Third-Party Funders of International Arbitration - Chapter 6 - Soft Law in International Arbitration - Second Edition

JEFFERY COMMISSION is a Director with responsibility for overseeing Burford’s underwriting and investment activity in investor-state and international commercial arbitration. Mr. Commission is an authority in the field of international arbitration, having been involved with several multi-billion-dollar investment arbitrations and international commercial arbitrations throughout his career. He is the author of numerous academic articles and two books on international investment law. He co-authored Procedural Issues in International Investment Arbitration, which was published in 2018 by Oxford University Press; his forthcoming book, Third Party Funding in International Arbitration: Law and Practice, will also be published by OUP. He is a frequent speaker on investment law issues at conferences around the globe. Prior to joining Burford, Mr. Commission practiced litigation and arbitration with Shearman & Sterling and Linklaters in New York, before becoming a Senior Associate in the International Arbitration Group at Freshfields. Subsequently he was Senior Counsel at Vannin Capital.

GIULIA PREVITI is a Senior Vice President with responsibility for assessing and underwriting legal risk in investment treaty and international commercial arbitration matters. She is the author of numerous articles on arbitration practice. Prior to joining Burford, Ms. Previti was a senior associate in the arbitration group at Freshfields, where she represented corporate and sovereign entities in commercial and investment treaty arbitrations. Ms. Previti earned her undergraduate degree from University College London, her master’s degree in comparative politics from the London School of Economics and Political Science and her law degree from New York University School of Law. She clerked for Senior District Judge Jack B. Weinstein in the Eastern District of New York.

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Originally from Soft Law in International Arbitration, Second Edition

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Introduction

At the time of the first edition, in 2014, there were not many, if any, hard law or soft law instruments to which one could refer on the use and practice of third-party funding in international arbitration. By 2020, six years later, the issue of third-party funding had been addressed by contracting states in treaty practice (CETA, EU-Vietnam FTA), national legislatures in laws and regulations (Hong Kong, Singapore), arbitral institutions in current or proposed rule revisions and/or policies (ICC, CAM-CCBC, CIETAC, SIAC, SCC, ICSID), and leading arbitral organizations in guidelines, reports or best practices (IBA, ICCA-QMUL, Club Español del Arbitraje). This is not surprising in light of the widespread acceptance and use of funding in international arbitration, with 208 funded arbitrations reported by firms in a recent Global Arbitration Review 100 survey (15th edition) released in March 2023, and increasing numbers reported by arbitral institutions. And tribunals, too, have acknowledged the important “access to justice” issues implicated by third-party funding, as well as the numerous reasons why a claimant may seek third-party funding, “including risk management and validation by a more objective third party of the merits of the claim.”

In the sections that follow, we survey the soft law instruments promulgated by leading arbitral institutions and organizations on the topic of third-party funding, highlighting guidelines and policies on key issues of disclosure, confidentiality and privilege, funder involvement, and costs.