1. 3 rd AIDA Europe Conference Amsterdam, 26-27 May, 2011 26 th May 2011, Working Party on Reinsurance TOPIC: “Confidentiality in Arbitration: A Comparative Jurisdictional Perspective.” Dr. Kyriaki Noussia, LL.M., Ph.D. noussia@gmail.com

2. 1. Introduction Arbitration  most popular form of alternative dispute resolution Of reasons for arbitration’s leading position  presumption of confidentiality within it Aim of presentation  comparatively present treatment of confidentiality in arbitration Treatment of topic is imperative nowadays  Reasons? - central role of confidentiality in arbitration, - confidentiality is not always preserved - its protection is often problematic in many respects and stages

3. 1. Introduction (Ctd.) Confidentiality  fundamental and compelling reason for arbitrating Arbitration proceedings  not public like state court proceedings  private (documents and award protected by duty of confidentiality) Private character  does not presuppose that confidentiality and privacy are identical Confidentiality  ability of parties arbitrating and of others to disclose documents and information of arbitration Privacy  ability of third parties to access/ observe the proceedings without consent of disputing parties and/or arbitrator

4. 1. Introduction (Ctd.) England  original distinction between privacy and confidentiality  not as strong nowadays as in the past Many cases  allow us reach above conclusion Most recently Emmott v Michael Wilson & Partners Ltd [2008] EWCA Civ 184  issue of the distinction (confidentiality & privacy)  raised again

5. 1. Introduction (Ctd.) Lawrence Collins LJ  arbitration is private privacy would be violated by publication of arb. doc.  arbitration is confidential - i.e. inherent confidentiality of doc. used & - i.e. implied agreement to use doc. only for arbitration purpose Confidentiality in 1 st sense  subsumed by conf. in 2 nd sense In other words  arb. doc. remain confidential whether or not they contain trade secrets

6. 1. Introduction (Ctd.) Notwithstanding above statements  confidentiality rule  ultimately vital to arb. process in England England  general assumption  confidentiality operates as implied term in arbitration But  duty of confidentiality - not absolute - may be overridden by wider considerations - may be waived by parties

7. 2. The Legal Framework of Arbitration & the Position in Relation to Confidentiality ENGLAND Arbitration  statutorily regulated (Arbitration Act 1996) Report on Arb. Bill (Feb. 1996)  Departmental Advisory Committee (“DAC”) Privacy & Confidentiality  features upon which parties choosing arb. in England place great importance Arbitration Act 1996  no reference to obligation of confidentiality Legislative process  DAC concluded - confidentiality not to be regulated expressly - courts should be left to rule case-by-case

8. 2.The Legal Framework of Arbitration & The Position in Relation to Confidentiality (Ctd.) GERMANY Arbitration  long tradition, nowadays Z.P.O. 10 th Book Arbitration proceedings  not public participation (parties & arbitrators) GREECE Civil Code Procedure (art.867-903) (domestic) Law 2735/1999 (international)

9. 3. Case Law on Confidentiality in Various Jurisdictions Ample case law to mention Today  representative case law (reinsurance & other) Case law  divided in 3 parts 1/ confidentiality  in relation to arbitral proceedings - existence of proceedings - course of proceedings & consolidation 2/ confidentiality  in relation to document discovery 3/ confidentiality  in relation to the arbitral award

10. 3. i. Confidentiality Re Proceedings ENGLAND  where 2+ arbitral tribunals need be set up always attendant risk of inconsistent findings  where separate disputes have common features practice in English law  consolidate proceedings BUT  English courts  not always consistent rulings other times consolidation granted other times not

11. 3.i. Confidentiality Re Proceedings (Ctd.) ENGLAND Eastern Saga [1984] 2 Lloyd’s Rep. 373 Leggat J.  concurrent hearings not infringing arb. privacy Decision  unexpected forceful reminder - arbitration = private process - parties  agree/not concurrent hearings

12. 3.i. Confidentiality Re Proceedings (Ctd.) ENGLAND Sacor Maritima v Repsol [1998] 1 Lloyd's Rep 518 Disputes from 2 charters  referred to 2 separate arbitrations Court  facts and conclusions to be transported totally differently in 2 nd arb.  no justification for proceedings consolidation

13. 3.i. Confidentiality Re Proceedings (Ctd.) ENGLAND Ali Shipping Co. v Shipyard Trogir [1998] 1 Lloyd’s Rep. 643 6 companies  owned & managed by Ali Shipping entered into 6 separate contracts with Trogir Shipyard to have 1 vessel build for each company In separate arbitral proceedings for 3 of the 6 vessels  Trogir sought to introduce materials from the 1 st arbitration First Instance Court  no confidence duty blocked doc. communication Court of Appeal  disagreed Court of Appeal’s decision  in sharp contrast to the general English judicial trend

14. 3.i. Confidentiality Re Proceedings (Ctd.) ENGLAND Associated Electric & Gas Ins. Serv. Ltd.(AEGIS) v European Reinsurance Co. of Zurich [2003] UK PC 11 (Jan. 29, 2003) - 2 successive arbitrations - same parties - arising out of two separate disputes - under an automatic, facultative reinsurance agreement European Re  sought to introduce award from 1st arbitration AEGIS  obtained ex parte injunction to restrain European Re to introduce 1st award Bermuda Court of Appeal  allowed Eur. Re’s app. & vacated inj. AEGIS  appealed to Privy Council Privy Council  recognised need to preserve confidentiality

15. 3.i. Confidentiality Re Proceedings (Ctd.) GERMANY Arbitration proceedings  not public Clear  arbitrators themselves subject to confid. duty may not disclose award/details without parties agreement Debated conflict of academic opinions on topic of confidentiality OLG Karlsruhe Court Dec. 27.11.2007  parties had committed to secrecy and confidentiality nevertheless offense of this obligation not to be justified as such

16. 3.ii. Confidentiality Re Doc. Discovery/Disclosure ENGLAND Confidentiality Duty for documents disclosed on discovery  judicially established in Dolling-Baker v Merrett [1990]1 W.L.R. 1205 Court of Appeal  restrained party to reins. arbitration from disclosing on discovery in subsequent action documents relating to arbitration BASIS  docs not relevant to issues in action docs production not necessary for fair case ruling

17. 3.ii. Confidentiality Re Doc. Discovery/Disclosure (Ctd.) ENGLAND More recent ruling in J. F. Emmott v M. Wilson & Partners Ltd. [2008] EWCA Civ 184 -confirms England as arbitration-friendly jurisdiction -which respects desire of parties for confidentiality - while recognising legitimate circumstances for confid. relaxation

18. 3.iii. Confidentiality Re the Award ENGLAND Important aspect  extent to which awards are confidential Department of Economic Policy & Development of the City of Moscow (DEPD) v Bankers Trust Co. [2003] EWHC 1337 Q  whether award should be published Court  sensitivity of award material = favoured confidentiality preservation Associated Electric & Gas Ins. Serv. Ltd.(AEGIS) v European Reinsurance Co. of Zurich [2003] UK PC 11 (Jan. 29, 2003) & Ali Shipping Co. v Shipyard Trogir [1998] 1 Lloyd’s Rep. 643 Held  award could be produced

19. 3.iii. Confidentiality Re the Award (Ctd.) GERMANY OLG Frankfurt Court - Decision of 22.10.2004 Held  where arbitral tribunal’s constitution challenged as biased  no valid reason for confidentiality breach / for a challenge & annulment of the arb. award

20. 4. Critical Assessment – Conclusions Parties  expect arbitration to be confidential Cross-border disputes  many legal systems, parties What does this mean for confidentiality in arbitration? Case law  confidentiality Qs = legal minefield Confidentiality in arbitration  ongoing scholarly debate

21. 4. Critical Assessment – Conclusions (Ctd.) English view  implied right of arb. privacy extends to confidentiality Other jurisdictions  confidentiality = implied characteristic Extent  varies (various factors) NO READY SOLUTION exists Parties may hold key to solution = contractual provision on conf. Still  not wholesale certainty Advise  draft confidentiality clause in detail BUT  need to see both conf. adv. & disadv. => confidentiality > to be observed BUT WITHIN limits Many Q  still unanswered, no clear consensus in arb. world  sparse quant./qualit. data for general conclusions

22. 4. Critical Assessment – Conclusions (Ctd.) Where do we stand? England  aim of Arbitration Act 1996 = establish autonomy of arbitration from court intervention Nowadays  view = party autonomy much favoured Absent a - way to assess conf. practical impact - consensus on origins of conf. duty  no safe guidelines to be drawn on directions of confidentiality

23. 4. Critical Assessment – Conclusions (Ctd.) No golden solution & best path = in between Business & financial worlds  value confidentiality highly enough  against general relaxation of confidentiality Best solution?  continue to assess it case by case

24. Thank You For Your Attention !