New SCC Rules 2023- what has changed?

The revised version of the Arbitration Institute of the Stockholm Chamber of Commerce (now called the SCC Arbitration Institute) Arbitration Rules entered into force on 1 January 2023 (the Revised Rules). The Revised Rules apply to arbitrations commenced on or after that date.

The changes to the Revised Rules mainly provide more detail on practical issues arising over the course of an arbitration and shift the scope of or responsibility for certain decisions for the SCC Board or the arbitral tribunal. For the majority of these changes, corresponding amendments have also been made to the SCC rules for Expedited Arbitrations. There have also been some changes made to the language in certain provisions to improve clarity and there has also been an increase in the SCC's administrative fees.

Content of submissions

Article 29 has broadened the scope of what information is required to be included in the Statement of Claim and Statement of Defence. Previously, the claimant and defendant had been required to submit a Statement of Claim or Statement of Defence which includes the "factual and legal basis" on which the party relies on (Article 29(1)(ii) and 29(2)(ii) of the 2017 Rules respectively). The Revised Rules now state that the claimant and defendant are required to include the "facts and other circumstances" on which the party relies on (Article 29(1)(ii) and 29(2)(ii) of the Revised Rules).

The rationale behind this change has not been made public. It may be intended to reflect the fact that arbitral tribunals have a wide discretion to take into account relevant trade usages and principles of fairness and justice as agreed by the parties in addition to substantive rules of law (see Article 27). The widened scope of this provision may also encourage parties to place more emphasis on the factual context that sits behind claims.

Guidance on practical issues

Article 32(2) of the Revised Rules states that the arbitral tribunal may decide on whether hearings shall be held in person or remotely, after consulting with the parties and having regard to the circumstances. This aligns the institutional rules with the post-pandemic trend of remote hearings for procedural matters or substantive hearings.

Tribunal's discretion to terminate proceedings

Article 45(2) now allows the tribunal to terminate arbitral proceedings by way of an order. Previously, the tribunal only had the power to terminate proceedings by way of an award. Termination before a final award usually occurs where the parties having arrived at a settlement, they do not submit a statement of claim or defence, or they fail to provide security for costs or pay an advance on costs. This change should enable tribunals to end proceedings more quickly without being required to meet the formality requirements of an arbitral award.

Article 51(5) has been amended to give the tribunal power to dismiss a case in whole or in part if a party fails to make the required payment for advance on costs and if the case has been referred to the tribunal. Under the 2017 Rules, only the SCC Board had the authority to dismiss a case in these circumstances.

Recommended number of arbitrators

The SCC model clause has been revised so that it no longer includes a "recommended addition"  that the parties should agree on the number of arbitrators. This amendment has been made because the SCC Rules themselves provide a method for determining the number of arbitrators in the absence of such agreement (Article 16(2)).

For more information, please contact Mathias Wittinghofer, Partner, Stephanie Lam, Associate, or your usual Herbert Smith Freehills contact.