Originally from Journal of Damages in International Arbitration

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MS. MARBOE: The topic of this panel is new on the agenda of the Juris Damages Conferences. For the first time we are talking about costs in international arbitration. We think that this topic, which has important financial implications, is drastically under-researched. Only a short list of dedicated literature can be found. There are, however, some studies undertaken by GAR (Global Arbitration Review), some recent statistics and other quantitative research. I will share with you a few numbers that show us that costs in international arbitration may really be considerable. 

The GAR research reveals that the mean costs for claimants are about USD 6.0 million, respondent costs are about USD 4.9 million on average, but there are some large claims on the record, namely USD 81.4 million of costs for the claimant and USD 31.5 million for the respondent. These are only the party costs. In addition, there are arbitration costs, the second category of costs, which are the cost of the tribunal and some administrative costs of the arbitral institution. They are on average USD 920,000 in ICSID cases.  UNCITRAL is a little more expensive, USD 1.09 million on average in the past years. These costs must also be borne by the parties. This is in inherent in international arbitration as there is no public institution, which is funded by state parties, even in ICSID. The tribunal has to apportion these costs and has to thereby apply legal rules. They can be contained in the applicable treaty, which should not be forgotten as some treaties have provisions on costs in the arbitration, and in addition in the procedural rules applicable in the arbitration. They may be UNCITRAL arbitration rules, ICC arbitration rules, or ICSID arbitration rules. They all have somehow different principles.