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18 | 26th september - 2nd october 2014 | UtILItY WeeK Policy & Regulation Market view I nternational arbitration is the generally accepted means of dispute resolution for contractual disputes arising in the energy and natural resources industries. There are a number of institutions that arbitrate disputes in accordance with their own procedural rules. Of these, the London Court of Interna- tional Arbitration (LCIA) is one of the busi- est and most important for energy-related disputes. In 2013, 290 arbitrations were referred to the LCIA, of which nearly a quarter were from the energy and natural resources sector. Accordingly, the publication by the LCIA of its new rules of arbitration on 25 July 2014 is a matter of substantial interest to those in the energy industry who have agreements providing for LCIA arbitration. The new rules will automatically apply to arbitrations commenced on or aer 1 October 2014, unless otherwise agreed. Numerous amendments have been made, many of which are relatively minor. Some however, are important. A number of the revisions are aimed at speeding up and streamlining proceedings, or encouraging parties and the tribunal to conduct proceed- ings as efficiently as possible. These include revisions to streamline the proceedings: • request for arbitration and response can be submitted by way of electronic form via LCIA website; • shortened time frames for filing pleadings and written submissions. And revisions to encourage parties and tribu- nal to conduct proceedings efficiently: • tribunal members to declare availability to act; • tribunal to make final award "as soon as reasonably possible following the last submission from the parties"; • tribunal permitted to take parties' con- duct into account when awarding costs. The LCIA rules also seek to address com- plex issues that commonly arise in disputes involving multiple parties, as is oen the case in international disputes in the energy industry. Whereas under the old rules, a respond- ent could bring a counterclaim only against the claimant (and not, for example, against another party to the agreement who might be jointly liable), the new rules provide that a respondent can bring a "cross-claim" against the claimant as well as against any other respondent. The LCIA rules also contain provisions enabling the tribunal to order the consolida- tion of two or more arbitrations into a single arbitration, including where: • all the parties agree in writing; • separate arbitrations have been com- menced under the same arbitration agreement or any compatible arbitration agreement between the same disputing parties, and provided that no tribunal has yet been formed in the other proceed- ings or, if already formed, such tribunal is composed of the same arbitrators. The LCIA court has the power to con- solidate separate arbitrations commenced between the same disputing parties pursu- ant to the same arbitration agreement prior to the appointment of any tribunals. Another new feature in the LCIA rules is the ability to appoint an emergency arbi- trator. This follows recent precedent set by other arbitral institutions such as the SCC (Stockholm Chamber of Commerce) and the ICC (International Court of Arbitration). In case of emergency prior to formation of the tribunal, any party may apply to the LCIA for the immediate appointment of a tempo- rary sole arbitrator to conduct emergency proceedings pending the formation of the tribunal. If the application is granted, the LCIA shall appoint an emergency arbitrator within three days of receipt of the application and the emergency arbitrator must then decide the claim for emergency relief within 14 days. Any such award may then be confirmed, varied, discharged or revoked in whole or in part, by order or award made by the subse- quently constituted tribunal. The emergency arbitrator provisions will not apply where: the parties concluded their arbitration agreement before 1 October 2014 and have not agreed to opt-in to the relevant provisions; or the parties have agreed in writing to opt-out of the relevant provisions. The LCIA rules are the first set of arbitra- tion rules to introduce ethical guidelines for parties' legal representatives, and parties are required to ensure their representatives agree to comply with them. The guidelines are set out in an annex to the LCIA rules and their apparent purpose is to ensure that all parties are represented by counsel subject to common ethical obliga- tions, thereby minimising the difficulties that can arise where counsel from different juris- dictions are subject to varying professional conduct obligations. Under the LCIA guidelines, legal repre- sentatives should not: • obstruct the arbitration or jeopardise the finality of the award; • knowingly make false statements or pro- cure or assist the preparation of false evidence; • knowingly conceal or assist in the con- cealment of any document ordered to be produced by the tribunal; • make or attempt to make undisclosed unilateral contact with tribunal members. If a party's legal representative violates the guidelines, the other party or the tribu- nal may make a complaint. If the tribunal upholds a complaint, it can sanction the offending legal representative by issuing a written reprimand or written caution as to future conduct in the arbitra- tion, and taking any other measure neces- sary to fulfil its duties. Michael Darowski, of counsel, and Annabel Maltby, associate, Hogan Lovell New arbitration rules The utility industry's busiest international court of arbitration is changing its rules. Michael Darowski and Annabel Maltby summarise the key developments. LCIA rules change Better streamlining and greater efficiency of proceedings New rules applicable to multi-party disputes Introduction of "emergency arbitrator" provisions Introduction of ethical guidelines for counsel