Understanding the Rules of Expedited Arbitration in International Construction Dispute Resolution

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1. Introduction

Currently, the field of international construction within international trade has witnessed an increase in disputes, creating a strong need for effective and expedited dispute resolution. International construction projects involve two critical factors – time and cost – which demand a dispute resolution mechanism that is flexible, simple, and cost-efficient. However, conventional arbitration rules often prolong proceedings and incur significant expenses, thereby highlighting the need to apply Expedited Arbitration Rules as an optimal solution.

Experience in countries with well-developed construction sectors, such as the United Kingdom and the United States, demonstrates a trend toward establishing separate expedited arbitration mechanisms to enhance the efficiency of dispute resolution processes. For Vietnam – a developing international construction market that is attracting substantial investment – studying, approaching, and evaluating the feasibility of applying Expedited Arbitration Rules has become increasingly necessary. 

2. On Expedited Arbitration Rules

2.1. Development of Expedited Arbitration Rules

The term “Expedited Arbitration Rules” began to emerge in the 1990s, aiming to address the limitations of Regular Arbitration Rules, which imposed significant burdens of time and cost on disputing parties. Essentially, the expedited arbitration process is not an entirely separate procedure but is conducted under a set of rules with shorter and more strictly defined timelines.

Even prior to the establishment of specific rules, organizations such as the International Chamber of Commerce (ICC) resolved cases using expedited procedures, in some instances concluding disputes within as little as 38 days. This development continued with the World Intellectual Property Organization (WIPO) drafting its WIPO Expedited Arbitration Rules in 1994. Subsequently, other institutions developed or supplemented their own expedited rules, including the United Nations Commission on International Trade Law (UNCITRAL), which implemented its Expedited Arbitration Rules in 2021.

The Expedited Arbitration Rules have developed three main trends: (1) Stand-Alone Expedited Rules – a separate set of rules governing the entire procedure from the initiation of the claim to the issuance of the award, considered the most comprehensive process. (2) Semi-Separate Expedited Rules – provisions or distinct chapters incorporated within the Regular Arbitration Rules, usually established based on the dispute’s value or the parties’ agreement. In this case, other provisions of the Regular Rules still apply. (3) Implicit Expedited Rules – no specific expedited rules are set; instead, the parties are allowed to agree on shortened time limits for various stages of the arbitration proceedings.

2.2. Content of Expedited Arbitration Rules

Expedited arbitration rules focus on brevity, strict timelines, and procedural efficiency, encompassing five main elements.

The scope of application is typically limited to disputes of relatively low value or those that are not overly complex. Many international arbitration institutions set specific monetary thresholds for their application, for example: CIETAC Rules (not exceeding RMB 5 million), JCAA (below JPY 300 million), SIAC (below SGD 6 million), or ICC (below USD 3 million, depending on the time of agreement). The UNCITRAL Expedited Arbitration Rules 2021, however, do not impose any value restrictions; they only require the parties’ agreement to apply the rules, taking into account the complexity and other relevant factors.

Regarding arbitrators, expedited arbitration rules typically provide for a sole arbitrator to participate in the dispute resolution process in order to save time and costs, although the parties’ right to appoint multiple arbitrators is still preserved. The time and procedure for appointing the arbitrator are also significantly shortened compared to regular procedures. For the main procedural steps, they are condensed in both number and duration. Claimants are usually required to submit the Request for Arbitration and Statement of Defense simultaneously, and respondents must reply within a short period. Hearings may be conducted in a documents-only arbitration format unless requested by the parties and deemed appropriate by the arbitral tribunal. If hearings occur, the time is limited (e.g., 3 months under AIAC or WIPO), and limitations are applied regarding the number of witnesses (typically 2 per party) and documents.

Regarding arbitral awards, the award may be rendered with full reasoning or without any reasoning, depending on the specific provisions of each set of rules. All arbitral institutions have mechanisms to ensure the quality of the award and the fairness of the proceedings, even within expedited procedures. Finally, arbitration costs are considered a significant advantage, as many arbitral institutions reduce lawyer fees and expenses for in-person hearings. However, administrative costs may not decrease substantially, and for high-value disputes applying expedited procedures (such as under ICC rules), management costs may be comparable to those of regular arbitration.

3. On the Use of Expedited Arbitration Rules in International Construction Disputes

The demand for expedited procedures in construction arises from the need to reduce costs and ensure the enforcement of construction contracts. This procedure first developed in the United Kingdom in the 1990s with the enactment of the Statutory Adjudication Act, regarded as the precursor to expedited procedures in the construction sector. Subsequently, the UK further developed rules such as the CIMAR Model Construction Arbitration Rules. This development spread to the United States with the establishment of several expedited construction arbitration rules, including the CPR Expedited Construction Arbitration Rules (effective 2006), the AAA Expedited Procedures (effective 2016), and the JAMS Expedited Construction Arbitration Rules (effective 2021).

Expedited Construction Arbitration Procedures possess distinctive features, primarily concerning their scope of application and procedural rules:

– Regarding the scope of application, there are three main approaches: (i) the parties’ agreement; (ii) the field of the dispute; and (iii) the value of the dispute.

– Regarding procedural rules, these rules impose very strict timelines:

  • CPR Rules, also known as the “100-Day Arbitration Rules”: the entire arbitration procedure is limited to 100 days from the preliminary conference.

  • AAA Expedited Procedures: establish a “standard period” of 45 days to complete the main hearing. The hearing shall not exceed 1 day (or a maximum of 2 days if extended), and the award must be issued within 14 days after the conclusion of the hearing.

  • CIMAR Model Rules: encourage short hearings or documents-only hearings, with hearings not exceeding one day, and the award to be issued approximately one month thereafter.

The current situation indicates that an increasing number of construction disputes are being resolved through expedited arbitration procedures. Arbitration centers handling numerous construction and engineering cases have reported a significant rise: nearly 80% of disputes in the construction and engineering sector are being processed under expedited arbitration rules. These cases are handled in a timeframe shorter than the typical 8–9 months provided under standard expedited arbitration rules.

4. Mechanisms for Resolving Disputes through the Bigboss International Arbitration Center (BBIAC)

To resolve a dispute through commercial arbitration at BBIAC, clients may insert one of the following two clauses into their contracts:

4.1. Model Arbitration Clause

“Any dispute arising out of or in connection with this contract shall be settled by arbitration at the BIGBOSS International Commercial Arbitration Center (BBIAC) in accordance with the Arbitration Rules of Procedure of this Center.”

Additionally, the parties may supplement the clause with:

(a) The number of arbitrators shall be [one or three]. 

(b) The seat of arbitration shall be [city and/or country]. 

(c) The governing law of the contract shall be [ ].* 

(d) The language of the arbitration shall be [ ].**

Notes:

* Applicable only to disputes involving a foreign element. 

** Applicable only to disputes involving a foreign element or disputes where at least one party is an enterprise with foreign invested capital.

4.2. Model Arbitration Clause Applicable to Expedited Procedure

“Any dispute arising out of or in connection with this contract shall be settled by arbitration at the BIGBOSS International Commercial Arbitration Center (BBIAC) in accordance with the Arbitration Rules of Procedure of this Center. The Parties agree that the arbitration proceedings shall be conducted under the Expedited Procedure stipulated in Article 37 of the BBIAC Arbitration Rules of Procedure.”

Additionally, the parties may supplement the clause with:

(a) The seat of arbitration shall be [city and/or country]. 

(b) The governing law of the contract shall be [ ].* 

(c) The language of the arbitration shall be [ ].**

Notes:

* Applicable only to disputes involving a foreign element. 

** Applicable only to disputes involving a foreign element or disputes where at least one party is an enterprise with foreign invested capital.

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