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In its decision 4A_16/2023 of 8 November 2023 the Swiss Federal Tribunal tackled a controversial question: whether a claimant who has seized a wrong court gets a second chance to introduce its claim in the right (competent) court. Art. 63(1) and 64(2) of the Swiss Civil Procedure Code ("CPC") indeed provide for a grace period to seize the proper court. But what happens if in the meantime the claim became time barred? In the case at hand, a state court had dismissed a lawsuit for lack of jurisdiction as the parties had agreed to settle disputes by arbitration. By the time the claimant initiated arbitration, the claim was time barred. The claimant argued that this was irrelevant since the first action had interrupted the time bar in light given Art. 63(1) and 64(2) CPC. The sole arbitrator disagreed and considered the claim inadmissible. The leaseholder then requested the Swiss Federal Supreme Court to set the award aside. The Court found that the arbitrator had wrongly disregarded Art. 63(1) and 64(2) CPC which form part of Swiss substantive law. The Court nevertheless dismissed the challenge because (domestic) arbitral awards can only be annulled in case of a qualified error (manifest disregard). [ABSTRACT FROM AUTHOR]

As arbitration laws and rules lack detailed provisions on the conduct of the proceedings, it has become standard practice to establish case-specific procedural rules at the outset of an arbitration in a so-called Procedural Order No. 1 ("PO1"). However, views diverge as to how one should go about when drafting PO1s, and especially how detail-oriented and comprehensive they should be. Furthermore, over the past few years, arbitrators have faced increasing criticism for relying too much on model PO1 templates instead of focusing on continuous case management that takes maximum advantage of the flexibility inherent in international arbitration. This article summarizes the recent debate about the role of PO1 in case management. Additionally, it discusses some of the most fundamental issues that arbitral tribunals and parties should consider when preparing PO1s. The author posits that despite contrary arguments by some leading practitioners, a skillfully crafted and sufficiently comprehensive PO1 remains the cornerstone of any well-run arbitration. [ABSTRACT FROM AUTHOR]

With the introduction in 2021 of Article 190a of the Private International Law Act (PILA) and the simultaneous amendment of Article 191 PILA, which now refers to a new Article 119a of the Federal Supreme Court Act, the extraordinary remedy of “revision” of decisions rendered in international arbitrations seated in Switzerland has been put on a statutory footing. Before that, revision was recognised and governed only by the case law of the Swiss Supreme Court. There are many procedural aspects to revision proceedings that are not specifically stipulated in the law but derive from the practice of the Supreme Court. Other procedural aspects are governed by provisions of the Federal Supreme Court Act which may not at first glance appear applicable to revision proceedings against arbitral awards but which the Court nonetheless applies to such proceedings. Finally, practices developed by the Supreme Court before the entry into force of the new statutory regime to a large extent continue to apply under the new regime. The present article summarizes these procedural aspects of revision proceedings and is helpful to those handling revision proceedings before the Swiss Supreme Court. [ABSTRACT FROM AUTHOR]

While it is controversial what principles an arbitral tribunal should apply when making a cost award under normal circumstances, it is widely accepted that an arbitral tribunal may take the parties' procedural conduct into account and the most commonly applied institutional rules all confer broad discretion on the arbitral tribunal to consider procedural misconduct when deciding about costs. Procedural misconduct can occur in different forms and facets. The most regularly reported forms include frivolous or inflated claims, meritless requests, unsolicited submissions, dilatory or obstructive behavior and failure to produce documents. Since misconduct contravenes the duty to arbitrate in good faith and the goal to conduct the arbitration in a cost and time efficient manner, procedural misconduct of a certain gravity should not go unnoticed. Arbitrators should under appropriate circumstances indemnify the opponent and/or sanction the party engaged in misconduct for wasteful behavior by rendering an adverse cost award. They can do so either in an interim or partial award or at the end of the proceedings. [ABSTRACT FROM AUTHOR]

For years parties to international arbitrations have used the discovery mechanism of § 1782 to seek the U.S. courts' assistance in obtaining evidence from persons in the United States. Over time, a circuit split developed on whether § 1782 extended to private arbitral tribunals. This summer, the United States Supreme Court resolved the circuit split, holding that the scope of § 1782 did not encompass private international arbitration, but leaving the door open for arbitral tribunals imbued with some level of governmental authority. After providing a summary of the Supreme Court's decision, the article focuses on the implications of this new precedent and its impact on participants to arbitration proceedings seated outside the U.S. with a focus on arbitrations seated in Switzerland. [ABSTRACT FROM AUTHOR]

The chosen arbitral seat is one of the most important features of an arbitration clause, and dozens of jurisdictions around the world are competing to be the seat of choice for international arbitrations. The Chartered Institute of Arbitrators (CIArb) has provided parties and legislators a loose framework to determine what is (and what is not) a "safe" arbitral seat, referencing factors that concern the domestic legal framework for arbitration, the competency of the courts and matter of party convenience. Italy has never been able to position itself as a preferred arbitral seat for various reasons, but this is starting to change. In late 2021 Italy modernized its arbitration law, reforming key elements of its Code of Civil Procedure that govern domestic and international arbitrations. While these efforts bring Italy in line with other, more preferred arbitral seats, it remains to be seen whether these efforts will improve the perception of Italy as a "safe" seat. To be sure, however, it is a positive step in the right direction. [ABSTRACT FROM AUTHOR]

Rule 16.4 of the SIAC Rules precludes parties from appealing the SIAC Court's decisions on arbitrator challenges as opposed to Rule 40.2, which specifically preserves the right of the parties to appeal the SIAC Court's decision on challenge rendered under Article 16. In this case, it is difficult to discern whether the parties are entitled to appeal the decision or not. The article purports to address this conflict by undertaking cross-jurisdictional analysis and exploring the interplay of Rule 16.4 with Article 13 of the UNCITRAL Model Law. The article also explores various contractual and statutory interpretation rules to reconcile Rule 16.4 and Rule 40.2, and proposes the linguistic modifications to Rule 16.4 and Rule 40.2 to resolve the conflict. [ABSTRACT FROM AUTHOR]

Section 1782 of Title 28 U.S.C. ("Section 1782") is a discovery mechanism of U.S. law which aims at providing efficient assistance to parties in international disputes and at encouraging foreign countries by example to provide similar assistance to the U.S. courts. Even though the number of domestic regulations of judicial assistance for the taking of evidence is growing worldwide, the mechanism under Section 1782 remains quite unique in several aspects. Section 1782 applications have proven to be very useful also in obtaining evidence in support of international arbitrations. However, the use of this powerful tool in international arbitration raises specific questions that are still debated inside and outside the U.S. courts. The purpose of this article is to provide a practical overview of the issues that parties to an international arbitration seated in Switzerland may commonly encounter when they seek evidence located in the U.S. through a Section 1782 application. After an introduction to the requirements under Section 1782, the article discusses the rights of the parties to an international arbitration seated in Switzerland to make use of this mechanism. [ABSTRACT FROM AUTHOR]

In international arbitration, the designation of the applicable law by the parties does not always fully answer the question of which law arbitrators should apply to solve the dispute: sometimes, mandatory laws (or mandatory rules) that do not belong to the chosen applicable law, i.e. "foreign" mandatory laws, come into play. The question of whether and to what extent arbitrators should or can deviate from the parties' choice of law (which is a direct consequence of the principle of party autonomy) and apply foreign mandatory laws has been debated at length during the past decades. This article focuses on the scenario where arbitrators have to decide whether to apply a foreign mandatory law invoked by one party but rejected by the other. It aims to determine the incentives and potential risks that may exist in doing so, in particular in relation to the finality of the arbitral award in view of possible public policy concerns at the recognition, enforcement or setting aside stage. [ABSTRACT FROM AUTHOR]

The 2015 reform of Russian arbitration law has introduced a new means of dealing with mandatory rules in arbitration. It has done so by making certain disputes arbitrable where a number of conditions have been met - they are conditionally arbitrable. This article compares the new Russian approach to mandatory rule arbitration to the older second look doctrine as espoused by the US Supreme Court. [ABSTRACT FROM AUTHOR]

Partial awards on advances on costs have been and still remain a matter of controversy in international commercial arbitration. This article discusses the myth of partial awards on advances on costs rendered under the Swiss Rules, whereby the authors are of the view that the text of art. 41 of the Swiss Rules does not speak in favour of a substantive obligation of the parties to make payment of the advances. The authors opine further that, even if a tribunal were to find that according to art. 41 of the Swiss Rules the parties were under a substantive obligation to make payment of advances, there may be valid grounds for a party to refuse making such payments. And where a party raises such objections, the tribunal should enter into an analysis of the objections raised before making any decision on the substituting party's request of reimbursement. Finally, the authors are of the view that (in arbitrations seated in Switzerland and conducted under the Swiss Rules) merely by making substitute payment on behalf of the defaulting party the substituting party does not incur any damage in the sense of art. 97 CO. As a consequence, the authors conclude that under the Swiss Rules (and from a Swiss legal perspective) any decision rendered on the substituting party's request for reimbursement of the advance payments should only take the form of a procedural order, as opposed to the form of a partial award. This conclusion is in line with certain considerations made by the Swiss Federal Supreme Court in a series of decisions, in which the payment of advances was seemingly qualified as a matter of procedural law. [ABSTRACT FROM AUTHOR]

With regard to the impact of the Covid 19 pandemic on arbitration this article focuses on hearings and the legal and technical issues that virtual or remote arbitral hearings raise. Such hearings rapidly became the "new normal", particularly in international arbitration practice. [ABSTRACT FROM AUTHOR]

In most arbitrations, the precise amount to be paid by one party to another cannot be ascertained with certainty. Tribunals, therefore, often (have to) resort to estimating quantum issues. The article analyses how arbitrators can - in a dogmatically coherent approach - come to the conclusion that they may indeed do so. The issue is more complex than one may think because under some laws (as e.g. German) the provision on an estimate is included in the civil procedure codes while in others (as e.g. Swiss) it is included in the civil codes. For a tribunal seated in Switzerland, applying German law, that might mean that it cannot apply either provision. The result is obviously wrong. The article gives arbitrators a road map how they can conclude that they may indeed estimate the final amount to be awarded either by (i) qualifying the provision in the codes of civil procedure as substantive in nature or (ii) basing their competence on the general article dealing with the procedure, as e.g. Art. 182, 184 PILA. It also covers the question which is similar although different for tribunals applying the CISG. Finally, arbitrators applying the Swiss Rules in their 2021 version can now directly rely on Article 26(1) Swiss Rules (2021) which allows the tribunal to "determine the [...]burden of proof.". [ABSTRACT FROM AUTHOR]

The Swiss Rules of International Arbitration (the “Rules”) were adopted in 2004 and revised a first time in 2012. In 2021, the Swiss Chambers' Arbitration Institution (SCAI) in charge of the Rules and the Swiss Arbitration Association (ASA) joined forces to set up the Swiss Arbitration Centre, replacing SCAI. This triggered a new revision of the Rules, which entered into force on 1 June 2021². It was followed by a practice note in March 2023 [ABSTRACT FROM AUTHOR]