COVID-19 and its impact on International Arbitration: the show must go on

Published: 14/4/2020

Since our first COVID-related blog on 3 March 2020, events have moved rapidly all over the world as the global pandemic extends its reach into virtually all aspects of global society.

Our first COVID-related blog can be viewed here

Historians commenting on the impact of the virus have noted that in years to come our children will study this period and identify a distinct point in time when society changed; a period "before COVID-19" and "after COVID-19". At the time of writing, there are over 1.7 million confirmed cases, and over 100,000 deaths. Sadly, we are all too aware that these numbers underestimate the true impact of the virus (given the inadequacies of testing in various jurisdictions and policy decisions not to test in certain locations) and will in any event increase and do so rapidly, over the coming weeks. The economic impact is likely to be devastating across all global markets.  

Just as efforts were taken on a global scale to contain the virus itself, so too do steps need to be taken to limit its impact on the sustainability of our work. Different approaches to containment taken by different jurisdictions have taken the ability of the virus to control society on a different trajectory. Germany, for example, which took a particularly proactive approach to containment, has to date been able to cite a much lower mortality rate than other European nations. Now is the time for practitioners at every stage of the arbitration pathway to step up, push aside any preconceived notions as to the limitations of virtual dispute resolution, and work proactively to anticipate and resolve any imperfections with such processes when they are deployed.

If we fail to do so, delays will penetrate the arbitral systems at every level. Access to justice for our clients and potential clients will be compromised and procedural timetables will stagnate. Parties with weaker merits may seek to take advantage of the crisis to actively seek delay with little recourse for their counterparties. Parties seeking to enforce their rights arising out of the crisis will be unable to do so. Alongside cost, risk of delay is a primary consideration for clients in the current market and efficiency a significant factor in favour of resolving disputes through arbitration. Understanding and deploying the latest technologies to allow arbitrations to proceed efficiently must now be a primary concern.

Practitioners everywhere are having rapidly to acquaint themselves with a myriad of video conferencing applications, such as Skype for Business, Zoom, Microsoft Teams and LoopUp. Such platforms offer team collaboration in these times of isolation and social distancing, and with the correct technical support, can ensure that procedural and substantive hearings can be conducted and timetables maintained. Before COVID-19, the buy-in of all the parties and the panel was key to the use of such platforms, unless their use was necessitated by circumstance, such as witnesses being prevented from leaving particular jurisdictions and being compelled to give evidence remotely.  As it becomes more mainstream there will become an ever diminishing list of reasons for parties and arbitrators to give for why it should not be used.  

The document preservation element of proceedings has already enjoyed a decade or more of technological innovation. Even if documents are harvested in hard copy today (vanishingly rare), they are still scanned and uploaded onto electronic databases, which then make the documents text searchable. As AI advances, documents now no longer just have "key word" searches run through them, but can be clustered for such things as emotions and sentiments. Such advances were necessitated by the different media through which people can now communicate - from email to text, to BBM messaging, to Slack - and the consequential explosion of data meaning that full document review became out of the reach of human capability. It is to be surmised that as this stage of the lifecycle of a case has been changed beyond recognition, so too with hearings.

It is clear that the above alternative ways of working, of meeting, of preserving, gathering and transmitting evidence and of conducting lengthy and complex hearings were starting to infiltrate our practice of international arbitration before COVID-19. What COVID-19 will no doubt be credited with doing however, is accelerating that process and removing all barriers to adopting the new order, because the old is simply not possible and standing still is not an option.

What is key is that international arbitration, arguably more than any other dispute resolution mechanism (due not least due to its inherent multi-jurisdictional nature, scope for flexibility in its governing rules and an increasing awareness of the environmental impact of unnecessary travel) has the tools to be able to implement a significant and wholesale change to arbitration practice - and do so swiftly. It will not be perfect at first, and we may look back with nostalgia at days when hearings could begin without a detailed technical briefing and cross-examination of a witness could take place with all the benefits of reading body language and subtle changes in facial expression that come hand in hand with an 'in person' hearing. However, just as AI technology is now making yet further advances into document analysis, who is to say that as video conferencing becomes more mainstream for hearings, technology will not innovate again and, for example, people's faces could be scanned during live evidence and analysed by an algorithm for tell-tale traits of lying?

What does seem certain is that once the immediate threat of COVID-19 has passed, we will not be seeking to curtail the efficiencies of practice that it has thrust upon us.

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