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Summer 2006

Kirkpatrick & Lockhart Nicholson Graham LLP’s ArbitrationAArrbbiittrraattiioonn WW Worldoorrlldd

Welcome to the 2nd edition of Contents ‘K&LNG’s Arbitration World‘ Should a court compel parties to mediate? 2 Selection of Arbitrators 2

n We examine some practical Welcome to the second edition of Investor Protection in the People’s 3 considerations in relation to 'Arbitration World', a publication from Republic of China arbitration clauses in insurance Kirkpatrick & Lockhart Nicholson contracts, consider the issue of Recent decisions and issues in the Court 4 Graham LLP's Arbitration Group. of Arbitration for Sport whether an arbitrator has authority to 'Arbitration World' aims to highlight grant rescission of the contract as a significant developments and issues in Document production in an 8 remedy in arbitration and offer some international arbitration that matter to electronic age thoughts on ways to deal with the in-house counsel and company tricky area of arbitration of multi- Enforcement of arbitral awards against 8 executives with responsibility for sovereign states party disputes with particular dispute resolution. reference to the construction sector; Recent developments around the world 11

In this significantly expanded edition: International Arbitration Seminar 12 n A number of recent decisions and Claridge’s, March 2006 n We look back at our International issues in the Court of Arbitration for Arbitration Seminar held at Sport are reviewed; The availability of rescission as a remedy 14 Claridge’s, London in March this in arbitration

year and look forward to our n Recent cases in the UK, US and The evolving approach to confidentiality 15 forthcoming International Arbitration Germany on sovereign immunity are in international arbitration Webinar programme in the Autumn; assessed; Multi party arbitration 17

n We consider the evolving approach to Arbitration clauses in insurance contracts 18 If you would like to supply any confidentiality in international feedback on anything featured in this arbitration and we touch upon the Autumn webinar programme 20 publication, please send an e-mail to impact on arbitration practice of the Who to contact 20 editors, Ian Meredith growth of e-discovery; and ([email protected]) and Peter Morton ([email protected]) (partners n We also consider the implications of at Kirkpatrick & Lockhart Nicholson the new form BITs entered into by Graham LLP). the People's Republic of China and provide a roundup of developments To register for forthcoming events in the world of arbitration across please contact Kathie Lowe, Events Europe, the Middle East, Asia and Manager, London. ([email protected]). Africa. Arbitration World

Should a court Selection of Arbitrators compel parties by Peter Morton to mediate? It has been said many times, such that it n Nationality of the party-nominated is now almost a cliché, that selection of arbitrator and the possible impact by Rachel Stephens the party-nominated arbitrator is the upon selection of the Chair; single most important decision a party The recent English Commercial Court will make in an arbitration. As the n Standing and reputation of the party- decision in C v RHL [2005] EWHC distinguished practitioner Dr Jean- nominated arbitrator to ensure that 873 (Comm) has caused some raised Flavien Lalive once put it, "The choice his/her views are influential; eyebrows. Is it a natural and healthy of the persons who compose the arbitral extension of the Woolf reform tribunal is vital and often the most n Unimpeachable reputation for principles, requiring parties to mediate decisive step in an arbitration. It has impartiality and independence, in the disputes where possible to save on the rightly been said that arbitration is only absence of which a party-nominated considerable cost of fighting their as good as the arbitrators." arbitrator will enjoy less credibility disputes, or is the decision a traitor to with fellow arbitrators; the principles of the Arbitration Act One of the key attractions of arbitration 1996, which allows the courts to (as far as 3 member tribunals are n Availability, to minimise subsequent interfere only in very limited concerned) is the comfort and delay; circumstances where parties have confidence parties gain by having a agreed to arbitrate? person of their own choice hearing and n Likely disposition (in relation to contributing to the determination of which most due diligence is likely to In C v RHL, on the application of C for their case. Of course, no equivalent be invested); an anti-suit injunction, two corporate opportunity exists in a Court process. parties who had signed an agreement n Familiarity with relevant law; containing a clause referring all The selection of the co-arbitrators, who disputes to arbitration were ordered by may in turn between them choose the n Familiarity with the relevant business Colman J to mediate. This was chairman of the tribunal, is an extremely or industry involved in the dispute; justified on the basis that subsidiary important means by which the parties and and affiliate companies of the can maintain an indirect influence over defendant (who had started court the arbitral process. n Experience in the international proceedings in Russia in breach of the arbitration arena. arbitration agreement) could join in, If the selection of a party's nominated and the range of remedies which a co-arbitrator is important then the It is now increasingly common practice mediator could broker were much selection of the Chair is crucial. It has to conduct pre-appointment interviews wider than those available to the court been said that the vast majority of and to engage in detailed due diligence or the arbitral tribunal. tribunals are Chair-driven and it is analysis of candidate arbitrators. The therefore essential that a party's Counsel extent to which this is appropriate in an It will be very interesting to see if the ensures, through selection of party- individual case will depend upon the decision is followed in other cases. If it nominated arbitrator and through other sums involved and a range of other is the start of a trend, it may serve to influence, that the right Chair is factors. To the extent such interviews increase the use of tiered dispute appointed. do take place, they should be kept resolution clauses allowing for a within strict parameters. structured transition from negotiation The sort of factors which are important to mediation and on to arbitration, and to have in mind when making selection even to clauses expressly excluding of party-nominated arbitrator and Chair mediation. include:

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Investor Protection in the People's Republic of China

By June 2005 China had concluded The climate within China is changing. appeared in the May 2006 issue of Bilateral Investment Treaties (BITs) New BITs with the Netherlands and International Trade Today and will be with 114 countries. BITs normally Germany, ratified in recent months, in the next issue of PLC Cross Border provide foreign investors with grant the much broader investor Quarterly magazine and on the PLC protections against measures such as protection common to other BITs. This Cross Border website: expropriation without compensation. gives scope for investors to structure (http://crossborder.practicallaw.com/main.jsp). International arbitration before an transactions so as to take direct If you would like a copy of this article please International Centre for the Settlement advantage of the new BITs as German contact Ian Meredith (details on page 20). of Investment Disputes (ICSID) or Dutch investors. Alternatively, tribunal is the usual mechanism for investors may be able to take advantage Trouble at CIETAC taking the benefit of such protections. of most favoured nation ("MFN") As has been widely reported, Dr Wang However, historically, BITs entered into clauses, which prevent China treating ShengChang, one of China's most by China provided that the only issue investors from one state less favourably respected arbitrators and a leading capable of reference to ICSID than those from another state, to take representative of CIETAC is at the time arbitration was the amount of the benefit of the protections available of going to press the subject of an compensation available if an investor to Dutch and German investors. investigation into alleged financial suffered expropriation. The value of irregularity. It is presently unclear how Chinese BITs to the foreign investor More detailed commentary on the issues this will affect the operation of CIETAC was therefore extremely limited. arising from the new China BITs and the future of arbitration in China.

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Recent decisions and issues in the Court of Arbitration for Sport ("CAS") by Martin King CAS' purpose is to provide an arbitral Those differing from the usual CAS spaces. The ad-hoc division decided jurisdiction to resolve disputes directly Code include: the 24 hour decisions that a change in team qualification or indirectly relating to sport, whilst referred to above, the constitution of criteria implemented by the Italian recognising the needs of the the panel is chosen by the President of national federation and its Olympic international sporting community and the ad-hoc division rather than being committee during the course of the doing so with specialist knowledge, party-nominated, the proceedings are qualification period was arbitrary and speedy procedures and cost efficiency. free of charge and the ad-hoc division is had not been properly communicated Its arbitrators are appointed for a four not subject to any particular law but to all potential participants. Based on year renewable term and must sign a must rule on the dispute pursuant to the original criteria for selection, Ms declaration of independence upon the Olympic Charter and general Isabella Dal Balcon qualified for appointment. CAS' jurisdiction is not principles of law. The ad-hoc rules also selection. Based on the new criteria in any way imposed upon particular specify that, before filing any request (introduced later and not sports, governing bodies or participants for arbitration against a decision of the communicated to Ms Dal Balcon), she but it is freely available to resolve IOC, a National Olympic Committee, did not qualify. The Italian national sporting disputes subject to its Code of an International Federation or an federation had not used any discretion Sports-related Arbitration and provided Organising Committee for the Olympic in selecting the team, relying solely on the parties agree to do so in writing. Games, the applicant must exhaust all the new second set of criteria. The CAS provides precedent arbitration internal remedies available to him CAS ad-hoc panel found the new clauses for sports federations or clubs to under the relevant regulations of the criteria arbitrary and considered it insert into their rules and regulations body concerned (unless the time unfair and unreasonable to apply them. and the majority of International needed to exhaust those remedies In usual circumstances the panel would Federations and National Olympic would make an appeal to the ad-hoc have preferred to refer the team Committees have included clauses in division ineffective). Thus the selection back to the Italian national their regulations referring any disputes Canadian Olympic Committee's federation for reconsideration - to CAS. ("COC") application against the however it was under significant time International Skating Union ("ISU") at pressure as the event approached. Ad-Hoc Division the Turin Winter Olympics earlier this Thus the panel declared that Ms At major events, such as the Olympics, year (relating to the ladies' short track Isabella Dal Balcon be selected to the the Commonwealth Games or the speed skating final during which the Italian snowboard team and left it to European Football Championships, it COC thought that a rival skater had the Italian federation and the Italian is often necessary for a tribunal to make committed a "kicking-out" Olympic committee to determine who very swift decisions to resolve sporting infringement and should thus be was to be left out. disputes, particularly when team disqualified) was dismissed by the ad- selection, qualification/progression hoc division since the applicant had The application to the ad-hoc division through the event and medals might be failed to first file a written protest and that received the most press attention at stake. CAS set up an ad-hoc division lodge a deposit with the race referee in was that of the 52 year old Anne to deliver decisions within 24 hours of a accordance with the ISU General Abernathy, the sole athlete request for arbitration, which first Regulations. representing the Virgin Islands at the operated at the Atlanta Olympics in Winter Olympics (dubbed "Grandma 1996, and has operated at many major Another crucial decision at the Turin Luge"). She was injured in a training events since (see following panel). Winter Olympics related to the run for the Women's Luge event and selection of the members of the Italian was not able to compete. Since she The ad-hoc division has a special set of snowboard team for the Parallel G missed the official weigh-in, she was rules for its proceedings. Slalom event for which there were 4 not included in the start list for the

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race. She had participated in 5 Panel independence Federation disciplinary panel. IAAF previous Winter Olympics between An issue crucial to all types of appealed to CAS and proceedings are 1988 and 2002 and requested that her arbitration is the independence and ongoing. Kenteris and Thanou are also name be entered on the race list as a impartiality of the tribunal panel and facing separate charges in Greece participant "who did not start". The CAS is no exception. Respondents in regarding the crash amidst allegations panel invited Grandma Luge and the two recent doping cases have raised that they and their former coach faked International Luge Federation to try questions regarding the potential the crash to avoid the drugs test. and settle their dispute amicably and partiality of an eminent CAS arbitrator the ILF later agreed to write to the in light of alleged connections to the The CAS panel consisted of Peter IOC to request that Anne Abernathy's World Anti-Doping Agency ("WADA"). Leaver QC (IAAF's party-appointed name be included on the results list arbitrator), Christopher Campbell (the without a start number and with the Greek sprinters Kostas Kenteris and sprinters' party-appointed arbitrator) annotation 'DNS'. Katerina Thanou failed to attend a and Yves Fortier (President of the drugs test hours before the start of the Panel, selected by the two party- At the recent Commonwealth Games Athens Olympics. Reports then appointed arbitrators). Mr Fortier is in Melbourne, the ad-hoc division surfaced that the pair had been Chairman and senior partner at exercised its discretion to refer a involved in a mysterious motorcycle Montreal firm Ogilvy Renault. Also dispute to arbitration by CAS in crash and had been taken to hospital, appointed to assist the Panel as an ad- accordance with the usual Code of thus missing their tests. They were hoc clerk was Stephen Drymer, a Sports-related Arbitration. The provisionally suspended from partner at Ogilvy Renault. urgency that might otherwise exist in competition by the International such a case was absent as one Association of Athletics Federation Prior to a CAS hearing scheduled for respondent had withdrawn from the ("IAAF") and missed the Games. late February 2006, the sprinters raised Games and the other came fourth and However, the IAAF decision was later an objection alleging that the President was thus not a medallist. reversed by a Greek Athletics of the Panel, Mr Fortier, had not disclosed that his firm represents WADA (which has an interest in the prosecution of drug cheats and whose chairman, Dick Pound, had been vocal following their acquittal by the Greek Athletics Federation stating at the time that WADA would appeal to CAS if the IAAF did not) and that there was therefore a clear conflict of interest. Mr Drymer stepped down as ad-hoc clerk to the panel following their objection and the International Council of Arbitration for Sport ("ICAS") was in the process of considering the sprinters' application to remove Mr Fortier from the panel when Mr Fortier decided to step down.

Mr Fortier is reported to have stated that the application to remove him had no basis in fact or in law and reiterated his full independence, but he was troubled by the accusations and stepped down in order that the

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Continued from page 5 arbitration procedure could continue in CAS: brief chronology 2000: European Football an atmosphere of confidence and and key facts Championships (Belgium/Netherlands) serenity. CAS stated that it had full 1981: a sports-specific jurisdiction was and Sydney Olympics confidence in the independence and the brainchild of the IOC President impartiality of Mr Fortier and pointed Juan Antonio Samaranch 2002: Salt Lake City Winter Olympics out that he has no relationship and Manchester Commonwealth personally with WADA. Meanwhile 1984: CAS became operational and its Games lawyers for Kenteris and Thanou stated Statutes (as ratified by the IOC) came that they were seriously concerned into force 2004: Athens Olympics with this unfortunate development and the integrity of the process must be 1991: CAS published a guide to 2006: Turin Winter Olympics and safeguarded at all costs. The hearing arbitration including a precedent Melbourne Commonwealth Games has been postponed to a later date and arbitration clause for sports Mr Fortier will be replaced on the federations/clubs' rules Key Facts panel. n seat in Lausanne, Switzerland. Also 1994: CAS reforms following challenge operates from branches in Sydney Last year, Tim Montgomery (the to CAS award before the Swiss Federal and New York offering sports former 100m world record holder) was Tribunal. CAS' close connection to dispute resolution services found guilty by CAS of the offence of IOC could call independence into throughout Europe, Oceania and the admitting having used a prohibited question. CAS modified its statutes US substance in contravention of IAAF replacing them with the Code of Rules and CAS imposed a period of Sports-related Arbitration and created n over 150 arbitrators from more than ineligibility of 2 years from 6 June 2005 the International Council of Arbitration 37 countries and stripped Montgomery of all awards for Sport ("ICAS") to run and finance since 31 March 2001 (including his CAS n 2 divisions: Ordinary Division - world record in 2002). He was found to hearing first instance disputes often have admitted to US athletics team- 1996: Ad-hoc division created to make of a commercial nature; and, Appeals mate Kelli White at an event in swift decisions on sporting disputes at Division - hearing disputes of a Portugal in 2001 that he had taken "the major events, sitting at: purely sporting nature, commonly Clear" (tetrahydrogestrinome or "THG" appeals from last instance decisions - a designer steroid which was 1996: Atlanta Olympics of sporting bodies undetectable by routine anti-doping testing until 2003). This was a notable 1998: Nagano Winter Olympics and n awards are final and binding and can decision in itself since it was a "non- Kuala Lumpur Commonwealth Games be enforced according to rules of analytical positive" case which found private international law Montgomery guilty notwithstanding that he had never tested positive in any in-competition or out-of-competition Montgomery's hearing had been representatives are reported to be drug test and showed that doping exactly the same CAS panel as the currently considering a potential offences can be proved by a variety of Kenteris/Thanou hearing (i.e. challenge to the award before the SFT means and not just pursuant to positive including Mr Fortier as President and or in a US federal district court. It testing. Mr Drymer as ad-hoc clerk). They remains to be seen whether there are urged CAS to vacate the arbitration any other potential challengers who Soon after Mr Fortier stepped down award and dismiss the doping charges have been on the wrong end of a CAS from the Kenteris/Thanou panel, against Montgomery. CAS pointed doping decision in which Mr Fortier Montgomery's representatives wrote to out that a challenge to a CAS award has been a panel member. CAS raising the same conflict of needs to be brought before the Swiss interest objection. The CAS panel for Federal Tribunal. Montgomery's

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Introducing K&LNG’S Autumn Webinar Programme

We are proud to announce that in To register your interest please contact n Dealing with political risk October K&LNG's Arbitration Group Kathie Lowe, Events Manager, 5 October 2006, 14:00 GMT will be running a series of on-line London. ([email protected]). seminars. "Virtual" delegates need only n Difficult countries register their interest to receive log in If you would like to propose topics for 12 October 2006, 14:00 GMT details. Delegates can then "join" each future webinars please feel free to do webinar by accessing the dedicated so. website where they can hear the n Document production in an presentations and view the materials, electronic age email comments and observations to 19 October 2006, 14:00 GMT the webinar moderator and contribute to the discussion. Please see page 20 for more details. CPD accredited.

Hot Topics

Conflicts of interest and barristers’ chambers

When the IBA Committee produced the IBA guidelines on Conflicts of Interest in Arbitration, barristers' chambers were specifically exempted. As many tenants in London chambers are not barristers but lawyers from a wide range of countries, many of whom have left their partnerships in leading law firms as a result of the difficulties caused by the increasing scrutiny of conflicts, is the time now right to look more closely at whether the barristers' exception be limited to those formally called to the bar?

Do secretaries to the tribunal pose a danger to the arbitral process?

Over recent years the practice of Tribunals appointing secretaries has grown to the extent that it could be said to be unusual for there to be no "assistant". Clearly in the case of an ad hoc Tribunal, where there is no administering organisation, there are very many administrative tasks which can be more efficiently undertaken by administrative assistants than by the Tribunal members themselves. The question however arises as to whether it is proper for the role of the secretary to extend into research for the Tribunal members (including in particular the Chair), the drafting of procedural orders, minutes of the deliberations of the Tribunal, the boiler plate sections of awards or indeed more significant sections of awards.

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Document production in an Enforcement of electronic age arbitral awards by Sarah Aspinall Over recent years many commenta- With the development now of the against sovereign tors have suggested that there has far more onerous obligations on US been a developing consensus over litigants to engage in e-discovery States the scope of document production dramatically increasing the scope of by Jeffrey Vitek and in international arbitration. the material each party is required Caroline Benham Starting with the IBA Rules of to disclose and with pressure from Evidence in June 1999, and to a lim- many US law firms to take the same Recent cases have served to reinforce ited extent, the development of principles and export them to inter- the principles of State immunity. A principles of proportionality national arbitration, we may see a party considering contracting or working enshrined in the English Court dramatic extension and perhaps with a State government should reforms of the same year, there has polarisation of approaches and a therefore do so with caution. been a movement towards a middle consequent shattering of the devel- ground between the old civil and oping consensus. Even if a party is successful in obtaining common law traditions. a judgment or arbitral award against a State, there are a number of important points relating to State immunity which should be borne in mind and the victory may be an empty one if the property against which execution is sought attracts immunity and cannot be enforced against. The UK position State Assets The principle of State immunity was statutorily recognised in the State Immunity Act 1978 ("the SIA"). A foreign State is immune from both injunctive relief and execution unless the State's written consent has first been obtained or the property against which execution is sought is for the time being in use or intended for use for commercial purposes. To this extent, execution cannot be made against a credit balance on a bank account kept by a foreign State for the purpose of meeting the ordinary expenditure of its embassy but may be issued where the purpose of the account is to discharge liabilities incurred in commercial transactions. A central bank account attracts almost absolute immunity and will only be

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liable to execution if it has waived its at any time intended for use for The US position immunity from execution in writing. commercial purposes within the In the United States, as in the UK, a The SIA specifically provides that meaning the SIA . foreign sovereign is granted certain where a central bank or other monetary protections from the attachment of authority is a separate entity it is State-Owned Companies judgments and awards and the entitled to immunity from injunctive Whether or not a State-owned company execution of these against its property. relief and execution as if it were a State. attracts immunity is less clear cut. An Those protections are set out in the Irrespective of this, the property of the entity which is distinct from the Foreign Sovereign Immunities Act central bank would normally be immune executive organs of the government and (“FSIA”) and codified at 28 USC from execution as it is not regarded as is capable of suing or being sued will ss1602-1611. being used for, or intended for use for, only be entitled to immunity if the commercial purposes. proceedings relate to anything done by Under the FSIA, there is a general it in the exercise of sovereign authority presumption that a foreign State's In the recent case AIG Capital Partners and the circumstances are such that a property is immune from attachment Inc v the Republic of Kazakhstan the State would have been immune. In and this must be overcome in order to assets of the central bank of Kazakhstan Kensington v Republic of the Congo an execute a foreign arbitral award in the were immune from the enforcement application for enforcement was made US against the property of the foreign process. The claimant had obtained an against the proceeds of oil disposals by sovereign. However, there are arbitration award and sought to obtain a the Republic of Congo's State-owned oil exceptions to this presumption which third party debt order against cash and company. The claimant was successful are set out in ss1610(a) and (b) and the securities pursuant to a custody in obtaining a third-party debt order property in the US of a foreign state will agreement with the National Bank of directly against a debt owed to the oil not attract immunity from execution if Kazakhstan. They sought enforcement company. The court found that the oil that property is used for a commercial against funds and securities in London company had deliberately established a activity in the US. Commercial activity which were part of the National Fund of complex structure of companies to is defined in s1603(d) as "either a regular Kazakhstan set up as a stabilisation fund prevent the Republic of Congo's course of commercial conduct or a to ride out fluctuating oil and creditors from seizing funds in the hands particular commercial transaction or act". commodity prices. The fund was of the oil company "with the object of In determining whether property is used administered by the National Bank of evading enforcement of existing for a commercial activity, the courts will Kazakhstan which in turn placed part of liabilities of the Congo by hiding its consider what the property is used for it in the care of banks in London under assets from view". rather than how it was generated or a custodianship agreement. The funds produced. were actively traded. It was held that "property of a state's central bank or other monetary authority" under s14 SIA meant any asset in which the central bank had some kind of property interest, irrespective of the capacity in which the central bank held the assets or the purpose for which the assets were held. In this case, the nature of the property right of the bank was immaterial as the assets concerned were immune from the enforcement process. Even with this being the case, the property was immune from the enforcement jurisdiction of the UK courts as the assets in question were not

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Continued from page 9

This most often becomes an issue when claim under the German-Soviet-Russian the property is an intangible asset such Bilateral Investment Treaty following Conclusion as money owed to the foreign sovereign. the claimant's success, he sought to Both in the UK and the US it will only The question then is whether the enforce the award made by the be possible to enforce a judgment or money is used by the foreign sovereign Stockholm Chamber of Commerce by award against the property of a State if for commercial activity in the United attachment of the Russian Embassy's that property is being used, or is States, such as paying a commercial VAT refund claims against Germany intended for use, for commercial debt, and not whether the money was and the fees owed by Lufthansa to purposes. Funds in a State's central generated by commercial activities. If a Russia for air traffic rights on and over bank account held in the UK or US will court finds that the property at issue is Russian territory. The Federal Supreme attract immunity from execution unless used for commercial activity and that Court denied both attachments, thus that immunity has been explicitly the judgment is “based on an order frustrating the claimant's attempts to waived. Whilst in the UK, the confirming an arbitral award rendered seize assets of the Russian State located Kensington case does give some limited against the foreign State,” the court will in Germany. This case further comfort to a party seeking to enforce an permit attachment of and execution illustrates the difficulties for claimants award against a State-owned company, against the property. seeking to isolate assets which are this is generally a difficult area in which available for attachment. The Court a prudent investor should seek to Just as in the UK, a foreign central bank held that both categories of asset were protect itself. account held in the US is immune from subject to Russian public law and execution even if the funds are for use therefore fell within State immunity. or intended for use for a commercial purpose. S1611 states that immunity will only not attach to the central bank account if it has been explicitly waived by the bank or authority in question or its parent foreign government.

In summary, once an arbitral award against a foreign State has been confirmed by a US tribunal, that award can be executed against the sovereign's property located in the US and used for commercial purposes in the US. There are further exceptions to immunity which may apply in specific circumstances and parties are advised to explore the full realm of these given their particular circumstances. The German Position In a recent decision by Germany's highest court in civil matters, the Federal Supreme Court has recently rendered an important decision on the enforcement of arbitral awards against state assets. In the case of a German investor, Sedelmayer, in the context of a

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Recent developments around the world

Europe Poland Saudi Arabia Following its entry into the EU on 1 When Saudi Arabia joined the ICC as a Austria May 2004, Poland has adopted wide- member in 1975, it formed the Saudi Austria has recently passed a new ranging amendments to its arbitration National Committee, to implement ICC Arbitration Act, based on the laws in an effort to bring them into line initiatives in the Kingdom. The UNCITRAL Model Law. The new with the UNCITRAL Model Law and Committee did not however meet until legislation comes into force this to resolve the problems which have in 2004 (when it took the name ICC-Saudi summer. the past beset arbitration proceedings in Arabia). ICC-Saudi Arabia has recently Poland. The new laws are ten years in established a Saudi International The legislation covers domestic and the making and are a significant Arbitration Commission for the international, commercial and non- improvement on their predecessor. promotion of ICC arbitration throughout commercial arbitration (there are special the Kingdom. It is expected that new provisions for consumer and labour Russia arbitration centres around Saudi Arabia disputes) and with it Austria hopes it As highlighted in the last edition of will follow. will be an even more attractive venue Arbitration World, ICAC's new rules for international arbitration. The most were published at the end of last year Asia significant change to existing legislation and came into force for arbitrations is the power given to arbitral tribunals to commenced after 1 March of this year. Pakistan make interim awards, which will be They introduce significant changes to The New York Convention on the enforced by the state courts. the way ICAC works and to the Recognition and Enforcement of appointment and challenge of Foreign Arbitral Awards came into force Denmark arbitrators. in Pakistan on 12 October 2005. A new Danish Arbitration Act, also based on the UNCITRAL Model Law, Middle East Africa came into force last year. The Act gives the Danish courts jurisdiction to hear United Arab Emirates Liberia questions of the composition of the The London-based Chartered Institute The New York Convention on the arbitral tribunal (including those relating of Arbitrators has opened a regional Recognition and Enforcement of to impartiality of an arbitrator) where the office in Dubai, with responsibility for Foreign Arbitral Awards came into force Danish courts have jurisdiction over at the United Arab Emirates. The in Liberia on 15 December 2005. least one of the parties and the seat of Institute is a not-for-profit organisation the arbitration has not yet been which promotes training for arbitrators determined. and the standing of arbitration around the world. It plans to work closely with In a departure from the Model Law, the the relatively new Dubai International new Danish legislation does not require Arbitration Centre and other centres in arbitration agreements to be in writing. Dubai to provide training programmes An award based on an arbitration for arbitrators in the region. agreement not in writing could be difficult to enforce in a different country.

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Topical Issues in International Arbitration

Claridge’s, 23 March 2006

Our second annual International Arbitration Seminar, held at Claridge’s, London this year, yet again proved to be an overwhelming success with both attendees and those who joined by our live web feed.

The day was broken up into three panel sessions. The first panel, chaired by John Magnin (K&LNG London partner), covered: constituting and managing the relationship with the Tribunal, including the selection and appointment of arbitrators; the importance of selecting the right counsel; pre-appointment interviews of arbitrators; and the application of the IBA Guidelines on Conflicts of Interest. Members of the panel included Peter Morton (K&LNG London partner), Michael Schneider (founding partner of Lalive, Geneva), Jennifer Kirby (Deputy Secretary General of the ICC, Paris) who gave the perspective of the Institution, Robyn Durie (T-Mobile (UK) Limited) who gave the in-house lawyer's view and Samuel Haubold (tenant of Littleton Chambers, London) who spoke from his experience both as a board director and arbitrator.

John Dingess (K&LNG) Sherry Williams (Halliburton Company)

Marina Kaldina (Basic Element Company) David Mildon QC (Essex Court Chambers) and John Dingess (K&LNG)

The second panel session, chaired by James Hudson (K&LNG London partner), focused on disputes in the national resources and energy sectors. Topics covered included strategies in dealing with disputes in far-flung places, dispute resolution under long-term supply agreements and a history of arbitration in South America. The panellists included John Dingess (K&LNG Pittsburgh partner), David Mildon QC (Essex Court Chambers, London), Sherry Williams (Halliburton Company, Houston), and Marina Kaldina (Basic Element Company, Moscow).

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Michael Hwang SC (Essex Court Chambers) Ian Meredith (K&LNG)

Zachary Douglas (Matrix Chambers) and Xing Xiusong, Sean (Global Law Office) Wang Jie (CIETAC), Zachary Douglas (Matrix Chambers), Michael Hwang SC (Essex Court Chambers), Xing Xiusong, Sean (Global Law Office) and Ian Meredith (K&LNG)

The third panel session was chaired by Ian Meredith (K&LNG London partner) and focused specifically on China and the Asia-Pacific region. Michael Hwang (Senior Counsel, Singapore) started the session with an overview of issues arising in arbitration in various countries across the Asia-Pacific region. Wang Jie (CIETAC) spoke regarding CIETAC and the changes brought about by the new CIETAC Rules, Xing-Xiusong, Sean (Global Law Office, Beijing) spoke on issues regarding enforcement of arbitral awards in China, before Zachary Douglas (Matrix Chambers, London) finished off the day with a presentation on investment treaty arbitration.

We would like to thank all the panellists for their contributions, and would also like to thank all those who joined us on the day, both in person and on-line.

SUMMER 2006 13 Arbitration World

The availability of rescission as a remedy in arbitration by John Sylvester and Steven Pieren

The authority of an arbitrator to contacted F&C to indicate that F&C fraudulently induced to enter into the resolve a dispute between parties is had breached the agreement. In agreement to arbitrate, the rescission derived from the agreement between response to these allegations, F&C claim was within the scope of an the parties to arbitrate such dispute. filed an action to arbitrate the dispute. arbitrator’s authority. The agreement to arbitrate is Prima Paint filed suit in federal court As recently as this year, the Supreme typically a clause in a business seeking to rescind the agreement due Court has reaffirmed the broad Prima contract between two parties, rather to F&C’s allegedly fraudulent Paint holding that an arbitration clause than being a separate agreement that representations that it was solvent and is severable from the remainder of the only addresses the parties’ desire to also sought to enjoin the arbitration contract and, unless the challenge is to arbitrate potential disputes. In the proceeding because the rescission the arbitration clause itself, the issue course of arbitrating disputes arising issue was a question for the federal of the contract’s validity is properly under the business contract, the court rather than an arbitrator. within the scope of the arbitrator’s question often arises whether an authority, rather than within the scope arbitrator has the authority to rescind, Construing the Federal Arbitration of a court’s authority. See, e.g., or otherwise void, the business Act, the Supreme Court determined Buckeye Check Cashing, Inc. v contract between the parties. Given that a federal court may only Cardegna, 126 S. Ct. 1204, 1209 (2006) that the authority of an arbitrator to determine issues “relating to the (affirming that rule of severability resolve disputes typically is derived making and performance of the applies to actions in state court from a clause in the business agreement to arbitrate… Accordingly, governed by Federal Arbitration Act). contract, rescission of the business if the claim is fraud in the inducement Therefore, a party seeking to rescind a contract would also arguably rescind of the arbitration clause itself – an contract in arbitration may rely on the power of the arbitrator to resolve issue which goes to the ‘making’ of the Prima Paint and its progeny to support the dispute. This issue has arisen in agreement to arbitrate – the federal its argument that rescission of a an insurance arbitration currently court may proceed to adjudicate it. business contract generally is within being handled by K&LNG, and the But the statutory language [of the Act] the scope of an arbitrator’s authority insurers have argued that the does not permit the federal court to and should not be determined by a arbitrator has no authority to rescind consider claims of fraud in the court in the first instance. the contract at issue. inducement of the contract generally.” Therefore, only if the fraud-in-the- The authority of an arbitrator to The Supreme Court of the United inducement claim is limited to the rescind a business contract under state States was presented with this arbitration clause, and the rescission arbitration acts is less certain, and the question in Prima Paint Corp. v claim goes to the making of the result may even vary from court to Flood & Conklin Manufacturing Co., agreement to arbitrate, does the court within a specific state. Compare 388 U.S. 395, 87 S. Ct. 1801 (1967). federal court have jurisdiction to Anton Sattler, Inc. v Cummings, 425 In Prima Paint, the parties entered decide the dispute. If, however, the N.Y.S.2d 476, 479 (N.Y. Sup. Ct. 1980) into a consulting agreement with a fraud-in-the-inducement claim relates (finding contract void and reversing broad arbitration clause. One week generally to the contract as a whole, arbitrator’s award due to fact that after the execution of the agreement, then the rescission claim is within the arbitrator could not enforce terms of Flood & Conklin Manufacturing Co. scope of an arbitrator’s authority. In void contract) with Kessler v Nat’l (“F&C”) filed a petition for Prima Paint the Supreme Court Cas. Co., 185 N.Y.S.2d 437, 440 (N.Y. bankruptcy. Upon discovering determined that, as there was no claim App. Div. 1959) (overruling trial F&C’s bankruptcy filing, Prima Paint that Prima Paint was specifically court’s determination that arbitrators

14 SUMMER 2006 www.klng.com

The evolving approach to confidentiality in international

arbitration by Sarah Munro had no power to rescind or reform the One of the major advantages of contemplated, a company should be agreement). Therefore, when referring a dispute to arbitration, rather aware that it has an overriding negotiating the terms of a potential than seeking redress through the obligation to disclose anything material arbitration clause, a party may wish to courts, is the expectation that the to the investor in the listing document. consider selecting the Federal parties' evidence and submissions, Continuing arbitration proceedings are Arbitration Act to govern the together with the details of any award, likely to fall within this category. arbitration for the more uniform will remain confidential. This is often treatment of a variety of issues, cited by leading companies as the Likewise in the US, SEC rules and including the availability of rescission principal reason for the inclusion of financial statements' regulations may as a remedy. arbitration clauses in their commercial require disclosure of material contracts. By using arbitration rather arbitration proceedings which a Under English law, the arbitration than litigation, parties hope to avoid, at company is defending (and possibly clause is also separated from the larger least in part, the publicity that major those in which the company is contract. Therefore, unless the court proceedings can attract, and to claimant). A listed company should rescission claim specifically relates to ensure that commercially sensitive therefore seek specific and detailed the arbitration clause, rather than the information does not reach the hands of advice before entering the arbitral contract generally, an arbitrator has the competitors. process. authority to resolve the dispute. Under most domestic laws, the However, the principle of Institutional provisions arbitration clause constitutes a separate confidentiality in arbitration is not The machinations of an arbitral and distinct contract under the absolute. As set out below, there are a tribunal are by their nature Kompetenz-Kompetenz principal. number of issues parties should bear in confidential, and this is largely upheld Therefore, unless the rescission claim mind when considering submitting by institutional rules. The ICC specifically relates to the arbitration disputes to arbitration. International Court of Arbitration clause rather than the contract publishes extracts from a number of generally, an arbitrator retains Limits to confidentiality redacted versions of ICC arbitral authority to resolve the dispute. Whilst arbitration proceedings and awards on its website and in certain awards themselves may be confidential, academic publications. Article 6 of the In summary, under the federal law of listed companies should be aware that Statutes of the International Court of the United States and under English they may still be required to disclose Arbitration states that "The work of the law, a party to a contract may support both the proceedings and any adverse Court is of a confidential nature which its argument that, unless a party’s awards under their reporting must be respected by everyone who rescission claim relates directly to the obligations. In the UK, the Disclosure participates in that work in whatever arbitration clause itself, a rescission Rules require companies listed on the capacity." claim is properly within the scope of full list to disclose as soon as possible the arbitrator’s authority. The various any information which, if generally Article 30.1 of the LCIA Arbitration state arbitration statutes vary in their available, would be likely to have a Rules provides that "Unless the parties resolution of this issue, with some significant effect on its share price. In expressly agree in writing to the State courts finding rescission claims to the drawing up of both final and contrary, the parties undertake as a be arbitratable and other State courts interim accounts, auditors must general principle to keep confidential finding a rescission claim to be outside disclose and account for contingent all awards in their arbitration, together the scope of an arbitrator’s authority. liabilities. Further, if a listing is with all materials in the proceedings

SUMMER 2006 15 Arbitration World

created for the purpose of the 1996 was intended to leave intact as a by consent pursuant to section 9 arbitration and all other documents feature of English arbitration the aspect Arbitration Act. Although the applicant produced by another party in the of privacy and confidentiality, and this was not a party to those underlying proceedings not otherwise in the public has been confirmed in various recent proceedings, they were relevant to his domain - save and to the extent that court decisions. employment tribunal claim, and he disclosure may be required of a party therefore wanted access to several key by legal duty, to protect or pursue a Maintaining the confidentiality of documents from those proceedings. As legal right or to enforce or challenge an documents may be key. In Ali Shipping a non-party, his application was award in bona fide legal proceedings Corporation v Shipyard Trogir the governed by the provisions of the CPR before a State court or other judicial Court of Appeal held that arbitration Part 5.4 detailed above, and the court's authority." Article 30 also emphasises proceedings and documents or other permission was therefore required for the confidential nature of deliberations information generated during the disclosure. Colman J held that such of the tribunal and the fact that awards course of the arbitration should be permission should not be given to a will not be published without prior treated as confidential, subject to five "stranger" to an arbitration unless all the written consent of all parties and the defined exceptions: 1) consent; 2) an parties to the arbitration consented or tribunal. order of the court; 3) by leave of the there was an overriding interest of court; 4) circumstances where justice in favour of disclosure. The By contrast, the ICSID website disclosure is reasonably necessary to applicant failed to meet this test and contains access to online decisions and protect or establish the legal right of a the court held that where the awards, showing the full texts, often in party or a third party; and 5) in the application for a stay was preceded by a variety of languages. According to the interests of justice. applications for freezing injunctions or ICSID and Additional Facility third party disclosure orders, despite Arbitration Rules, the tribunal may The decision in Ali Shipping can be the existence of a binding arbitration allow persons who are not parties to the contrasted with the court's position on agreement, the court's discretion in arbitration to attend a hearing only access to copy documents from court relation to such an application by a "with the consent of the parties", and proceedings in litigation. Although non-party to the arbitration should be Article 48(5) of the ICSID Convention applications to the court which concern exercised by reference to principles of contains the same prohibition existing or anticipated arbitrations are confidentiality. concerning publication of an award. usually heard in private, the Civil Procedure Rules (CPR) do not provide Conclusion Comparing arbitration such a restriction in respect of litigation Arbitration remains the process of and litigation proceedings. CPR Part 5.4 makes choice for parties who are keen to Given these apparent limitations, is it provision for the supply of documents retain confidentiality when seeking to still correct to suggest that parties from court records. Under the rules, a resolve disputes. A number of recent concerned about confidentiality should court or court office may keep a decisions, including those mentioned choose arbitration rather than litigation? publicly accessible register of claims above, have emphasised that the courts In February 1996, the Departmental which have been issued out of that are willing to engage in a balancing Advisory Committee in England court. Any person who pays the exercise to weigh the importance of produced a Report on the Arbitration prescribed fee may, during office hours, confidentiality against other concerns. Bill in which it was stated that search any available register of claims. Parties should bear in mind, however, confidentiality and privacy were that requirements to disclose may be "essential features" of commercial The way ahead imposed upon them and it may not be arbitration in England. In terms of the In Glidepath BV and others v possible to keep the existence or hearing: arbitration proceedings are by Thompson and others the underlying substance of an arbitration completely their nature private, whereas court proceedings, which involved allegations confidential. proceedings are usually held in public. of fraud against the defendants, Although silent on the issue of commenced in court but part way confidentiality, the Arbitration Act through had been stayed to arbitration

16 SUMMER 2006 www.klng.com

Multi party arbitration

Where multi party disputes arise, it is view that it is now easier in England to the Umbrella Agreement relate to or desirable that issues be dealt with in refer related disputes between are the same as the subject matter of a the same proceedings rather than in a multiple parties to the same arbitrator. dispute between other parties to the series of separate proceedings. The Umbrella Agreement. Such procedure aim is to save time and money and, Multi party arbitrations may arise could involve reference to an more importantly, to avoid the risk of because there may be several contracts independent third party whose conflicting awards on the same issues. with different parties which bear on decision all parties agree to abide by. This goal is achievable if the parties the matters in dispute or, alternatively, At the time an Umbrella Agreement is litigate in national courts but more there may be several parties to one entered into all the parties e.g. difficult in arbitration. contract. In this latter case one of the Consultants and Subcontractors will issues which arises on joinder is that not be appointed. However, in each Taking a construction project as an each party, for example of a joint subsequent Deed of Appointment a example, a major international venture, may wish to appoint an clause should be present which construction project is likely to involve arbitrator. Both the ICC Rules (1998 ensures strict adherence to the terms not only the Employer and the Main Edition) and the LCIA Rules (1998 of the Umbrella Agreement and Contractor but an Engineer, Edition) provide for the right of the provided that "the Parties" in the Consultants and a host of specialist parties to nominate (jointly, if Umbrella Agreement are defined Subcontractors and Suppliers. Each appropriate) a member of the arbitral sufficiently broadly. If therefore a will be operating under different tribunal if they can agree and to take dispute arises between the Employer contracts, often with different choice away that right and vest it in the and the Main Contractor and the Main of law and arbitration clauses, and yet Institution if they cannot agree. Contractor considers it related to its any dispute between the Employer dispute with its Subcontractor then and the Main Contractor may well Unusually the LCIA Rules permit the three parties can be part of the involve the Engineer and one of the joinder of consenting third parties on same arbitral proceedings and thereby Subcontractors. Presently, without the the application of one of the parties to avoid inconsistent decisions and save consent of all parties, if separate the arbitration. One way to avoid the time and money. arbitration proceedings are problems which arise in multi party commenced, such proceedings cannot arbitrations in international Of course, consideration needs to be be consolidated despite the fact that construction engineering projects is for given to whether tactically early there is a risk of inconsistent findings. all parties to the project to enter into commitment to an Umbrella Grounds on which the Subcontractor an Umbrella Agreement before the Agreement will be beneficial. For may object are that its dispute is not project begins which clearly sets out example, the Employer may not wish related to the dispute between the their agreement to the same arbitral to become involved in a more Employer and the Main Contractor. tribunal in the event of the same or complicated arbitral process when as This point was addressed recently in similar issues of fact and law arising in far as he is concerned responsibility an English court judgment City & a dispute(s). The Umbrella lies solely with the Main Contractor. General (Holborn) Limited v AYH plc Agreement would have to deal with where the judge held that it was not such things as the procedural rules for necessary for the majority of the issues the arbitration (for example ICC or in the proposed arbitration to be LCIA), the seat of the arbitration, the substantially the same as or connected law governing the dispute, the with the issues in the arbitration that language of the arbitration and a had already started. It was sufficient if procedure for resolving any disputes a material portion of the issues were which arise in relation to whether or the same. This case is support for the not disputes between two parties to

SUMMER 2006 17 Arbitration World

Arbitration clauses in insurance contracts - some practical considerations by Sarah Turpin and Ben Morgan

Policyholders are increasingly aware of governing law or procedure to be fol- restricted to only certain categories of the need, not only to ensure that the lowed which will inevitably result in dispute, leaving other disputes to be terms of insurance contracts are certain, additional costs and significant delays in dealt with by the courts. but to negotiate improvements to the recovery. This is not only extremely policy wording aimed at making the frustrating but can prove disastrous for n The number of arbitrators and the wording more policyholder friendly. the policyholder. procedure for their appointment, While eyes are usually on "key" clauses including any requirement for relating to the scope of cover and the One of the perceived advantages of candidates to have industry-related policy exclusions, it is remarkable how arbitration is that the process is more experience. little attention is given to dispute reso- flexible and potentially less time con- lution clauses. When a claim is made, suming than court proceedings. This n The governing law, if not stipulated they can be among the most critical may not prove to be the case if inade- elsewhere in the contract, should be terms of an insurance contract. quate attention is given to the arbitra- covered in the arbitration clause and tion provisions at the policy drafting the policyholder should look to use "Standard" policy wordings produced by stage: taking the time to get the word- this to its benefit. The law in some insurers often favour arbitration as the ing right can avoid unnecessary delays jurisdictions is more "policyholder means of resolving any disputes in rela- and have dramatic effects on the cash friendly" than in others, and this can tion to the scope of policy cover and/or flow, or even the survival, of a business. create valuable leverage in the quantum of claims. settlement negotiations. There are at least five essential compo- Achieving Clarity nents that should be present in any n The type of arbitration should be Where arbitration is the chosen method arbitration clause: made clear, whether an of dispute resolution, it is essential that institutionally administered the arbitration clause is properly drafted n The clause should specify what arbitration (e.g. ICC, LCIA) or to ensure that the process works effec- categories of dispute are to be alternatively an "ad hoc" arbitration tively in practice. Failure to do so can resolved through arbitration. In some where the parties are left to manage lead to challenges over the correct seat, cases the arbitration clause will be the procedure between themselves and the tribunal (once formed).

n The seat of the arbitration must be specified and the policyholder should look to influence this. In addition to the potentially considerable costs involved in having to travel far afield to resolve a dispute, it is very important to bear in mind that, in the absence of a contrary provision, the "seat" will determine (a) the law governing the arbitration (which may be different from that governing the contract generally) (b) the scope for interference by national courts (c) the scope for appeal and (d) the enforceability of the award. While the policyholder should make

18 SUMMER 2006 www.klng.com

every effort to negotiate each of these against two insurers in Bermuda. This The incorporation of an arbitration pro- components to its advantage, the per- fragmentation of the dispute resolution vision by means of a general incorporat- fect position may not always be achiev- process is highly inefficient and may ing provision was considered by HHJ able. Nonetheless, at the very least well have an adverse impact on any set- Jack QC in Trygg Hansa Insurance there should be certainty about what is tlement negotiations. Attention to Company Limited v Equitas Limited agreed. Depending on the wording of detail at the time of placement can [1998] 2 Ll Rep 439. The Judge was the policy and the choice of law, there result in a more cost effective and required to consider the effect of sec- may be no downside to insurers in streamlined process being put in place. tion 6 of the Arbitration Act 1996 which delaying payment while resolving specifically provides that an arbitration uncertainties about the arbitration Global Insurance clause can be incorporated into an agreement. In contrast, policyholders Similar difficulties can arise in the con- agreement by reference, provided that may be forced by cash flow difficulties, text of global insurance programmes. A the reference is such as to make it part compounded by delays in trying to company may take out local policies to of the agreement itself. The Judge resolve these formalities, into accepting provide limited cover for overseas sub- held that section 6 did not alter the lower settlements than they should real- sidiaries while also taking out a global or existing law relating to incorporation by istically be entitled to. master policy to provide additional reference and that he was obliged to fol- cover for the same types of risk. The low the analysis in Excess Insurance Excess Layer Insurance local policy may provide for coverage Company Limited v Mander [1995] Most excess layer policies are based on disputes to be resolved through the L.R.L.R 358. In that case, Colman J standard form wordings which often local courts or local arbitration, whereas held that, in the absence of special provide that the excess layer policy "fol- the global policy may provide for dis- words of incorporation, general words of lows form" i.e. follows the same terms putes to be resolved in another jurisdic- incorporation are not to be treated as and conditions as the primary layer, tion. While there are real benefits in effective for the purpose of section 6 except as otherwise provided. There is, having global insurance cover, care and, in the light of this, the general however, authority under English law needs to be taken to ensure that poli- words of incorporation in the excess of that general words of incorporation may cies contain express provisions for the loss contracts in that case were not to be not be sufficient to incorporate an arbi- resolution of coverage disputes and that taken as indicating an intention to tration clause (or other dispute resolu- there are no conflicts in the dispute res- incorporate the arbitration clause from tion clause) into an excess policy. This olution provisions. the primary policy. lack of certainty can lead to delay and there should ideally be an express dis- The importance of an effective mecha- pute resolution provision. (See the nism for the resolution of policy cover- Trygg Hansa case referred to in the age disputes cannot be overstated. The panel). policyholder should take steps to ensure that, if an insurer wrongfully refuses to Problems can also arise where the settle a claim, there is a clear and excess layer policy contains an express enforceable mechanism in place to www.klng.com arbitration or dispute resolution clause enable the dispute to be resolved in a The arbitration section of our website which differs from that of the primary timely, fair and cost-effective manner. www.klng.com has recently been re- layer policy. This is not uncommon formatted and now includes not only and can prove very expensive for the information about the firm's arbitration policyholder. In the event of a coverage practice but also general information dispute involving both primary and about arbitration and its potential excess layer insurers the policyholder benefits and information on some of could, by way of example, be forced to the leading arbitration institutions in arbitrate against one insurer in London, the world. issue civil proceedings against three insurers in New York and arbitrate

SUMMER 2006 19 Arbitration World

Autumn Webinar Programme Dealing with political Difficult Document production in risk countries an electronic age n What are Investor Protection claims - Special problems arise when one The development of scavenging we will focus on the developing contracting party is located in a State technology, the move of many corporates Bolivian situation and how that may where difficulties are experienced with to paperless or near paperless operations trigger BIT claims as a route to judicial involvement in international and the recent cases perceived to have explain this fast developing area of arbitration - here we will be looking at been determined on the basis of arbitration; recent developments in India with "electronic smoking guns" all represent Ciccu Mukhopadhaya of the leading challenges for the International n We will also look at practical steps India Arbitration law firm Amarchand & Arbitration community. In this webinar that a General Counsel can take in Mangaldas & Suresh A. Shroff & Co. we will be joined by Prof Hans Van structuring deals/investments to Houtte (a member of the IBA maximise scope for using the We will also be considering the issues Committee that drafted the IBA Rules protection of BIT's; and arising in Bangladesh, Pakistan, of Evidence) and will be looking at: Indonesia, Thailand, China, Venezuela n Review MIGA, OPIC and other and Bolivia. The focus will be on what n What scavenging technology can commercial forms of political risk a party can do to limit exposure to uncover; cover. "games playing" including anti suit applications and the misuse of "public n The impact of e-discovery on 5 October 2006 14:00 GMT policy" bars to enforcement. arbitration; and

12 October 2006 14:00 GMT n How far a party to an arbitration can finesse the document production procedure to its advantage.

To register for forthcoming events please contact: 19 October 2006 14:00 GMT Kathie Lowe, Events Manager, London. ([email protected]). Who to Contact For further information contact Ian Meredith (London) [email protected] T: +44 (0)20 7360 8171 James Hudson (London) [email protected] T: +44 (0)20 7360 8150 Tom Birsic (Pittsburgh) [email protected] T: +1 412 355 6538 John Dingess (Pittsburgh) [email protected] T: +1 412 355 6564 Mark Haddad (Boston) [email protected] T: +1 617 261 3116 James Pranske (Dallas) [email protected] T: +1 214 939 4985 Carleton Strouss (Harrisburg) [email protected] T: +1 717 231 4503 Robert Galt III (Miami) [email protected] T: +1 305 539 3311 Kirkpatrick & Lockhart Michael Gordon (New York) [email protected] T: +1 212 536 4855 Nicholson Graham LLP Jon Michaelson (Palo Alto) [email protected] T: +1 650 798 6704 110 Cannon Street Deborah Bailey-Wells (San Francisco) [email protected] T: +1 415 249 1065 London EC4N 6AR Glen Reichardt (Washington) [email protected] T: +1 202 778 9065 www.klng.com

Kirkpatrick & Lockhart Nicholson Graham (K&LNG) has approximately 1,000 lawyers and represents entrepreneurs, growth and middle market companies, capital markets participants, and leading FORTUNE 100 and FTSE 100 global corporations nationally and internationally. K&LNG is a combination of two limited liability partnerships, each named Kirkpatrick & Lockhart Nicholson Graham LLP, one qualified in Delaware, U.S.A. and practicing from offices in Boston, Dallas, Harrisburg, Los Angeles, Miami, Newark, New York, Palo Alto, Pittsburgh, San Francisco and Washington and one incorporated in England practicing from the London office. This publication/newsletter is for informational purposes and does not contain or convey legal advice. The information herein should not be used or relied upon in regard to any particular facts or circumstances without first consulting a lawyer. Data Protection Act 1998 - We may contact you from time to time with information on Kirkpatrick & Lockhart Nicholson Graham LLP seminars and with our regular newsletters, which may be of interest to you. We will not provide your details to any third parties. Please e-mail [email protected] if you would prefer not to receive this information. 20 SUMMER 2006 © 2006 KIRKPATRICK & LOCKHART NICHOLSON GRAHAM LLP. ALL RIGHTS RESERVED.