ICC Arbitration Proceedings: Practice, Enforcement of Awards, and Costs

ICC Arbitration Proceedings: Practice, Enforcement of Awards, and Costs

Determination of the facts of the case

The arbitration panel will make a decision on the case unless one of the parties requests a hearing.

The arbitration panel will attempt to ascertain the facts using all methods it deems appropriate

The arbitration panel may appoint an expert after consulting with the parties

The arbitration panel may hear from an expert witness, or from another person as well. Furthermore, upon the request of one of the parties, it may even allow the parties to question the experts.

 

Hearings 

Hearings may be held at the request of the parties or at the request of the arbitration panel.

After consulting with the parties, it may be decided that hearings be conducted remotely in various forms. This could be video conferencing, telephone, or similar suitable communication methods.

The arbitration panel presides over the hearings, and the parties may be present at the hearings or attend through a representative they have authorized.

 

Conclusion of the Trial and Submission Date of the Draft Judgment

The arbitration panel is striving to draft its decision and submit it to the council as soon as possible.

This means that a decision will be made either from the date of the final hearing on the matters to be judged, or as soon as possible from the date of submission of the last permitted petition.

The secretariat and the parties are informed of the estimated timeframe for the submission of the draft to the Council for approval.

This marks the beginning of the point where the parties can no longer present evidence related to the matters decided upon.

 

Temporary Legal Protection Measures

The text states that when the arbitration board receives the file, it may decide on a temporary protective measure if one of the parties requests it and the board deems it appropriate.

If the arbitration panel decides to issue such an interim measure, it may request the requesting party to provide the necessary security.

It is even stated that the parties may not only apply to an arbitrator but also request temporary protection from the judicial authorities. The condition is that this request can be made before the case is sent to the arbitration board, or, if appropriate, afterwards.

Such an application and the measures taken by the judicial authority shall be notified to the Secretariat without delay. The Secretariat shall inform the arbitration board of this matter.

 

 Emergency Referee

If the parties are in a situation of urgency where they cannot wait for the formation of an arbitration panel, they may resort to measures in accordance with emergency arbitration rules.

The application must include the following information

-The situation or situations that led to this application

- Explanation of what urgent measures are requested

-An explanation of why this temporary legal protection measure was needed

It is stated that such an application will be accepted if it is made before the case goes to the arbitration board. In this case, the chairman of the board will appoint an emergency arbitrator.

However, in this case, the decisions made are not binding once the arbitration panel has been formed.

 

The emergency referee does not apply in three situations

It is stated that an emergency arbitrator cannot be contacted in three specific situations.

-If the arbitration agreement was concluded on January 1, 2012

-If the parties agree that these conditions will not apply

-If the arbitration agreement arises from an international treaty

 

Final Decisions, Timeframe and Majority Requirement

The arbitration panel has six months to make its final decision.

This period begins from the date of the final signature of the arbitration board or the parties on the terms of reference, or from the date the approval decision of the board is transmitted to the arbitration board by the secretariat.

If the arbitration panel consists of more than one arbitrator, decisions are made by majority vote.

If a majority cannot be reached, the head referee's vote is decisive.

The grounds accepted as supporting evidence in the decision are presented as justification

 

Review of the Decision by the Tribunal

We mentioned that the arbitration panel submitted its draft decision to the council. It is stated that the council can only make formal changes to the draft decision; it cannot make substantive changes, but can draw attention to it. As previously mentioned, the council does not resolve the dispute; it manages the process, and it is possible to say that it fulfilled this role here as well.

However, it is important that the court approves the decision in terms of form, since the arbitration panel cannot notify the parties of the decision without obtaining this approval.

Once approved, the decision is sent by the council to the secretariat.

 

Notification, Delivery and Enforceability of the Decision 

The secretariat notifies the parties of the signed copies of the decision upon its approval.

However, service of process is only possible upon payment of court costs.

Payment can be made by one party or both.

The decision rests solely with the parties involved.

The notification of the decision makes it binding.

The parties may submit requests for correction of material errors in the decision and clarification of ambiguous matters to the secretariat within 30 days of receiving notification of the decision.

 

Enforcement

It is said that a decision becomes binding once it is rendered, but for it to be enforceable, the arbitration award given by the ICC arbitration – or, if we consider Turkish law, an enforcement decision from a Turkish court – is required.

Anyone with a legal interest can request this by submitting a petition.

The competent court to issue the enforcement order will be the civil court of first instance.

If the parties have reached such an agreement, the competent court shall be the court of the place of residence of the party against whom the decision was made in Türkiye, or if that is not possible, the court of the place where they reside, or if that is also not possible, the court of the place where the property subject to execution is located.

The party requesting enforcement submits the arbitration award, its translations, and related documents to the competent court in its petition.

The lawsuit is then served on the opposing party.

The case is conducted through hearings, and the procedure is simplified.

However, it cannot be said that every decision can be enforced.

 

Matters that the court may consider ex officio

-The country where enforcement of the arbitration award is sought does not allow for a solution through arbitration. To elaborate further, the International Arbitration Law states that arbitration is not applicable to disputes concerning real rights over immovable properties located in Türkiye, or to disputes that are not subject to the will of the two parties, thus indicating that it is not possible to obtain an enforcement award in such cases.

-The arbitration decision constituting a violation of public order: According to the inconsistent view of the Court of Cassation, submitting the arbitration panel's decision to the approval of the council constitutes a violation of public order on the grounds that it casts a shadow on the impartiality and independence of the arbitrators. However, the Court of Cassation has also defended opposing views.

 

The following are matters that the parties may raise but which the court will not consider ex officio:

-The parties to the arbitration agreement being incapacitated or the arbitration agreement being invalid.

-The arbitrator's decision was outside the limits of the arbitration agreement

-The selection of the arbitrator(s) or the procedure applied is contrary to the laws of the country where enforcement is sought

 

In some cases, ICC arbitration panel decisions do not require enforcement by Turkish courts.

As is known, parties applying for arbitration can agree on which procedural law and which substantive law will apply. The existence of such an agreement means that if the procedural law applicable to the resolution of the dispute falls under Turkish jurisdiction, there is no need for an enforcement decision.

Therefore, if the parties have opted for Turkish procedural law, we are faced with the idea that the decision was made under the authority of Turkish law. This is considered by the Supreme Court as a situation not subject to enforcement.

 

Expenses

Registration fee: This is the fee requested from the party requesting arbitration when submitting their request to the secretariat. It can be considered a kind of application fee.

 

Advance payment for interim expenses: This is a fee determined upon receipt of the arbitration request. It covers expenses incurred during the period between the receipt of the arbitration request and the preparation of the terms of reference.

 

Advance payment for expenses: The Board determines an advance payment for expenses to cover arbitrator fees, the ICC's administrative costs, and other costs related to arbitration for claims made to it.

However, this advance payment for expenses is a fee that can be renegotiated during the arbitration proceedings.

This is a payment made equally between the parties. However, the other party is free to pay the advance for any expense if the other party fails to pay its share

If the agreed-upon advance payment for expenses is not met by either party, the general secretary consults the arbitration board, and a decision is made to suspend the work for a period of not less than 15 days. If this period expires, the requests are deemed withdrawn.

 

The final decisions will determine the arbitration costs, specifying which party will bear the costs or the proportions in which they will share them.

 

Intern Student

Bedirhan TAŞÇI