The new president of the International Chamber of Commerce (ICC) Court of Arbitration, Claudia Salomon, is the first woman to lead the institution since its establishment in 1923. Here, she discusses her new role, and what changes she expects to see in the dispute resolution landscape in Asia

China Business Law Journal: Tell us about your strategies to keep the ICC Court’s presence in Asia, especially with more Asian jurisdictions setting up their own arbitration institutions?

Claudia Salomon: We are very focused on expanding the ICC’s presence in Asia, and fully expect an increase of cases involving Asian parties. Last year, parties to arbitrations came from 145 countries and independent territories worldwide, and 25% came from the Asia-Pacific. Currently, we have case management teams located in Hong Kong and Singapore, with legal staff from mainland China, Hong Kong, India and Singapore.

We have a representative office in Shanghai, where our North Asian director and her team are located. We have the strongest Asian presence on the ICC Court, more than ever before, including vice presidents from mainland China, India, and Singapore. The ICC dispute resolution services governing body now includes Sundaresh Menon, the chief justice of Singapore, and Liz Chung, the legal director of Netflix Korea.

We are paying close attention to the release of the draft of the new arbitration law in China, which is currently open for public comment and includes provisions regarding how foreign arbitral institutions may set up case management offices in China. If we have the opportunity to do so, that will certainly be our plan.

But in the immediate term, we will focus on an extensive training programme tailored to key stakeholders, in-house counsel, young practitioners and arbitrators. The ICC Young Arbitrator Forum North Asia and South Asia chapters are key in that respect. We are also focused on assuring visibility and appointments for arbitrators from Asia.

In 2018, the ICC introduced its expedited procedures for streamlined arbitration with reduced fees. The case is decided by one arbitrator with a simplified procedure and a final award rendered within six months from the case management conference. These procedures automatically apply to cases under USD2 million or USD3 million, depending on when the contract was signed, and they have been a resounding success and extremely popular. We had numerous cases in which the parties have opted into the expedited procedures, even though the amount in dispute is above the threshold. It’s notable that in 2020, 38% of the new filings involved an amount in dispute not exceeding USD3 million.

The ICC rules also offer a procedure for parties to seek urgent temporary relief from an emergency arbitrator when they’re unable to wait for the constitution of a tribunal. And the emergency arbitrator must issue his or her order within 15 days. Since the start of my term as president of the ICC, we have had a very significant number of such applications, frequently filed on a Friday night, including one claimant to file six separate applications at once. But in all of these cases, I’ve been able to appoint emergency arbitrators extremely quickly, and most often within 24 hours.

So, looking ahead, we will first focus on the needs of small and medium-sized enterprises (SMEs) that drive most of the economy and have been most impacted by the pandemic. We know they need an effective means of resolving low-value disputes. We are working closely with the broader ICC, which is establishing centres for entrepreneurship throughout the world providing services and assisting SMEs.

Second, we’re focused on technology-related disputes, biotechnology, and AI [artificial intelligence]. We will see tremendous and rapid growth in this area of high-end manufacturing, and can expect an increase in such disputes. About 40% of ICC cases fall in the category of energy or construction and infrastructure, and especially in Asia we will expect to see that trend to continue.

CBLJ: What are the emerging trends in arbitration you have observed in Asia?

Salomon: The progress that Asian jurisdictions have made in international arbitration is unprecedented. The governments in the region have been very forward-thinking and nimble in addressing arbitration issues, including legislation dealing with the emergency arbitrator, third-party funding, and enforcement of interim relief.

We see a real increase in the sophistication of Asian parties in addressing cross-border disputes, and the emergence of world-class corporate counsel, particularly as Asian parties have more bargaining power in their contract negotiations, including over the terms of their dispute resolution provisions. We see a very high standard of the top-tier Asian law firms, particularly in Singapore, Hong Kong, India, South Korea and Japan, and we also see the emergence of a growing number of top-tier Asian arbitrators.

We have also seen an increase in intra-Asian disputes arising from significant intra-Asian investment and the desire by Asian parties to have arbitration seated in Asia, particularly Hong Kong and Singapore, but we also see Beijing and Shanghai as preferred seats.

The complexity of disputes has been rapidly increasing. For example, construction disputes are often intertwined with finance disputes, and I saw that recently as an arbitrator. So this development calls for more experienced arbitrators. It sparks the parties to consider a combination of arbitration, mediation and other dispute resolution mechanisms in a more efficient and economical way.

CBLJ: What have you learned during the covid-19 pandemic?

Salomon: From the pandemic, we’ve seen that international arbitration can quickly adapt and embrace new technologies as essential tools for dispute resolution, and that certainly is true in China. As we see, the draft of the PRC Arbitration Law includes provisions where the tribunal can decide to conduct the arbitration through online means.

The 2021 ICC rules also made important changes, so the ICC is even more efficient, flexible and embraces this digitalisation. The new rules make clear that tribunals are empowered to conduct hearings in person and remotely to take into consideration the relevant facts and circumstances of the case. All filings are now electronic unless a party specifically requests that hard copies be served.

In the early stage of the pandemic, the ICC issued a guidance note on how to minimize, or even avoid, potential disruption by thoughtful use of case management tools. These included the use of video-conferencing, which has now become commonplace, but also included consideration of legal or contract interpretation issues that may be decided on a preliminary basis to narrow the issues in dispute and the scope of issues that need to be decided in an evidentiary hearing. The guidance note is available in multiple languages including Chinese.

From my perspective, as we hopefully emerge out of the pandemic, the presumption that meetings and hearings will be in person has been flipped. Before the pandemic, we assumed evidentiary hearings would be in person unless there were very specific reasons for a witness or expert to testify remotely. Now, everyone needs to consider whether there’s a need or a strong desire to meet in person.

So, when travel resumes, I expect it will be rare for a tribunal to conduct a procedural hearing in person, and video-conferencing will be the norm. For evidentiary hearings, there will certainly be more openness to video and hybrid hearings, although some parties will want to be in person for major matters.

CBLJ: What are your thoughts on third-party funding in dispute resolution?

Salomon: Third-party funding is an important development because it enables parties who might not otherwise be able to bring a claim to have access to justice. We have seen the emergence of legislation and regulation in Hong Kong and Singapore expressly recognising and permitting third-party funding. But we’ve also seen third-party funding increasingly used in an arbitration seated in mainland China.

In recent years, the number of third-party funding companies in China has been on the rise. In line with the trend toward transparency in international arbitration, the 2021 ICC arbitration rules require parties to disclose the existence and identity of third-party funders. Disclosure and transparency seek to avoid conflicts of interest between an arbitrator and the parties, or related parties, including funders, ensuring the impossibility of an award. The 2021 ICC rules are another step toward allowing funders and parties to work together in a transparent manner, and that builds further confidence into the arbitration framework and confidence in the use of third-party funders.

CBLJ: Are there any other developments you expect will enhance the arbitration ecosystem in Asia?

Salomon: We have seen the New York Convention signed by 168 countries. It’s one of the most successful international treaties in history, and there are very few jurisdictions in the world that are resisting the enforcement of arbitration awards. However, how the New York Convention is actually applied in that particular jurisdiction is mixed around the world.

The ICC is known to have processes that make enforcement of arbitration awards more likely as a result of the scrutiny process that is part of the ICC rules. The awards are reviewed not just by the case management staff, but also by members of the ICC Court before a final award is issued by the tribunal. We find that process assures that the arbitration awards have the reasoning and all other elements to make enforcement of the awards more likely.

Apart from the unprecedented changes and developments in the international arbitration infrastructure in Asia, we’ve also seen a real interest in consideration of all of the tools for resolving disputes. That is really the ICC’s approach, that the International Centre for ADR’s offerings and our international arbitration rules and processes are available to the parties, not as single items, but potentially all available and needed in order to resolve a dispute.

So, if parties have launched an arbitration but want to pause because they believe they can make progress through settlement negotiations or mediation, that will be part and parcel of the arbitration and dispute resolution process, because we know that when a party is in arbitration, they don’t want an arbitration, what they want is a resolution of their dispute.