The Singapore International Arbitration Centre (SIAC) is at the forefront of this initiative. The sixth edition of the Arbitration Rules of the SIAC¹ (SIAC Rules 2016) came into effect on 1 August 2016. Further, SIAC’s 2016 Annual Report² was published on 10 March 2017 and gives an update on how the SIAC Rules 2016 have been utilised. The key amendments made by the SIAC Rules 2016 and their use so far are examined below.

Early Dismissal of Claims and Defences (Rule 29)

The SIAC Rules 2016 introduce an early dismissal procedure similar to a summary judgment and/or strike-out application before the courts. Pursuant to Rule 29, a party may apply to the relevant tribunal for the early dismissal of a claim or defence on the basis that the claim or defence is manifestly without legal merit or manifestly outside the jurisdiction of the tribunal and the tribunal must make its decision within 60 days.

Although the early dismissal procedure is not novel to court litigation, the SIAC is the first major international arbitral institution to introduce this procedure. The early dismissal procedure is a welcome innovation as it has the potential to enable significant savings in time and cost by deterring parties from mounting speculative claims or baseless defences. However, it does seem more likely that respondents will make use of this procedure since claimants may have concerns about whether an award obtained through the early dismissal procedure will face issues upon enforcement.

SIAC’s 2016 Annual Report suggests that the early dismissal procedure had not been utilised as of 31 December 2016. We anticipate that the procedure will only be utilised sparingly because of the high burden of showing that a claim or defence is manifestly without merit or manifestly outside the jurisdiction of the tribunal, but on the occasions it is used, significant time and cost savings will surely result.

Multiple Contracts and Consolidation (Rule 6 and Rule 8)

Rules 6 and 8 of the SIAC Rules 2016 align the SIAC Rules with the rules of other major international arbitral institutions.

Pursuant to Rule 6 a claimant may either (a) file a notice of arbitration in respect of each arbitration agreement invoked and concurrently submit an application for consolidation, or (b) file a single notice of arbitration in respect of all the arbitration agreements invoked. Pursuant to Rule 8, the SIAC Court of Arbitration has the power to consolidate multiple arbitrations without the consent of all parties, provided certain criteria are satisfied. If an application for consolidation is made after constitution of the tribunal, the tribunal shall decide whether to grant an application for consolidation.

This is again a step in the right direction as it potentially prevents uncooperative parties (typically the respondents) from forcing related disputes to be progressed through multiple arbitrations, each adding further time and costs. From a more practical point of view, the consolidation of arbitrations could be a welcome relief to claimants bringing related claims in situations where they might otherwise have to pay advances on the costs of multiple arbitrations to the SIAC on behalf of themselves and the respondents.

According to SIAC’s 2016 Annual Report, 20 applications for consolidation involving 52 cases were made between August and December 2016, of which 6 were granted. Clearly this new rule is being applied regularly.

Joinder (Rule 7)

Rule 7 of the SIAC Rules 2016 expands tribunals’ powers on joinder by allowing a party or non-party to apply for an additional party to be joined to an arbitration. While these powers seek to mirror those held by courts, a key distinction is that a party cannot be joined in a SIAC arbitration without its consent, as demonstrated in an arbitration agreement. This is, of course, intrinsically linked to the fundamental principle that arbitration relies on the agreement of the participants to the process.

According to SIAC’s 2016 Annual Report, between August and December 2016, one application for joinder was made, but not granted.

Improved Expedited Procedure (Rule 5)

The expedited procedure was first introduced into the SIAC Rules in 2010 and has developed into one of the SIAC’s most popular mechanisms for disposing of arbitrations efficiently. According to the SIAC’s 2016 Annual Report, the SIAC received 70 requests for the expedited procedure in 2016 alone, of which 28 were accepted.

The SIAC Rules 2016 extend the accessibility of the expedited procedure by increasing the monetary threshold from S$5 million to S$6 million with the effect that more arbitrations will qualify for this procedure. Further, where an arbitration proceeds under the expedited procedure, the tribunal has the discretion to decide if the dispute should be decided on the basis of documentary evidence only, without requiring the consent of all parties.

The expedited procedure was also recently introduced by the International Chamber of Commerce (ICC) in Article 30 of its revised Arbitration Rules³, which are applicable from 1 March 2017. The ICC Arbitration Rules however go a step further than the SIAC Rules 2016 and stipulate that the expedited procedure shall automatically apply to arbitrations if the amount in dispute does not exceed US$2 million unless the parties have opted out, provided that the arbitration agreement in question was concluded after 1 March 2017.

Conclusion

The SIAC Rules 2016 provide a robust set of tools which, if used properly, go a long way towards ensuring that SIAC arbitrations progress in an efficient and cost-effective manner. The onus is now on parties and tribunals to take advantage of these tools and it is clear from the statistics published by the SIAC that, on the whole, they are indeed doing so.

Client Alert 2017-128

1. siac.org.sg
2. siac.org.sg
3. iccwbo.org