A Review of the FAI’s Year 2019
The year 2019 was full of action at the FAI. The FAI Arbitration Rules and Rules for Expedited Arbitration were revised, entering into force on 1 January 2020. Mr Santtu Turunen was appointed as new Secretary General to head the FAI Secretariat. New Finnish and international Board members began their terms. In May, the FAI hosted the 15th IFCAI Biennial Conference in Helsinki. The FAI launched a specialisation programme for arbitration lawyers.
The key statistics were positive: The new filings increased by 10 percent compared to the previous year, reaching 67 cases by the end of the year. The median duration of FAI arbitration remained at an excellent level of 8 months after transfer of the case file to the tribunal, and at 3 months in FAI expedited arbitrations.
Please find below some brief comments on selected highlights of the FAI statistics and a brief account of the highlights of FAI activities in 2019.
67 New Filings
In 2019, 67 new cases were filed with the FAI. This is approximately 10 percent more than in 2018 and slightly above the average of the past decade. In 2020, 34 new cases have been filed so far.
Picture 1: Number of new filings 2010 – 2019.
Short Median Duration of FAI arbitrations
In 2019, FAI arbitrations continued to be very fast. The median duration of arbitrations was 8 months (after transfer of the case file to the tribunal), and 3 months in expedited arbitrations.
The FAI Arbitration Rules and FAI Expedited Rules contain time limits for the rendering of the final award of 9 months and 3 months, respectively. Extensions have been requested and granted in some complex cases or pending settlement negotiations.
More Expedited Arbitrations than before
Among the new filed cases, the percentage of expedited arbitrations increased from 3 to 10 percent in 2019.
The short duration of FAI arbitrations may explain why FAI arbitration users have not seen a need to choose expedited arbitration more often. However, there seems to be a strive for even faster dispute resolution. For this reason, the revised FAI Rules offer more flexibility in the choice between standard and expedited arbitration proceedings. In accordance with the 2020 Rules and subject to the consent of the parties, a case under the FAI Arbitration Rules can be referred to be conducted under the FAI Expedited Arbitration Rules, and vice versa, prior to the confirmation of any arbitrator.
The Institute also offers a new model arbitration clause to supplement the existing model clauses. This so-called combined clause leaves the ultimate choice of the applicable Rules to the discretion of the Institute. According to the combined clause, the dispute shall be subject to the Rules for Expedited Arbitration unless the Institute, at the request of a party, decides that the FAI Arbitration Rules shall apply. When deciding on whether to apply the FAI Arbitration Rules, the Institute shall take into account the complexity and value of the dispute, as well as other relevant considerations. The model clause serves to mitigate the risks and lower the threshold for agreeing on expedited arbitration proceedings.
Pictures 2 and 3: Type of Cases in 2018 and 2019
Full statistics available at the FAI website
For the full statistics please visit our website at https://arbitration.fi/the-arbitration-institute/statistics/.
Revised 2020 Rules
The revised 2020 Arbitration Rules and Rules for Expedited Arbitration of the Finland Chamber of Commerce contain individual improvements to the well-functioning 2013 Rules, with the aim of speeding up and streamlining the arbitration process. Key changes include wider possibilities to deliver documents by electronic means and more flexibility in the choice between standard and expedited arbitration proceedings. In addition, in accordance with the 2020 Rules, the Institute shall fix an advance on costs in connection with all arbitrations, domestic and international alike. Under the 2013 Rules, an advance on costs was always fixed in international cases, whereas the Arbitration Institute could use its discretion to order one in domestic disputes.
New Secretary General Santtu Turunen
Santtu Turunen was appointed as new Secretary General of the FAI as of 1 June 2019. Santtu Turunen is responsible for developing and coordinating the FAI’s activities both in Finland and internationally. Santtu has experience in serving as an arbitrator in domestic and international cases. Further, he has published several arbitration related books and articles and taught conflict management and arbitration.
New International Board Members
The Board of the FAI was strengthened with seven experts as from the beginning of 2019. Daniel Hochstrasser (Partner, Bär & Karrer AG, Switzerland), Jennifer Kirby (Principal, Kirby, France), Stefan Kröll (Arbitrator, Honorary Professor, Director of the Center for International Dispute Resolution, Bucerius Law School, Germany) and Robin Oldenstam (Partner, Mannheimer Swartling Advokatbyrå AB, Sweden) joined the International Board. Tero Artimo (Attorney at law, Asianajotoimisto Artimo & Co, Finland), Antti Järvinen, Attorney at law, Partner, Frontia Attorneys at Law, Finland) and Tuuli Timonen (Senior Licensing Manager, Nokia Technologies Oy, Finland) were the new Finnish members of the Board.
The IFCAI Conference
On 23 May 2019, the Arbitration Institute of the Finland Chamber of Commerce (FAI) hosted the 15th IFCAI Biennial Conference in Helsinki. The International Federation of Commercial Arbitration Institutions (IFCAI) organises the IFCAI Biennial Conference every two years in cooperation with an IFCAI member arbitration institution. In 2019, it was hosted by the FAI in lieu of the traditional Helsinki International Arbitration Day (HIAD). A record number of more than 250 participants from 26 countries and 17 international arbitral institutions attended the event.
The topic of the day was strategic and effective conflict management from the point of view of different stakeholders. The first panel focused on conflict diagnosis, conflict resolution strategies, arbitration and ADR methods for strategic and effective conflict resolution. The second panel focused on effective conduction of arbitration in the face of current challenges in the arbitration scene. The third panel addressed how to enhance the interplay between state courts and arbitral tribunals. The final interview session offered a glimpse into the future of international arbitration and dispute resolution in an era of artificial intelligence.
See a video of the conference here https://www.youtube.com/watch?v=1jbYnM_MZjU&t=2s
The FAI Invests in the Next Generations – the FAI Specialisation Programme for Arbitration Lawyers and the FAI Trainee Program
The FAI invests in the next generations. Firstly, the FAI introduced a Specialisation Programme for Arbitration Lawyers, which is a two-year programme completed whilst working as a Case Manager at the Institute. In addition to case management work, the participant will have the opportunity to join FAI events and programmes, such as the Finnish Arbitration Academy, as well as be supported to create a network in the arbitration community and publish an article on arbitration law. Ms Tanja Volanen was appointed as the first participant in the program.
In addition, the FAI further developed its trainee program. The FAI aims to choose trainees for preferably 6-month period of part time work. Within this period of time, the trainees will have a chance to get an insight into FAI activities, learn the basics of the institutional role in arbitration and create some networks in the field. Solja Seppänen, a law student from the University of Turku, started in the trainee program in October 2019.
The FAI published the FAI Award Checklist and the FAI Tax Guidelines
The FAI Award Checklist aims to support the arbitral tribunal in the drafting of arbitral awards under the Arbitration Rules and the Rules for Expedited Arbitration of the Finland Chamber of Commerce. The checklist is not exhaustive nor binding on the arbitral tribunal but intended to give general recommendations for a high-quality and enforceable award.
The purpose of the FAI Tax Guidelines is to draw the arbitrators’ attention to tax issues related to the arbitrator’s fee and expenses. The guidelines, however, do not exempt the arbitrator from verifying the tax treatment of his/her fee and expenses.
The FAI Tax Guidelines in English https://arbitration.fi/wp-content/uploads/sites/22/2020/02/fai-tax-guidelines-15.3.2019.pdf
The FAI Tax Guidelines in Finnish https://arbitration.fi/wp-content/uploads/sites/22/2019/03/fai-valitystuomion-tarkistuslista-lopullinen-lisatty-sivuille-15.3.2019.pdf
The FAI Partnered with the IPR University Center for Two Panels on IP Arbitration at the Helsinki IP Summit on 23-24 October
The FAI coordinated two panels on IP Arbitration at the Helsinki IP Summit, one on ”Why and how to agree on arbitration in IPR Contracts/Disputes?” and the other on “Why Finland is a perfect seat for IPR arbitration and what could we do to be even more attractive?”.
Helsinki IP Summit is the biggest IP event in Scandinavia, connecting people from all the areas of intellectual property. The Summit is organised by the IPR University Center, a joint institute of six Finnish universities whose function is to coordinate and promote education and research connected to intellectual property rights. It is targeted to IP practitioners, business leaders, start-ups, law and business students and academics in the IP field.