BCDR-AAA Launches New Arbitration Rules

The Bahrain Chamber for Dispute Resolution (BCDR-AAA) has recently launched its new Arbitration Rules.  The Rules have been highly anticipated as the reviewing process commenced in September 2016.  The new Arbitration Rules came into effect on 1^st October 2017 and are a culmination of the most recent practices and trends in international commercial arbitration and are not modelled after one set of rules.  In fact, there are elements reflected from various arbitration rules such as the ICC, LCIA and ICSID.  The Rules have been launched on 20 November 2017 and are published in in English, Arabic and French.

Prior to the amendment of the Arbitration Rules, the BCDR-AAA adopted the ICDR Arbitration Rules with minor changes made and issued its first Arbitration Rules in 2010 which remained unchanged until now.

The departure of the 2010 arbitration rules came in with new detailed rules which consisted of 41 articles in which the most prominent are highlighted:

1. Date of Commencement: Article 3 provides that the arbitration is deemed to have commenced on the date on which the Chamber receives the Request and filing fee. The arbitration shall take place in accordance with the new Rules if it is filed after 1 Oct 2017 and if the parties have not specifically agreed to apply the old BCDR-AAA Arbitration Rules.
2. Online filing: Articles (2.3, 4.3, 6.3 and 6.5) provide for online filing of various applications, responses and submissions through the BCDR-AAA website in order to support electronic filing and eliminate paper based applications.
3. Filing Fees & Cost of Arbitration: The Chamber has followed in the steps of the ICC model in determining and fixing arbitrator fees. The filing fees have been increased and vary depending on the number of arbitrators serving on a tribunal.  The fees can be seen here.
4. Expedited Procedures: Article 6 provides for expedited procedures unless the Parties opt out of this option. These procedures are applicable to any disputes that do not exceed USD 1 million and if the parties agreed in writing to apply the expedited procedures.  Under these Procedures, the chamber appoints a sole arbitrator who must issue a final award no later than 30 days from the date of close of proceedings.
5. Summary Procedures: The most prominent addition to the Arbitration Rules is the introduction of summary procedures. Under Article 18 the Tribunal has the power to determine on a summary basis any legal or factual issue considered by the applicant party to be material to the outcome of the arbitration.
6. Tribunal Secretary: A new addition to the BCDR-AAA Rules as the old version did not contain any provisions regarding the appointment of tribunal secretaries. Article 13 provides a detail instruction regarding the appointment, supervision and requirements of tribunal secretaries under the Rules.
7. Privilege: Article 24 of the new Rules stipulates that tribunals take into account applicable principles of privilege and if the parties, counsel and documents are subject to different rules of privilege, the tribunal shall apply the highest-level pf protection which shall apply to all parties.
8. Emergency Arbitrator: The BCDR-AAA have kept the option of appointing an emergency arbitrator and provided for the jurisdiction and scope under Article 14 of the new Rules. Pursuant to this Article, the emergency arbitrator who is appointed before the formation of the Tribunal, may issue interim or conservatory measures within 15 days after the date of appointment.  It is significant to point out that the non-refundable fee for the application of emergency arbitrators is USD 25,000 and the Chamber fees are USD 10,000.
9. Majority Power of the Tribunal: A controversial article; Article 15 stipulates that a member tribunal is able to proceed in the absence of one arbitrator if the defaulting arbitrator fails without good cause or refuses to participate in the arbitration.  Although there are some safeguards on the application of this Article, it raises immediate issues regarding the enforceability of an award and increases the potential for challenges to the award.
10. Limitation of Liability: Article 41 provides to the arbitral tribunal, tribunal secretaries, experts, emergency arbitrators, the Chamber itself and its employees. The only exception to the rule is in case of deliberate wrongdoing. None of the abovementioned is under any legal obligation to not make any statement regarding the arbitration even if requested by a judicial authority.

The full texts of the new BCDR-AAA Arbitration Rules can be viewed here.