What is arbitration?
A dispute ? Think about arbitration.
You manage your company on a daily basis with all its strategic, operational and commercial challenges. It is a tough task. A dispute can arise at any time with your clients, suppliers or partners. It is in your interest that it can be treated quickly and efficiently.
Have you thought about arbitration?
Resolving a conflict through arbitration allows you to obtain a decision very quickly when the situation is urgent. Parties can submit their disputes to an arbitral tribunal, composed of one, three or more persons. On the basis of the request and the explanations of the parties, this arbitral tribunal will then render a binding decision, the ‘arbitral award’.
A final decision is rendered by competent and experienced arbitrators who are specialised in the sector in which you are active or in the field of the dispute in question.
The arbitrators are fully independent and decide in a neutral manner. The cases can be treated in any language and in any country as chosen by the parties. The confidentiality is guaranteed – your business secrets and know how are protected.
The decisions rendered by the arbitrators have the same value as decisions rendered by the courts. They resolve the disputes and allow you to seize the assets of your debtor in more than 150 countries in the world.
Arbitration offers an alternative with a high added value.
Arbitration can only take place with the agreement of all parties involved. A clause confirming this agreement can either be inserted into any contract, at the time of signature of the contract or a specific agreement to arbitrate can be entered into once the disputes has arisen.
CEPANI also offers services of mediation as well as other alternative dispute resolution methods that always promote an amicable settlement.
At the heart of Brussels, home to several institutions of the European Union as well as many other international companies and organisations, CEPANI provides its services in both a national and an international context.
Why choose arbitration? Arbitration, the right choice for me?
As a method of alternative dispute resolution, legally provided for by the Code of Procedure, arbitration offers all the usual legal guarantees yet tops them up with a greater flexibility and time efficiency.
A CEPANI arbitration offers a number of benefits:
Efficiency
Arbitration proceedings conducted under the CEPANI Arbitration Rules typically last a little over a year, except for expedited procedures (< EUR 100,000), which are expected to be concluded within five months.
The arbitral award is final and subject to only a limited court control.
Confidentiality
Unless the parties agree otherwise, the arbitral proceedings are confidential, including all Awards in the arbitration, together with all materials in the arbitration created for the purpose of the arbitration and all other documents produced by another party in the proceedings not otherwise in the public domain, save and to the extent that disclosure may be required of a party by legal duty, to protect or pursue a legal right, or to enforce or challenge an Award in legal proceedings before a state court or other legal authority.
Expertise of Arbitrators
Arbitrators are appointed either by the parties or by CEPANI in accordance with the required expertise for the case.
Costs
In a CEPANI arbitration, the costs are determined by a scale based on the amount in dispute. This allows the parties to estimate the cost of the arbitration proceedings they intend to initiate, using the online cost calculator tool provided by CEPANI.
These costs, as well as other party expenses such as legal fees, can be recovered pursuant to the decision rendered by the Arbitral Tribunal.
Arbitration Timeline
The purpose of the CEPANI Arbitration Timeline is twofold.
The outline provided for below is meant to give parties to CEPANI arbitral proceedings and their counsel an indicative timeline based on the 2023 CEPANI Arbitration Rules.
Second, as time efficiency is an essential feature of arbitration, the timeline provides information to the parties on how to effectively facilitate each step of the proceedings.
The time periods concerning the first three steps of the procedure are calculated based on a starting point ‘X’. It is important to note that this point will only be reached once the CEPANI Secretariat has received both the Request for Arbitration including the annexes thereto as well as the payment of the registration costs.
The time periods concerning the last four steps in the proceedings are calculated based on starting point ‘Y’, i.e. the appointment of the Arbitral Tribunal. Before this appointment can take place, however, the parties are required to fully pay the advance on arbitration costs. The CEPANI Secretariat requests the parties to pay this advance within one month of the date of the commencement of the proceedings.
The timelines outlined below are those provided for by the CEPANI Arbitration Rules and may vary depending on various factors, such as the complexity of the case, the degree of cooperation between the parties, the need for expert or witness intervention, such as the complexity of the case, the degree of cooperation from the parties, the need for experts or witnesses, etc.
X: Filing of the Request for Arbitration
CEPANI arbitration proceedings are initiated by submitting a Request for Arbitration to the CEPANI Secretariat. The date on which the CEPANI Secretariat receives the Request for Arbitration including the annexes thereto as well as the payment of the registration costs (as determined in Schedule I of the CEPANI Arbitration Rules), shall be deemed to be the date of commencement of the arbitral proceedings.
The Request for Arbitration must include the information listed in Article 3 of the CEPANI Arbitration Rules, and must contain in annex copies of all relevant agreements, more specifically the arbitration agreement, and any other important exhibits. A model Request for Arbitration can be found on our website.
The Claimant may choose to submit a very detailed Request in which the relevant facts are clearly stated, the legal grounds relied upon are explained and the claims are specifically, clearly and succinctly set out and substantiated with evidence provided in the exhibits. Such a Request for Arbitration will require more time to draft. Therefore, the Claimant should consider whether it is in its interest or not, considering possible settlement negotiations, to submit such a detailed Request. If the arbitration proceedings do continue, however, such a Request will undoubtedly save the Claimant time when presenting its case at the stage of the written Memoranda.
Alternatively, the Claimant may choose to draft a very short Request containing nothing more than the minimum requirements set out in the CEPANI Arbitration Rules. This option is undoubtedly a faster and more cost-effective way to initiate arbitration proceedings. It may, however, lead to multiple rounds of written Memoranda later in the proceedings. It may also make it more difficult for the Respondent to formulate an appropriate answer and/or counterclaim. Thoroughly defining all the issues surrounding the dispute may also be harder.
It is recommended that the Claimant make an early analysis of the nature of the dispute and consider the costs and benefits of the strategic choices listed above. Obviously there is a vast middle ground between the two extremes.
X + 30 days: Filing of the Answer to the Request for Arbitration
Within one month of the date of the commencement of the CEPANI arbitration proceedings, the Respondent must file with the CEPANI Secretariat its Answer to the Request for Arbitration.
The Answer to the Request for Arbitration must include the information listed in Article 4 of the CEPANI Arbitration Rules, and must contain in annex copies of all relevant exhibits.
Just as for the Claimant, several strategic options are open to the Respondent when drafting its Answer to the Request for Arbitration. The Respondent may choose to file a short Answer containing the minimum requirements set out in the CEPANI Arbitration Rules, or it may opt for a very detailed and elaborate Answer that may render subsequent multiple rounds of written Memoranda unnecessary, or it may go for anything in between these two extremes. The Respondent must examine the pros and cons of these options, i.a. in light of the one month time limit specified by the CEPANI Arbitration Rules for the filing of the Answer.
These strategic choices also apply to any counterclaim the Respondent wishes to file. If there are any substantial procedural objections, such as a challenge of the jurisdiction of the Arbitral Tribunal, the Respondent may elect to concentrate in its Answer on these issues rather than on the merits of the case.
X + 60: Filing of the written observations on the counterclaim
In the event the Respondent has submitted a counterclaim, the Claimant may submit written observations on said counterclaim within one month of the date of the filing of the Answer to the Request for Arbitration.
The written observations on the counterclaim should adhere to the same format as the Request for Arbitration. The same strategic choices as for the Request for Arbitration must be made. At this stage, a reassessment of the case may be necessary, given that the Respondent has set out its defense, counterclaims and exhibits.
In light of any possible new information, the likelihood of a settlement may have increased or decreased.
Y: Appointment of the Arbitral Tribunal
Once the advance on arbitration costs has been fully paid, the Arbitral Tribunal will be appointed. It is important that this advance be paid within one month of the date of the commencement of the proceedings, as requested by the CEPANI Secretariat.
If the parties have opted for a sole arbitrator, this arbitrator will normally be appointed by the Appointments Committee. If, however, the parties have themselves agreed on the choice of arbitrator, the appointment is merely subject to confirmation by the Appointments Committee or by the CEPANI President (Article 15.2 of the CEPANI Arbitration Rules).
If the parties have foreseen three arbitrators, the Claimant and the Respondent must each nominate an arbitrator, respectively in the Request for Arbitration and the Answer to the Request for Arbitration. The third arbitrator, who will act as chair, will be appointed by the Appointments Committee, unless the parties have agreed otherwise.
When nominating an arbitrator, whether it be a sole arbitrator by mutual consent or a party appointed arbitrator, it will positively influence the efficiency of the proceedings to nominate a person with a certain degree of expertise in the field to which the dispute relates. In addition, nominating an arbitrator familiar with arbitral proceedings, specifically arbitrations governed by the CEPANI Arbitration Rules, is also advisable.
Y + 30: Filing of the Terms of Reference
Within one month of its appointment, the Arbitral Tribunal must transmit the Terms of Reference to the CEPANI Secretariat. The Terms of Reference are an objective summary of the facts and issues of the case and the assertions and claims of all parties involved. This document will serve as the basis for the examination of the case by the Arbitral Tribunal. Furthermore, this document assists the parties in assessing at this early stage of the procedure the strengths and weaknesses of their positions, which may help them in early settlement negotiations.
Article 23.1 of the CEPANI Arbitration Rules explicitly states that the Terms of Reference may be drafted in the presence of the parties. Clearly delineating and defining the issues in dispute as well as the legal framework that will be used to evaluate these issues, will greatly improve the speed and efficiency of the proceedings.
The parties should carefully consider how many rounds of written Memoranda are necessary. This will depend on the nature of the Request for Arbitration and the Answer, as well as the nature and complexity of the case. If these documents are detailed and the issues have been clearly set out and discussed, multiple rounds of written Memoranda may be avoided, thus limiting the risk of needless reiterations or dilatory tactics. To limit such risks, the parties may also consider asking the Arbitral Tribunal to clearly define what issues should be focused on and which questions must not be discussed.
The parties must also consider the advantages or disadvantages of bifurcating certain issues and asking the Tribunal to render partial Awards. Asking the Tribunal for a decision on jurisdiction or on liability before further considering the dispute, may speed up the proceedings or facilitate a settlement. A potential disadvantage of bifurcation is that a party may file a motion for setting aside such partial Awards, which may undermine the further conduct of the arbitral proceedings.
Y + 30: Drawing up the Procedural Timetable
When drawing up the Terms of Reference, or as soon as possible thereafter, the Arbitral Tribunal will organise a case management meeting between the Arbitral Tribunal and all parties involved in the proceedings. This meeting may take place in person or via telephone or video conference. After having consulted the parties, the Arbitral Tribunal will draw up in a separate document the Procedural Timetable.
It is recommended that the parties not only send their counsel to attend this meeting but that they be present themselves. This may positively influence the time limits agreed upon. In any case, the parties themselves are likely to have a better understanding of the history of the dispute and to be in a better position to estimate what time limits are realistic.
To ensure accelerated proceedings, it is crucial that the parties agree on appropriately short and realistic deadlines for submitting Memoranda and exhibits, organising the hearing(s), the closing of the debates and any other procedural steps deemed necessary, such as e.g. the production of documents or the hearing of witnesses. With regard to the rounds of written Memoranda, providing for simultaneous rather than sequential filings is likely to be more time-efficient.
Y + 210: Rendering of the Award
Within six months of the date of the Terms of Reference, the Arbitral Tribunal will render the Award (Article 30.1 CEPANI Arbitration Rules).
Over the course of these six months, the filing of the Memoranda, the organisation of hearings, the filing of post-hearing briefs, the closing of the debates and the examination of the case by the Arbitral Tribunal will take place.
It is self-evident that the parties’ and Arbitral Tribunal’s adherence to the deadlines agreed upon in the Procedural Timetable will favor a speedy conclusion of the proceedings.
As is the case for all other written submissions, it is important to keep the assertions and claims in the Memoranda specific and to the point. Overly lengthy documents with digressions about irrelevant factual circumstances or unimportant legal details should be avoided.
After consulting with the parties, the Tribunal shall decide whether the hearing shall be held physically, by videoconference, teleconference, any other appropriate means of communication or by a combination foregoing methods. The Arbitral Tribunal may decide the case on the basis of documents, unless the parties or one of them requests a hearing. These options may be worth exploring for an efficient conduct of the proceedings.
Parties should consider the added benefits of submitting post-hearing briefs, or the lack thereof. Such final submissions may be useful as a summary of what the parties consider the hearings to have proven, but they do of course add an additional step to the proceedings.
Once the Award has been rendered and provided that the arbitration costs have been fully paid, the CEPANI Secretariat will notify to each party, by registered letter or by courier service, an original copy of the Award signed by the members of the Arbitral Tribunal. An electronic copy of the Arbitral Award will also be sent to the parties by email.