Demande de caution garantissant les frais de l'arbitrage/ Ordonnance de procédure reproduite dans la sentence finale/ Mesures conservatoires et provisoires/ Compétence de principe de l'arbitre/ Compétence d'exception des tribunaux étatiques/ Demande recevable/ Art. 16 du Règlement/ Droit de procédure applicable/ Art. 11 du Règlement/ Demande rejetée.

'On August 14, 1992, Defendant filed a submission in support of its Application for security; Claimant replied to this application by a memorial dated September 15, 1992, which was commented to by Defendant in a letter of September 16, 1992.

The Arbitrator dismissed the application for security by an order dated October 15, 1992, the text of which is reproduced below:

"Order on application for security

1. On July 20, 1992, Defendant (hereinafter Counterclaimant) filed an application for an order for a formal award requiring Claimant (hereinafter Counterdefendant) to provide security for Counterclaimant's counterclaim and its costs in this arbitration and in French court proceedings.

This application was confirmed and substantiated by Counterclaimant in a memorial dated August 14, 1992.

2. Counterclaimant formally requests that Counterdefendant be ordered to provide security, by way of a bank guarantee issued by a first class bank, in the amounts of:

(A) 1 779 000 French francs to cover the principal amount of its counterclaims; and

(B) US$ 125 000 to cover the costs of arbitration and litigation (US$ 30 000 in fees and costs payable to the ICC, US$ 80 000 in fees to counsel and other expenses connected with the proceedings, and US$ 15 000 to cover the costs and expenses connected with the French court proceedings brought by Counterdefendant).

3. The justification given by Counterclaimant for its application for security is that Counter-defendant, in case the arbitrator accepts its counterclaim, will not be able to comply with the award because of its precarious financial position and that, for the same reason, Counterclaimant will not be able to recover its costs.

4. In the alternative, Counterclaimant requests, at the minimum, an order for security for costs of US$ 125 000, and, in the second alternative, it re-iterates its first alternative and at the same time volunteers to provide security for Counter-defendant's costs up to the same amount of US$ 125 000.

5. In a memorial dated September 15, 1992, Counterdefendant contended that Counterclaimant's application for security should be dismissed because the Arbitrator has not jurisdiction to entertain it and because, under French law, such security would be unlawful. At the meeting devoted to the execution of the Terms of reference, on July 24, 1992, Counterdefendant also argued that Counterclaimant's application was inadmissible in that it was not made in Counterclaimant's answer and counterclaim.

6. By a letter dated September 15, 1992, Counterclaimant gave its comments on Counter-defendant's memorial of September 15, 1992.

7. Considering that none of the parties has requested a hearing on Counterclaimant's application for security; that the arbitrator does not consider such a hearing to be necessary and considering there is no legal or practical need to decide the issue by a formal award, the arbitrator, having duly studied the written material submitted by the parties,

MAKES THE FOLLOWING ORDER

8. Counterclaimant's application for security is admissible. Contrary to Counterdefendant's view, nothing in the Rules of Arbitration of the International Court of Arbitration restricts the right of a party to make a new claim after the documents contemplated in Article 3, 4 and 5 of these Rules have been exchanged. According to Article 16 of the Rules, the parties may even make new claims before the arbitrator, under certain conditions, after the execution of the terms of reference. A fortiori, they can file new claims before the execution of this document, which, according to Article 13 (1) of the Rules, is drawn up in the light of the most recent submissions of the parties.

9. The arbitrator has jurisdiction to deal with the application for security. Article 8 (5) of the Rules of the International Court of Arbitration states that, once the file has been transmitted to the arbitrator, it is only in exceptional circumstances that the parties should apply to judicial authority for interim or conservatory measures. As a result, the jurisdiction of the arbitrator in this respect is the principle and the jurisdiction of the judicial authorities is the exception (see ICC Award n° 4126, 1984, Collection of ICC Arbitral Awards, p. 551, comments by S. Jarvin; ICC Award n° 6697, 1990, Revue de l'Arbitrage, 1992, p. 135, comments by P. Ancel).

10. Counterclaimant's application for security, if granted, would be lawful. Contrary to Counterdefendant's suggestion, domestic French law on civil procedure is not applicable to this international arbitration, which is governed only by the Rules of the ICC Court of arbitration, and more particularly, their Article 11, in accordance with Article 1494 of the French Code of Civil Procedure (NCPC) applicable to international arbitration. Thus, where the ICC Rules of arbitration are silent, and in the absence of any other rules agreed upon by the parties in this respect, the arbitrator may lawfully grant the measure applied for by Counterclaimant, provided he is satisfied that justice will be served that way. Moreover, even if French domestic procedural law were applicable, Counterclaimant's application can still be accepted provided certain conditions are met.

11. Nevertheless, Counterclaimant's application is dismissed. The object of the application is, quite simply, fundamentally irreconcilable with its ground. The arbitrator does not see, were he to grant the application, how Counterdefendant should be expected to convince a first class bank to issue a guarantee for amounts it is admittedly unable to pay.

12. The arbitrator therefore takes it that Counterclaimant is not really concerned about Counterdefendant's present financial position, given also its proposal of April 3rd, 1992, that Counterdefendant take over Counterclaimant's assets in France to the amount of 50 million French francs (Annex 4 to Counterclaimant's Answer and Counterclaim of May 15, 1992). More likely, Counterclaimant is concerned about a possible change in Counterdefendant's financial situation, or has doubts about its willingness to comply with an award favorable to Counterclaimant. There are, however, no facts before the arbitrator to support such concerns. To the contrary, by submitting to International Chamber of Commerce arbitration, Counterdefendant just as much as Counter-claimant, has undertaken to carry out the resulting award, as per Article 24 (2) of the ICC Rules. There is no reason to assume that Counterdefendant, or Counterclaimant for that matter, will not comply with that undertaking.

13. The above mentioned reasons apply to the alternative prayers of Counterclaimant as well as to is principal prayer. Consequently, all prayers are dismissed.

14. Counterdefendant has claimed that the costs resulting from Counterclaimant's application be borne by Counterclaimant. The arbitrator will deal with this question in his award.

15. The text of this Order will be inserted in the text of the arbitrator's award when issued."'