New Rules at the Danish Institute of Arbitration per 1 April 2021

Immediate applicability

Unless otherwise agreed by the parties, the new rules apply to all cases commenced after their entry into force (1 April 2021). As such, all parties having included a reference to the Institute's rules in their contract(s), without specifying which version of the rules applies in case of a dispute, should acquaint themselves with the 2021-version. 

Covid19 and green change

The revised rules reflect a clear tendency towards a more digitalized process, meaning that, in principle, all communication and exchanges between the parties, the arbitral tribunals and the Institute may take place electronically. The International Chamber of Commerce (ICC), which is one of the world's leading institutions in the field of international arbitration and alternative dispute resolution, has included similar provisions in its updated rules which entered into force on 1 January 2021. Both sets of rules furthermore endow the arbitral tribunals with authority to determine, in some circumstances, that the hearing shall be held by virtual means.

Thus, this international trend has now found its way into Danish arbitration practice and is expected to influence also purely Danish proceedings (i.e. proceedings involving only Danish parties and Danish arbitrators).

These new provisions are surely a response to the current- and potential future epidemics and demands from users to decrease transportation and paper consumption and generally expedite the proceedings (see below). 

Efficiency and transparency

The increased awareness amongst users for time-cost efficiency and demand for transparency in the arbitral process have been leitmotifs in international arbitration over a number of years. This is also reflected in the new rules which allow the Institute to fix (and shorten) time limits on its own accord whenever necessary for the efficient conduct of the proceedings.

Regarding the goal of increased transparency, in addition to the arbitrators' duty to disclose any circumstances which may give rise to doubts as to their independence and impartiality vis-à-vis the parties, under the new rules, the parties are under an obligation to disclose if a third-party is funding the cost of the proceedings and has a financial interest in the outcome.

A similar provision is found in the 2021-version of the ICC rules and surely reflects a general trend of having recourse to specialized litigation funders in larger cases. Additionally, both sets of rules oblige parties to disclose changes in their legal representation and clarify that such new counsel may be precluded from entering the proceedings where this may give rise to a conflict of interest for one of the members of the arbitral tribunal.  

New fee rates and clarifications regarding document production, the language of the request for arbitration etc.

The Institute's new rules clarify several points which have occasionally given rise to doubt in the past. For example, the revised rules expressly recognize arbitral tribunals' power to order document production and also clarify which language shall be used in the request for arbitration when the language of arbitration is not set out in the arbitration agreement (going forward this will be determined by the language of the arbitration agreement itself). Moreover, the Institute has adopted new increased rates for the tribunals' fees and the administrative charges, which are now set out in a separate note and not in the rules themselves. 

These and several other changes constitute a rather substantial revision of the rules (which now contain 52 articles against only 36 previously). The revision is bound to influence all new proceedings under the auspices of the Institute but also arbitration practice in Denmark more generally in the years to come.