CONFIDENTIALITY VS TRANSPARENCY IN INTERNATIONAL COMMERCIAL AND INVESTMENT ARBITRATION
Confidentiality is considered by users of international arbitration to be one of its most important features. In the 2018 Queen Mary and White and Case Survey, for example, it was identified as one of international arbitration’s ‘central pillars’. Over 87 percent of respondents attached importance to confidentiality in international commercial arbitration, with 40 percent of respondents listing it as ‘very important’.
Given the significance of confidentiality to users, it may come as a surprise that international arbitration is not automatically confidential. The misunderstanding arises because hearings are generally not open to the public and awards are not published. However, the fact that the proceedings are private does not mean that the parties are under an obligation to keep them confidential. In fact, absent a provision in the arbitration rules or an agreement between the parties, the parties are under no obligation to maintain the confidentiality of the proceedings.
Despite the importance of the perception of confidentiality to international arbitration, over recent years there has been a move toward greater transparency. While this move can be seen most clearly in the context of investment arbitration, it has had an impact on international commercial arbitration as well.
Confidentiality in international commercial arbitration
In international commercial arbitration, the parties’ duty to maintain the confidentiality of the proceedings may arise from three sources. First, the parties can expressly agree to keep the proceedings confidential, either in their arbitration agreement or at the outset of or during the proceedings. Second, the rules of the institution administering the proceedings, such as the London Court of International Arbitration (LCIA), may require the parties to keep the proceedings confidential. Finally, the parties may be under a duty of confidentiality by virtue of the national law that applies to the proceedings.
Jan-Mar 2019 issue
Freshfields Bruckhaus Deringer LLP