Contextualizing the numbers and positioning yourself as an arbitrator
As 2018 draws to a close I thought it would be useful to put some numbers into context and to revisit the published numbers from 2017 before the 2018 numbers are collated by the institutions and released. As a self-employed arbitrator, it is important for me to properly understand where the new arbitration cases are coming from and how I can best position myself for consideration in relation to any appointment.
Given that the majority of my appointments as arbitrator are in relation to energy disputes, I have analyzed the reported numbers of energy related arbitrations. Note that the comments below are limited only to institutional arbitrations, the prevalence of ad hoc arbitrations in the energy sector will be the subject of a subsequent blog post.
The ICC reported 810 new cases in 2017. The energy sector accounted for 155 new cases in 2017, representing 19% of the overall caseload. There were 70 Emergency Arbitrator applications, of which half related to the construction, energy and engineering sectors.
The LCIA reported 285 new cases in 2017. The energy sector accounted for 68 new cases in 2017, 24% of the caseload.
The ICDR reported 1026 new cases in 2017. The ICDR did not publish a breakdown of the number of energy-related disputes, only stating “the largest claims by industry were (in descending order) in technology, commercial insurance, energy, aviation/aerospace/national security, pharmaceuticals, financial services and commercial construction.”
ICSID reported 49 new cases in 2017, 27% of which were energy related. The Energy Charter Treaty was the most frequently invoked international investment agreement.
There is a widespread perception that energy-related arbitrations are responsible for a significant proportion of all arbitrations, however the reality is not so compelling. To generalize, we can say that around a fifth to a quarter of commercial arbitrations relate to the energy sector (and this is on the basis that a broad definition of ‘energy’ is adopted). Whilst certainly significant, when this percentage is translated into numbers of new cases, the number is much smaller. The statistics I have cited above only relate to arbitrations administered by the ICDR, ICC, LCIA and ICSID. The AAA, which deals with domestic arbitrations in the US, has by far the largest case load of any institution but it has not yet been possible to ascertain how many cases it received in 2017 relating to energy disputes.
So what conclusions can be drawn from the above numbers? First, and this is always an important consideration: there aren’t that many new arbitration cases every year. Second, energy-related disputes are, not surprisingly, a reasonably significant proportion of those new cases. As an energy arbitrator, the best way to position oneself for consideration for appointments on these cases is to continue to refine and develop a deep understanding of the industry. The two most important characteristics in an arbitrator according to the BLP survey, were “expertise” and “efficiency”. Demonstrating expertise in an industry, by, for example, speaking at conferences and publishing papers is the best way an arbitrator can position themselves when those disputes arise.