ICC Statistical Reports

ICC arbitration's universal reach confirmed

The 1996 statistical report, published last year, announced a historical breakthrough in ICC arbitration as for the first time in the ICC Court's existence the number of parties from Western Europe represented less than 50% of those involved in ICC arbitration.This was confirmed in 1997 as the percentage of European parties remained under 50% while the number of cases was increasing.

The extension of ICC arbitration's reach materialized most notably in South and East Asia last year, with Asian parties representing 15.1% of all parties in 1997 (up from 9.5% in 1996). ICC Asia, recently established in Hong Kong, as well as ICC national committees in the region, have been particularly active in the promotion of arbitration last year. Countless conferences on the new ICC Rules were held throughout the region. The number of parties from Malaysia went up from 2 in 1996 to 15 in 1997. The figure for India went from 15 to 45; that of Japan from 15 to 27. There was an increase in the number of parties from Hong Kong and Mainland China (from 25 to 32). Figures for Indonesia, Pakistan, Singapore, the Republic of Korea, Sri Lanka, Taiwan and Vietnam also went up.

The number of parties from Latin America and the Caribbean went down by 3.2% in 1997, but the number of countries involved went up (from 13 to 16). Representatives from ICC headquarters presented the new Rules in 5 Latin American countries last year, namely: Brazil, Cuba, Mexico, Uruguay and Venezuela.

The figures for North Africa and North America went down slightly, those for Sub-Saharan Africa and Oceania were stable, and those for Central and Eastern Europe and the Middle East went up. A total of 1290 parties from 103 countries or territories were involved in ICC arbitration cases filed in 1997.

A State or State entity was a party in 8% of the cases filed in 1997. This figure is difficult to follow over the years. It had gone down from 14.1% in 1995 to 5.4% in 1996 following sweeping waves of privatization. One possible explanation for the increase now recorded for 1997 is the rapid growth of foreign direct investment, which sometimes gives rise to disputes between the host State and the private investor.

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Origins of the parties

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Status of cases filed

The "Status of cases filed", which was introduced last year, provides a more realistic idea of the number of cases that actually proceed to a final award.

Reasons for withdrawals are numerous and difficult to identify. But one may reasonably guess that a fair number of the withdrawals that take place between the filing of the request and the transmission of the Terms of Reference to the Court are due to a settlement between the parties. A settlement during the arbitral procedure may be triggered by a number of reasons, among which the threat of an impending, binding award, the realization of the financial and psychological costs involved in contentious proceedings, or the clarification of the issues by the arbitrator at the stage of the Terms of Reference.

This year's breakdown of withdrawals uses a different basis than that of last year so as to offer acceptable grounds of comparison with cases administered under the 1998 Rules.

Amounts in dispute

Amounts in dispute in cases filed in 1997 were again similar to those recorded the year before. As in 1996, the most important slice is between one and ten million US$. There is a notable increase, however, in the number of cases in which amounts at stake are below 200 000 US$ (from 15.4% in 1996 to 18.8% in 1997). The number of cases involving amounts in excess of 100 million US$ went up from 1.9% in 1996 to 2.2% in 1997. Disputes in which more than one million US$ are at stake represented roughly 50% of cases filed in 1997.

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Origins of arbitrators

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Economic Sectors

The breakdown of ICC cases by economic sectors for 1997 indicates a reduction in the proportion of cases classified under international trade (sales of goods) and distributorship agreements (from some 43% in 1996 to 35% in 1997). A significant increase was registered in intellectual property related disputes (from 14.7% to 17.3%), perhaps confirming the trend in favour of arbitration in this field (see the Report on intellectual property disputes and arbitration in this issue).

Construction and engineering contracts again represented 14% of ICC cases. A number of these contracts refer to the FIDIC conditions, which are the subject of the series of ICC awards published in this issue. Joint venture and cooperation agreements, acquisitions and mergers, and advertising each represented roughly 5% of cases filed. Other matters of significance were: services, consultancy, management, agency and transport.

Numbers of arbitrators

Arbitration agreements

The charts that appear on this page and the next provide information relevant to the negotiation of international business contracts. The dates of the contracts on which arbitration requests were based show the importance of choosing a well-established arbitration institution, as disputes sometimes arise decades after the signature of the contract.

The Court's Secretariat has traditionally directed the prospective users' attention to three elements which it might be advisable to include in their arbitration agreements: the applicable rules of law, the number of arbitrators and the place of arbitration. In 1997, the applicable rules of law were provided in the parties' contract in 81.3% of the cases. The place of arbitration was agreed by the parties in 85% of the cases. As for the number of arbitrators, it was indicated in only 42% of the contracts. The parties, however, often agree on the number of arbitrators following the filing of a request (33% in 1997), leaving the Court to decide this issue in 25% of the cases.

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Places of arbitration

Conciliation and ad hoc appointments

The ICC Rules of Optional Conciliation, which remain unchanged after the revision of the Rules of Arbitration, offer a means of resolving a dispute amicably. The Rules provide for the appointment of a sole conciliator with the full and unqualified consent of the parties. Use of ICC conciliation remains limited. Eight requests were filed in 1997. Half of these requests were withdrawn without any agreement having been entered; the other cases were pending at the end of 1997.

In 1997, ICC acted as appointing authority in eight cases, five of which were conducted under the UNCITRAL Rules.

International Centre for Expertise

The ICC International Centre for Expertise was kept extremely busy in 1997, as 33 requests were filed concerning disputes in a broad range of fields. The international reach of the Centre was demonstrated by the involvement of parties from 29 countries or territories and 5 continents. The experts proposed or appointed by the Centre came from 15 countries, namely: Australia, Belgium, Canada, Cyprus, Denmark, France, Germany, Ireland, Japan, Italy, Mexico, Sweden, Switzerland, the United Kingdom and the United States of America.

Cases brought this year concerned, for instance, power plants in the former Soviet Union, Spain and Pakistan, a hydro-electric dam in Africa, production units and processing equipment in Europe and the Middle-East, distribution of industrial equipment in Europe, price determination proceedings for raw materials in East Asia and documentary credit differences throughout the world.

Of the 33 requests filed in 1997, 14 concerned a documentary credit difference. Of these 14 requests, 4 were filed under the ICC Rules for Documentary Credit Dispute Resolution Expertise (DOCDEX), which came into force on 1 October 1997.¹ The parties involved in DOCDEX cases in 1997 came from 9 countries or territories. The panels constituted for these cases were composed of experts from 9 different countries. The introduction of DOCDEX came with high expectations with respect to speed. These were met as all four decisions were rendered within 100 days, the average being 75 days. It should be noted that the speed of the proceedings largely depends on the parties. The procedure is entirely document-based and the experts need not meet in person.