of Article 3 of the Rules or any related provisions in the Rules without laying any such proposal before the Commission.

The 2017 amendments to the ICC Arbitration Rules were proposed in May 2016 by the ICC Court, laid before the ICC Commission on Arbitration and ADR at its Washington session on 17 September 2016, and finally approved by the ICC Executive Board in Bangkok on 20 October 2016.³⁷ Article 6 of the ICC Court Statute and Article 1 of the Internal Rules of the ICC Court reiterate the confidential nature or character of the work of the ICC Court, making it difficult to gain access to information about the process that led to the amendments.

In essence, it seems that the ICC Court and the ICC Commission on Arbitration and ADR undertake norm-making functions within the ICC structure.

The ICC Commission on Arbitration and ADR drafts and revises the various ICC rules for dispute resolution and produces reports, guidelines and best practices on legal, procedural and practical aspects of dispute resolution, in view of improving ICC dispute resolution services and responding effectively to users’ needs.³⁸ According to the ICC website, the Commission provides for a global forum of around 1,000 members from more than 92 countries including lawyers, in-house counsel, arbitrators, mediators, law professors and experts in various dispute resolution fields. Partners from international law firms, general counsel representing global corporations are also members. Members are appointed to the Commission by their respective countries' national committees to the ICC. The Commission holds two plenary sessions per year at which proposed rules, reports and guidelines are discussed, debated, and voted upon. A steering committee comprised of the chair and the vice-chairs of the Commission,³⁹ along with other representatives of ICC dispute resolution services, meets twice a year to discuss and agree upon the overall action plan for the Commission, including the proposal of task forces. The specific work of the Commission is often carried out in smaller task forces, consisting of members who are appointed by the ICC's national committees. Task forces are usually chaired by two members who guide the form and substance of the work. A task force may have a specific, dedicated mission - such as the publication of a set of rules or guidelines - or may be set up to study a certain aspect of arbitration, without a precast idea of the end result of its work.

III. Complementarity of ICC and UNCITRAL in norm-making

ICC and UNCITRAL have both developed working methods that appear well suited to achieving their respective goals.

• For ICC: to reflect practical needs of parties through effective norm-making, and implement the ICC dispute resolution rules through the ICC Court and ICC International Centre for ADR.
• For UNCITRAL: to reflect the interests of States and paving the way for universal application of its texts, including the UNCITRAL Arbitration Rules, and promote a global arbitration culture.

That being said, the two organizations may learn from each other. UNCITRAL has paid great attention to the normative work of ICC, and there are many examples where standards developed by the ICC in other areas of law were subsequently turned into inter-governmental instruments. Members of the ICC Banking Commission may recall UNCITRAL’s efforts to draw inspiration from the Uniform Rules for Demand Guarantees (‘URDG’) when it discussed the United Nations Convention on Independent Guarantees and Stand-by Letters of Credit.⁴⁰ In the field of arbitration, it goes without saying that innovative features recently introduced by ICC, for example, expedited procedures as well as emergency arbitration, are worth considering at UNCITRAL's level in the years to come.

However, it is probably the ICC norm-making process that UNCITRAL might wish to further reflect on. There may be benefits of considering certain aspects that have allowed ICC to react expeditiously and successfully to new developments. Given the difference in the constituencies and objectives of the two organizations, the fact that UNCITRAL’s revision of its Arbitration Rules took four years whereas ICC was able to complete the revision of its Arbitration Rules in a year or so, is not a source of concern. It may however be advisable to consider introducing some tools that are likely to expedite the UNCITRAL norm-making process. UNCITRAL prides itself on always reaching its decisions through consensus (with two exceptions) and it has never voted on issues of substance. There are many reasons why consensus may be the preferred method in the making of international standards. The UN General Assembly often prefers decision-making by consensus even though its rules of procedure foresee decision-making through voting by a simple majority. In fact, those good reasons may have led the Hague Conference on Private International Law, an inter-governmental organization comparable to UNCITRAL, to resort more systematically to decision-making by consensus. Notwithstanding this, when carefully used, decision-making through a majority vote could expedite the normative process, especially on matters of substance. This will require extensive review of the notion of consensus, which has a history of its own in the context of UNCITRAL. At this stage, suffice it to say that ICC’s experience will offer precious points of comparison.

The international political and economic landscape may be changing constantly. Nonetheless, international organizations like ICC and UNCITRAL will continue to play a significant role in support of international arbitration through the formulation of procedural norms applicable to international arbitration. Hopefully, many will agree that ICC and UNCITRAL are complementary norm-making institutions. The challenge faced by both institutions in their normative capacity is the preparation of sound standards, which codify and improve the procedural aspect of international arbitration. What makes it more challenging is that norm-making itself needs to:

• address arbitration practical needs and contemporary developments;
• promote substantive discussions through open and transparent processes;
• enhance the legitimacy and the normativity of the standards; and
• cater to the needs of both State entities and commercial players.

In other words, both organizations will need to continue ensuring the acceptability and usefulness of the norms and standards they formulate.

An increased cooperation between ICC and UNCITRAL could go a long way towards establishing and enhancing a sound legislative framework for arbitration. As indicated above, the ICC Arbitration Rules and the UNCITRAL Arbitration Rules do not operate in the same fashion. They do not compete with each other, and through closer cooperation, they may fertilize an arbitration culture in the common interest of all.

Concluding plea: joint steps towards an ADR-friendly environment

Both organizations should take joint steps towards the promotion of appropriate law reforms, which may take the form of legislative technical assistance or capacity building. The UNCITRAL Model Law on International Commercial Arbitration has a proven track record and is widely recognised as an acceptable common ground through which all legal cultures may approach or develop arbitration, both at the domestic and international levels. Experience shows that legislative reforms heavily depend on promotional efforts undertaken by international organizations to raise awareness about existing standards and to provide a better understanding of how they operate. Our concluding plea is therefore that ICC and UNCITRAL join forces in promoting an arbitration-friendly (or at the very least arbitration-tolerant) environment.

Needless to say that the idea outlined above with respect to arbitration could be transposed further into other fields of alternative dispute resolution. For instance, in 2018, UNCITRAL will be finalizing a new Convention addressing the cross-border enforcement of settlement agreements reached through international commercial mediation. This would be accompanied by corresponding revisions to the 2002 UNCITRAL Model Law on International Commercial Conciliation. This is an area for which a number of ICC standards already exist and both organizations should collaboratively create, modernize and harmonize State legislation and worldwide business practice. Current efforts by UNCITRAL with regard to investor-State dispute settlement reform is also an area whereby the experience of ICC may shed light both from a procedural perspective and as a channel to reflect the interests of the businesses as investors. Here too, closer collaboration between ICC and UNCITRAL would benefit businesses worldwide and international trade more generally.

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