UNCITRAL Arbitration Rules 2010 & 1976: A Comparison- Part I

We've had two small overviews of the UNCITRAL Arbitration Rules 2010 last year (here and here). Coinciding with the first anniversary of the 2010 Rules of the UNCITRAL (15 August 2011), we would be having a series of posts on the New Rules. The purpose of this series would be to minutely compare the New Rules with the old one (1976). In this first post of the series, we'll give a brief history of the New Rules.

The United Nations Commission for International Trade Law (UNCITRAL) has been the forerunner in convergence and harmonization of laws relating to international trade law. One of the chief contributions of UNCITRAL has been in the field of international arbitration law. The UNCITRAL Arbitration Rules, 1976 and UNCITRAL Model Law on International Commercial Arbitration, 1985 (“Model Law”) have been used prominently as rules governing arbitrations. Arbitration laws of several countries are on the basis of UNCITRAL’s Model Law on International Commercial Arbitration, 1985. More than sixty seven jurisdictions have based their arbitration laws on the UNCITRAL Model Law on International Commercial Arbitration, 1985. For a list of the countries that have adopted the Model Law, access this link.

The UNCITRAL Arbitration Rules provides the procedural framework primarily for ad hoc arbitrations (Ad hoc arbitrations are those arbitrations which are not administered by any arbitration institution. An arbitration is ad hoc even if an institution is chosen merely for constituting the arbitration tribunal). However, due to the popularity of the said Rules, even several institutions have agreed to administer arbitration under the UNCITRAL Arbitration Rules. Singapore International Arbitration Centre, Hong Kong International Arbitration Centre, Cairo Regional Centre for International Commercial Arbitration, WIPO, are some examples. The Arbitration Rules have been used in several investment treaties and in well-known arbitrations. The UNCITRAL Working Group II has cited an UNCTAD report wherein about 100 investment treaties were reviewed and in the said treaties about sixty percent of them referred to ad hoc arbitration according to the UNCITRAL Arbitration Rules (Para 33, A/CN.9/717). The below figure represents the arbitration rules under which different international investment disputes have been resolved or are being resolved from 1987 till 2010 See, UNCTAD, Latest Developments in Investor– State Dispute Settlement, IIA, Issue Note No. 1 (March 2011):



Use of UNCITRAL Arbitration Rules in International Investment Disputes

Out of the 390 international investment disputes that have arisen so far, about 109 of these have used the UNCITRAL Arbitration Rules. This is roughly equivalent to about twenty eight percent of all international investment disputes in the world. 

Recently, the UNCITRAL has, after more than three decades, revised its Rules on arbitration (2010 Rules). For a long time practitioners and academicians have wondered why UNCITRAL has not revised its Arbitration Rules, 1976 just like several arbitration institutions which have revised their Rules from time to time. One of the possible reasons for the non-revision might have been that the adoption of the UNCITRAL Model Law on International Commercial Arbitration was in itself a sort of Rules revision. Paulsson and Petrochilos (Jan Paulsson & Georgios Petrochilos, REVISION OF THE UNCITRAL ARBITRATION RULES) have cited four reasons for revising the Rules:

1. advances in arbitration practice since 1976;
2. the 1976 Rules was based on arbitration rules that are no longer in force;
3. use of the 1976 Rules in context that were not strictly “commercial” and consequent issues such as transparency, consolidation of claims etc that arise of out such use; and
4. the Rules had to be consistent with the procedural standards that had developed in international arbitration since 1976.

Recognising this deficiency, the UNCITRAL, in its 39th session of the UNCITRAL, decided to accord priority to the revision of the UNCITRAL Arbitration Rules. Subsequently, in its 45th session, the Working Group on International Commercial Arbitration and Conciliation compared the UNCITRAL Arbitration Rules, 1976 with the arbitration rules of several other institutions and identified possible areas which might need consideration for revision.

Some of the areas identified were to making the Rules applicable to even non-contractual arbitrations, giving power to arbitral tribunals to change the time limits given in the Rules, Separation of Notice of Arbitration and Statement of Claim, separation of Reply to Notice of Arbitration and Statement of Defence, introduction of provisions for multiparty arbitration, providing for a continuing duty of disclosure of independence and impartiality by arbitrators, having time limits for challenge for arbitrators and so on. The Working Group has been working since then on the revision of the Arbitration Rules.

More details in the next post on the series.