During the first year of application of the 1998 ICC Rules of Arbitration, the ICC International Court of Arbitration received its ten thousandth Request and celebrated 75 years of growth. The year of 1998 ended with an important overall increase in the Court's activity.

Number of Requests

The chart below provides a broad picture of the quantitative evolution of ICC arbitration since the establishment of the Court, based on figures published here for the first time. The figures show that the ICC Court was off to a quick start with 36 requests received in its first year and an increase to 93 requests in 1930. An understandable slump is then noticeable throughout the thirties, followed by a near-total paralysis during the second world war. From then on, progress was slow and unstable until the mid-sixties, when growth accelerated and became more predictable, a trend which continues at an increased pace today. If the number of requests filed with the ICC Court follows the pace noted in the first few months of this year, the figure for 1999 should be well over 500.

Requests filed since 1921

The figures published below are the result of a thorough and meticulous review of ICC's archives since 1921 performed by Mirèze Philippe of the Court's Secretariat. The reader will note that the International Chamber of Commerce started receiving requests for conciliation and arbitration before the Court was formally established.

Parties to ICC arbitration

The chart showing the origins of the parties in cases filed with the ICC in 1998 provides an overview of the geographical reach of ICC arbitration. [Page5:]

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A total of 1151 parties came from 104 countries and from all continents. For three consecutive years the proportion of parties from outside Western Europe has been over 50%, reaching 56.3% in 1998 and thus confirming ICC arbitration's universality. This was accompanied by a marked acceleration over the same period of the growth of ICC arbitration among Asian parties. Asian parties, broken down here between South & East Asia and Oceania, represented an all-time record high of 20% of the total number of parties in ICC cases. The involvement of parties from other regions has been stable, with a slight increase in relative terms for North Africa (1.8% in 1997 to 2.4% in 1998) and North America (10.3% in 1997 to 12.6% in 1998).

A state or state entity was involved as party in 10.1% of the cases filed with the ICC Court in 1998 (compared to 8% in 1997, 5.4% in 1996 and 14.1% in 1995). The ICC Court continued in 1998 to handle a fair number of multi-party arbitration cases, as about one new case out of five involved more than two parties. This figure has been stable over the past few years at around 20%.

Status of cases filed

The Status of cases filed for 1998 provides data on the number of withdrawals over the past five years and the stages of the procedure at which the withdrawals were made. It was noted last year that although reasons for withdrawals may be difficult to identify, it is reasonable to say that a fair number of those which take place between the filing of the Request and the transmission to the Court of the Terms of Reference are due to a settlement between the parties. The number of cases withdrawn at that stage increased sharply last year, from 138 in 1997 to 170 in 1998. The greatest increase concerned the period before the transmission of the file to the Arbitral Tribunal.

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The overall number of cases pending before ICC arbitration tribunals remained above 900 in 1998, a fact with which the Court and its Secretariat are coping relatively well. It should be noted that the staff of the ICC Court has been growing in line with the number of requests over the past few years.

Origins of arbitrators

In 1998, a total of 675 arbitrators were appointed in accordance with the ICC Rules, as compared with 745 in 1997. The lower number of arbitrators is in line with the smaller number of three-member panels in ICC cases. As in 1997, the arbitrators appointed in 1998 were of 62 different nationalities. [Page8:]

Arbitration agreements

The charts shown on this and the top of the next page provide information that can prove useful in the drafting of arbitration agreements with respect to the choice of the institution, the place of arbitration and the number of arbitrators, elements to which the ICC Court's Secretariat routinely draws the attention of prospective parties. Another element to be considered is the provision in the contract of applicable rules of law.

The importance of choosing a well-established arbitral institution is once more illustrated by the dates of the contracts that gave rise to the disputes brought before the ICC Court in 1998. Four of those contracts were more than 20 years old when they gave rise to a dispute; two of these were 25 years old. It is also worth noting that contracts that give rise to disputes submitted to ICC arbitration most often do so within two or three years of their conclusion.

As concerns the place of arbitration, it was based on the parties' agreement in 81% of the cases set in motion in 1998. In all other cases the place of arbitration was fixed by the Court, in accordance with the ICC Rules. The most popular countries for ICC arbitration, France and Switzerland, were chosen on fewer occasions in 1998. France was chosen 77 times in 1998 as compared to 110 in 1997; Switzerland was selected in 66 cases in 1998 compared to 77 in 1997.

Turning to the number of arbitrators, which under the ICC Rules is also fixed by the Court failing agreement between the parties, it was based on contractual provisions in 41% of the cases set in motion in 1998. As is well known, the standard ICC arbitration clause leaves this matter open, stating that disputes shall be settled 'by one or more arbitrators' appointed in accordance with the Rules. In a fair [Page9:] number of cases, the parties agree on the number of arbitrators following the filing of the Request. In 1998 this was the case in 32% of the cases. This means that the number of arbitrators was based on an agreement of the parties in 73% of the cases, leaving the matter to the Court's decision in 27% of the cases set in motion in 1998. The proportion of cases submitted to a panel of three arbitrators has been decreasing steadily over the past few years: 58.7% in 1995, 56.5% in 1996, 52% in 1997 and 47.4% in 1998. Put differently, more than half of the cases are now submitted to a sole arbitrator.

Economic sectors

The 1998 breakdown of cases by economic sectors indicates a further reduction in the proportion of cases falling under international trade (sale of goods) and distributorship: some 43% in 1996, 35% in 1997 and 31.5% in 1998. The proportion of intellectual property related disputes went down to 12% (from some 17% in 1997 and 14% in 1996). The proportion of construction and engineering cases increased from 14% in 1996 and 1997 to 18% in 1998. Joint venture and business structure agreements gave rise to roughly 8% of the Requests filed in 1998. Mergers and acquisitions represented 9.5% of the cases. Other matters of significance concerned the service industry: advertising, consultancy, finance, management, agency and transport.

Amounts in dispute

Amounts claimed and counter-claimed in ICC arbitration cases filed in 1998 have not changed significantly over the past few years. One noticeable evolution in 1998 is the lower proportion of cases in which the amount in dispute was not quantified (from 14.4% in 1997 to 6.4% in 1998). As in 1997, the most important slice is that ranging between one and ten million US$ (32.1% in 1997 and 34.9% in 1998). The number of cases in which amounts at stake are lower than 200 000 US$ went down from 18.8% in 1997 to 11.8% in 1998. The aggregate amount of claims and counter-claims pending at any time in ICC cases is in the range of 25 to 35 billion US$.

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Conciliation and ad hoc appointments

The ICC Rules of Optional Conciliation currently in force were adopted in 1988 to facilitate the amicable settlement of business disputes under the aegis of ICC. The Rules provide for the appointment of a conciliator with the full and unqualified consent of the parties. As was the case in 1997, use of ICC Conciliation was very limited in 1998 with only seven requests filed under the Rules. Three of these requests were withdrawn without an agreement having been reached, three were still pending at year-end and one was turned into an arbitration. The ICC Commission on International Arbitration is currently studying the possibility of furthering ICC involvement in the field of ADR, a process which might eventually lead to a change in the current Rules.

The International Chamber of Commerce (either the ICC Court, its Chairman, the UNCITRAL Committee of the Court or the President of ICC) acted as appointing authority in 13 ad hoc arbitration cases (the figure was eight in 1997). Five of these appointments were made under the UNCITRAL Rules.

International Centre for Expertise

The activity of the ICC International Centre for Expertise was modest in 1998 in terms of the number of cases submitted, as only eleven requests were filed. The parties involved, however, came from twelve countries and five continents. The experts proposed or appointed also came from twelve countries, namely: Austria, Canada, P. R. China, Denmark, France, Germany, Indonesia, Italy, Morocco, Singapore, Syria and the United Kingdom.

Cases brought in 1998 involved highly specialized and complex issues. For three of these cases, the administration of the expertise was requested; some required the interpretation of contractual provisions. The cases concerned, for instance, inclusion of a name of an expert as adjudicator in World Bank standard bidding documents, the constitution of a dispute resolution body under a Power Purchase Agreement concerning a gas-fired electricity generation plant located in South-East Asia, the installation of sub-sea telecommunications cables, a coal price determination exercise under a Power Purchase Agreement and the resolution or a technical difference relating to the electrification of railways.

Four of the requests filed with the Centre were made under the Documentary Credit Dispute Resolution Expertise Rules (DOCDEX), which came into force on 1 October 1997. The DOCDEX Decisions were rendered within approximately two months and a half following the Request.

The forecast for 1999 is quite promising, as the Centre has already noticed a significant increase in its activity in both general expertise and DOCDEX.