New HKIAC Rules enter into force on 1 November 2018

The Hong Kong International Arbitration Centre (HKIAC) Council has approved updated Administered Arbitration Rules (2018 Rules). The 2018 Rules are the product of a detailed review, by a committee including Herbert Smith Freehills' Professional Support Consultant Briana Young, and a robust public consultation process. The 2018 Rules are accompanied by a Practice Note on Appointment of Arbitrators and will enter into force on 1 November 2018.

2018 Rules

HKIAC's 2013 Rules were well-received and widely used. Since their introduction, they have been considered one of the leading sets of arbitral rules in the market. The 2018 amendments are therefore limited to changes that improve users' experience, reflect market change, and keep the HKIAC Rules at the forefront of arbitral practice.

The 2018 Rules reflect amendments:

• allowing parties to submit documents through secured online repositories, either of their own choosing or as provided by the HKIAC (Articles 3.1(e), 3.3 and 3.4);
• requiring tribunals to consider the effective use of technology in adopting suitable procedures for the conduct of the arbitration, in order to avoid unnecessary delay or expense (Article 13.1);
• expanding the provision for single arbitration under multiple contracts. A party may now commence a single arbitration under more than one arbitration agreement. Previously, all the parties had to be bound by the same arbitration agreement (Article 29);
• granting tribunals express power to conduct multiple arbitrations concurrently or sequentially, and to suspend any of those arbitrations until the determination of any one of them (Article 30);
• introducing an early determination procedure (Article 43);
• allowing parties to request that the HKIAC, tribunal or emergency arbitrator suspend the proceedings so that they may pursue alternative means to settle their dispute (Article 13.8);
• expanding the Emergency Arbitrator Procedure to allow applications up to seven days before, concurrent with, or after the submission of a Notice of Arbitration (Article 23.1 and Schedule 4)
• shortening the time limits under the Emergency Arbitrator Procedure (Article 23.1 and Schedule 4); and
• requiring that the tribunal notify the parties and the HKIAC of the anticipated date of delivering the award, which shall be no later than three months after the proceedings have been closed (Article 31.2).

There are also several amendments that reflect the imminent introduction of third party funding for arbitration in Hong Kong (Articles 34.4, 44 and 45.3(e)). These include provisions that:

• funded parties must disclose the existence of a funding arrangement and the identity of the funder;
• funded parties may disclose arbitration-related information to current or prospective funders; and
• tribunals may consider third-party funding arrangements when fixing the costs of an arbitration.

Practice Note on the Appointment of Arbitrators

The Practice Note sets out the HKIAC's general practice of appointing arbitrators. Arbitrators are appointed through the Appointments Committee, which will consider a non-exhaustive list of factors, including:

• any qualifications agreed by the parties;
• any qualifications or candidates suggested by any of the parties;
• the identity of the parties, counsel and co-arbitrators (if any);
• the nationality of the parties;
• the nationality of the arbitrator;
• the place of residence of the arbitrator;
• the availability of the arbitrator;
• the proposed fees of the arbitrator;
• the nature and complexity of the dispute;
• the amount in dispute;
• the governing law of the contract(s);
• the seat of arbitration;
• the language of the arbitration and underlying contract(s);
• the number of previous appointments of the arbitrator in HKIAC cases; and
• HKIAC’s previous experience with the arbitrator and any party feedback.

The Practice Note also affirms the HKIAC's commitment to diversity in arbitral appointments, by providing that it will include "wherever possible, qualified female candidates and qualified candidates of any age, ethnic group, legal or cultural background among those it considers for arbitrator appointments".