The Vienna International Arbitral Centre (“VIAC”) has just introduced a new version of the Rules of Arbitration (“2018 Vienna Rules”) which took effect on 1 January 2018 and will apply to all proceedings commenced after 31 December 2017.
The 2018 Vienna Rules aim at promoting efficiency of arbitration proceedings. First, under the 2018 Vienna Rules, all proceedings will be administered by the VIAC through an electronic case management system, thus the provisions on the submission of Statement of Claims and on service have been adapted accordingly (Article 7, 12 and 36).
Second, Article 33(6) of the 2018 Vienna Rules sets a basis for a respondent to request security for costs, if it substantiates that the recoverability of a potential claim for costs is, with a sufficient degree of probability, at risk. If the party fails to comply with an order for security for costs, the arbitral tribunal may, upon request, suspend in whole or in part, or terminate the proceedings.
Third, the 2018 Vienna Rules explicitly state that arbitrators shall conduct the proceedings in an efficient and cost-effective manner (Article 28(1)). The arbitrators’ effort in this regard may influence their fees. This is because the Secretary General may increase the arbitrators’ fees according to his or her own discretion by a maximum total of 40 percent vis-à-vis the schedule of fees, in particular for especially complex cases or for especially efficient conduct of proceedings (Article 44(7)). Conversely, the Secretary General may decrease the arbitrators’ fees by a maximum total of 40 percent, in particular for inefficient conduct of proceedings (Article 44(7)). The parties and their representatives are also obliged to act efficiently and do not cause unnecessary costs and expenses. The parties’ contribution to the efficient and cost-effective proceedings may be taken into consideration while determining the cost of proceedings (Article 38(2)).
The above changes are complemented with the revision of the Schedule of Fees. The Registration Fees and Administrative Fees for small cases have been reduced, while the fees for cases involving very high amounts in dispute have been slightly increased.
The 2018 Vienna Rules also enable the VIAC to administer domestic cases, which was not possible before. This change implements the Austrian legislation passed in May, which allows parties to choose any arbitral institution to hear their domestic disputes. Previously, the VIAC was required to refer domestic cases to the arbitration centre of a regional economic chamber. The VIAC expect that domestic cases will significantly increase the caseload.
Prepared by: Aleksandra Orzeł-Jakubowska, associate, Łaszczuk & Partners