Originally from Leading Arbitrators' Guide to International Arbitration - 2nd Edition

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Within the last decade confidentiality has become an important topic in arbitration. Many articles have been written and analyses undertaken. Common assumptions have been questioned and it is apparent the subject is more complex, obscure and less well settled than previously thought. Until the current flurry of activity, confidentiality was the subject of assumptions rather than established legal principles and rules. Moreover these assumptions were vague and general in nature and did not adequately address the different facets of confidentiality.

What has been the cause of the current flurry of activity on confidentiality? The answer is simple and is predicated on two factors. The first is the perceived existence and importance of confidentiality to arbitration, and in particular international arbitration. The second is a decision of the High Court of Australia in 1995 which disturbed the status quo.

As to the first factor, it is trite to note that confidentiality is often given as one of the reasons for choosing arbitration as a means of dispute resolution in contrast to litigation. This is well illustrated by the study of Dr. Christian Buhring-Uhle. Dr. Buhring-Uhle conducted an empirical study from November 1991 to June 1992. His survey sought to collect data from participants in international commercial arbitration as to the advantages and disadvantages of this method of dispute resolution. Dr. Buhring-Uhle collected his data by way of questionnaires and personal interviews. The respondents resided in the United States, Europe, the Middle East and Australia. Dr. Buhring-Uhle’s questionnaire listed 11 advantages of arbitration which comprised: neutral forum, international enforcement by treaty, confidential procedure, expertise of the tribunal, lack of appeal, limited discovery, speed, more amicable, greater degree of voluntary compliance, less costly procedure and more predictable results. His survey shows that the third most important reason for choosing arbitration is its confidential procedure. This rated very highly and was just below “neutrality of the forum” and “international enforcement by treaty.” Over 60% of the respondents considered confidentiality to be either “highly relevant” or “significant.” Likewise, Hans Bagner notes that a statistical survey of United States and European users of international commercial arbitration conducted in 1992 for the London Court of International Arbitration by the London Business School listed confidentiality as the most important perceived benefit.