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The impacts of COVID-19 on arbitral proceedings

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The impacts of COVID-19 on arbitral proceedings

6/1/2020

Before the COVID-19 pandemic, remote hearings were mostly used in international arbitrations, especially those related to emergency or expeditious procedures, in which the conflict needs to be resolved in a short time.

With the social isolation measures recommended by the World Health Organization (WHO) due to the pandemic, this practice is being widespread: almost all domestic arbitration procedures are currently underway exclusively by electronic means and some remote hearings have already been held[1].

Many arbitration proceedings cannot wait for the end of the pandemic to proceed, either because of the relevance of the amounts in dispute, or because of the urgency of the demands. In addition, the delay in resolving the dispute could compromise one of the main characteristics of the arbitration: the celerity of the procedure in relation to the other dispute settlement methods.

Given this scenario, administrative resolutions were issued by the main arbitration chambers indicating that it is up to the Arbitral Tribunal to decide (i) to suspend or continue the proceedings already in place; and (ii) to conduct remote hearings[2].

Some chambers, such as the Center for Arbitration and Mediation of the Chamber of Commerce Brazil-Canada (CAM-CCBC)[3], the Chamber of Conciliation, Mediation and Arbitration Ciesp/Fiesp (CCMA-CIESP-FIESP)[4] and the Center for Arbitration and Meditation AMCHAM Brazil (CAM-AMCHAM)[5], included in their resolutions provisions on (i) mandatory participation of members of the chamber in remote hearings, (ii) the suggestion of platforms to be used, (iii) the way of recording the meeting and (iv) the requirement for technical support staff. The CAM-AMCHAM informed that it is preparing a guide of good practices for remote audiences.

The experiences with these audiences proved to be positive and may even present some advantages in relation to the face-to-face audience: (i) greater preparation of the parties to guarantee clearer and more objective presentations; (ii) greater organization and better conduct of hearings by the Arbitral Tribunal; (iii) fewer interruptions by the other party; and (iv) better time and cost optimization for holding hearings.

The COVID-19 pandemic could become the catalyst for a trend in arbitration: the option for fully electronic arbitration procedures, from the request for arbitration to hearings and witnesses’ inquiries, a new reality that challenges parties, lawyers and arbitrators.

Our Arbitration Team has already been working to take full advantage of this new trend.

[1] Available at: https://valor.globo.com/legislacao/noticia/2020/04/20/camaras-arbitrais-passam-a-julgar-todos-os-casos-por-meio-eletronico.ghtml.

[2] See for example, Administrative Resolutions (i) CAM-CCBC nº RA 40/2020, item 4; (ii) CIESP-FIESP nº 2/2020, item 7; (iii) CAMARB nº 08/20, item 5; (iv) FGV nº 01/2020, Article 4; (v) AMCHAM nº 01/2020, item II.I; e (vi) CAM nº 01/2020, Article 3).