Confidentiality is touted as one of the essential attributes of international commercial arbitration. In reality, however, there is no universally accepted understanding of the duty of confidentiality as it applies to the arbitration process. Its existence, contours and limits are determined in each case, by reference to the parties’ agreement, the applicable institutional rules and/or national laws.

By contrast, there is wide-spread consensus that one aspect of the arbitral process – the arbitral tribunal’s deliberations – is confidential. Indeed, deliberations confidentiality has been described as “a fundamental principle which constitutes one of the mainsprings of arbitration”. It encompasses the tribunal’s right to exclude from its deliberations all persons other than itself and those authorized by it, and the tribunal’s obligation to not disclose its discussions and opinions to any entity outside of itself. However, this “arbitral omertà” is not absolute. Its limits have been tested, including most recently in the Singapore International Commercial Court (the “SICC”), in CZT v CZU, [2023] SGHC (I) 11. This article therefore compares the legal basis, scope and exceptions to deliberation secrecy in international commercial arbitration, under Singapore and Swiss law.

 

1. Singapore law: The veil of secrecy may be lifted only in the “very rarest of cases”  

 

Singapore law governs the confidentiality of deliberations if Singapore is the seat of the arbitration and the parties to the dispute have not expressly agreed to a confidentiality regime, including by selecting institutional rules with confidentiality provisions. The International Arbitration Act (Cap 143a) does not expressly regulate deliberations confidentiality. Instead, it is based on common law.  
The SICC first ruled on the legal basis, scope and exceptions to deliberations confidentiality in CZT v. CZU (¶42). This case arose out of an ICC arbitration initiated by CZU against CZT. The Final Award issued by majority found against CZT. In a scathing dissent, the minority “accused the Majority of having ‘engaged in serious procedural misconduct’, ‘continued misstating of the record’, attempting ‘to conceal the true ratio decidendi from the Parties’, ‘distortion of the deliberation history’, lack of impartiality, and knowingly stating an incorrect reason for the Minority’s refusal to sign the Final Award” (¶19). Based on these allegations, CZT initiated annulment proceedings, in which it sought disclosure of the records of the tribunal’s deliberations. 

In considering the disclosure application, the SICC made the following observations: 

 

  •   First, it confirmed that the legal basis for the confidentiality of deliberations, like the confidentiality of arbitral proceedings, was “an implied obligation in law” (¶44) and that there were “very strong policy reasons for protecting [it]”, including enabling frank discussions within the tribunal and protecting the tribunal from outside scrutiny or influence (¶¶44, 53). 
  • Second, on the scope of protection, while affirming that confidentiality applies “generally to the deliberations stage of a […] proceeding” (¶¶72-73), the SICC distinguished between the process and substance of deliberations. It clarified that the “process” of deliberations does not fall within the ambit of deliberations confidentiality, because it “do[es] not involve an arbitrator’s thought process or reasons for his decision”. Thus, disclosure could be ordered if it concerned a process issue, such as a co-arbitrator’s exclusion from or non-participation in the deliberations (¶50).
  • Third, on the matter of exceptions, the SICC held that confidentiality over the substance of deliberations may be lifted only “in the very rarest of cases” and where the interests of justice in ordering disclosure demonstrably outweighed the reasons for maintaining confidentiality (¶¶45, 53). This threshold would be met if (i) there were “very serious” allegations in the annulment proceedings, such as corruption by an arbitrator, (ii) the “allegations ha[d] real prospects of succeeding”, and (iii) other objections to disclosure (i.e., lack of relevance, non-specificity, disproportionality, etc.) were inapplicable (¶53). 

 

Applying these principles, the SICC held that CZT had failed to demonstrate that its allegations in the annulment proceedings had real prospects of succeeding and thus, refused to order production of the deliberations records. 

This decision reaffirms Singapore’s reputation as a pro-arbitration jurisdiction. However, in the author’s view, its practical implications for future international arbitration cases are unpredictable. Going forward, in order to access deliberation records, a party will need to first demonstrate that it has real prospects of establishing its allegations in the annulment proceedings. But the likely reality is that the party is seeking disclosure precisely because it lacks the evidence to support its allegations. Given this catch-22, it seems unlikely that a request for disclosure will ever succeed if courts were to apply the SICC’s formula.    

 

2. The position under Swiss law  

 

The Swiss law position on the confidentiality of arbitrators’ deliberations is similar in various respects to the Singapore law position. Chapter 12 of the Swiss Private International Law Act does not contain express statutory provisions dealing with the confidentiality of deliberations or exceptions thereto. Instead, its existence has been recognized by Swiss commentators and in case law.      

As to the scope of deliberations secrecy, the Swiss Federal Tribunal (“SFT”) – the only court competent to hear challenges against international arbitration awards – has held that it “covers all opinions expressed in the course of the [tribunal’s] discussion, [and] thus ultimately the manner in which the majority was reached”, but not the “results of the deliberation”. Consequently, as under Singapore law, any information concerning the course of the deliberations and voting, such as communications between arbitrators, notes and memoranda, working papers, and draft awards, is confidential. By contrast, the communication of the results of the deliberations by an arbitrator to one or both of the parties prior to the notification of the award does not violate deliberations secrecy, because the content of the discussions and the votes are not revealed. 

There appears to be no decision of the SFT on the exceptions to deliberations secrecy in the context of an international arbitration proceeding. However, leading Swiss commentators have expressed the view that confidential aspects of the deliberations may be disclosed in exceptional circumstances, such as in cases of material misconduct or fraud committed by a co-arbitrator(s) or if there is an obligation to disclose under the law. Considering Switzerland’s pro-arbitration reputation, it seems likely that, if faced with a request for production of the deliberations records, the SFT will be slow to order disclosure and will, at the very least, require a demonstration of exceptional circumstances like the SICC.

 

3. Concluding observations: Is there a need for reconsideration?

 

Notwithstanding the preceding observations regarding the practical utility and persuasive value of the SICC’s decision, it would be premature to already advocate for its reconsideration. It is not possible to predict every factual pattern requiring an exception to be made to the confidentiality of deliberations. Given this and the countervailing policy reasons favoring the protection of deliberations confidentiality, any attempt at in-roads should not be guided by a straitjacket formula, but one that is flexible enough to account for the specific circumstances of each case. The formula developed by the SICC goes a long way in trying to achieve this objective. Therefore, in the authors’ view, it would be better to first observe how courts in Singapore and elsewhere handle the application of the ratio in CZT v. CZU and make any changes only if the formula proves unworkable.  

 

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Bibliography

(1) Books: A. Jolles, S. Stark-Traber, et al., “Chapter 7: Confidentiality”, in E. Geisinger and N. Voser (eds), INTERNATIONAL ARBITRATION IN SWITZERLAND: A HANDBOOK FOR PRACTITIONERS (2nd edn, Kluwer 2013); B. Berger and F. Kellerhals, INTERNATIONAL AND DOMESTIC ARBITRATION IN SWITZERLAND (4th edn, Hart Beck and Nomos 2021); G. Kaufmann-Kohler and A. Rigozzi, International Arbitration – Law and Practice in Switzerland (OUP 2015); N. Radjai, “Chapter 18, Part II: Confidentiality of Arbitration in Switzerland”, in M. Arroyo (ed), ARBITRATION IN SWITZERLAND: THE PRACTITIONER'S GUIDE (2nd edn, Kluwer 2018); G. Born, “Chapter 20” in INTERNATIONAL COMMERCIAL ARBITRATION (3rd edn, Kluwer 2021 (updated August 2022)); J. Choong, M. Mangan, et al., A GUIDE TO THE SIAC ARBITRATION RULES (2nd edn, OUP 2018).

(2) Periodicals: Hong-Lin Yu, “Duty of Confidentiality: Myth or Reality”, (2012) 31(1) C.J.Q. 68; C. Müller, “Confidentiality in international commercial arbitration: a sham?”, (2005) 23(2) ASA Bulletin 216; M. E. Schneider, “President’s Message: Arbitral Decision Making – A Look into the Black Box”, (2012) 30(3) ASA Bulletin 509; M. J. Goldstein, “Living (or not) with the partisan arbitrator: are there limits to deliberations secrecy?”, (2016) 32(4) Arb Int’l 589; International Law Association, International Commercial Arbitration Committee, “Report and Recommendations on ‘Confidentiality in International Commercial Arbitration’ 2010”, (2012) 28(3) Arb Int’l 355; M. J. Alarcon, et. al., “The English Approach to the Law Governing Confidentiality in International Arbitration”, Kluwer Arbitration Blog, 18 August 2022, available at <https://arbitrationblog.kluwerarbitration.com/2022/ 08/18/the-english-approach-to-the-law-governing-confidentiality-in-international-arbitration/> accessed on 5 August 2023.

(3) Jurisprudence: CZT v CZU, [2023] SGHC (I) 11; AAY v. AAZ, [2011] 1 SLR 1093, [54], [57]; International Coal Pte Ltd v Kristle Trading Ltd., [2009] 1 SLR 945 [82]-[84]; Myanma Yaung Chi Oo Co Ltd v Win Win Nu, [2003] 2 SLR 547; “B. Moser v. BMY, divisionde Harsco Corporation, 1ère Cour civile du Tribunal fédéral, Not Indicated, 12 November 1991”, (1992) 10(2) ASA Bulletin 264; “La République du Liban v. Y. et Z., Ière Cour civile, 4P.154/2005, 10 November 2005”, (2006) 24(1) ASA Bulletin 106; P v. Q and others, [2017] EWHC 148 (Comm); Fertilizantes Fosfatados Mexicanos, S.A. et al v. Chemical Carriers, Inc., 751 F.Supp. 467 (SDNY 1990).