Arbitration Blog

On the 15th of March 2024, the Netherlands Arbitration Institute (NAI) will officially launch its updated arbitration rules (the "2024 Arbitration Rules") at a launch event in The Hague. The 2024 Arbitration Rules include several changes that aim at, for example, implementing new tools for resolving disputes faster, preventing guerilla tactics, supporting diversity in arbitrators' appointments, and making the arbitration process more accessible to first time users by clarifying the rules and codifying established practice. We describe the most notable changes below. The 2024 Arbitration Rules entered into force on 1 March 2024. 

New tools for the faster resolution of disputes

First and foremost, the 2024 Arbitration Rules introduce expedited arbitral proceedings (Article 42 and Appendix D). The expedited arbitration rules will be applicable by default to proceedings where the claims do not exceed EUR 1,000,000, unless the parties have agreed otherwise. Parties can, however, also agree to apply the expedited arbitration rules to their dispute when higher amounts are involved. 

The expedited arbitration rules require the arbitrator to be appointed within one month of the proceedings having been commenced (Article D4(5)). Parties will have only one round of written submissions and the hearing will in principle be held virtually. The expedited arbitration rules shorten the proceedings to facilitate a quick resolution of the dispute (i.e. the award must be rendered within six months of the initiation of the proceedings). However, it is unclear what the consequence of not abiding by the prescribed time limits would be. Other institutions, for instance, penalise arbitrators who fail to render an award within the allowed timeframe by reducing their fees. We are therefore curious to see how the NAI will enforce these time limits in practice.

Another helpful feature of the 2024 Arbitration Rules is the introduction of the early determination of unfounded disputes (Article 45). At the request of a party, the arbitral tribunal may decide by way of an order or an award that a claim is either manifestly inadmissible, outside the tribunal's jurisdiction or manifestly legally unfounded, after having given the parties an opportunity to present their views. The decision must be rendered within 30 days. 

Preventing guerilla tactics

The 2024 Arbitration Rules are also geared towards anticipating, addressing and preventing attempts by the parties to use guerrilla tactics to disrupt or delay the arbitral process.

For instance, the NAI Challenge Chamber is now able to reject a challenge if it finds that the challenging party is abusing its right (Article B3(8)). This will prevent unfounded challenges delaying the arbitral process due to the time required for challenge proceedings and the possible issues of 'due process paranoia' that such challenges could give rise to. 

Additionally, to tackle parties' attempts to delay the proceedings the tribunal now must "take into account the manner in which parties conducted the proceedings as well as whether each of the parties promoted the speedy and efficient conduct of the proceedings" when deciding on the division of the costs of the arbitration and the costs of legal assistance (Article 59(4)). Although arbitrators usually sanction parties' unacceptable conduct in costs decisions, an express written provision to this effect might dissuade the parties even more from attempted dilatory tactics and provide the tribunal with reassurance when penalising such actions. 

Promoting diversity among the arbitrators