The Singapore International Arbitration Centre Proposes Updates to its Arbitration Rules

The Singapore International Arbitration Centre Proposes Updates to its Arbitration Rules

September 20, 2023, Covington Alert

The Singapore International Arbitration Centre (“SIAC”) has in recent years become one of the premiere global arbitration institutions. Since it last updated its rules in 2016, its case load has grown steadily — increasing from 271 new cases filed in 2015 to 357 in 2022. New case filings in the first quarter of 2023 were at a historical high, with 332 new cases filed.

Last month, SIAC released a draft 7^th Edition of its Rules (the “Draft Rules”), which draw on SIAC’s experience in administering over 3,000 international cases under the already robust 2016 Rules. 

Key innovations include: (i) introduction of the Streamlined Procedure; (ii) greater availability of the Expedited Procedure; (iii) greater availability of preliminary determinations; (iv) coordinated arbitration proceedings for disputes that are being heard by the same sets of arbitrators; (v) rules on the disclosure of third-party funding arrangements (which became legal in Singapore after the 2016 Rules were adopted); (vi) provisions for publication of redacted versions of awards; and (vii) the ability to challenge an arbitrator for dilatory rulings.

• Streamlined Procedure (Draft Rule 13): The Draft Rules introduce the Streamlined Procedure as an alternative to the existing Expedited Procedure. The Streamlined Procedure is available where the parties agree to its application, the amount in dispute does not exceed S$1,000,000 (about US$740,000), or the circumstances of the case warrant the application of the Streamlined Procedure, as determined by the SIAC President. Under the Streamlined Procedure, the parties would have 3 days to nominate a sole arbitrator, failing which the SIAC President “shall seek to appoint the sole arbitrator within 3 days.” Only a sole arbitrator may be appointed. In conducting the proceedings, the sole arbitrator has discretion in setting the timeline, but must render a final award within 3 months from the date of constitution of the tribunal, unless the Registrar extends the time for making the final award.
• Expedited Procedure (Draft Rule 14): The Draft Rules also broaden the application of the existing Expedited Procedure. Under the 2016 Rules, the Expedited Procedure is available where the parties have agreed to its application, the amount in dispute does not exceed S$6,000,000 (about US$4.4 million), or “in cases of exceptional urgency.” The Draft Rules increase the limit to S$10,000,000 (about US$7.4 million), while also eliminating “exceptional urgency” as basis for applying the Expedited Procedure. Under Draft Rule 14.1, the final award will be issued within 6 months of the constitution of the tribunal, unless the Registrar extends the time for making the final award.
  
  In 2022, nearly a quarter (87 of 357) of new SIAC cases involved an application for use of the Expedited Procedure, but only 48 were accepted.

• Preliminary Determinations (Draft Rule 46): Draft Rule 46 allows parties to apply to the tribunal for a preliminary determination of “any issue” in the arbitration where the parties agree the tribunal may determine the issue on preliminary basis, the determination is likely to save time and costs and lead to a more expeditious resolution, or the circumstances warrant a preliminary determination. Rule 46.4 imposes a deadline of 45 days for the tribunal to render a decision or award from the date of the filing of an application for preliminary determination (unless the Registrar extends the time).
• Coordinated Arbitration Procedures (Draft Rule 17): Draft Rule 17 provides that, where the same tribunal is constituted in two or more arbitrations, and a common question of law or fact arises out of or in connection with all arbitrations, the tribunal may determine that the coordinated arbitrations shall be conducted concurrently or sequentially, heard together, or suspended pending a determination in the other coordinated arbitrations.
  
• Third-Party Funding (Draft Rule 38): Singapore adopted regulations in 2017 to allow for third-party funding in international arbitration. The Draft Rules require the parties to disclose the existence of a third-party funding agreement and the identity of the third-party funder. Parties may not enter into a third-party funding agreement that would give rise to a conflict of interest of an arbitrator after the tribunal has been constituted.
• Publication of Redacted Awards (Draft Rule 60): Under current rules, awards may not be made public absent consent from the parties and the tribunal. The Draft Rules propose to reverse that presumption – the parties are deemed to have agreed to the publication of decisions and awards with party information and other identifying information redacted, unless either party objects in writing within six months after the conclusion of the arbitration. Draft Rule 60 is in line with recent practice at other arbitral institutions. For instance, under an ICC practice note, parties and arbitrators accept that many ICC awards made after 1 January 2019 may be published, unless the parties object.
• Challenge of Arbitrators (Draft Rule 26.1): Two grounds of challenge have been added. First, an arbitrator may be challenged if he or she is unable to perform his or her functions. Second, an arbitrator also may be challenged if he or she fails to act or perform his or her functions in accordance with the Rules or within prescribed time limits. While a welcome addition in principle to ensure that time limits are respected, there is a risk that challenges will add further delay and expense in complex disputes. Draft Rule 27 requires payment of a “challenge filing fee,” the amount of which will be set in the SIAC Schedule of Fees.
• Diversity & Inclusion (Draft Rule 19.5): Draft Rule 19.5 requires the SIAC President to take into account “principles of diversity and inclusion” in the appointment of an arbitrator under the Draft Rules.

A summary of key procedures under the Draft Rules appears below.

SIAC likely will continue to update and refine the Draft Rules as it considers public comments. The period for public consultation runs through November 21, 2023. If you are interested in commenting on the Draft Rules, or have questions about them, please contact the members of Covington’s International Arbitration Practice.

Key Procedures Under the 2023 Draft Rules