The 2020 Revision of the IBA Rules on the Taking of Evidence in International Arbitration: Addressing the New Normal
The International Bar Association’s (IBA) Rules on Taking of Evidence in International Arbitration were first introduced in 1999. The rules aim to provide parties and arbitrators a resource for an efficient, economical and fair process for the taking of evidence in international arbitration and to strike a balance between common and civil law practices. To this end, the rules address the presentation of documents, witnesses of fact and expert witnesses, inspections, as well as the conduct of evidentiary hearings.
The Rules on Taking of Evidence in International Arbitration may be specifically adopted by parties to be applied in conjunction with institutional, ad hoc or other rules or procedures governing international arbitrations. Even when parties have not specifically agreed on the adoption of the rules, they serve as a well-recognised soft-law instrument regarding evidentiary issues in international arbitration.
On 15 February 2021, about a decade after the last update in 2010, the IBA published its revised rules together with an updated commentary. The 2020 revision clarified a number of points to remove ambiguity on interpretation and aligned the rules with common procedural and evidentiary practices developed in international arbitration over the past decade. Further, it addressed the opportunities and challenges brought about by the increasing use of new technology in taking of evidence in international arbitration.
Unless agreed otherwise, the revised 2020 rules automatically apply to all arbitrations in which the parties agree to apply the rules after 17 December 2020, i.e. the date of the formal adoption of the revised rules.
This blog post gives readers an overview of the key updates to the rules.
Promoting Remote Hearings
To reflect the tools implemented and practices adopted by parties and arbitral tribunals both before and during the global COVID-19 pandemic, the 2020 revision introduced a new paragraph 2 to Article 8 (Evidentiary Hearing) explicitly providing for the possibility of conducting evidentiary hearings remotely. The new Article 8.2 provides that the arbitral tribunal may, at the request of a party or on its own motion, and after consultation with the parties, order that the evidentiary hearing be conducted as a remote hearing. This means, pursuant to the newly inserted definition of ‘remote hearing’, that the hearing may be conducted in whole, or in part, by way of videoconferencing or other communication technology.
Further, the new article requires that the arbitral tribunal consult with parties with a view to establishing a remote hearing protocol to govern the conduct of the remote hearing. Such protocol may address, for example, technology to be used, placing documents before a witness, and measures to ensure witnesses are not improperly influenced.
Underlining Issues of Cybersecurity and Data Protection
According to the ‘meet and consult’ approach adopted in paragraph 2 of Article 2 (Consultation on Evidentiary Issues), the arbitral tribunal needs to consult with the parties on evidentiary issues already at an early stage of proceedings. The 2020 revision added a new sub-paragraph (e) to the list, encouraging the arbitral tribunal to also consult with the parties on the ‘treatment of any issues of cybersecurity and data protection’. Such issues may concern compliance with data protection regulation, such as the GDPR, or cybersecurity in remote hearings.
When considering these topical issues, the updated commentary on the rules suggests that parties seek further guidance from resources such as the draft ICCA-IBA Roadmap to Data Protection in International Arbitration and the ICCA-NYC BAR-CPR Protocol on Cybersecurity in International Arbitration.
Introducing the Possibility to Exclude Illegally Obtained Evidence
Paragraph 3 of Article 9 on the possibility to exclude illegally obtained evidence is one of the new provisions added to the rules. It gives the arbitral tribunal the power, at the request of a party or on its own motion, to exclude evidence obtained illegally. The specific circumstances under which illegally obtained evidence should be excluded was contemplated while drafting the rules, but no consensus was found. Thus, such determination is left to the discretion of arbitral tribunals.
Such an open-ended approach is understandable considering the absence of uniform national laws and the different approaches taken by arbitral tribunals on the issues of whether illegality has occurred or whether evidence is admissible. However, it would be advisable for arbitral tribunals to opt for caution in the use of this discretion, as an overly robust stance might push a dissatisfied party to challenge the award on the grounds of violation of the party’s right to be heard or of public policy, and therefore, lead to complications at the enforcement stage.
Clarifying Document Production Procedures
The 2020 revision introduced some efficiency-oriented clarifications to the document production procedures provided in Article 3 (Documents) of the rules. A new sentence was inserted into Article 3.5, which provides that the arbitral tribunal may allow the party who has requested the production of documents to respond to an objection from the opposing party—a change that reflects a well-established practice of arbitral tribunals.
Likewise, the deletion of the requirement in Article 3.7 that the arbitral tribunal confer with the parties after the requests and objections are submitted to the tribunal, reflects the prevailing practice of arbitral tribunals ruling on objections to document production without further consultation, i.e. without an additional round of comments from the parties.
Further, the newly adjusted Articles 3.12(d) and (e) helpfully clarified that while translations shall be submitted together with documents that are in a language other than the language of the arbitration, this requirement does not apply to documents produced only to the counterparty in response to a request to produce.
Allowing Revised or Additional Witness Statements or Expert Reports to be Submitted
The 2020 revision added clarification to the already established provisions in paragraph 6(b) of Article 4 (Witnesses of Fact) and paragraph 3(b) of Article 5 (Party-appointed Experts). The adjusted articles provide that revised or additional witness statements or expert reports may also be submitted based on ‘new developments that could not have been addressed in a previous witness statement’ or expert report, respectively.
The 2020 revision of the rules is mostly intended to reflect prevailing best practices and to clarify selected provisions. Therefore, the revision cannot be characterised as ground-breaking but rather a modernisation of the well-functioning rules.
However, by accommodating the rapid shift from physical to remote hearings brought about by the global COVID-19 pandemic, the 2020 revision will surely cater to the needs of commercial parties engaging in international arbitration now and in the future. Remote hearings may not only save costs and time but also the environment, which was encouragingly mentioned in the updated commentary of the rules as a consideration for the insertion of the new paragraph on remote hearings.
Ilona Karppinen & Onni Koivu