Insights from the SG VYAP Panel Discussion
THE AUTHOR:
Rachel Hage, Dual J.D. & Master II Candidate at American University Washington College of Law & Université Paris Nanterre
The Singapore chapter of Very Young Arbitration Practitioners (“SG VYAP”) recently hosted an insightful panel discussion on “Trends in International Arbitration for Junior Lawyers”, moderated by Sunita Advani (Arbitral Assistant to Mr. Michael Lee of Twenty Essex and SG VYAP Founder and Chair) and sponsored by CMS Holborn Asia. The event assembled a panel of lawyers from diverse backgrounds to discuss the current trends in arbitration while simultaneously touching upon significant industry sectors, tools for procedural efficiency, and the evolving role of arbitrators.
Current Trends in Arbitration Caseloads and Sector Dominance
Os Agarwal, a Senior Associate at CMS Holborn Asia, started the panel by presenting research on sector trends supported by CMS’s data-driven disputes survey. She highlighted the drivers behind arbitration’s growth, including the maturing of specific markets, increased use of Third-Party Funding (“TPF”), and the focus on making certain jurisdictions more arbitration-friendly, with both government departments and domestic courts cooperating to achieve this aim. She emphasized that arbitration is not just surviving; it’s thriving. While they did observe fluctuations in the caseload, the trend remains upward: the number of cases peaked at around 8,200 in 2020 before slightly declining to 7,800 in 2022. Nonetheless, this is a significant increase from approximately 6,600 cases in 2017. Agarwal explained that this increase was linked to an overall enhancement of user confidence and the drivers behind arbitration’s growth mentioned above, which are developing throughout arbitral institutions globally.
A key trend that the CMS Data-Driven Disputes Survey has identified is that the number of commercial arbitrations across most institutions surveyed is steadily increasing. What are the drivers for this, and do you see this continuing globally and across various sectors and regions?
Irene Mira, the Deputy Director of Arbitration and Alternative Dispute Resolution (“ADR”) for South Asia at the International Chamber of Commerce (“ICC”), explained that last year, the ICC administered around 29,000 cases for about 2,389 parties from 141 countries. She noted that construction, engineering, and energy have been dominant sectors in recent ICC caseloads, reflecting global economic priorities, and their range has been from thousands to billions of dollars.
Furthermore, Tulio Di Giacomo Toledo, Senior Legal Counsel and Representative of the Permanent Court of Arbitration (“PCA”) in Singapore, shared insights into the PCA’s arbitration caseload. He explained that the PCA has seen an increase in commercial arbitration cases – currently, there are approximately 210 pending cases. Over the past five years, the proportion of commercial disputes has significantly increased, evolving from being a small fraction of the PCA’s caseload to the predominant type of case. Toledo also emphasized that natural resources remain a significant sector in the PCA’s caseload, particularly in gas and construction.
Andres Larrea Savinovich, Deputy Counsel at the Singapore International Arbitration Centre (“SIAC”), introduced the thirty-year-old institution. In 2022, SIAC saw 357 new cases; in 2023, SIAC saw almost double the number of cases, 663 new cases. He believes we will continue to see growth in arbitration because of its many advantages in meeting these new globalized needs, such as confidentiality and neutrality.
Sector Shifts
The CMS Data-Driven Disputes Survey highlights that the energy and construction sectors dominate international arbitration overall but not uniformly across all institutions or regions. Could you provide an overview of the key sectors driving arbitration in your institutions, their caseloads, dispute values, regional origins, and the factors behind these trends?
Mira explained that in the ICC’s caseload over the past 5 years, the top two prevailing sectors have been construction and engineering, followed by energy. Looking specifically at 2023 for the ICC, the top sectors were construction, energy, transportation, health and pharmaceuticals, metals and raw materials, and general trade and distributions. Savinovich said at SIAC in particular, the total amount in dispute for all cases in 2023 was US$11.90 billion, a significant increase compared to 2022, where the total was US$5.61 billion. The SIAC’s top three users are India, China, and the United States. Toledo explained that the PCA’s primary caseloads are construction, oil and gas, electricity and power, and mining.
Additionally, Mira explained that since the COVID-19 pandemic, there has been a notable rise in healthcare disputes. The pandemic underscored the need for reliable dispute mechanisms in sectors like healthcare and pharmaceuticals, which previously did not contribute significantly to arbitration caseloads. She recommended that lawyers stay mindful of the market by understanding the growing industries and learning how to read the market.
Efficiency Tools in Arbitration Processes
The CMS Data-Driven Disputes Survey reports that the rules of the majority of arbitral institutions do not explicitly empower tribunals to make early determinations of an entire claim or defense. Please share if tribunals can make early determinations under your institution’s rules. If yes, what are the dismissal rates, and do you feel this tool improves efficiency while ensuring a just outcome? Moreover, are there any other tools in your respective institution’s rules to promote efficiency, and how effective are they?
Savinovich explained that Rule 29 of the SIAC Arbitration Rules 2016 provides for early dismissal of claims and defenses under two grounds: where such claims and defenses are manifestly outside the jurisdiction or without legal merit. Since the introduction of the rule changes, SIAC has seen 65 applications under Rule 29. This, he explains, reflects that parties and tribunals increasingly rely on the early dismissal mechanism, which he says is excellent for saving time and cost. Savinovich also added that in the new 2025 Edition of the SIAC Rules, SIAC has shortened the time for issuing a decision on early dismissal from 60 days to 45 days and intends to shorten the timelines for other mechanisms to improve efficiency. Further, SIAC is raising the monetary threshold dispute for expedited procedures from S$6 million to S$10 million.
Mira added that the ICC rules do not contain specific provisions on early dismissal, but Article 22 of the ICC Arbitration Rules 2021 allows the tribunal to make an early decision if the parties submit a request. Moreover, she recommended that arbitration practitioners read the Note to Parties and Arbitral Tribunals on the Conduct of the Arbitration Under the ICC Rules of Arbitration (2021), which contains all the case management policies that target transparency in the ICC’s administration of cases. She explained that ICC’s case management policy has always been transparent about reducing fees for the arbitral tribunal and the institution’s administrative expenses in case of unjustifiable delays. The range of this reduction of costs is 5%-20%. For example, if there is a delay by the arbitral tribunal in submitting their draft award, and if the ICC Secretariat also finds delays in specific procedures, the fee reduction consequences may apply.
The Role of Arbitrators in Facilitating Settlements
Some institutions take an interventionist approach to encouraging settlement, and others empower tribunals to facilitate the settlement process at their discretion or do not address this at all. Can you briefly explain your institution’s position? In each of your experiences, what are the driving factors and best practices that promote settlement, and which stakeholders are best placed to promote settlement?
Toledo noted that the PCA has witnessed a shift in the approach towards settlement, with tribunals becoming more comfortable with engaging in settlement discussions with parties or encouraging parties to engage in formal mediations or negotiations.
Mira explained that the ICC provides parties with the possibility of traditional arbitration and ADR options, giving parties flexibility in resolving disputes. She clarified that the ICC does not influence the parties’ decisions regarding whether to settle or proceed with arbitration. Instead, the ICC acts as a safeguard to ensure compliance throughout the ADR and/or arbitration processes.
Lastly, Savinovich explained that SIAC has an agreement with its sister organization, the Singapore International Mediation Center (“SIMC”) (i.e., the SIAC-SIMC Arb-Med-Arb Protocol). Following this protocol, SIAC will constitute a tribunal for arbitration proceedings initiated before the SIAC, after which the case is stayed and submitted to mediation at the SIMC. Parties will then try to reach an agreement within 8 weeks. If the parties reach an agreement, they come back to the tribunal, and the tribunal records this in a consent award. However, if the parties cannot reach an agreement within the 8-week timeframe, the arbitration will resume before the already-appointed arbitral tribunal. Savinovich explained that 75% of the cases that go to the SIMC are settled. He believes that the other 25% of parties are still content with this process because there is no significant increase in time investment – in the event that parties fail to reach a mediation agreement, they can simply proceed with arbitration since the tribunal has already been constituted.
* Editor: Bernice Tan, Senior Associate at Drew & Napier
ABOUT THE AUTHOR
Rachel Hage is a current law Student in the final year of her studies for a dual degree, which includes a J.D. from the American University Washington College of Law and a Masters I and II from the Université Paris Nanterre (Paris X) in International Commercial Law. She is expected to take the New York Bar exam in 2025.
*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.
