‘Best practice’ 2021 AIAC arbitration rules come into force

The AIAC Arbitration Rules 2021 (84-page / 1.2MB PDF) came into force on 1 August, replacing the 2018 edition. The new rules incorporate a fast-track procedure for expedited arbitrations, which was previously governed by a separate set of rules. They also include a new provision on summary determination, allowing for the early dismissal of claims that are inadmissible, manifestly outside the jurisdiction of the tribunal, or manifestly without merit.

Previously known as the Kuala Lumpur Regional Centre for Arbitration (KLRCA), the AIAC rebranded in 2017 to better position itself as an international dispute resolution facility. It is a member of the multi-jurisdiction Asian-African Legal Consultative Organisation (AALCO), and its rules are based on the 2013 version of the UNCITRAL Model Law.

International arbitration expert Mohammad Talib of Pinsent Masons, the law firm behind Out-Law, said that the new edition of the rules “reflects the modern trend towards enhancing efficiency, dealing with complex disputes and enhancing cost efficiency in arbitration”.

“The rules reflect many of the best practices that institutions are now adopting to help users of arbitration to take the maximum benefit from the flexibility that arbitration offers over traditional modes of dispute resolution,” he said.

“Particularly interesting is rule 44.6, which has been newly inserted and allows the AIAC to publish arbitration awards – in whole or in part – with the written consent of the parties. This will enhance the transparency of arbitration and help build up a more open knowledge base of jurisprudence that will be relevant to all who are involved in arbitration,” he said.

However, Talib noted that the new rules do not contain any provisions in respect of data protection – unlike, for example, the latest version of the rules of the London Court of International Arbitration (LCIA), published last year.

“This suggests that this is an area where the best approach is still uncertain when it comes to international arbitrations that make large use of personal data or other data that needs protection,” he said.

The new rules apply to all arbitrations commenced with the AIAC from 1 August 2021, unless otherwise agreed by the parties.

Among the provisions revised and updated in the new version of the rules are those around emergency arbitrations; joinder and consolidation; closure and termination of provisions; the technical review process; and costs and deposits. They also incorporate a new provision allowing for consolidation of multi-contract disputes.