The growth in ICC arbitration observed throughout the nineties continued and intensified during the final year of the decade. The statistics presented below provide evidence that ICC arbitration now reaches out more widely than ever. For ease of reference, this presentation follows the sequence of the 1998 ICC Rules of Arbitration. Where relevant, the corresponding Articles of the previous version of the Rules are indicated in a footnote.

I. Commencing the arbitration

Number of Requests

The number of Requests for Arbitration received in 1999 rose by 13.5% from the previous year, topping 500 for the first time in the Court's history. The overall increase for the entire decade was 45%, which is twice the rate recorded in the eighties. Demand for international commercial arbitration is indissociably linked to world economic activity. The greater the number of international business relations, the greater the risk of disputes and the consequent need for appropriate means of resolving them. Hence the almost non-existent demand for arbitration during the Second World War and, by contrast, its rise at times of economic prosperity, as in the sixties and seventies, and again in the nineties under the effect of globalization.

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Parties to ICC Arbitration

Internationalism is a hallmark of ICC arbitration. It is reflected especially in the diverse geographical origins of the parties. During 1999, a total of 1,354 parties came from a record 107 countries and territories across the world. These included, for the first time since Court statistics have been published, Armenia, Belize, Equatorial Guinea and the Marshall Islands. There were notable increases in the number of parties from Bermuda, Brazil, Cyprus, Portugal and the USA. The latter continues to be the most highly represented country in terms of numbers of parties, with Germany holding onto its second position, closely followed by France. The breakdown between continents is broadly similar to previous years. Europe still leads the field, but South and East Asia's former lead over North America has decreased, leaving the two almost neck and neck in second position. There has been a small increase in the proportion of Latin American and Caribbean parties and slight decreases in the percentages of parties from the Middle East, Central and Eastern Europe and North Africa. The involvement of parties from Sub-Saharan Africa and Oceania remains stable.

The involvement of states and state entities as parties in ICC arbitration cases has fluctuated during the nineties. In 1990, 26.3% of the Requests registered with the ICC Court involved a state or state entity. This figure fell slightly in 1991, followed by a sharp drop to 4.8% in 1992. During the mid-nineties it rose to an average of 12.7%, since when it has again dropped back, averaging 8.6% over the last three years of the decade.

There has been less fluctuation in the proportion of cases involving more than two parties. After remaining stable at around 20% up until 1998, it rose to 25.3% in 1999.

Under Article 6(2) of the 1998 Rules,1 failing an Answer from the Respondent, or in the event of an objection concerning the existence, validity or scope of the arbitration agreement between the parties, the Court may allow the arbitration to take place 'if it is prima facie satisfied that an arbitration agreement under the Rules may exist'. In 1999, the Court addressed this issue in 193 cases, almost double the 1998 total. In three of these cases, the Court decided that the arbitration could not proceed, leaving the parties the right to ask any court having jurisdiction whether or not there was a binding arbitration agreement.

II. The arbitral tribunal

Articles 7 to 12 of the 1998 Rules of Arbitration deal with the Arbitral Tribunal. 2

Pursuant to Article 7(2),3 prospective arbitrators are required to 'sign a statement of independence and disclose in writing to the Secretariat any facts or circumstances which might be of such a nature as to call into question the arbitrator's independence in the eyes of the parties'. In 1999, 39 qualified statements of independence were submitted. [Page7:]

Arbitrators may be either confirmed/appointed by the Court (Article 9(1)) or confirmed by the Secretary General (Article 9(2)).4 Only the Court has the power to refuse to confirm an arbitrator. In 1999, confirmation was refused in 15 cases, as compared with 26 in 1998.

When required to appoint a sole arbitrator or the chair of an Arbitral Tribunal, the Court normally does so upon the proposal of an appropriate ICC National Committee, pursuant to Article 9(3). 5 238 such appointments were made in 1999, involving 29 National Committees.

In the course of the year, 28 challenges were made pursuant to Article 11.6 Two of these were accepted by the Court.

Finally, a total of 27 resignations were submitted to the Court in 1999, 25 of which were accepted.

The table above provides an overview of cases at the various stages of ICC arbitration. It provides clear evidence of the considerable increase in the Court's workload over the last five years, with the number of cases pending reaching almost 1,000 at the end of 1999. A rise of just under 40% in the number of Requests filed between 1994 and 1999 is matched by a similar rise in the number of cases withdrawn. Most withdrawals occur early in the procedure. [Page8:]

Arbitrators

In keeping with the ICC Court's increased caseload, the number of arbitrators rose in 1999, reaching an all-time high of 849, which is 25.8% more than in 1998. This increase is explained by the renewed rise in the number of three-member panels, after the previous year's fall, and the considerable rise in the number of cases set in motion by ICC.

Like the parties, the arbitrators also reflect the internationalism of ICC arbitration. As will be seen from the table below, most arbitrators are of Western European origin. Switzerland, the UK, France and Germany are traditionally the leading suppliers, although 1999 saw noteworthy rises in the number of arbitrators from the Netherlands and Spain. The number of Latin American and Caribbean arbitrators also rose.

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III. The arbitral proceedings

With respect to many aspects of the proceedings, consideration is first and foremost given to the parties' intentions, as expressed in their arbitration agreement, if any, and in their Request and Answer.

Arbitration agreements

Prospective parties to ICC arbitration are advised to include in their contracts an arbitration clause specifying a certain number of relevant details.7

The choice of the place of arbitration was made by the parties in 84% of cases and by the Court in the remaining 16%. France confirmed its lead as the most popular country chosen for ICC arbitration, followed by Switzerland. Barbados, the Marshall Islands, Mozambique, Peru, the Russian Federation and Venezuela were chosen as places of arbitration for the first time since the ICC International Court of Arbitration Bulletin has been publishing Court statistics. Amongst the rarer choices, there were notable increases in the number of times India and Thailand were chosen, the former being chosen in nine cases (as compared to five in 1998) and the latter in five cases (as compared to two in 1998).

As far as the number of arbitrators is concerned, disputes are usually decided by one or three arbitrators. The overriding majority of three-member panels was instituted pursuant to the parties' wishes, as expressed either in their contracts or by subsequent agreement (91.9%). In those cases decided by sole arbitrators, the decision to appoint a [Page10:] sole arbitrator was made by the Court almost as often as it was made pursuant to the parties' wishes (45.3% and 54.7% respectively).

The rules of law applicable to the merits of the dispute were specified by contract in 82% of the cases registered in 1999. Although the rules of law of a Western European country are still the most commonly chosen, the proportion of cases to which this applied fell from 65.1% in 1998 to 48.7% in 1999. Swiss law was the most frequently chosen, with French law taking second place, and the laws of England, which had been the most frequent choice in 1998, taking third place. The drop in the choice of the law of a Western European country reflects a shift towards other regions of the world. The law of the State of New York, for instance, was chosen almost twice as often as in 1998, and there were significant increases in the number of times the laws of Mexico, Thailand and, most notably, India were chosen.

IV. Awards

Awards are the subject of Articles 24 to 29 of the 1998 Rules.8

Article 269 covers the eventuality of parties reaching a settlement after their file has been transmitted to the Arbitral Tribunal. Such a settlement is recorded as an Award by consent if the parties so request and the Arbitral Tribunal agrees. In 1999, 38 Awards were made by consent (as compared with 31 in 1998).

One of the distinctive features of ICC arbitration is the requirement laid down in Article 27 10 that all Awards be subjected to the scrutiny of the ICC Court before they are signed. In 1999, 269 Awards were submitted to the Court pursuant to this Article (as compared with 273 in 1998).

Article 2 11 gives the Court the power to suggest modifications with respect to the substance of an Award and prescribe modifications with respect to its form. No Award may be rendered until it has been approved by the Court as to its form. When scrutinizing draft Awards, the Court 'considers, to the extent practicable, the requirements of mandatory law at the place of arbitration' (1998 Rules, Appendix II, Article 6 12 ). [Page11:]

Awards raising particular problems or difficulties are scrutinized at Plenary Sessions on the basis of a report by a Court member. A Plenary Session of the Court is held once every month. Other Awards are scrutinized, and may be finally approved, by a Committee of the Court. Such Committee comprises the Chairman or a Vice-Chairman and two members; it meets three times each month.

A total of 23 Awards were referred back to the arbitrators in 1999 (as compared with 18 in 1998); this was done for reasons of form in seven cases and for reasons of both substance and form in two cases. In the remaining 14 cases, the Court requested clarification (this compares with six requests for clarification in 1998). In 99 cases (as compared with 62 in 1998), the Court gave its approval subject to modifications as to form, and in one case subject to modification as to form plus a remark on substance.

In 1999, 69 partial or interim Awards and 162 final Awards were rendered, as compared with 59 and 214, respectively, in 1998. There were seven corrections and two interpretations of Awards, as provided for in Article 29.

The total number of Awards accompanied by dissenting opinions was 18, the same figure as in 1998. In 12 cases the dissenting opinion was drafted by the arbitrator nominated by the Respondent. The dissenting opinion came from the arbitrator nominated by the Claimant in the remaining six cases. One Award was made by the chairman of the Arbitral Tribunal alone, failing a majority, pursuant to the last sentence of Article 25(1). 13

In 1999, Awards were rendered in the following languages: English, French, German, Italian, Portuguese, Spanish and Turkish.

Amounts in dispute

As far as the amounts claimed and counterclaimed in ICC arbitration are concerned, the largest proportion of cases continues to fall into the US$ 1 million/10 million bracket.

The proportion of cases involving comparatively small amounts (i.e. less than US$ 200,000) rose to 13.9% in 1999, after falling slightly to 11.8% in 1998.

If the cases in which the amount in dispute is not quantified are disregarded, the resulting percentages are indicated in the extreme right-hand column.

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Contracts

An analysis of the contracts in cases registered in 1999 reveals that well over half (65.1%) were less than five years old. As far as the subject matter of the contracts is concerned, four principal areas may be identified. Almost half concern goods (48.4%) and a little over a fifth services (21.5%). Contracts relating to corporate and share agreements account for 12.5% of disputes and those relating to intellectual property 6.7%.

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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 sole conciliator with the full and unqualified consent of the parties. Use of the Rules has been declining over recent years, a tendency which was confirmed in 1999 with a mere five cases registered, the lowest number in the entire decade. Of these, two were withdrawn without an agreement having been reached. The remaining three were still pending at the end of the year. The broader issue of ADR within the context of ICC is currently being examined by a Working Party of the ICC Commission on International Arbitration.

ICC acted as appointing authority in a total of nine ad hoc arbitration cases, which marks a return to the levels recorded in 1996 and 1997, after a slight rise in 1998. Three of these appointments were made under the UNCITRAL Rules.

International Centre for Expertise

The ICC International Centre for Expertise deals with the proposal and appointment of experts. The prediction early in 1999 of an increase in its activity has been borne out, with a total of twenty-nine requests filed by the end of the year. Eight of these were made under the Documentary Credit Dispute Resolution Expertise Rules (DOCDEX).

As far as general expertise cases are concerned, the parties involved came from twenty-two countries and three continents. The experts proposed or appointed came from eleven countries: Belgium, Brazil, Canada, Chile, Denmark, France, Germany, Indonesia, Switzerland, the United Kingdom and the USA. Five of the cases brought in 1999 also requested the Centre to administer the expertise.

Cases filed in 1999 related to a variety of areas ranging from construction and light and heavy industrial works to banking and foodstuffs. Many were of a highly technical nature. Examples of the various needs covered were the testing of duct works and smoke clearing systems in the construction of an airport, the quality of hulled buckwheat, the legitimacy of a claim for extra costs and time in dredging work, and the auditing of processors.

As far as the DOCDEX requests are concerned, the parties involved came from nine countries covering the following regions: Western Europe (2), South and East Asia (5), the Middle East (1) and North America (1). The experts appointed came from eleven countries - eight from Western Europe, two from South and East Asia, one from the Middle East and one from North America.

In six cases, all the parties involved wished to participate in the DOCDEX procedure. None of the cases made any provision for the decision resulting from the procedure to be binding. DOCDEX proceedings lasted on average two to two-and-a-half months. User feedback shows this specialized dispute resolution service to be much appreciated.

1
Cf. Article 8(3), 1988 Rules.

2
Cf. Article 2, 1988 Rules.

3
Cf. Article 2(7), 1988 Rules.

4
Under the 1988 Rules, confirmations of arbitrators were made solely by the Court.

5
Cf. Article 2(6), 1988 Rules.

6
Cf. Article 2(8), 2(9), 1988 Rules.

8
Cf. Articles 17, 18, 19, 21, 22, 23, 24 and 25 of the 1988 Rules.

9
Cf. Article 17, 1988 Rules.

10
Cf. Article 21, 1988 Rules.

11
Cf. Article 21, 1988 Rules.

12
Cf. 1988 Rules, Appendix II, Article 17.

13
Cf. Article 19, 1988 Rules.