Effects of COVID-19 in Arbitral Proceedings: Possible measures that may be considered to mitigate...
Updated: Oct 23, 2020
COVID-19 is a health catastrophe that massively disrupts the world economy. This pandemic situation and the shutdown of large parts of the economy has led to a drastic drop in the cash-flow of companies and to a threat of mass insolvencies. The outbreak of Covid-19 is also affecting litigation and arbitration procedures as it is difficult to progress due to safety concerns and public health restrictions imposed to limit or slow the virus’s spread. This affect occurred in various ways, ranging from an increased use of remote hearings to general court closures, depending on the countries and institutions concerned.
Considering arbitral proceedings, pandemic situation effects both arbitration applications and pending arbitrations. The challenges facing everyone involved in arbitration during this period are unprecedented; parties, counsel and tribunals try to minimize and avoid such difficulties by use of case management tools.
As the authorities and institutions react, new measures are being put in place daily. Arbitral institutions like ICSID, ICC, HKIAC and LCIA are regulating their rules to help parties, counsel and tribunals work coherently through this period. These regulations consist of hearings by audioconference, videoconference or other similar means of communication ("virtual hearing) and online applications without need for face-to-face interactions.
Arbitral institutions are taking measures to ensure continuity of services. Starting with ICSID, most of the institutions have made electronic filing their default procedure; this prevents hardcopy document sharing that may cause the spread of virus and also reduces the time-loss. Also, institutions publish detailed guidelines to guide parties, counsel and tribunals and hold series of webinars to ensure smooth running of procedures.
It is important to recognize the important role of parties, counsel and tribunals in ensuring that disputes will continue to be resolved on a fair, expeditious, and cost-effective basis. So, procedural tools provided by arbitral institutions shall be used effectively by parties, counsel and tribunals to mitigate the delays generated by the pandemic.