The 2020 Revision of the IBA Rules on the Taking of Evidence in International Arbitration

The IBA Rules on the Taking of Evidence

The IBA Rules are a largely used instrument in international arbitration. They provide a framework for the taking of evidence in arbitration proceedings aiming at bridging the gap between cultural differences as to how evidence is gathered and presented. Their roots go back to 1983 when the IBA published the Supplementary Rules Governing the Presentation of Evidence in International Commercial Arbitration. These were revised in 1999, when the IBA published the IBA Rules on the Taking of Evidence in International Commercial Arbitration. Before 2020, the only revision had occurred in 2010 when, inter alia, the word “commercial” was deleted from their title as the IBA Rules also find great acceptance in investment and sports arbitration.

The 2020 Revision Process

The revision process had already started before the COVID-19 pandemic. In 2016, the IBA published the Report on the Reception of the IBA Arbitration Soft Law Products, which was the result of a worldwide survey on the use and reception of the IBA Rules as well as both IBA guidelines on party representation and on conflicts of interest. As to the IBA Rules, the Report concluded that there was no immediate need for review, since respondents affirmed by an overwhelmingly large margin that the rules did not need to be amended. Nevertheless, the Report had envisaged that a full revision might be considered in 2020, i.e., ten years after the 2010 revision (Report on the Reception of the IBA Arbitration Soft Law Products, para. 238).

In 2019, the IBA Arbitration Guidelines and Rules Subcommittee established a Task Force (Task Force) in charge of revising the IBA Rules, which consisted of more than 30 arbitration practitioners from several nationalities. The Task Force consulted with more than 160 arbitration institutions and the members of the 1999 Working Party and the 2010 Review Subcommittee.

The 2020 IBA Rules were adopted by a resolution of the IBA Council on 17 December 2020 and published on 17 February 2021.

Remote Hearings

The aforementioned necessity to adapt the IBA Rules to the possibility of online hearings is clearly reflected in Art. 8 on evidentiary hearings, where new rules for remote hearings have been introduced. The 2010 IBA Rules gave priority to in-person evidentiary hearings as Art. 8.1 set forth that witnesses should appear in person unless the arbitral tribunal allowed the use of videoconference or similar technology. This presumption no longer exists under the 2020 IBA Rules. Due to lockdowns and restrictions of free movement during the COVID-19 pandemic, parties and arbitral tribunals had to break new ground to be able to continue procedures efficiently under the new circumstances.

The newly inserted Art. 8.2 reflects these possibilities and foresees a more proactive approach by expressly providing that the arbitral tribunal may, at the request of a party, or on its own motion, order that the evidentiary hearing will be conducted remotely. The question of whether a remote hearing might also be ordered against the will of the parties or not is intentionally not addressed in the 2020 IBA Rules. This could be stipulated in one direction or the other in an arbitration clause, under lex arbitri (right to physical hearing) or the applicable arbitration rules (e.g. Art. 26.1 ICC Rules).[2]

According to the 2020 IBA Rules, remote hearing is defined in the definition section as “a hearing conducted, for the entire hearing or parts thereof, or only with respect to certain participants, using teleconference, videoconference or other communication technology by which persons in more than one location simultaneously participate“. The definition of the term is deliberately very open and future-oriented, especially with regard to the equipment and programs that can be used.

In order to meet the challenges of such a remote hearing, be it of a technical (e.g. network connection, equipment, handling) or practical nature (e.g. different time zones), the 2020 IBA Rules provide for the preparation of a protocol for ensuring that remote hearings are conducted “efficiently, fairly and, to the extent possible, without unintended interruptions”. Art. 8.2 lists the following topics that might be addressed in the protocol:

• (a) the technology to be used;
• (b) advance testing of the technology or training in use of the technology;
• (c) the starting and ending times considering, in particular, the time zones in which participants will be located;
• (d) how documents may be placed before a witness or the arbitral tribunal; and
• (e) measures to ensure that witnesses giving oral testimony are not improperly influenced or distracted.

However, this list does not claim to be exhaustive and such contents are merely suggested (“may address“). This leaves room for the parties and/or arbitrators to draft the protocol on a case-by-case basis.

Checklists and guidance notes on remote proceedings have already been made available by arbitral institutions such as the ICC[3] and renowned institutions such as The Chartered Institute of Arbitrators (CIArb).[4]

As to measures to prevent a witness from being influenced during his or her testimony, the Commentary on the revised text of the 2020 IBA Rules (Commentary) gives some examples: “These methods include questioning the witness at the outset of the examination about the room in which the testimony is being given, the persons present and documents available; installation of mirrors behind the witness; use of fish-eye lenses; or the physical presence with the witness of a representative of opposing counsel“.

Whilst it is true that virtual hearings might not be suitable for all arbitrations, it is to note that the feedback from arbitration practitioners who have participated in online hearings has generally been very positive (including among those who were very skeptical about conducting virtual hearings when the pandemic broke out).

Cybersecurity and Data Protection

Art. 2 was amended to include the treatment of cybersecurity and data protection among those evidentiary issues that shall be addressed by the arbitral tribunal in consultation with the parties at the beginning of the arbitration proceedings. These are two topics to which special attention has been drawn in international arbitration, given the increasing use of technology in arbitration proceedings, the enactment of data protection laws and the amount of confidential information exchanged between parties, arbitrators and institutions.

The 2020 IBA Rules do not provide for specific rules in this regard, but the Commentary on the revised text of the 2020 IBA Rules refers to two instruments which the parties may find useful when considering these issues, namely (i) the ICCA-IBA Roadmap to Data Protection in International Arbitration (ICCA-IBA Roadmap) and (ii) the ICCA-NYC Bar-CPR Protocol on Cybersecurity in International Arbitration (Protocol).

The ICCA-NYC Bar-CPR Protocol on Cybersecurity in International Arbitration is dated late 2019, but it is referred to as the 2020 Protocol. The purpose of the Protocol is twofold: First, it is intended to provide a framework for establishing information security measures for individual arbitrations. This framework provides procedural and practical guidance to assess security risks and to identify available measures that can be implemented. Second, the Protocol is intended to raise awareness of information security in international arbitration.

With regard to the ICCA-IBA Roadmap to Data Protection, a consultation draft for public comments has been released and the final version of the document is scheduled to be launched on 26 September 2021, during the ICCA 2021 Congress in Edinburgh. The purpose of the ICCA-IBA Roadmap is to assist arbitration practitioners in identifying and effectively addressing data protection issues in the context of arbitration proceedings.

Lastly, it has to be noted that data protection and cybersecurity have also been the subject of the amendment of institutional rules. In 2020, the LCIA was the first arbitration institution to include a provision on data protection (Art. 30A).[5] It was followed by the new ICDR Rules (Art. 22.2[6]) and the new Swiss Rules (Art. 19.2[7]) in 2021.

Document Production

As regards the document production phase, there were five specific changes. These do not represent major changes, but rather reflect the current practice.

Four changes were made to Art. 3. It now expressly provides that:

• the requesting party may respond to objections if so directed by the arbitral tribunal (Art. 3.5);
• the parties are not obliged to produce multiple copies of documents which are essentially identical (Art. 3.12(c));
• there is no need to translate the documents produced in response to requests for document production (Art. 3.12(d)).

Furthermore, the new text of Art. 3.7 of the 2020 IBA Rules no longer sets forth that the arbitral tribunal shall consider the requests for document production “in consultation with the parties” as the text in italics has been deleted.

The fifth change can be found in Art. 9.5, which was amended to clarify that the arbitral tribunal may make necessary arrangements to protect the confidentiality not only of the evidence to be presented, but also of the documents to be exchanged during the document production phase.

Additional Witness Statements and Expert Reports

According to the 2010 IBA Rules, revised or additional witness statements as well as expert reports could only be submitted as long as they responded to submissions that had not been previously presented in the arbitration (Art. 4.6 for witnesses of fact and Art. 5.3 for party-appointed experts). In practice, it had already become established, in particular due to the parties’ right to be heard, that the need to submit revised or additional witness statements or expert opinions should be interpreted broadly.

The Task Force has taken this into account and in consideration of good faith and efficiency added new provisions to the IBA Rules equivalent for witness statements (Art. 4.6) as well as expert reports (Art. 5.3). According to these provisions, parties can submit an additional witness statement or expert report to cover new factual developments that could not have been addressed previously. Nevertheless, submissions of further witness statements and expert reports are still limited to responses to the counterparty’s evidence in order to prevent parties from attempting to surprise the opposing party with evidence or derail the procedural timetable.

Tribunal-Appointed Experts

An important clarification has been provided in Art. 6. The Task Force deleted the following wording of Art. 6.3 of the 2010 IBA Rules: “The authority of a Tribunal-Appointed Expert to request such information or access shall be the same as the authority of the Arbitral Tribunal“. Said sentence seemed to suggest that the tribunal-appointed expert might have the same authority as the arbitral tribunal itself to request relevant information from the parties. This misinterpretation has already been clearly negated beforehand in the Commentary to the 2010 IBA Rules as being inconsistent with other provisions. But under Art. 6.3 of the 2020 IBA Rules it is now clear that the arbitral tribunal alone has said authority to decide any disagreement between the tribunal-appointed expert and a party as to the relevance, materiality or appropriateness of such a request, e.g. if information is privileged and a party refuses to provide it based on a right of refusal.

Direct Testimony in Case of Waiver of Cross-Examination

Art. 8 was also amended to clarify some uncertainty regarding the questioning of a witness or expert who was not called to testify at the hearing by the opposing party, but only by the party who submitted the written statement. Now Art. 8.5 provides that if only the party that introduced the witness statement or expert report requests the witness’ or expert’s appearance at the hearing, the arbitral tribunal may, after hearing the parties, allow further direct testimony. In other words, the arbitral tribunal may allow the witness or expert to give further oral direct testimony after a prior witness statement or expert report despite the waiver of the other party of its right to cross-examine him or her.

Evidence Obtained Illegally

Art. 9 of the IBA Rules governs the admissibility and the assessment of evidence. Art. 9.2 of the 2010 IBA Rules already provided certain standards of admissibility but did not address its limitation or exclusion especially if evidence had been obtained unlawfully. Arbitral tribunals have always been faced with the handling of evidence obtained via an unlawful breach. The question even found its way into the 26^th Vis Moot in 2019.

The Task Force has now amended Art. 9 by adding a new provision regarding the exclusion of illegally obtained evidence either at the request of a party or on the own motion of the arbitral tribunal in Art. 9.3 of the 2020 IBA Rules. Nevertheless, there has been no consensus on standards, especially on how to determine “evidence obtained illegally” and under which circumstances it should be excluded.

In this context, for example, the possible entry of evidence into the public domain through public leaks such as WikiLeaks and Panama Papers has been discussed. Moreover, such a decision is likely to depend on the law applicable to the arbitration. Therefore, Art. 9.3 gives the arbitral tribunal full discretion as it “may” exclude illegally obtained evidence, whereas the arbitral tribunal “shall” exclude evidence under Art. 9.2.

Conclusion

The revision did not result in major changes, but mainly in specific amendments aimed at clarifying some points and at reflecting the already established standard practice as to the taking of evidence in international arbitration. Most notably, the 2020 IBA Rules embrace the increasing use of technology in international arbitration. They provide now for virtual hearings and encourage arbitrators and parties to address data protection rules and cybersecurity measures at the commencement of the arbitration proceedings. These changes are a response not only to the circumstances brought on by the COVID-19 pandemic, but also to the growing concerns over the protection of data and information.

Furthermore, the fact that there was no need for substantial changes shows that the IBA Rules are widely accepted by arbitration practitioners as they are and have been achieving their purpose of bridging the gap between different legal systems.

[1] For instance: LCIA Rules (2020), ICC Rules (2021) and ICDR Rules (2021).

[2] ICC Rules (2021): The arbitral tribunal may decide, after consulting the parties, and on the basis of the relevant facts and circumstances of the case, that any hearing will be conducted by physical attendance or remotely by videoconference, telephone or other appropriate means of communication.

[3] Checklist for a Protocol on Virtual Hearings and Suggested Clauses for Cyber-Protocols and Procedural Orders Dealing with the Organisation of Virtual Hearings (https://iccwbo.org/content/uploads/sites/3/2020/12/icc-checklist-cyber-protocol-and-clauses-orders-virtual-hearings-english.pdf).

[4] CIArb Guidance Note on Remote Dispute Resolution Proceedings (https://www.ciarb.org/media/8967/remote-hearings-guidance-note.pdf?mc_cid=cad9adebdf&mc_eid=f90f77d952).

[5] LCIA Rules (2020), Art. 30A (Data Protection): 30.4 Any processing of personal data by the LCIA is subject to applicable data protection legislation, and the LCIA’s data protection notice can be found on the LCIA website. 30.5 In accordance with its duties under Article 14.1, at an early stage of the arbitration the Arbitral Tribunal shall, in consultation with the parties and where appropriate the LCIA, consider whether it is appropriate to adopt: (i) any specific information security measures to protect the physical and electronic information shared in the arbitration; and (ii) any means to address the processing of personal data produced or exchanged in the arbitration in light of applicable data protection or equivalent legislation. 30.6 The LCIA and the Arbitral Tribunal may issue directions addressing information security or data protection, which shall be binding on the parties, and in the case of those issued by the LCIA, also on the members of the Arbitral Tribunal, subject to the mandatory provisions of any applicable law or rules of law.

[6] ICDR Rules (2021), Art. 22.2: The tribunal shall conduct the proceedings with a view to expediting the resolution of the dispute. The tribunal may, promptly after being constituted, conduct a procedural hearing with the parties for the purpose of organizing, scheduling, and agreeing to procedures, including the setting of deadlines for any submissions by the parties. In establishing procedures for the case, the tribunal and the parties may consider how technology, including video, audio, or other electronic means, could be used to increase the efficiency and economy of the proceedings

[7] Swiss Rules (2021), Art. 19.2: As soon as practicable after receiving the file from the Secretariat, the arbitral tribunal shall hold an initial conference with the parties to discuss the organisation of the arbitration proceedings, including rules of procedure, as well as issues of data protection and cybersecurity to the extent needed to ensure an appropriate level of compliance and security.