CRCICA’s draft new Arbitration Rules: Key aspects

Africa Focus

CRCICA’s draft new Arbitration Rules: Key aspectsContents

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Law Update: Issue 360 - Africa and Transport & Logistics

CRCICA’s draft new Arbitration Rules: Key aspects

John Gaffney
Senior Counsel,
Dispute Resolution

Chahira Bacha
Senior Associate,
Dispute Resolution

Darya Ghasemzadeh
Trainee Lawyer,
Arbitration

Egypt has established itself as a well-regarded forum for arbitration. Arbitration in Egypt is regulated by the Egyptian Arbitration law No. 27 for 1994, which applies to both domestic and international arbitrations. Egypt is also party to a number of international treaties, such as the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which is incorporated into local law. The Cairo Regional Centre for International Commercial Arbitration (“CRCICA” or the “Centre”) is considered as the most prominent arbitral institution in Egypt and has seen its caseload steadily increase over the years.On 24th of June 2023, the Centre published its new draft CRCICA Arbitration Rules (“New Rules”), in order to obtain comments and feedback from members of the arbitral community. Once finalized, the New Rules are due to enter into force later in 2023, at a date yet to be determined (the New Rules are in the process of being adopted by CRCICA’s Board of Trustees and are currently subject to editorial amendments). Background to the New RulesThe New Rules are based on the UNCITRAL Arbitration Rules (as revised in 2010, and amended in 2013 and 2021). Consequently, they include a number of significant new provisions. These include rules pertaining to the consolidation of arbitrations, early dismissal of claims, emergency arbitrator rules, expedited arbitration rules, online arbitration filing, multiple contracts, and third-party funding. In addition, the New Rules have revised the administrative fees, and the arbitral tribunal fees in response to economic developments over the past decade.

In this article, we review a number of the key new provisions. Consolidation of proceedings Consolidation of multiple arbitral proceedings typically involves joining one proceeding into another, and discontinuing the former proceeding, resulting in a single award. It thus has the potential to afford the parties flexibility, efficiency, and cost savings. The New Rules set out the circumstances in which arbitral proceedings may be consolidated and sets out the process for consolidation. This is a significant development as it brings the New Rules in line with global best arbitral practice. Under these New Rules, a party may file an application to CRCICA to consolidate two or more pending arbitrations into a single arbitration. In deciding whether to accept or reject the application, the Centre will consider whether any of the following criteria is satisfied..

All parties have agreed to consolidation in writing;

All claims are made under the same arbitration agreement(s);

If there are separate arbitration agreements, those agreements are compatible, such that the dispute(s) arise from the same legal relationship;

Whether the disputes arise out of contracts consisting of a principal contract and its ancillary contract(s); or

The disputes arise out of the same transaction or series of transactions.

Multiple ContractsThe New Rules also allow for the possibility to join multiple claims arising out of more than one contract under a single arbitration. In deciding whether multiple claims can proceed in a single arbitration, the Centre will consider whether the arbitration agreements under which the claims are made are compatible, whether the relief sought arises out of the same transaction or series of related transactions, and any other circumstances which the Centre deems relevant.Early dismissal of claimsThe New Rules empower an arbitral tribunal, at the request of any party, and after hearing from all other parties, to dismiss a claim from the outset, without considering it in detail where the claim is manifestly without legal merit or that claim is manifestly outside the jurisdiction of the arbitral tribunal.Interim ReliefThe New Rules provide that the arbitral tribunal may at the request of a party, grant interim measures. In such a scenario, if the arbitral tribunal has not yet been fully constituted or the arbitration has not yet commenced, an emergency arbitrator may, at the request of a party, be appointed by the Centre, to determine a party’s request for interim relief. The New Rules also set out the process for appointing an emergency arbitrator, communicating the urgent application to the other party, challenge, and replacement of the emergency arbitrator, as well the place and conduct of an emergency arbitration. An interim measure is any temporary measure by which, at any time prior to the issuance of the award by which the dispute is finally determined, a party is ordered for example to maintain or restore the status quo pending determination of the dispute, to take action that would prevent, or refrain from taking action that is likely to cause current or imminent harm or prejudice to the arbitral process itself, or to preserve the relevant assets or evidence. The New Rules provide that the arbitral tribunal, prior to granting an interim measure, shall be satisfied that there is a reasonable possibility that the requesting party will succeed on the merits of the claim, or that irreparable harm is likely to result if the measure is not ordered.

The “The New Rules are based on the UNCITRAL Arbitration Rules (as revised in 2010, and amended in 2013 and 2021)”.

Expedited Arbitration RulesExpedited arbitration, an accelerated form of arbitration that can save parties time and costs, are introduced in the New Rules. As its name implies, expedited arbitration shortens arbitral time frames for, among other things, the holding of a case management conference, rendering an award or the submissions process.The expedited rules introduced by the New Rules only apply where the parties have expressly agreed to be bound by such rules and may equally be opted out of through mutual consent of the parties. Thus, it follows that the New Rules do not apply by default, but rather may be deployed at the parties’ discretion. The approach adopted by the New Rules expressly differs with that of other arbitral institutional rules, such as the ICC Rules 2021 or the ICDR Rules 2021, which set a threshold limit for expedited rules to apply by default where the amount in dispute is below a certain amount (e.g. below USD 3 million under the ICC Rules 2021 or USD 500,000 under the ICDR Rules 2021).The Expedited Arbitration Rules provide that the Award shall be issued within six months from the constitution of the Tribunal, unless otherwise agreed by the parties.Use of Technology In line with developments over the past decade, and the increasing deployment of online services over the pandemic, the New Rules expressly provide that notices of arbitration can be submitted online, by following the conditions for filing a notice of arbitration available online at CRCICA’s website. Moreover, the New Rules also expressly envisage the possibility of holding hearings remotely via video conference or other appropriate means, which reflects the recent shift in remote working paradigms following the Covid epidemic. Third Party FundingThe New Rules provide that a party that is funded by a third party is required to disclose the existence of the funding and the identity of the funder at the commencement of and throughout the arbitral proceedings. This is an innovative, welcome development as it is the first effort to regulate third-party funding in Egyptian arbitration and help avoid potential conflicts and related enforcement issues. ConclusionThe New Rules provide a comprehensive set of procedural rules and bring the Centre’s rules in line with the latest set of UNCITRAL Arbitration Rules (as revised in 2010, and amended in 2013 and 2021), and highlight Egypt’s role as a significant hub for international commercial arbitration in the Middle East and Africa. According to the Centre’s press release, the New Rules endeavour to “ achieve a balance between cost effectiveness and maintaining high quality services to best serve the interests of users”. While the New Rules have revised and raised the administrative fees and the arbitral tribunal fees in response to economic developments over the past decade, the fees remain competitive and in line with other arbitral institutions.

For further information,
please contact John Gaffney or Chahira Bacha.

^{Published in August 2023}