DATE DOWNLOADED: Mon Mar 6 13:35:35 2023

SOURCE: Content Downloaded from HeinOnline

Citations:

Bluebook 21st ed.

Nathan D. O'Malley, The Procedural Rules Governing the Production of Documentary
Evidence in International Arbitration - As Applied in Practice, 8 LAW & PRAC. INT'l
Cts. & Tribunals 27 (2009).

ALWD 7th ed.

Nathan D. O'Malley, The Procedural Rules Governing the Production of Documentary
Evidence in International Arbitration - As Applied in Practice, 8 Law & Prac. Int'l
Cts. & Tribunals 27 (2009).

APA 7th ed.

O'Malley, N. D. (2009). The procedural rules governing the production of documentary
evidence in international arbitration as applied in practice. Law and Practice of
International Courts and Tribunals, 8(1), 27-90.

Chicago 17th ed.

Nathan D. O'Malley, "The Procedural Rules Governing the Production of Documentary
Evidence in International Arbitration - As Applied in Practice," Law and Practice of
International Courts and Tribunals 8, no. 1 (March 2009): 27-90

McGill Guide 9th ed.

Nathan D. O'Malley, "The Procedural Rules Governing the Production of Documentary
Evidence in International Arbitration - As Applied in Practice" (2009) 8:1 Law & Prac
Int'l Cts & Tribunals 27.

AGLC 4th ed.

Nathan D. O'Malley, 'The Procedural Rules Governing the Production of Documentary
Evidence in International Arbitration - As Applied in Practice' (2009) 8(1) Law and
Practice of International Courts and Tribunals 27

MLA 9th ed.

O'Malley, Nathan D. "The Procedural Rules Governing the Production of Documentary
Evidence in International Arbitration - As Applied in Practice." Law and Practice of
International Courts and Tribunals, vol. 8, no. 1, March 2009, pp. 27-90. HeinOnline.

OSCOLA 4th ed.

Nathan D. O'Malley, 'The Procedural Rules Governing the Production of Documentary
Evidence in International Arbitration - As Applied in Practice' (2009) 8 Law & Prac
Int'l Cts & Tribunals 27

-- Your use of this HeinOnline PDF indicates your acceptance of HeinOnline's Terms and
Conditions of the license agreement available at
https://heinonline.org/HOL/License
-- The search text of this PDF is generated from uncorrected OCR text.
-- To obtain permission to use this article beyond the scope of your license, please use:
Copyright Information
MARTINUS
N IJHOFF The Law and Practiceof
P U BL S H E R S InternationalCourtsand Tribunals 8 (2009) 27-90 brill.ni/lape

The Procedural Rules Governing the Production of

Documentary Evidence in International Arbitration -
As Applied in Practice

Nathan D. O'Malley'
Partner, international arbitration practice, Conway & Partners, Rotterdam,
The Netherlands

Abstract
This article considers the provisions of the IBA Rules on the Taking of Evidence in International
Commercial Arbitration pertaining to documentary evidence, Articles 2, 3, and 9. The IBA
Rules have emerged over time as a compromise set of standards appropriate for international
arbitration and are widely used by tribunals throughout the world. This piece provides examples
of arbitral case law in respect of the application of the Rules to issues concerning the taking and
admission of documentary evidence. Moreover, the article also addresses issues regarding the role
of the IBA Rules in the judicial review of arbitral awards, and their use in investor-state arbitra-
tion as opposed to international commercial arbitration. The goal of this article is to provide a
thorough, case based commentary on the common approach used by tribunals in this area of
procedure.

Keywords
IBA Rules of Evidence; document production; evidentiary procedure

Documentary evidence is often afforded the highest level of credibility within

international arbitration, thus how it is obtained and introduced into a pro-
cedure is of considerable importance.2 The process of "discovery", or the less
Anglo-American centric phrase, "document production", which is a term
generally understood to encompass the compulsory disclosure of evidence
by one party to another, in no small part figures into a discussion of this
issue. While the term "discovery" still remains anathema to arbitration,

1) LL.M. Esq.
2)Jean-Franqois Poudret & S~bastien Besson, Comparative Law of International Arbitration
§ 6.4.3.2 (2d ed. 2007). The authors refer to documentary evidence as evidence "par excellence"
when it comes to the perception of arbitrators.

© Koninklijke Brill NV Leiden, 2009 DOI:lO0.II 63/157180309X429678

28 O'Malley/ The Law and Practiceof InternationalCourts and Tribunals 8 (2009) 27-90

clearly the mood has changed regarding the production of documents in

general, and now it can be confidently said that document production, in
one form or another, is compatible with international arbitral procedure. 3
In order to facilitate document production in international arbitration,
counsel and tribunals alike often refer to the IBA Rules on the Taking of
Evidence in International Commercial Arbitration ("IBA Rules" or "the
Rules"), and in particular Articles 3 and 9.4 The Rules have achieved prom-
inence within international arbitration because they embody a delocalized
set of standards uniquely appropriate for arbitral practice. 5 By fulfilling this
role, the Rules represent a major step towards decoupling international
arbitration from the moorings of domestic rules or processes. 6 Thus it can
be said that the IBA Rules, and in particular Articles 3 and 9, reflect stan-
dard international arbitral procedure.7 Currently the IBA has commis-
sioned a subcommittee for the purpose of reviewing, and possibly revising,
the Rules in light of current developments within arbitration. Results from
the subcommittee's work are expected in the Fall of 2009.
While it is true that one of the underlying advantages of arbitration is
that it is largely free of the cumbersome rules of procedure found in local

1 Bernard Hanotiau, Document Production in International Arbitration: A Tentative Defini-

tion of 'Best Practices', In: Document Production in InternationalArbitration,ICC International
Court of Arbitration Bulletin 2006 Special Supplement 676 (ICC Service 2006) "Whatever dif-
ferences there may be between the various legal cultures, it is generally agreed that document
production has a place in international arbitration. The issue is therefore not whether there will
be document production but rather how much document production will be required."
') International Bar Association Council, IBA Rules on the Taking of Evidence in International
Commercial Arbitration (1999), availableat http://www.ibanet.org/images/downloads/pubs/IBA-
Rules-on-Taking-of-Evidence.pdf.
5) Julian D.M. Lew, Loukas A. Mistelis & Stefan M. Kr611, Comparative International
Com-
mercial Arbitration § 4.3 (2003) "Delocalisation can only function provided that quasi autono-
mous international procedural rules emerge." See also, IBA Working Party, Commentary on the
New IBA Rules of Evidence in International Commercial Arbitration, Business Law Interna-
tional, no. 2 (2000) at 16, available at http://www.ibanet.org /legalpractice/Arbitration.cfm.
"The new I BA Rules of Evidence reflect, in the view of the Working Party, a useful harmoniza-
tion of the procedures commonly used in international arbitration", at 1.
6) Julian D.M. Lew et al., supra note 5, § 4.5.0 at 16.
') Writing about the history of the Rules, Stephen R. Bond made the following point in a paper
published in 2005, "...thus it is submitted that the 1999 IBA Rules were not a great leap for-
ward, but rather a highly desirable, generally accurate codification of actual document produc-
tion practice as it had evolved in international arbitration." Stephen R. Bond, The 1999 IBA
Rules on Evidence in International Commercial Arbitration Regarding, in: ArbitralProcedureat
the Dawn of the New Millennium p. 103 (Bruyant, Brussels, 2005).
O'Maley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009) 27-90 29

courts, it is not heretical to arbitration doctrine for there to be some mea-

sure of standardized practice. 8 In the interest of developing some unifor-
mity within arbitration there appears to be an emerging consensus that
where gray areas of arbitration procedural law need to be filled, such as
those issues not directly dealt with by either the arbitration rules, or the
lex arbitri,it is highly advisable for tribunals to look to arbitral precedent
for appropriate rules. 9 In this respect, arbitral tribunals have for some time
considered that there are general rules of evidence and procedure which
apply to arbitration regardless of whether they are actually contained within
their mandate, to which reference to past examples of case law can help
identify such principles.' 0 For these reasons, Articles 3 and 9 and the inter-
pretation which tribunals have given to their provisions is central to the
development of a widely accepted evidentiary procedure for international
arbitration.
The intention behind writing this article is to contribute to the stan-
dardization of practice within international arbitration by providing exam-
ples and analysis of arbitral case law and opinion as it applies to the
interpretation of the IBA Rules of Evidence, specifically Articles 3 and 9.

1) UNCITRAL Notes on Organizing Arbitral Proceedings § 50, 1996. The use of supplemen-
tary rules or procedure regarding documentary evidence is recommended as in most cases insti-
tutional or ad hoc rules will not provide such guidance.
9)As one commentator has noted, "However, it is only recently that arbitrators have started to
fill gaps in arbitration rules by relying upon general rules of procedure adopted in the practice of
international tribunals or generally accepted in the laws of states. This is, doubtless, the right
approach - again, within the bounds of lex arbitri'. Georgios Petrochilos, Procedural Law in
International Arbitration, §5.22 (2004). One tribunal constituted under the ICSID and NAFTA
rules made the following observation regarding the Rules and precedent, "The IBA Rules are
used widely by international arbitral tribunals as a guide even when not binding upon them.
Precedents and informal documents, such as the IBA Rules, reflect the experience of recognized
professionals in the field and draw their strength from the intrinsic merit and persuasive value
rather than from their binding character". Railroad Development Corporation and Republic of
Guatemala, ICSID Case No. ARB/07/23, Decision on Provisional Measures.
,0)Chevrau Claims Arbitration, in: The PermanentCourtofArbitration:InternationalArbitration
and Dispute Resolution: Summaries of Awards, Settlement Agreements and Reports, p. 130
(P. Hamilton et al. eds., 1999). In this case the tribunal was required to render a decision on a
daim brought by France on behalf of one of its nationals against the United Kingdom. There had
been an initial question of who carried the burden of proof in the matter, with France arguing
that the submission agreement did not specify such a burden, thus there was no 'burden' of proof
in the case. The tribunal rejected such reasoning on the basis that there were basic rules of evi-
dence that applied irrespective of whether the submission agreement made reference to them,
"[The submission agreement was not] intended to exclude the application of the normal rules of
evidence". The arbitrator then went on to assign to France the burden of proof in the case.
30 OMalley / The Law andPractice ofInternationalCourts and Tribunals 8 (2009)27-90

In particular, the first part of this article will examine the general manner
in which the IBA Rules are being adopted into arbitral procedure. The core
of this article will deal with the issue of how Articles 3 and 9 are interpreted
in arbitral case law, with a focus on the objections which may be raised
by parties resisting document production or the admissibility of evidence.
Finally, a discussion of issues related to document production in arbitra-
tion, specifically the right of tribunals to take an adverse inference from
a refusal by a party to comply with document production orders as well
as the interplay between tribunals and domestic courts when it comes to
document production under the Rules, is included in the third portion of
this article.

I. The Adoption of the IBA Rules of Evidence into a Procedure, its

Effect upon the Enforceability of Final Awards and the Difference
Between Using the Rules in Investor-State ArbitrationVersus Commercial
Arbitration
Article 2 of the IBA Rules states that they may be adopted into an arbitra-
tion as a supplement to the arbitral rules governing the overall procedure."
The text of Article 2(1) reads as follows:

Whenever the Parties have agreed or the Arbitral Tribunal has deter-
mined to apply the IBA Rules of Evidence, the Rules shall govern the
taking of evidence, except to the extent that any specific provision of
them may be found to be in conflict with any mandatory provision of
law determined to be applicable to the case by the Parties or by the
2
Arbitral Tribunal.'

It is the choice of the parties or the tribunal as to how and in what form
the Rules may be adopted. They have at their core a certain amount of
flexibility, however, it should be pointed out that they are designed to be
adopted as a complete set of binding rules.' 3 The intention notwithstand-

' IBA Rules, supra note 4, at Art. 2(1).

12 Id.
3') The rules state that when adopted into a procedure, "the Rules shall govern the taking of
evidence". Therefore it is clear that as they were written, it was the intention that they would be
used as a binding set of procedural rules. IBA Rules, supra note 4 Art. 2(1).
OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90 31

ing, it seems in many cases tribunals still balk at such a notion. This reac-
tion may come about for several reasons, some of which will be addressed
below. The remainder of this section will discuss the practice of tribunals
in regard to adopting the IBA Rules and also the effect which incorporat-
ing them formally into a procedure will have on a potential challenge to
a final award. Finally, the question of whether the rules are, or should
be applied differently when used in an investor-state arbitration versus
a strictly commercial arbitral setting, is addressed in the final portion of
this section.

A. The Trend Towards Adopting the IBA Rules h la Carte

The available arbitral precedent seems to indicate a consistent trend in favor
of adopting the IBA Rules in a manner that may be described as h /acarte.
By this it is meant that tribunals prefer to pick and choose which articles
of the IBA Rules they wish to apply, or refer to them as loose guidelines
rather than adopting them formally into the procedural rules of the arbi-
tration as a "fixed menu". A typical procedural formula used by tribunals
applying the l/a carte approach will usually resemble something similar to
the following statement taken from an order by a tribunal constituted under
the International Chamber of Commerce ("ICC") rules of arbitration:

In administering the evidence, the Arbitral Tribunal will generally take

inspiration from the IBA Rules on the Taking of Evidence in Interna-
tional Commercial Arbitration of 1 June 1999."4

Another formulation often used by tribunals includes referring to the Rules

as "guidelines", as the following example taken from a tribunal constituted
under the London Court of International Arbitration ("LCIA") Rules
demonstrates:

The IBA Rules on the Taking of Evidence in International Commer-

cial Arbitration, as adopted by the IBA Council on June 1, 1999, may

'4) Unpublished, ICC No. 14082, Procedural Order No. I See also the formulation in
RosInvestCo v. Russia whereby the tribunal adopted the IBA Rules by stating "The Parties and the
Tribunal may use, as a guideline, the IBA Rules on the Taking of Evidence in International Com-
mercial Arbitration, always subject to changes considered appropriate in this case". RoslnvestCo
v. Russia, Arb. Inst. Stockholm Chamber of Commerce ("SCC"), No. V079/2005 (2007).
32 OMalley / 7he Law andPracticeofInternationalCourts and Tribunals 8 (2009) 27-90

be taken into account by the Arbitral Tribunal, should it consider

them appropriate as mere guidelines for establishing the rules of the
arbitral proceedings."

The burden, or complications raised by too many rules may be a motiva-

tion for a tribunal to refer to the IBA Rules only as guidelines. However,
one well known arbitrator has advocated an /la carte approach for the
reason that the IBA Rules have not yet "stood the test of time" and thus
their shortcomings have not been properly assessed.1 6 This comment, hav-
ing been made shortly after the debut of the Rules, may no longer be as
strongly held over nine years later. It seems to be clear that with time, con-
fidence in the IBA Rules is growing, as evidenced by their utilization in
fields that stretch beyond their originally intended use in commercial arbi-
tration, namely international investor-state arbitration. This development
was pointed out in an award rendered in 2005 wherein a tribunal consti-
tuted under the International Center for the Settlement of Investment
Disputes (ICSID) Rules wrote:

The IBA Rules on the Taking of Evidence in International Commer-

cial Arbitration, though not directly applicable in this case and pri-
marily provided for use in the field of commercial arbitrations, can be
considered (particularly Articles 3 and 9) as giving indications of what
may be relevant criteria for what documents may be requested and
ordered to be produced in ICSID procedures between investors and
7
host states.'

There are certainly other reported and non-reported instances of tribunals

involved in investor-state arbitration applying the IBA Rules, in particular
Article 3 with regard to the issue of document production.18

J Unpublished, LCIA No. UN 5699, Procedural Order No. 1.

*' Marc Blessing, Introduction to Arbitration - Swiss andInternationalPerspectives, in Interna-
tional Arbitration in Switzerland 288 (Steven V. Berti et a[., eds. 2000).
M' Noble Ventures Inc. (U.S.) v. Romania, ICSID, No. ARB/01/11 (2005), availableat http:I/ita.

law.uvic.ca/documents/Noble.pdf. It should be explained that Article 9 by virtue of Article 3(3)

of the IBA Rules lists defenses for parties wishing to avoid turning over document requests in addi-
tion to providing objectives to the admissibility of documentary evidence into the procedure.
'" A number of investment arbitrations wherein the IBA rules were applied are cited in this
article.
O'Maley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90 33

It would seem that the trend towards using the IBA Rules in an h/a carte
fashion would thus have less to do with any perceived shortcomings as
opposed to other factors. One possible factor influencing this trend is that
arbitrators often wish to remain free to craft an arbitral procedure as they
see fit, and the Rules may appear to restrain this freedom. However, the
Rules themselves contemplate the fact that tribunals will want to diverge
from them, therefore their formal adoption into an arbitration does not
limit a tribunal's right to change the procedure as they think is appropri-
ate.19 A more pressing issue for tribunals which lends credence to the h Ia
carte approach may be the perceived effect which formally adopting the
IBA Rules into a procedure could have on whether a final award is subject
to challenge.

B. Does the Formal Adoption of the IBA Rules into an Arbitral Procedure
Increasethe Likelihood of a FinalAward Being Challenged?
Some commentators have suggested that if the IBA Rules are included in
an arbitration procedure formally, for instance as part of the terms of refer-
ence, that their possible misapplication by a tribunal may be used later by
a party as a basis for attacking an award. 0 For example, it could be argued
by disappointed litigants that an unfair administration of the Rules vio-
lates the standards of the lex arbitri under which the procedure was con-
ducted, such as the de minimis rule that the parties to an arbitration "shall
be treated with equality".2 Indeed, perceived failures by tribunals to evenly
apply the IBA Rules have been used by parties as an argument in favor of
setting aside awards in the past.22
In a reported case before the Swiss Federal Tribunal, a German company
sought to set aside an award based upon an alleged breach of the IBA Rules

)Tribunals can adapt the rules in ways which are appropriate for the arbitration as is pointed
out in the preamble. IBA Rules, supra note 4, at Preamble para. 2. The Rules also contemplate
that they may be referred to as guidelines. As an example of the way in which other procedures
can be used alongside the IBA Rules, some tribunals have used interrogatories in addition to and
alongside the evidence taking procedures found within the Rules.
20) Poudret & Besson, supra note 2 at 553 '[The IBA Rules] will not only have a bearing in the
arbitral proceedings but also at a later stage when the award is subject to judicial review."
21) UNCITRAL Model Law on International Commercial Arbitration (1985, with Amend-
ments as adopted in 2006), art. 18 at p. 14.
22) ABB AG v. HochtiefAirport GmbH, EWHC 388 (Comm). See also X v.A., Decision of
28 March 2007, 25 ASA Bulletin 3, 610, 610-617 (2007).
34 OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009) 27-90

and the Swiss lex arbitri,which requires that the principle of fairness and
equal treatment of the parties be observed in the conduct of the arbitra-
tion.23 In its decision on the challenge, the Swiss Federal Tribunal stated
that an alleged violation of the IBA Rules was not an admissible grounds
for challenging an award, and thus not a basis for claiming that the equal-
ity standard has been breached. This does not mean that if a tribunal does
commit an act of procedural unfairness while applying the IBA Rules it
will not justify challenging an award, rather the point is that the mere mis-
application of the Rules does not violate the equality standard per se. There-
fore in Switzerland, strictly speaking, a complaint of misapplication of the
Rules does not of its own accord appear to justify the setting aside of an
award.
As an example of a somewhat different analysis, a setting aside case enti-
tled ABB AG. v. HocbtiefAirport GmbH & Athens InternationalAirport
S.A., was brought before the Commercial Court, Queen's Bench Division
in England by a party to an LCIA arbitration wherein the IBA Rules of
Evidence were applied. The challenging party sought to set aside an award
based on three grounds, one of which was that the denial by the tribunal
of its requests under the IBA Rules for the production of documents was a
violation of the tribunal's duty to act "fairly and impartially as between the
parties".24 The court in this instance looked to the standards found within
the IBA Rules as part of its analysis. While in the end the challenge failed,
it is worth noting that the court's initial response after reading the case file,
including the procedural orders made by the tribunal, was as follows: "it
may be instructive to know that at the end of my pre-reading in this case
I was fairly certain that I would have no alternative but to remit or to set
aside the award, notwithstanding the court's general approach to strive to

23) Ibid., at 416. This case is discussed in greater detail in section Ill. 1 of this article. See also,
Blessing, supra note 16, at 253 citing Art. 190 of the PILA. This section of the PILA allows a
party to challenge an award if a tribunal has "... violated the principle of equal treatment of the
parties or their right to be heard".
24) The Hochtiefaward is discussed in further detail below inrelation to the issue of materiality

and relevance in section 11.2.b. Article 68 of the English Arbitration Act of 1996 allows a court
to set aside an award if it finds the award or the proceedings to have been adversely affected by a
.serious irregularity". A serious irregularity is defined, inter alia, as a failure by a tribunal
to act
"fairly and impartially" as between the parties (section 33a). Bruce Harris, Rowan Planterose &
Jonathan Tecks, The Arbitration Act 1996, a Commentary, at 166-167 (4th Ed. 2007),ABBAG
v. Hochtiefsupra note 22 at 388, 390.
O'Malley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009) 27-90 35

uphold arbitration awards".25 The English court's observation in Hochtief

is important as it leaves open the possibility that indeed, if a tribunal does
improperly apply the IBA Rules of evidence, a successful challenge could
conceivably be made on the basis of a breach of the Rules.
The question of whether a misapplication of the IBA Rules by a tribunal
could open the way to challenge an award appears to vary by jurisdiction.
In Switzerland, it is clear that a mere misapplication of the Rules does not
constitute admissible grounds for claiming that the fairness standard found
in the Private International Law Act has been breached. However, in Eng-
land, the court did seem willing to look at the IBA Rules as part of its
analysis of whether the tribunal had acted fairly in its procedural conduct
of the arbitration. Therefore, to some extent there does appear to be a basis
for suggesting that in some jurisdictions, a court may view a breach of the
Rules as justification for setting aside an award.
In contrast to the notion that the formal inclusion of the IBA Rules
would increase the chances of a final award being challenged, there is an
argument to be made that the adoption of the IBA Rules can have the
opposite effect, and protect an award from being set aside. In the Hochtief
case, the court noted the fact that the tribunal had not provided much
explanation for its procedural decisions, which invariably worked in favor
of the party challenging the tribunal's procedural decisions as unfair. Thus,
in the absence of any contemporaneous evidence as to the tribunal's rea-
sons for their procedural decisions, in particular the decision not to grant
document production to one party when they had granted it to the other,
the court had to look at the procedural record, and take into consideration
the standards found in the IBA Rules, specifically Article 3(6) and Article
9(2)(a).26 In so doing, the court was able to root its eventual decision not
to set aside the award in those standards found within the Rules and essen-
tially refer to them when explaining why the tribunal had not acted in
violation of the lex arbitri'srequirement that it proceed in a fair and impar-
tial manner.
The principle described above applies equally for challenges brought in
those jurisdictions where the courts interpret the New York Convention as
allowing for the refusal of recognition and enforcement of an award on

25) Id. The Court's analysis turned on the standard found in the English Arbitration Act,
section 33(a).
26) See Section II, B, 1-2 below.
36 OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90

grounds that the procedure did not comport to minimum standards of

due process.27 In one particular case, an Indonesian respondent party chal-
lenged the enforcement of an award rendered by a tribunal constituted
under the UNCITRAL Rules of Arbitration, with its seat in Geneva, on
the grounds that it had not been afforded the opportunity to present its
case. One of the arguments lodged in favor of the challenge was that
the respondent parry was denied, prior to a witness hearing, several broad
requests for document production. While the court rejected the challenge,
it did so on the basis that the requested document production did not have
a large enough impact on the final award so that it could be said that the
respondent party was deprived of a fair opportunity to present its case.28
Arguably, however, had the tribunal adopted the Rules, and denied the broad
requests for documents on the basis of the standards found in Article 3, the
reviewing court would have been given an easier, and identifiable standard
against which it could have effortlessly verified that due process had indeed
been observed.
Finally, a word should be given to the issue of the general acceptance of
the Rules within arbitration and the impact this may have on a court's
decision to enforce or set aside an award. Whether a court is willing to view
the misapplication of the IBA Rules as a formal breach of the lex arbitrior
not, it would seem that the continued use of the IBA Rules in arbitration
will lend credence to their status as a codification of proper arbitral prac-
tice in regard to the taking of evidence. Assuming this holds true, it is likely
that courts will take the Rules increasingly into account when reviewing
awards as a source of persuasive authority for what is considered fair and
equal treatment within an arbitration. This would be the case regardless of
whether the Rules are formally adopted into a procedure or not. Thus, if a
tribunal does decide to adopt the IBA Rules as guidelines or in an d la carte
fashion because it does not wish its decisions to be restricted by the Rules,
it may in the end still not prevent a court from looking to the Rules when
reviewing a tribunal's procedural conduct.

27)In the Matter of an Arbitration Between Karaha Bodas Co. L.L.C., Petitioner v. Perusahaan
PertambanganMinyak Dan Gas Bumi Negara, Respondent, 190 F.Supp. 2d (2001) 936, 947.
) Id at 304.
OMaley The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90 37

C. The IBA Rules in an Investor-State Arbitration Versus Commercial

Arbitration
As mentioned above, investor-state tribunals frequently use the IBA Rules
as a guide for their procedures. Clearly, this use of the Rules exceeds their
originally intended application to commercial disputes as is indicated by
their formal name. This development raises the question, however, of
whether there are differences between the way the Rules are applied in an
investment arbitration as opposed to a commercial dispute.
If precedent is any indicator, it would seem that indeed the IBA Rules
are up to the task of investor-state arbitration as evidenced by their use
by tribunals. 29 This being said, however, some tribunals have recognized
that investor-state arbitration does presuppose a different approach to evi-
dentiary procedure than what one might expect in a standard commercial
dispute:

With respect to the differences between domestic litigation and inter-

national arbitration, the Tribunal recognizes that it is generally under-
stood that one reason parties choose arbitration is to avoid the relatively
extensive document production practices of courts generally and United
States courts in particular. It feels that this expectation is not generally
different in the context of NAFTA Chapter 11 arbitration, although
the Tribunal notes that the investment arbitration context in which
there may not be a contractual relationship between the parties does
distinguish such proceedings from international commercial arbitra-
tion, and thus militates in favor of some greater receptiveness on the
part of the Tribunal for document production requests.30

The more liberal approach to document production, which tribunals in an

investor-state arbitration may be inclined to take, can be based, as stated in
the quote above, on the fact that the parties to the dispute have not agreed
as a matter of contract to engage in arbitration. The lack of a contractual
relationship undermines the consent by the parties to typical arbitral pro-
cedure because the forum for the dispute was not the result of a negotiated
29) See, for instance, the Noble Ventures Inc. (U.S.) v. Romania arbitrationsupra no. 17.
0o)Glamis Gold Ltd v. United States ofAmerica, NAFTA/UNCITRAL, unnumbered (November 17,
2005: Decision on Objections to Document Production), footnote 1, availableat http://ita.law.
uvic.caldocuments/14 Decision.pdf.
38 OMalley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

agreement. Thus the prohibition on wider ranging document production,

which is commonly understood to be a result of choosing commercial arbi-
tration, is not necessarily as straightforward in an investor-state arbitral
forum where a party has not bargained for it, but rather has begun arbitral
proceedings based on a statutory or treaty based right to seek redress.
The different nature of the investor-state arbitration beast, in contrast to
its commercial arbitration sibling, is also rooted in the public interest com-
ponent which is increasingly identified with it. There is a case to be made
that investor-state arbitral tribunals perform a regulatory role which is dis-
tinct from commercial arbitration due to the power over public funds
which they exercise, similar to that of an administrative institution. 3' The
impact of decisions by investor-state tribunals upon the functioning of
government, and ultimately the use of public assets, has led to greater
demands for transparency in investor arbitration for this reason. 32 How the
"regulatory" aspect of investor-state arbitration affects evidentiary proce-
dure has not been explored in full, to this author's knowledge, however,
one can surmise at least two areas of the Rules where this distinction can
make a difference.
First, the presumption in Article 3 that evidence produced pursuant to
a tribunal's order will be kept confidential, as set forth in Article 3(12),
may not extend to investor-state arbitrations where the final awards (and
to some extent partial awards and procedural orders) are made public as a
matter of policy. In this regard, tribunals may not feel comfortable adher-
ing to a such a strict confidentiality rule, and could feel that this Article
conflicts with the performance of their duties. Final awards may, as a mat-
ter of necessity, have to refer extensively to the contents of documents
produced in accordance with procedural orders, and thus the confidential-
ity of such documents would be breached.
Second, investor-state tribunals who subscribe to the belief that their
role contains a public interest function, may well embrace the notion that
there lies a higher onus on them to seek the truth, as opposed to simply

30 This point was raised by Professor Benedict Kingsbury during his presentation entitled
"Investor-State Arbitration, Fair and Equitable Treatment, Proportionality, and the Emerging
Administrative Law of Global Governance" at the June 09, 2008 ICCA Congress.
M2For a discussion of the issues surrounding the transparency debate in investor-state arbitra-
tion, see Procedural Order Number 3 in the Biwater Gauff v. Tanzania case. Biwater Gauff
(Tanzania) Ltd. v. UnitedRepublic of Tanzania, ICSID Case No. ARB/05/22, Procedural Order
No. 3 (29 September 2006), available at www.worldbank.org/icsid.
OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009) 27-90 39

arbitrate a solution to a commercial dispute. Thus, to the extent it is cor-

rect to view investment tribunals as fitting within a regulatory framework,
their responsibility to ensure that the relevant evidence is brought out into
the open is arguably greater when compared to the duty incumbent upon
a commercial tribunal. The direct impact of such a philosophical difference
between the two types of arbitration would be that investor-state tribunals
may be inclined to order larger amounts of document production than
what would normally be allowed under the Rules in a purely commercial
arbitration.
In sum, therefore, as the transparency demands of investor-state arbitra-
tion could conflict with the confidentiality provisions of the Rules, in par-
ticular Article 3(12), it may be that tribunals might be inclined to opt out
of those provisions when adopting the Rules into a procedure. As for the
greater breadth of document production which may be entertained by
investment tribunals, based on either their interpretation of the expecta-
tions of the parties (as referred to in the quote above) or because of a view
stemming from the perceived regulatory role of investor-state arbitration,
no actual change needs to be made to the Rules themselves. This difference
can be compensated for in the interpretation given to the IBA Rules, in
as much as a tribunal may regard, for instance, the "narrow and specific"
requirements of the Rules (see section II(A) below) in an investment con-
text to be reasonably wider and more encompassing in scope than in a
commercial dispute.
The above being said, it must be pointed out that as investor-state arbi-
tration does resemble to a large degree the procedures found in commercial
arbitration, the Rules would seem to fit the investment context well. Whether
the evolution of the two types of arbitration will lead to greater divergence
in practice or not is difficult to tell. Until such time, however, the IBA
Rules appear to be well suited in most respects to govern the evidentiary
practices found within international investor-state arbitration.

II. Article 3 Requests to Produce

An important starting point in an analysis of this subject is establishing
what Article 3 does not do. In direct reference to the issue of documentary
evidence, the drafters of the Rules (the "Working Party") stated that their
intention was not to create an Anglo-American style system of document
40 O'Malley / The Law andPracticeofInternationalCourts and Tribunals 8 (2009)27-90

production for international arbitration.3" Thus, Article 3 should in most

instances not be interpreted as allowing for wide ranging "discovery". Dis-
covery in the Anglo-American sense can be both thorough and time-
consuming, and has at its core the intention of allowing a party to establish
its case. Such a procedure is not advisable for arbitration for a number of
reasons.
The above point being true, it should be considered in light of the fact
that the system found in Article 3 also allows for times when it is appropri-
ate for tribunals to order a party to produce documents, sometimes in large
quantity. Consider the following quote from a civil law jurist describing
how narrowly document production was to be conducted in international
arbitration in 1991:

The request for production of documents must be specific. It should

be directed at the production of an individual contract, of a particular
letter, such as a letter mentioned in another letter already produced to
the Court, or the like. 4

This approach is now no longer prevalent within international arbitration,

and can be contrasted with the fact that the IBA Rules contemplate the
production of a category of documents to a party when such a category is
reasonably narrow and well defined. Clearly, under the aforementioned
rationale, production by a party of a box worth of documents was unthink-
able, but such a situation is now quite possible with the modern practice of
document production as set forth in the Rules.
It is important when looking at the procedure in Article 3 to start with
the rule laid out in the beginning of the section, which is Article 3(1) of the
Rules. It should be noted that this Article sets forth a basic principle with
regard to the conduct of an arbitration by stating:

Within the time ordered by the Arbitral Tribunal each Party shall sub-
mit to the Arbitral Tribunal and to the other Parties all documents
available to it on which it relies, including public documents and those

IBA Working Party, supra note 5, at 20.

As quoted by Stephen Bond in his article on the 1999 Rules. Bond, supra note 7 at 101.
34)

Emphasis added.
O'Malley / the Law andPractice ofInternationalCourts and Tribunals 8 (2009) 27-90 41

in the public domain, except for any documents that have already
been submitted by another party."

The essence of this rule can be found either expressly or implicitly within
the rules of the major arbitral institutions and it can have a practical effect
on the procedural timing of the document production phase of an arbitra-
tion.36 The presumption that parties will produce all documents that they
intend to rely on means that tribunals often do not wish to entertain requests
for the production of documents prior to the submission of the primary
substantive pleadings (e.g. statement of claim or defense). The reason for this
is simply that asking parties to produce documents that they would likely
include with their main submissions anyway compromises the efficiency
and speed of an arbitral procedure. Thus it is common practice for tribu-
nals to schedule the document production portion of the arbitration to
37
follow the filing of the substantive statements of the case by the parties.
The direct effect of this practice, however, is that parties usually do not
have the benefit of obtaining documents through adverse production for
use in their main submissions. This is entirely consistent though with the
fact that document production in arbitration generally is not a means by
which a party should seek to establish the main thrusts of its case.
Article 3(2) is the main article setting forth document production pro-
cedure and allows a party to submit to a tribunal a request for the opposing
party to produce documents.3" The Article expressly names this petition or
application a, "Request to Produce" (or "Request"). A Request under the
Rules is required to follow a specific formal criteria, which is described
within Article 3(3), the text of which states the following:

35) IBA Rules, supra note 4, Art. 3(1).

" ICC Rules of Arbitration (1998) Art. 20(2), LCIA Rules of Arbitration (1998) Art. 15(6),
4
and WIPO Arbitration Rules (2002) Art. 1(c).
37) In one UNCITRAL investor-state arbitration award the procedural summation recorded the
following order: "the Arbitral Tribunal issued procedural order no. 4 rejecting the Claimant's
request for production of further documents on the ground that it first needed to receive Claim-
ant's Memorial and Respondent's Response." CME Czech Republic B. V v. The Czech Republic,
UNCITRAL, WL 24070172 (AppAWD) (2001) § 19.
- IBA Rules, supra note 4, Art. 3(3). Some tribunals have introduced an intermediate step by
asking the parties to first submit requests to each other before they are submitted to the tribunal.
This step is seemingly intended to encourage parties to first reach an accommodation on discov-
ery before involving the tribunal. See GAMI Investments v. Government of the United Mexican
States, NAFTA/LINCITRAL, unnumbered (2003), Procedural Order No. 1 § 7.7.
42 OMalley / 7he Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

A Request to Produce shall contain:

(a) (i) a description of a requested document sufficient to identify it,

or (ii) a description in sufficient detail (including subject matter)
of a narrow and specific requested category of documents that are
reasonably believed to exist;
(b) A description of how the documents requested are relevant and
material to the outcome of the case; and
(c) A statement that the documents requested are not in the posses-
sion, custody or control of the requesting Party, and of the reason
why that Party assumes the documents requested to be in the pos-
session, custody or control of the other Party.

The Working Party explained the intent behind Article 3(3) in its com-
mentary by stating that it, "is designed to prevent a broad fishing expedi-
tion while permitting parties to request documents that can be reasonably
identified and which can be shown to be relevant and material to the out-
come of the case."39 Where a party does not object to the requested pro-
duction, it is required under Article 3(4) to turn over the documents within
the time-frame ordered by the tribunal. Experience indicates, however,
that the party who does not wish to turn over documents described in a
Request will likely refer to anything it deems objectionable as a "fishing
expedition" whereas its opponent will deny that this is the case. To resolve
such questions, the rule given to a tribunal is set forth in Article 3(6):

The Arbitral Tribunal shall, in consultation with the Parties and in a

timely fashion, consider the Request to Produce and the objections.
The Arbitral Tribunal may order the Party to whom such Request is
addressed, to produce to the Arbitral Tribunal and to the other Parties
those requested documents in its possession, custody or control as to
which the Arbitral determines that (i) the issues that the requesting
party wishes to prove relevant and material to the outcome of the case
and (ii) none of the reasons for objections set forth in Article 9.2 apply.

While the rule in Article 3(6) is clearly formulated, it still leaves much for
the arbitral tribunal to determine of its own initiative. What type of analy-

") IBA Working Party, supra note 5 at 22.

OMa~lty / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90 43

sis should be used to determine whether the requested documents are suf-
ficiently relevant or material to the case, how broad can a request be before
it goes too far, and other questions may arise when a tribunal considers
objections raised by a resisting party.
The remainder of this section will be dedicated to reviewing the stan-
dards applied by tribunals in assessing Requests to Produce. In particular,
the following issues will be addressed:

1. applying the "narrow and specific" rule when evaluating document

production requests;
2. the materiality and relevance objections;
3. issues of privilege and legal impediment in regard to document pro-
duction;
4. how to analyze objections based on the grounds of unreasonablebur-
den;
5. what grounds of commercial or technical confidentiality should be
considered by tribunals;
6. how should objections based on political or institutional sensitivities
be considered when ordering document production; and
7. objections to document production based on fairness and equality.

A. Applying the "Narrowand Specific" Standardto Requests to Produce

The phrase "narrow and specific" is a standard which is at the heart of docu-
ment production or disclosure in international arbitration, and is included
as part of the criteria applicable to Requests to Produce in Article 3(3) of
the Rules. Compared to the formulation found within the American Fed-
eral Rules of Civil Procedure, which arguably provides the widest of stan-
dards for obtaining document production by allowing a party to receive
any document "reasonably calculated to lead to the document production
of admissible evidence", the "narrow and specific" rule truly sets interna-
tional arbitration document production apart from discovery style docu-
ment production. 40 One English Court, which was reviewing the procedural
conduct of a tribunal empanelled under the LCIA Rules, noted that disclo-
sure in the English civil rules of procedure sense could be described as
follows, "An order for disclosure normally directs the person to whom it is

40) Federal Rules of Civil Procedure, Rule 26(b) ER.C.P. (2004).

44 O'Malley/ The Law and PracticeofInternationalCourts and Tribunals 8 (2009) 27-90

addressed to carry out a reasonable search for documents in his possession

falling within classes which are often broadly described and to list them for
the information of the parties to the proceedings".4 In contrast to this
description, it is instructive to review the order of the tribunal in the Thun-
derbirdv. The UnitedStates ofMexico arbitration, whereby the "narrow and
specific" criteria was described in the following manner:

In accordance with Article 3(3)(a) of the IBA Rules, the categories of

documents to be produced shall be "narrow and specific", which the
Tribunal interprets to mean narrowly tailored, i.e., reasonably limited
in time and subject-matter in view of the nature of the claims and
42
defenses advanced in the case.

Thus under the Rules, failure by counsel to identify sufficiently the docu-
ments or a narrow category of documents should lead a tribunal to refuse
to grant Requests to Produce. This was what happened in another UNCIT-
RAL rules arbitration wherein the tribunal rejected all requests for the pro-
duction of documentary evidence because the requesting party had simply
listed various issues and stated that it was seeking "all documents concern-
ing [the matter]". The tribunal wasted little effort in simply turning down
the requesting party by stating, "the tribunal rules that the Request to Pro-
duce as formulated in each such item... is not in conformity with Article
4
3 of the IBA Rules, and the Request to Produce is declined.
An example of a Request to Produce which did meet the "narrow and
specific" standard of Article 3(3) is found in the CME Czech Republic B. V
v. The Czech Republic partial award. 44 In this instance, the investor party
originally submitted a Request to Produce which described only general
categories of documents. This original Request was subsequently denied by

41) [2005] EWCA Civ 1218.

42) International Thunderbird Gaming Corporation v. United Mexican States, NAFTA/UNCI-
TRAL, unnumbered (2003), Procedural Order No. 2 § 2(ii).
41) Grand River Enterpriseset al. v. United States ofAmerica, NAFTA/UNCITRAL, unnumbered
(2007), Procedural Order % 3 and 5, available at http://www.state.gov/documents/organiza-
tion/85416.pdf. See also Ronald S. Lauder v. The Czech Republic, UNCITRAL, WL 3418600
(AppAWD) (2001) § 24 wherein the tribunal ruled that "requests for productions of general
categories of documents were inappropriate" under the IBA Rules.
44) CME Czech Republic B. V v. The Czech Republic, UNCITRAL, unnumbered (2001), Final
Award, availableat http://ita.law.uvic.ca/documents/CME-2003-Final-00 I.pdf.
O'Malley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009) 27-90 45

the tribunal as not in conformity with Article 3 of the Rules.45 Later, the
investor party submitted a second Request for which the tribunal granted
the production of a vast majority of the documents. The tribunal's descrip-
tion of the investor party's Request is instructive:

The Claimant requested the production of documents related to spe-

cific [name of third party] files related to the License, comprising 18
specifically described documents. The Claimant further requested the
production of six further categories of documents related inter alia to
[name of third party]. These categories of documents were all defined
either by dates or by specific file numbers of the [third party]. Further,
the Claimant asked for the production of eleven specific documents
identified by date and further description.4 6

The above quote is an example of how parties ought to tailor a Request

under the IBA Rules. In practical terms a party who submits a Request to
Produce must limit the time frame for which it seeks a category of docu-
ments to a period proportional to the contention it seeks to prove. Also, to
the extent possible, parties should seek to limit the types of documents
they request to those that have a strong connection to the relevant issue.
As reflected in the 7Thunderbirdformula above, narrowness under the IBA
Rules means narrow in both time and subject matter. The "specificity"
criterion, however, requires a requesting party to use the best means at its
disposal to identify the documents themselves. Obviously, referring to the
proper name of a requested document is preferred, but as business prac-
tices can vary between jurisdictions or by company to company, tribunals
should not expect parties to be able to give the exact title of a document.
Nevertheless, a party should give a functional description (e.g. An "envi-
ronmental impact study" or "report on soil conditions") of the documents
or category of documents (e.g. "the development committee meeting min-
utes") which is sufficient to allow both the opposing party and the tribunal
to distinguish the requested documents from other less relevant records.
Document production in international arbitration should, as a general
rule, not be a means by which a party is allowed to establish the bulk of the
evidence supporting its case so much as supplement it. Consistent with
45) Id., § 14 & 15.
46 Id., § 17.
46 O'Malley / 7he Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

this basic rule is that Requests for Production should be tailored to meet
specific aspects of a party's burden of proof. If a Party has submitted a
Request in such a fashion, it has, at least initially, met its duty to be narrow
and specific. It is then up to the opposing party to explain why the Request
is overly broad.

B. Analyzing the MaterialityandRelevance of a Request to Produce

As a well recognized principle of transnational civil procedure, "relevance",
in regard to evidence, can be defined as encompassing any evidence that is,
"probative material that supports, contradicts, or weakens a contention of
fact at issue in the proceeding. '4 7 Materiality, as a concept, is linked to a
party's burden of proof. In the context of document production, one tribu-
nal constituted under the ICC Rules of Arbitration in Switzerland put it
succinctly by stating that it is the issue of, "whether the requesting party
actually requires the document sought in order to discharge its burden of
proof in this arbitration".48 The value of attempting to differentiate between
the concept of "materiality" and "relevance" is debatable within the context
of the IBA Rules, however, because the two concepts are usually referred to
in tandem. It is sufficient to say therefore, that the standard of "relevance"
or "materiality" in regard to document production may be interpreted as
requiring that it be established that the requested documentary evidence
has a "likelihood of relevance" before it may be granted.49 This means that
a tribunal need not be absolutely convinced that the document is relevant,
but should seek reasonable assurances that it will be material and relevant
to the issues within an arbitration that impact upon a final award.
There are two principle Articles in the IBA Rules that make use of
the "materiality" and "relevance" standards: Articles 3(6)(i) and 9(2)(a).
Article 3(6)(i) of the Rules states that a tribunal should take under consid-
eration the question of whether the issues pursuant to which documents are
sought are, "relevant and material to the outcome of the case". Article 9(2)(a)
also provides that Requests should be denied if the requested documents

47 ALI/UNIDROIT Principles of Transnational Civil Procedure (2004). Comment p-16A

to Article 15. Found at http://www.unidroit.org/english/principles/civilprocedure/ali-unidroit-
principles-e.pdf.
4) Unpublished, ICC Arb., unnumbered, Procedural Order No. 3 § 8-12. One significant
factor in the decision to disclose is the relevance and materiality of the requested documents.
9) Hanotiau, supra note 3, §§ 14-16.
OMalley / The Law and PracticeoflnternationalCourts and Tribunals 8 (2009) 27-90 47

themselves have a "lack of sufficient relevance or materiality" to the issues

in the case.50
It is instructive to review the standards of relevance and materiality as
articulated in Articles 3(6)(i) and 9(2)(a) of the Rules as they stand for two
different types of analysis. In Article 9(2)(a) tribunals are required to look
at whether the documents that are requested are relevant and material in
connection with the issues or contentions that have been pled in the case.
On the other hand, Article 3(6)(i) directs the tribunal to look to whether
the issues pursuant to which the documents are requested are themselves
material. The following two sub sections of this paper review these separate
standards.

1. The Article 9(2)(a) Prima Facie Analysis

A party seeking to obtain document disclosure carries the burden of prov-
ing to a tribunal that its requests are sufficiently material to the issues at
bar. This means that a tribunal must engage in a primafacieanalysis of the
documents requested and their relationship with the matters pled.5 Influ-
encing this analysis are three factors which are explained further below.
The first factor a tribunal will tend to consider is whether the Request
for Production has included sufficient argumentation establishing the con-
nection between the documentary evidence and an aspect of a party's bur-
den of proof. A tribunal constituted under the UNCITRAL Rules explained
the type of usual analysis that is engaged in as follows:

50) IBA Rules, supra note 4,Art. 9(2): "[Tjhe Arbitral Tribunal shall, at the request of a Party or
on its own motion, exclude from evidence or production any document, statement, oral testi-
mony or inspection for any of the following reasons: (a) lack of sufficient relevance or materiality;
(b) legal impediment or privilege under the legal or ethical rules determined by the Arbitral
Tribunal to be applicable; (c) unreasonable burden to produce the requested evidence; (d) loss or
destruction of the document that has been reasonably shown to have occurred; (e) grounds of
commercial or technical confidentiality that the Arbitral Tribunal determines to be compelling;
(f) grounds of special political or institutional sensitivity (including evidence that has been clas-
sified as secret by a government or a public international institution) that the Arbitral Tribunal
determines to be compelling; or (g) considerations of fairness or equality of the Parties that the
Arbitral Tribunal determines to be compelling."
") In this context primafaciemeans that a tribunal would analyze a party's arguments to see if
the requesting party has made, what on the surface must appear to be, a credible argument as to
why it needs the documents. "Aprimafacie case is a case sufficient to call for an answer", Inter-
national Ore &Fertilizer Corp v. Razi Chemical Co. Ltd., 18 Iran-US Cl. Trib. Rep. 102, note 2
No. 351\-486-3 (1988).
48 O'Malley/ The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

...the tribunal has endeavored to make its decision regarding the Par-
ties' Objections in such a manner as to focus on the articulated mate-
riality of a given document or category of documents.52

It is crucial that a party provide a compelling explanation as to why docu-

ment "A" will support (or disprove) contention "1". The party seeking
documents should provide detailed explanations not only in order to sat-
isfy the requirements of Article 3, however, but also to provide the tribunal
with the necessary information it needs to be able to award the document
production over the objections of the opposing party. As it is a primafacie
analysis, it is common practice for tribunals to accord weight to the pro-
tests and representations of opposing counsel which are raised under Arti-
cle 9(2)(a). This point was made in an ICC arbitration in Switzerland,
wherein the tribunal stated, "the affirmation of counsel, for the objecting
party, whose good faith is assumed, that the documents in question are
neither directly relevant nor material, while not determinative, has to be
accorded weight"." 3 A party who fails to provide analysis or reasoning as to
why the documents requested are material to an issue in the arbitration has
not met the basic requirements of a Request to Produce, and its request
4
will most likely fail in light of the opposing party's objections.
A second factor which a party should give consideration to is the timing
of the Request to Produce. It has been the practice of tribunals in the past
to take into consideration whether they have enough information before
them to be able to conduct the requisiteprimafacie analysis. Thus submit-
ting a Request to Produce after the exchange of cursory and often vague
initial filings, may cause a tribunal to reject requested document produc-
tion. The bias against document requests filed early within a procedure
stems from the fact that a tribunal does not have a full view of the issues at
hand, and thus is unable to assess the relevance of the documents which are
being requested. Such was the situation in ICSID arbitration Noble Ven-
tures Inc. v. Romania. In this instance the tribunal stated in response to
claimant's Request for Production which was submitted after the initial
filings, "the Tribunal finds that at a time when only the short Request for
Arbitration Proceeding submitted by Claimant [is on the record] the Tri-

52) Glamis Gold Ltd. v. UnitedStates ofAmerica, NAFTAIUNCITRAL, supra note 30.
"J Unpublished, supra note 48, § 9.
54) IBA Rules, supra note 4, at Art. 9(6)(a) and Art. 3(3)(b).
O'MaUey / The Law and PracticeofInternationalCourts and Tribunals8 (2009)27-90 49

bunal is not in a position to identify, within the many and broad requests
submitted by Claimant, which documents must be considered relevant
and material for the Tribunal to decide on the relief sought."55 In an ICC
arbitration, a tribunal rejected a Request for production of documents for
the same reason, "The Arbitral Tribunal, at the present stage, is not con-
vinced of the relevance of the requested documents for the decisions to be
56
made in the framework of this arbitration".
Tlhis does not mean that the Requests to Produce must always be made
after the filing of a statement of claim or defense. In an unreported arbitra-
tion under the UNCITRAL rules, the Tribunal stated in a procedural order
applying the IBA Rules, "... documentary evidence is to be submitted with
written submissions. As a result, the submission of document requests by
Claimant would normally have been expected prior to the submission of
its statement of Claim and Reply. '57 In that instance, the Tribunal felt that
the issues, either through preliminary hearing or other submissions, had
been sufficiently vetted to allow it to evaluate document requests prior to
the submission of the statement of claim. It is conceivable that due to the
nature of the claim or the parties, that a tribunal would feel compelled to
order document production to take place early within the procedure.
Generally, however, a tribunal will seek to conduct the document pro-
duction portion of the procedure after the submission of a statement of
58
claim, and defense, and prior to further hearings or follow-up briefings.
This approach seems to be the most consistent with the spirit of document
production within international arbitration, as it allows for the tribunal to
properly assess Requests to Produce in light of a more developed record,
s) Noble Ventures Inc. v. Romania, supra note 17. This point is also referenced in the IBA Work-
ing Party commentary on Art. 3(3) stating that, "Because of the specificity required in the
Request to Produce, it is likely that such a Request will be made only after the issues have become
sufficiently clear in the case". IBA Working Party, supra note 5 at 23.
5 Virginia Hamilton, Document Production in ICC Arbitration, ICC Bulletin 2006 Special
Supplement at 70 (ICC Services 2006).
57) Unpublished, UNCITRAL, unnumbered, Procedural Order 3 (2004). See also the proce-
dural schedule found in RosInvenstCO UK Ltd. v. Russian Federation, supra note 14 at 18-23
where document production was ordered to take place prior to the substantive submissions.
51) This is often agreeable to the parties themselves, however, even in these situations tribunals
are confronted with another difficulty, namely the impact document requests will have on the
procedural calendar. As an example of a typical situation, one ICC arbitral tribunal was forced to
reset the calendar as a result of a request for documents, so that it defined the due date for the
next pleading as "seven days as of the date of Respondent's actual production of the requested
documents". Unpublished order, ICC No. 14087 (2006) Letter from the Tribunal.
50 OMalley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

and thus keep the document production portion of the arbitration tar-
geted to the most relevant issues at hand.
The third factor which may affect the primafacie analysis is the question
of whether the various categories of requested documents are easily acces-
sible to a party other than through document production. Tribunals gener-
ally need to be satisfied that the requested documents are not attainable
by the requesting party through means other than from their opponent.
This was the case in a NAFTA Chapter 11 arbitration organized under the
UNCITRAL Rules, Glamis Gold v. The United States of America. In this
instance the investor party sought documents from the American govern-
ment. 9 The state party responded by arguing that it was more than likely
that the information requested was already part of the public record. Tfhe
tribunal, on the surface, agreed with the state party's reasoning, and rejected
the request with the caveat that the investor party could renew it if it could
60
show that indeed this was not the case.
This requirement has been followed by numerous tribunals and is hinted
at in Article 3(3) of the Rules whereby it requires requesting parties to
show that the documents are not in their "possession, custody or control".
It is logically consistent that if tribunals do not want parties to have the
documents which they are asking another party to produce in their posses-
sion, it is equally desirable to require parties to obtain on their own initia-
tive that which can be found in the public record, before seeking it through
document production. Parties should be mindful that the primafacie anal-
ysis under Article 9(2)(a) is centered on the stated need, of a document to
prove an issue in the case. Certainly a party does not need a document to
be produced to it if the document is reasonably available through other
means. One tribunal articulated this standard as follows:

Where... the documents requested are in the public domain and equally
and effectively available to both parties, we believe that there would be
no necessity for requiring the other party physically to produce and
deliver the documents to the former for inspection and copying.6 '

59 Glamis Gold Ltd. v. United States ofAmerica, NAFTAIUNCITRAL, unnumbered (2005).

60) Id
6) ADF Group Inc. v. United States ofAmerica, ICSID No. ARB(AF)/00/1 (2001) Procedural
Order No. 3 § 4.
OMalley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90 51

Therefore it is not unusual for tribunals to deny document production where

they believe that the requested documents are reasonably available to the
requesting party, through means other than by an order for production.
The above examples give clues to what are in essence the core issues
which a tribunal may consider when performing a primafacie analysis
under Article 9(2)(a) of a Request to Produce. They can be summarized as
the following:

1. Has the requesting party articulated a compelling case as to why the

documents sought are connected to an issue in dispute;
2. Is the tribunal satisfied that the proceedings have progressed to a
stage so that its knowledge of the key issues in the arbitration is suf-
ficient to evaluate the relevance and materiality of the documents
being requested; and
3. Is the tribunal satisfied that the requested documents are not already in
the possession of the requesting party, or are not easily accessible by
the requesting party?

2. The Substantive Analysis of Article 3(6)(i)

Tribunals applying Article 3(6)(i) of the IBA Rules have the right to per-
form an analysis of a party's Request for Production so as to determine
whether the contention or issue a party seeks to prove is itself relevant. This
means that a tribunal is not restricted to analyzing whether there is a com-
pelling case as to why the documents are needed to prove a particular con-
tention, but also whether that contention itself would impact a potential
final award. This type of analysis is substantive in nature and is centered on
the tribunal's view of the case.
One example of this analysis is the Hochtiefcase referenced above.62 The
case involved two members of a construction joint venture which had been
created for the purpose of developing Athens International Airport. The
dispute arose over the transfer of ownership of one of the party's shares
in the joint venture company to a third-party.63 The contention of the
aggrieved party was that the transfer was performed in violation of, inter
alia, an oral agreement amongst the members of the joint venture which
granted what were essentially "rights of first refusal" over the transfer to the
621)ABBAG v. HochtiefAirport GmbH, supra note 22.
63 Id
52 O'Malley / The Law andPracticeof InternationalCourts and Tribunals 8 (2009)27-90

claimant.6 The arbitration had come down to a question of whether the

seller of the shares had acted in bad faith towards its joint-venture partners.
When the respondent party, the seller of the shares, requested the produc-
tion of documents relevant to the alleged issue of claimant's bad faith, the
tribunal rejected the request. Although the tribunal had allowed the claim-
ant to conduct document production earlier in the arbitration, the tribu-
nal rejected the respondent's request for production pursuant to the issue
of claimant's alleged bad faith on two separate occasions.
The tribunal's award was later challenged by the respondent party in a
setting aside procedure before the Queen's Bench Division (Commercial
Court) in England. 65 The respondent party stated a number of grounds
for the challenge, in particular that the tribunal had acted unfairly and
66
with bias by denying respondent's request for document production.
After conducting an analysis of the points raised by the challenging party,
including the decision to deny document production to the respondent
party under the IBA Rules, the court decided that the tribunal's decision to
deny document production due to its doubtful view of the respondent's
legal theory was justified. The court noted "It may very well be of course
that by the time it had to rule on [respondent's] second request to produce
documents in February 2005, the tribunal's thinking on these matters was
relatively advanced in the light of developments during the first two days
of the hearings". 67 The court found that it was reasonable for the arbitra-
tors to have dismissed respondent's theory in the case, because of the weight
of the evidence to the contrary. The court believed that it was not unfair or
partial for the tribunal to deny respondent's request to receive further doc-
uments pursuant to this theory: "The arbitrators had express power under
the IBA Rules to exclude from productions any document on ground of
lack of sufficient relevance or materiality. In my judgment they [the tribu-
nal] cannot be said to have acted unfairly in dealing with [respondent's]
68
request as they did".

64) Id.
65) Id
"" The English Arbitration Act, 1996, §§ 33 & 68 "The tribunal shall act fairly and impartially
as between the parties, giving each party a reasonable opportunity of putting his case and dealing
with that of his opponent".
"7 ABB AG v. HochtiefAirportGmbH, supra note 22.
(.4 Id.
O'Malley / The Law and Practiceof InternationalCourts and Tribunah8 (2009)27-90 53

The Hochtifarbitrationis consistent with a ruling in a NAFTA Chapter 11

arbitration held under the UNCITRAL rules called Methanex Corporation
v. United States ofAmerica.69 In this instance, the investor party sought to
have documents relating to the negotiating history of the NAFTA treaty
produced by the state party in order to establish the intent of NAFTA's
provisions. 70 The tribunal responded to the Request by requiring the inves-
tor party to submit a reasoned explanation as to why the negotiating his-
tory would influence the tribunal's understanding of the plain text of the
treaty.7' In other words, there was no doubt that the negotiating history
had a relevant connection to the treaty and the intent behind its text, how-
ever, what was not established was whether the negotiating history would
impact the tribunal's decision on a final award. After further explanation,
the tribunal remained unconvinced, and as a result, the tribunal denied the
investor party's request for production of the negotiating history because it
72
was not in compliance with the requirements of the IBA Rules.
The cases above should be viewed in the context of the fact that tribu-
nals must be mindful in all instances of their duty to treat parties with
procedural equality, and this no doubt applies to the issue of document
production. 73 Some concepts of "equal treatment" as found in various
lex arbitrihave been summarized as follows, "an arbitral tribunal may not
refuse one party what it has granted the other". 74 This formulation may give
rise to the false impression that where one party is granted document pro-
duction, the opposing party automatically receives the right to receive it as
well. Clearly this is incorrect, as the principle of equal treatment requires
that the same procedural standard be applied to each party in the arbitra-
tion, not that the parties be granted a right to discover documents simply
because its opponent has. A tribunal also has the right under Article 3(6)(i)
to deny document production where, as in the Hochtiefcase, it no longer
believes that the issue which a party seeks to prove is relevant in light of the

69) Methanex Corporation v. United States of America, NAFTAIUNCITRAL, WL 1950817

(APPAWD) (2005).
70) Ibid., Part II Chapter H.
7) Methanex, supra note 69, Part II Chapter H.

72) Methanex, supra note 69, Part II Chapter H § 25. The tribunal also made reference to
Article 9(2)(a) of the IBA Rules in its decision.
'3) For instance, as found in Article 18 of the UNCITRAL Model Law.
74) Michael E. Schneider, Article 182, in InternationalArbitrationin Switzerland, p. 288 (Steven
V. Berti et al. eds., 2000).
54 OMalley / 7he Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

evidence already on the record, or as in Methanex, the tribunal simply does

not share a party's belief that the issue it seeks the document production in
connection with will come to bear on a final award. In this situation, how-
ever, in order to withstand criticism by a reviewing court, a tribunal would
be well advised to provide a reasoned explanation as to why it denied doc-
ument production on the basis of Article 3(6)(i).

C. Obections to ProducingDocuments Based on Privilegeand Legal Impediment

The IBA Rules of Evidence provide for an assertion of "privilege" as a defense
to a Request to Produce. Article 9(2)(b) states that parties may plead a
defense to the production of documents if it can show a: "legal impediment
orprivilege under the legal or ethical rules determinedby the ArbitralTribunal
to be applicable".7
The concept of privilege or legal impediment can raise complex issues
for a tribunal as was pointed out in the commentary to Article 18 of the
ALIlUnidroit Principlesof TransnationalCivil Procedure:

Privileges protect important interests, but they can impair establish-

ment of facts. The conceptual and technical bases of these protections
differ from one system to another, as do the legal consequences of giv-
ing them recognition. In applying such rules choice-of-law problems
may be presented.76

When analyzing objections under Article 9(2)(b) a tribunal should begin

with the presumption that privilege, as a concept, is recognized as a trans-
national rule of procedure, and thus seek to find an appropriate version of
this rule to apply to both parties. 77 However, aside from that, there is little
further guidance on this issue within the Rules as to which rule of privilege
should be applied, or how a determination should be made on this point.
The Working Party commentary also does not say very much on this ques-
tion, and simply notes, "The Working Party felt that it was important that

11) In addition to privilege, the IBA Rules also allow for denying the admissibility or discover-
ability of documents on the grounds of commercial or institutional confidentiality which are
found compelling by the tribunal. IBA Rules, Art. 9 (2)(e) and (f).
7")ALI/Unidroit Principles, supra note 4 7, sec. P-18A.
M Dr. Horst Reineccius et al. v. Bank flr InternationalSettlements, Arbitral Tribunal concerning

the Bank for International Settlements, unnumbered, Procedural Order No. 5 (2002).
O'Malley / The Law andPractice ofInternationalCourtsand Tribunals 8 (2009) 27-90 55

such privilege be recognized in international arbitration". 78 It may well be

that this lack of direction simply reflects wider confusion within the arbi-
tral community as was noted by one well known arbitrator's comments on
79
this point: "The only thing that is clear is that nothing is clear in this area".
The following sections focus on the methods used for finding an appli-
cable rule of privilege by examining the (a) private international law approach,
which is based on using a particular choice of law analysis to find a munic-
ipal rule to apply, (b) the "survey approach", whereby tribunals have attempted
to resolve these issues by looking to a number of different sources of law
in order to apply a commonly accepted rule, and finally, (c) setting forth
some conclusions as to the merits of both methods.

1. The PrivateInternationalLaw Analysis

The apparent lack of clarity notwithstanding, there are a number of meth-
ods which commentators have proposed for determining the municipal
rule applicable to questions of confidentiality and privilege in international
arbitration. Some have leaned upon a conflicts of law, or private interna-
tional law analysis and advocated a "closest connection" test for finding the
applicable privilege rule. 80 One author has proposed that a party may rely
upon one or more of the following factors when using a "closest connec-
tion" test to determine the law applicable to the question of attorney-client
privilege: 1) the law where the attorney with whom the communication
took place is admitted to practice; 2) the law of the place where the attor-
ney-client relationship has its predominate effects, whether or not the
attorney is admitted to practice in that jurisdiction; 3) the domicile of the
party claiming the privilege; 4) the law of the place where the document is
located or stored; 5) the law of the place where the document is created;
and 6) the law of the place to which the document was sent.' Although
the above factors are particular to the issue of attorney-client privilege,
with small adaptation they may be used to analyze other types of legal
impediment. Moreover, tribunals may be inclined to use this method, as

78)IBA Working Party, supra note 5.

n) Klaus Peter Berger, Evidentiary Privileges: Best Practice Standards versus/ and Arbitral Dis-
cretion, 22 ArbitrationInternational4,501, 501-520 (2006).
I')Peter Roscher, 7he Application and Scope of Attorney Client Privilege in International Arbi-
tration, 2007:2, Stockholm InternationalArbitrationReview 1, 18 (2007).
81) Id. at 17.
56 OMalley / 7he Law andPracticeofInternationalCourts and Tribunals 8 (2009) 27-90

the "closest connection" test has become the most popular private interna-
tional law approach for solving this issue as one author pointed out, "there
is a discernable consensus in favor of a tribunal applying the municipal law
which has the closest connection to the allegedly privileged evidence, albeit
opinions differ as to what is the most appropriate connecting factor to be
82
applied".
The "closest connection" test was used by a tribunal constituted under
the rules of the Netherlands Arbitration Institute ("NAI") in order to ana-
lyze a legal impediment issue." In this instance the arbitral proceedings
were of a preliminary, summary nature, and were not part of the underly-
ing arbitration on the merits.84 The dispute involved an Italian party and a
Dutch party regarding royalties owed under a license agreement. Repre-
senting the Italian party was an Italian counsel with Dutch co-counsel,
while the Dutch party had also retained Dutch counsel.
The Dutch party produced a document showing the amount which the
Italian party had estimated the royalties owed on the contract to be. This
document had been generated as part of an earlier, aborted settlement dis-
cussion and had been delivered by the Respondent's Dutch co-counsel to
her Dutch opposite. The Italian party objected to the introduction of this
document into the procedure on the basis that it was being used in bad
faith. The tribunal, however, did not accept that there was any impediment
to introducing the document into the procedure because it regarded the
exchange between the two Dutch counsel as not subject to privilege. In
this instance the tribunal relied on the first factor of the "closest connec-
tion test" by choosing the law of the place where the two lawyers involved
in the exchange of the document were located, the Netherlands.85 Evi-
dently, the tribunal did not believe that the Dutch rules on settlement
privilege would prohibit a party from using the document during this stage
of the proceedings.
While the above example dealt with privilege in the context of admissi-
bility, the same standard would apply to whether or not privileged docu-

X2' Id.at 21.

"83 NAI 28 February 2007, Tijdschrift voor Arbitrage "T vA", 2008, 5 at 19.
.4 Netherlands Arbitration Institute Rules of Arbitration 2001, Section Four A.
'5) NAI supra note 84 at 22. "The Tribunal understands that Respondent clearly submitted the

sales figures and the corresponding royalties figures in the context of the settlement negotiations
and, although that information was not privileged because sent by co-counsel to Respondent and
not by Italian Counsel...".
OMalley / The Law andPractice ofInternationalCourts and Tribunals 8 (2009) 27-90 57

ments would be discoverable. In such cases, the party claiming the privilege
would need to provide (and a tribunal should demand) a primafacieargu-
ment as to why the document is covered by privilege. If inclined to look to
municipal law, a tribunal may then turn to a "closest connection" test and
use the rule found in the jurisdiction with the most connections with the
document.
There arises in connection with this approach, however, the concern
that different rules may emerge when it is applied to different documents
over which privilege has been claimed. If for each privilege situation, a new
"closest connection" analysis is applied, varying results may occur, and one
party will see a stricter jurisdiction's rule applied to its requested document
production, while another party may be afforded the benefit of a more
liberal rule. Indeed, this presents a situation which would appear unequal,
and could present a challenge to whether the tribunal's actions complied
with the "fairness and equality" requirements of the /ex arbitriand the rules.
The solution, as proposed by various authors is to apply the "most
favored privilege" rule to the issue.86 This rule essentially proposes that the
tribunal apply the jurisdictional rule to both parties which affords the
greatest protection. The Rules themselves, by providing Article 9 2 (g) which
allows for tribunals to deny parties the use of documents in a procedure
based on considerations of fairness and equality, would provide grounds
for a tribunal to apply one jurisdiction's rule on privilege to both parties."7
This approach would ensure, in the very least, that the parties would be
afforded the widest level of protection, and that each party can be assured
of equal treatment.

2. Surveying Relevant Sources of Law in Order to Establish Generally

Accepted Rules
Determining whether a document is privileged, and thus may not be pro-
duced due to the existence of a legal impediment does not necessarily
have to be resolved by formal reference to one jurisdiction's law. While
commentators seem to agree that there is no international standard that
exists by which all aspects of privilege and confidentiality can be uniformly

") Peter Roscher, supra note 80 at 20.

17) Hilmar Raeschke-Kessler, The Production of Documents in International Arbitration - A

Commentary on Article 3 of the New IBA Rules of Evidence, ArbitrationInternational,Vol. 18 -

No. 4, 411,428 (2000).
58 O'Malley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009) 27-90

judged,88 it does not mean that there are not some commonly held rules
which can be gleaned through a comparative law approach or by looking
to international legal principles.8 9
In ICC arbitration number 11258, the tribunal was faced with a request
by a respondent who sought from claimant statements that were prepared
pursuant to a mediation. 90 The mediation had taken place between a com-
pany related to claimant and a third party, in a jurisdiction other than
where the tribunal was sitting, and it had become known that respondent
was in possession of the documents. Unsurprisingly the claimant argued
that as the documents were prepared pursuant to mediation (by parties
other than those in the arbitration) they were confidential and not subject
to document production and equally not admissible. The tribunal was, in
this instance, briefed by the parties on the applicable law, with reference
being made to various municipal rules.9 ' After reviewing the submissions,
the tribunal did not look to the substantive law of the arbitration or any
other national law as dispositive of the issue. Instead the tribunal referred
to such instruments as the UNCITRAL Model Law on International Com-
mercial Conciliation, citing in particular Article 10,92 the UNCITRAL

88) Klaus Peter Berger, supra note 80. See also Peter Roscher, supra note 80. The following quote
provides a good summary of the situation: "There is no single international code of commonly
accepted principles even though all professional privileges have the same rationale - to encourage
frank and open communications between professionals and those with whom they have a profes-
sional relationship." Michelle Sindler & Tina Wustemann, Privilege across borders in interna-
tional arbitration: Multijurisdictional Nightmare or Storm in a Tea Cup? 23 ASA Bulletin 4,610,
610-611 (2005).
89) Sindler & Wusterman supra note 88. The authors make this further, valuable observation
regarding the approach of arbitral tribunals: "Experience shows that arbitrators apply common
sense to questions of privilege and seek a workable solution. Tribunals tend to apply the rules of
privilege that are shared by the parties (without regard to the rules of the forum)".
91) Unpublished, ICC No. 11258, Procedural Order No. 3 (2003).
91) Id.
"2)UNCITRAL Model-Law on International Commercial Conciliation (2002) Article 10 pro-
tects mediation statements from being subject to discovery: "1. A party to the conciliation pro-
ceedings, the conciliator and any third person, including those involved in the administration of
the conciliation proceedings, shall not in arbitral, judicial or similar proceedings rely on, intro-
duce as evidence or give testimony or evidence regarding any of the following: (a) An invitation
by a party to engage in conciliation proceedings or the fact that the party was willing to partici-
pate in conciliation proceedings; (b) Views expressed or suggestions made by a party in the
conciliation in respect of a possible settlement of the dispute; (c) Statements or admissions made
by a party in the course of the conciliation proceedings; (d) Proposals made by the conciliator;
(e) The fact that a party had indicated its willingness to accept a proposal for settlement made
by the conciliator; (f) A document prepared solely for purposes of the conciliation proceedings.
O'Maley / The Law and Practiceof InternationalCourtsand Tribunals 8 (2009)27-90 59

Conciliation Rules, various institutional rules as well as decisions by the

International Court of Justice, to support the construction of a "public
policy" in favor of protecting the confidential statements made pursuant to
mediation. The tribunal summarized the matter by saying:

The Tribunal considers that protecting the confidentiality of media-

tion proceedings is justified by public policy. In the Tribunal['s] view,
ordering the discovery of documents exchanged in the course of a
mediation between two third parties implies a self-evident risk of jeop-
ardizing mediation as an institution... This is similar to the well estab-
lished international legal principle applied by the ICJ precluding the
admittance of evidence of earlier efforts to settle the dispute. 9"

The survey approach was applied by another tribunal composed of well

known arbitrators who also looked to public policy and international
norms in order to analyze a privilege issue, in this case, attorney-client
privilege. In 2002 an order was issued by a tribunal in the Dr.HorstReinec-
cius et al. v. Bank of InternationalSettlements arbitration, wherein objec-
tions to the production of documents based on attorney-client privilege
under Article (9)(b)(2) were decided.9 4 The challenge confronting the tri-
bunals was the question of how to analyze privilege in the context of an
outside legal counsel's advice to officers of a corporation, in this case the
Bank of International Settlements ("BIS") based in Basel, Switzerland.
Objections to a request to discover certain legal advice by the share-
holder claimants had been lodged by BIS in the arbitration. The claimants

2. Paragraph 1 of this article applies irrespective of the form of the information or evidence
referred to herein. 3. The disclosure of the information referred to in paragraph 1 of this article
shall not be ordered by an arbitral tribunal, court or other competent governmental authority
and, if such information is offered as evidence in contravention of paragraph 1 of this article, that
evidence shall be treated as inadmissible. Nevertheless such information may be disclosed or
admitted in evidence to the extent required under the law or for purposes of implementation or
enforcement of a settlement agreement. 4. The provisions of paragraphs 1, 2 and 3 of this article
apply whether or not the arbitral, judicial or similar proceedings relate to the dispute that is or
was the subject matter of the conciliation proceedings. 5. Subject to the limitations of paragraph
1of this article, evidence that is otherwise admissible in arbitral or judicial or similar proceedings
does not become inadmissible as a consequence of having been used in a conciliation."
91) Unpublished ICC 11258, supra note 90.
9) Dr. Horst Reineccius et aL v. Bank for InternationalSettlements, Arbitral Tribunal concerning
the Bank for International Settlements, unnumbered, Procedural Order No. 6 (2002) at 8.
Found at www.pca-cpa.org.
60 OMalley / The Law andPracticeof InternationalCourts and Tribunals 8 (2009)27-90

argued that privilege could not be asserted, as the BIS could not withhold
legal advice vis-a-vis shareholders due to the shareholders' status as owners
of the BIS. Being an owner, the shareholders believed that they were enti-
tled to receive the legal advice given to the bank.95
The tribunal chose not to apply the law of the place of arbitration, which
was Dutch law as the arbitration was seated in The Hague, nor Swiss law,
the law of the home jurisdiction of the bank. Instead the tribunal chose to
take a broader approach and look to a number of sources to find a com-
mon rule to apply:

The attorney-client privilege, which is widely applied in domestic legal

systems, has been recognized in public international law and interna-
tional commercial arbitration rules and arbitral awards. The privilege
applies to corporate entities as well as to individuals; when claimed for
corporate entities it obtains with respect to those who are authorized
to participate in the decisions.96

Much like the decision in ICC case no. 11258, the tribunal surveyed inter-
national law, institutional rules, domestic law, and again, the case law
of the International Court of Justice wherein they noted that it had been
established in international law that shareholders and corporate entities
were to be regarded as having separate legal status.97 On this basis, the tri-
bunal gleaned some basic principles, most importantly that the right of
privilege extended to cover communications between outside counsel and
the decision makers (e.g. board of directors) within the BIS from discovery
by shareholders.9 8 The tribunal also analyzed the question by examining
whether the well understood criteria of ratione materiae 99
and ratione

95) Id at 10.
96) Id.
97) Id. referring to Barcelona Traction, Light and Power Company Limited (New Application:
1962) (Belgium v. Spain) Second Phase 1970 ICJ Reports 3.
98)"At the core of the attorney-client privilege in both domestic and international law is the apprecia-
tion that those who must make decisions on their own or others' behalf are entided to seek and receive
legal advice and that the provision of a full canvass of legal options and the exploration and evaluation
of their legal implications would be chilled, were counsel and their dients not assured in advance that
the advice proffered, along with communications related to it, would remain confidential and immune
to discovery." Dr.Hont Reineccius et. aL v.Bank.fir InternationalSettlements, supra note 94 at 10.
99)Ratione materiae: the legal communications which are entitled to an attorney-client privilege
must be related to making a decision that is in or isin contemplation of legal contention.
 OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90 61

personae'°° were met in this case, further suggesting that these underlying
principles of attorney-client privilege are sufficiently accepted in interna-
tional practice to be applied by the tribunal as general norms.'0 '
The survey approach does not have to take into account public or com-
mercial international law, but instead can be limited to a review of relevant
domestic laws. This was the case in the Glamis arbitration whereby the
tribunal was confronted by an investor party seeking certain documents
prepared by attorneys in the employ of the state government of Califor-
nia.' °2 While agreeing that the law of the United States should apply to the
issue of privilege, the parties failed to agree on which jurisdiction should
supply the law, each party arguing for a different state law and even the
application of federal common law.10 3 The tribunal's preferred approach
was to take a broader look at a number of American jurisdictions, and try
to find a consensus rule that would be suitable for international arbitra-
tion. Their method was described as follows:

... the Tribunal has reviewed the case law of numerous United States
jurisdictions - including California and the District of Columbia -
and attempted to identify a general consensus between the courts that
might be helpful in defining what the Parties would reasonably expect
to apply in this situation. The Tribunal then used this information
combined with the knowledge of and appreciation for the differences
between court proceedings and international arbitration, to craft stan-
dards that can assist the Parties in assessing their claims of privilege
and their objections to such claims.' 4

100)Rationepersonae.the legal advice must be between an attorney (whether in-house or outside)

and those who are afforded his or her professional advice for purposes of making or in contem-
plation of that decision.
101)Other issues decided by the tribunal included the fact that a party may waive privilege
according to generally accepted principles of international law. For a full description of the arbi-
tration, and the tribunal's procedural conclusions, review the 2004 article by Scott Armstrong
Spence. Scott Armstrong Spence, Organizing an Arbitration Involving an International Organi-
zation and Multiple Private Parties: The Example of the Bank for International Settlements
Arbitration, 21 JournalofInternationalArbitration4, 309, 309-328 (2004).
102) Glamis Gold v. United States ofAmerica, supra note 47, (2005).
103) Ld
04) Id
62 OMalley / The Law andPracticeof InternationalCourts and Tribunals 8 (2009)27-90

In an Austrian Federal Economic Chamber arbitration, it was reported

that the tribunal when faced with a similar issue regarding attorney-client
privilege, also adopted the survey approach, this time in regard to the laws
found in a number of different jurisdictions which it classified as "civil
law". 105 Their method for finding a rule was described as follows:

Rather than applying any countries' specific law(s) to the question at

hand, the Arbitral Tribunal will address the issue in accordance with
general principles developed by civil law and in civil law arbitrations,
general procedural rules on disclosure and due process and general stan-
dards of fairness applicable in international arbitration proceedings. 106

From the decisions cited above, it is clear that the tribunals may take a
broader view of the matter of legal impediment and privilege, where they
find that a norm or general practice can be gleaned from a survey or can-
vassing of the available and relevant sources of law. In some instances, that
may be tantamount to applying a principle of public policy, or simply find-
ing a generally accepted practice. In so doing, the tribunals appeared to
follow a three step process. First, they took into consideration what were
the available choices of law. In the Glamis arbitration they looked to the
various jurisdictions in the United States because the parties had agreed
that American law should apply. In the other instances, the tribunals looked
to public international law, examples of domestic law (presumably those
with a connection with the arbitration were given the greatest attention)
and the various international commercial law instruments, such as institu-
tional rules and model laws. As a second step, the tribunals reviewed these
diverse sources to determine whether there were commonly agreed princi-
ples and or rules. In performing this analysis, the tribunals seemed to take
careful note of the underlying policy objectives of the different rules on
privilege to see whether there were common elements which could be dis-
cerned. Finally, the tribunals reviewed the issue in light of the fact that
the parties were not involved in domestic litigation, but had brought their
dispute to an international tribunal, and thus their expectations of proce-
dural equity should be governed by considerations of common interna-

'05)Bernhard Meyer-Hauser & Phillip Sieber, Attorney Secrecy v. Attorney Client-Privilege in

International Commercial Arbitration, Arbitration, Vol. 73, No. 2 (May 2007), p. 148, 170.
'0Q Id.
OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90 63

tional arbitration practice, and policies upholding the good order of

international business and trade.

3. Conclusions Regarding the Various Approaches to the PrivilegeIssue

Arbitral tribunals have a number of concerns to contend with during a
procedure, such as ensuring the equal treatment of the parties and the
legitimate expectations of a party to have access to documentary evidence
when there is a legitimate and well specified reason for doing so. In addi-
tion to the concerns regarding fairness and equality, tribunals should also
take into consideration whether a party would be capable of complying
with the order of a tribunal without incurring unreasonably burdensome
07
ancillary problems. 1
Ultimately, under Article 9(2)(b) it is up to the tribunal to weigh these
concerns and find a method for selecting an "applicable" rule of privilege.
Clearly both approaches described above, and others, have merit and also
drawbacks. In a situation where a tribunal looks for a municipal law and
its private international law analysis leads it to a legal impediment or rule
of privilege which provides for a highly irregular result, it would seem
improper for both parties to be bound by this aberration of generally
accepted practice. Thus, in such instances, it would be more appropriate
for tribunals to use a "survey approach" in order to find a rule which is
indicative of modern practice, as found in relevant jurisdictions and inter-
national law. Any rule that is arrived at in this fashion would be more likely
to meet the parties' expectations of procedural equity as determined by
their decision to submit this matter to an international tribunal, and not a
domestic legal system which they were unfamiliar with.
On the other hand, commentators agree uniformly that there is not a
commonly accepted group of principles which can be applied in each and
every situation, thus there are instances where a particular municipal rule
must be chosen. In this respect, the choice must be made on grounds of
sound legal doctrine, and to that extent, a "closest connection" test is
entirely reasonable because of its wide acceptance in international legal
conventions and practice.

107)Such as where a party is in possession of a document which if turned over would cause it to
incur civil or criminal penalties.
64 O'Malley/ The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

D. Is the Request to Produce UnreasonablyBurdensome?

Article 9(2)(c) of the IBA Rules grants a party the right to object to a
Request to Produce on the ground that it presents an "unreasonable burden
to produce the requested evidence". The following portion of this article
will examine the general rule which is applicable to objections of burden as
well as the role a party's jurisdictional background may have in a tribunal's
analysis of burden.

1. The General Criteriato Be Applied to Objections Based on Burden

There is clear arbitral precedent that a party cannot escape its duty to
provide evidence by simply claiming that the evidence that is requested is
"voluminous" or a burden to produce.'08 However, there are times when
requests for document production can go too far, and pose unreasonable
hardships on a party. The analysis of this issue is assisted by an objective
criteria, as was articulated in ICC arbitration No. 11258. In response to
a defense lodged by the respondent that a production of documents was
burdensome, the tribunal articulated the following formula:

As a threshold matter, the Tribunal notes that, in and of itself, the

burden on a requested Party does not represent a sufficient reason to
disallow a request for production of documents. The burden imposed
on the producing Party should be weighted against the potential use of
the documents. 109

According to the above, an inquiry into the usefulness of the documents,

which would be similar to an analysis as to their materiality as described
above, is required as a starting point. Moreover, once it is determined that
the requested document is material, a tribunal should determine whether
the issue which a party seeks to prove with the documentary evidence is
very important to a final award. Requests for documents which have highly
probative value with regard to an issue which is nonetheless viewed by the
tribunal as minor, may not justify the burden imposed on the party asked
to produce it. Some preliminary issues, such as the determination of the

"") INA Corporation v. The Government of the Islamic Republic of Iran, 8 Iran-US Cl. Trib.
Rep. 373-377, No. 184-161-1 (August 13, 1985).
")J" Unpublished, ICC No. 11258, Procedural Order No. 2 (2003).
O'Malley/ 7he Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90 65

choice of applicable law, for instance, may not justify asking one party
to go through the effort to locate and produce documents."0 The burden
imposed on a party who must produce the evidence should be propor-
tional to the value of the documents."'
In most instances a tribunal is likely to find a Request overly burden-
some where either the location of the documents or the effort needed to
obtain them is difficult for the tribunal to quantify. In an ICSID arbitra-
tion entitled RailroadDevelopment Corporationand Republic of Guatemala
the investor party had petitioned for interim measures requiring the state
party to preserve what it considered to be important and relevant docu-
ments." 2 The requests that were submitted by the investor party were
judged to be overly broad by the tribunal, however, in addition to that, the
tribunal denied the request because the type of search that the state party
would have to undertake in order too comply with it was difficult to mea-
sure, and thus was judged too burdensome. The tribunal made the follow-
ing point in connection with this issue, "The Tribunal is doubtful that such
an all encompassing request, if recommended, can realistically be put in
practice. In this respect, the Tribunal fails to see how the measures requested
would suppose a merely 'ministerial task' for the government."' 'I
The burden placed on a party due to document production need not be
based purely on factors involving physical effort and expense. In a NAFTA
arbitration Waste Management, Inc v. United States of Mexico conducted
under the UNCITRAL Rules, the state party requested documents con-
cerning the possible commercial value of the investor party's subsidiary com-
pany. ' 4 For various factual reasons the documents which the state party
sought were in the possession of a third party with whom the investor

110)This would not necessarily be the case for the issue of jurisdiction, however, as that issue
can be central to whether an arbitration will proceed. This was recognized in ICC arbitration
14069 - whereby the tribunal decided that the Respondent had a right to contest jurisdiction
but was still subject to the discovery process. See also unpublished, ICC No. 14069, Procedural
Order No. 2. See also the procedural schedule in the RosinvestCo v. Russia, supra note 14, arbitra-
tion whereby the Tribunal made provision for discovery during the jurisdictional phase.
I As an example, in one arbitration the tribunal denied discovery because the invoices sought
by the respondent were primafacie too voluminous in number and the content of those invoices
was largely not in dispute. Waste Management v. Mexico, ICSID No. ARB(AF)/00/3 (2002).
1121)Railroad Development Corporation and Republic of Guatemala, ICSID Case. No. ARB/
07/23, Decision on Provisional Measures.
113) Id, p. 16.
114)Waste Management v. Mexico, supra note 111.
66 O'Malley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

party had a confidentiality agreement. The state party apparently believed

that it had the ability to discover those documents from the third party, if
only the investor party would waive its rights under the confidentiality
agreement and allow the documents to be disclosed. Thus, it requested the
tribunal to order the investor party to waive its rights under the confiden-
tiality agreement. The investor party resisted the request that it waive the
confidentiality agreement, and demonstrated that to do so would cause it
to take an adverse position in regard to current litigation involving that
same third party. The tribunal agreed that this would be burdensome and
denied the state party's request.
To determine the exact nature of the burden which is complained of, the
Working Party commentary suggests that the volume or number of docu-
ments requested as well as the access a party has to them are considerations
to be taken into account.' 5 One could also add the cost of producing the
document to such a list. A tribunal in these instances should not be afraid
to use its own common sense, and knowledge of business practice when
assessing the burden and inferring what is reasonable under the circum-
stances. 16 In fact, the modern approach to this issue, as reflected by court
rules regarding e-discovery, shows that tribunals should take into consider-
ation the commonly accepted practices regarding the storing and keeping
7
of data when determining what may be considered truly burdensome."1
In particular, reference should be made to what would normally be consid-
ered as standard record keeping practice for parties in various industries
(e.g. the construction industry) when assessing whether the documents
requested should be easily accessible.
In all situations, however, the "proportionality" rule, as stated above,
should weigh the heaviest upon a tribunal's decision regarding what is to
be considered unreasonably burdensome. In arbitrations where the facts
and issues regarding a dispute simply do not warrant an in-depth phase of
document production, such procedures should be minimal. As an example
of the other extreme, however, it may be useful to make note of a recent

11" IBA Working Party, supra note 5.

110 Methanex v. United States ofAmerica, supra note 69 § 57 Part III Chapter B, The Tribunal

noted in this case, "inference is an appropriate mode of decision in circumstances in which

firmer evidence is not available." See also Mojtaba Kazazi, Burden of Proof and Related Issues:
A Study on Evidence Before International Tribunals 243 (1996).
II7) For a discussion of e-discovery and arbitration see, John M. Barkett, E-Discovery for Arbitra-
tors, I Dispute Resolution International2, 129 (2007).
OMalley / The Law andPracticeofInternationalCourts and Tribunals 8 (2009) 27-90 67

arbitration that was held under the rules of the International Center for
Dispute Resolution ("ICDR"), between an Israeli and American company.
In that instance, claims for approximately 275 million U.S. dollars were in
dispute, and perhaps understandably, the amount of document produc-
tion which took place exceeded 150,000 pages of evidence.1 8 Clearly, in
that arbitration, the tribunal felt that extensive document production was
not unreasonably burdensome.

2. The JurisdictionalBackground of the Parties

A party's perception of burden may be heavily shaped by the legal culture
from which they come as their preparedness to disclose documents can be
informed by whether they are familiar with document production. This
was certainly the case in the Noble Ventures arbitration wherein the arbitral
tribunal specifically noted that some document disclosure in international
arbitration was allowable, but that this should be weighed against the fact
that the respondent, the Government of Romania, was from a "Civil Law
country where production of documents is used less than in common law
countries from where the investor comes"." 19
In an ICC arbitration with its seat in Switzerland, the tribunal also took
into consideration the legal jurisdiction from which the parties were from,
and noted the impact this had on document production:

In considering the Applications at issue, the Tribunal has been informed

by the fact that this arbitration has its seat in a civil law country and
that all of the parties involved in this arbitration are from civil law
countries. It follows that in deciding the Applications at issue, due con-
sideration has to be given to what constitutes a proper order for pro-
20
duction of documents from the civil law perspective. 1

From these examples one can surmise that tribunals feel that the civil law
background of one or both of the parties to an arbitration is a factor which
should be taken into consideration when properly balancing the document
production phase of an arbitration. This does not mean though that parties

"' Moftt Etzion Ltd. v. General Dynamics Land Systems Inc., U.S. Dist. LEXIS 11362 (Feb.
2008).
"9) Noble Ventures Inc. v. Romania, supra note 18.
120)ICC Arbitration, seat in Switzerland, No. (undisclosed), [Unpublished decision).
68 O'Malley / The Law andPracticeof InternationalCourts and Tribunals 8 (2009)27-90

from jurisdictions which do not have document production as part of their

legal heritage should in anyway receive a free pass or the converse: it may
be that the expectations of parties with common law backgrounds when
it comes to obtaining document production will not be accommodated,
however, as many well known commentators on the topic have stated,
document production is now a part of international arbitral procedure and
thus parties who hail from civil law jurisdictions must also recognize that
it is not unreasonable to be called upon to disclose documents to the
opposing party.'2'

E. CommercialandTechnicalConfidentiality GroundsforDenyingDocument
Production
Article 9(2)(e) states that document production can be denied on the
"grounds of commercial, or technical confidentiality that the Arbitral Tri-
bunal determines to be compelling". The Working Party Commentary
states that this rule has been included because it is recognized that in arbi-
tration practice there are documents which carry special technical or com-
mercial significance that should not be discoverable. 22 Indeed, the fact
that documents may not be per se privileged, but nonetheless have propri-
etary information which should by all means be kept confidential, has
been recognized before in statements of transnational procedural principles
as a factor to be weighed by international tribunals when considering
whether to order document production. 23
Determining what may be considered a compelling commercial or tech-
nical reason for denying a party document production is largely fact based.
One tribunal seated in the Netherlands under the ICC Rules formulated
this concept as an "unacceptable invasion of privacy". 124 In its procedural
order, the tribunal rendered a decision on a number of requests for docu-
ment disclosure, and routinely denied requests for documents which related
to the financial status of a company, including bank statements and also
tax returns, as being unduly invasive.' 25 Rulings of this kind are somewhat

12') B. Hanotiau, supra note 3.

122) Working party commentary, p. 20.
123) Unidroit/ALI Principles 16.5, "A person who produces evidence, whether or not a party, has
the right to a court order protecting against the improper exposure of confidential information."
1-4) Unpublished, ICC No. 1000, Procedural Order No. 8.

125) Id.
OMalley / The Law and Practiceof InternationalCourtsand Tribunals 8 (2009)27-90 69

instinctual as documents which reveal the financial inner workings of a

company would naturally seem to be accorded a higher level of protection
due to the repercussions that they can have for a party should they be
revealed. Such reasoning would also extend to formulas, know-how and
trade-secrets which companies go to great lengths to keep confidential.
This is less the case in regard to general records such as meeting minutes
of a relevant committee for example, or correspondence which discusses a
pertinent point.
That is not to say though that there are not instances where a request for
the production of highly probative financial, or technical records can be
granted by a tribunal, if it deems it necessary. This is especially true where
a confidentiality agreement or other measures may be taken by a tribunal
in order to protect the sensitive information. 2 6 The IBA Rules make provi-
sion for a general principle that all documents shall be kept confidential
and used only for the purposes of the arbitration in Article 3(12) of the
Rules, and moreover, they also authorize the tribunal to render procedural
orders setting rules of confidentiality binding the parties. An example of
such an order was issued in 2004 by an ICC tribunal sitting in regard to a
dispute between an Asian and European company. 2 7 In that instance the
tribunal was concerned about the confidentiality of the technical "know
how" which was described in two expert witness reports. The tribunal on
the other hand wanted to facilitate the procedure by asking the opposing
experts to meet and confer on points of agreement between their two
reports. In order to move matters along, while also meeting the concerns
of the parties over the protection of their respective trade secrets, the tribu-
nal issued a procedural order inviting the expert witnesses themselves to
enter into a "confidentiality undertaking" before moving forward with the
procedure.
In conjunction with the objection listed in Article 9(2)(e), tribunals have
in the past undertaken to review sensitive documents in camera. 28 In one

126) Article 3(12) of the IBA Rules provides that all documents that are produced during the
procedure be kept confidential and authorizes the tribunal to issue orders to that effect. See also
Article 9(3) of the same rules.
,27)Unreported, Procedural Order No. 7, 23 September 2004 (without number).
12') JardineLloyd Thompson CanadaInc. v. Western Oil Sands Inc. [2005] ABQB 509. The Alberta
Court of Appeals upheld the jurisdiction of the tribunal to order the document to be produced
to it. JardineLloyd Thompson CanadaInc. v. Western Oil Sands Inc. [2006] A.J. No. 32.
70 O'Malley / The Law andPracticeof InternationalCourts and Tribunals 8 (2009) 27-90

particular instance, during an international commercial arbitration in Cal-

gary, Canada held under the local rules of procedure, a tribunal ordered a
party to produce a commercial contract for its inspection which was sub-
ject to a confidentiality agreement.'29 When this action was challenged
before the Alberta Court of the Queen's Bench, it was argued that the
standard found in Article 9(2)(e) should have dissuaded the tribunal from
ordering the production of the contract, and that the confidentiality agree-
ment acted as a bar, preventing the tribunal from ordering the production
of the document. The court rejected both of those arguments, and affirmed
the right of the tribunal to conduct an in camera inspection of the docu-
ment to determine whether it should be turned over to the party whom
had requested it. While the Rules do not speak to this procedure directly,
they do allow tribunals to appoint an expert to review the evidence to
determine whether it should be kept out of the procedure, performing a
role similar to the one undertaken by the Canadian tribunal. Article 3.7 of
the Rules speaks directly to this procedure.
The abovementioned approaches are examples of the creative way in
which tribunals can use the inherent flexibility of arbitration as well as the
powers granted to them within the rules to protect confidential proprietary
information. In many instances, the confidentiality of such information is
not based in the strict application of a legal principle, such as attorney-
client privilege. 30 Thus tribunals do have a certain leeway in attempting to
find practical solutions that can meet the concerns of a party who objects
to the production of documents on the basis of Article 9(2)(e). Admittedly,
confidentiality measures within an arbitration may cause the procedure to
become complex. This concern, however, has been regarded by tribunals in
the past as not constituting a valid reason for a tribunal to back away from
providing the protective framework needed to allow commercially or tech-
31
nically sensitive documents to be used in an arbitration.'

129) Id.
'3) Arguably, the right of parties to have protections given to them is agood faith principle com-

monly recognized in international principles of due process. See art. 16.5 of the ALI/UNIDROIT
Principles of Transnational Procedure.
1i31 Canfrr v. United States, NAFTAIUNCITRAL, unnumbered § 146: "Tribunals operating at

a level of the NAFTA and of other multilateral or bilateral investment treaties should be, and are
as a rule, capable of dealing with procedurally complex cases with difficult confidentiality issues
without an appreciable decline in efficiency or without any impairment of due process", available
at http://www.state.gov/documents/organization/53113.pdf.
OMalley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009) 27-90 71

E Special Politicalor Institutional Groundsfor Resisting the Production of

Documents
IBA Rules Article 9(2)(f) states that a Request for Production may be denied
on the "grounds of special political or institutional sensitivity (including evi-
dence that has been classified as secret by a government or a public interna-
tional institution) that the Arbitral Tribunal determines to be compelling."
This issue is particularly present in investor-state arbitrations where state
parties have objected to requests for document production on grounds of
governmental privilege or state secrecy.
Privileges that are asserted by government entities or international orga-
nizations which are crafted to protect their particular work are different
from other types of legal impediments such as the confidentiality of medi-
ation documents or attorney-client privileges (although governments can
also avail themselves of such privileges as well). 132 These types of privileges
are based on the policies found in many municipal legal systems which
protect the consultative or deliberative process required by governments to
be able to operate, including the right to treat highly sensitive state secrets
as confidential. 13 3 Such privileges have been recognized by tribunals in the
past, as was pointed out in NAFTA Chapter 11 arbitration, Pope & Talbot
Inc. and The Government of Canada, whereby the tribunal dealt with the
issue:

It is not in dispute that a ground that may justify refusal of a party

to produce documents to an international arbitral tribunal may be
the protection of state secrets. But any reasonable evaluation of the
quality of that justification must depend in large part on having some
idea what those documents are. A determination by a tribunal that
documents sufficiently identified deserve protection is a very different

32) A type of this privilege known within the United States as the "deliberative" privilege is
defined as, "This governmental privilege permits governments to withhold documents that
reflect advisory opinions, recommendations and deliberations comprising part of a process by
which government decisions and policies are formulated, and was developed to promote frank
and independent discussion among those responsible for making governmental decisions and to
protect against premature disclosure of proposed agency policies or decisions." Black! Law Dic-
tionary (1990 6th Edition), at 1197.
133) The Glamis tribunal explained the basis for deliberative process as one relating to "...the

Government's need for the free and open exchange of communications." Glamis Gold Ltd v. the
UnitedStates ofAmerica, unnumbered at para. 58 (April 21, 2006).
72 OMalley / 7he Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

matter from acquiescence to a simple assertion, without any identifica-

4
tion, that they deserve protection."1

Two rules can be taken from the quote above. First, that governmental
privileges are recognized as a legitimate grounds for denying the produc-
tion of documents by international arbitral tribunals. Second, a state party
which asserts such grounds, must be required to justify the factual basis for
why the documents are subject to a governmental privilege. The following
two sections analyze these two aspects of this issue.

1. The Recognition of the Right of Governments or International

Organizationsto Protect Sensitive Documentsfrom Being Discovered
Decisions by tribunals, when it comes to matters of evidentiary procedure,
must be framed by the need to treat the parties equally. In an arbitration
involving a state party and a private party, it is clear that governmental
privilege is exclusively available to the state party in as much as a private
party cannot avail itself of a right to withhold evidence stemming from
the need to protect politically sensitive documents from being discovered.
Thus it is an inherently one-sided affair. This fact, however, must also be
balanced against the reality that governmental privilges are recognized as
legitimate reason for denying document production by the IBA Rules.
The IBA Rules do provide a balanced standard for tribunals by requir-
ing them only to accept the assertion of governmental privilege under
Article 9(2)(f) where they find the reasoning of the state party to be "com-
pelling". In order to find something compelling, a case has to be made for
the assertion of the privilege. This may seem self-evident, however, state-
parties in the past, such as in the Pope case and in a second NAFTA Chap-
ter 11 arbitration against Canada called S.D. Myers Inc. and The Government
of Canada have asserted this right by simply informing the tribunal that
the documents had been "certified" as falling under what has been termed,
"cabinet" or "crown privilege", without further explanation.135

134 Pope & Talbot Inc. v. Canada, NAFTA/UNCITRAL, unnumbered at § 2. Found at http://
ita.law.uvic.ca. In this case Canada had asserted a privilege referred to as "cabinet confidences"
which refers to a Canadian Government policy of protecting documents and reports issued as
part of the "collective decision making process". See also RPG Information Services Study, The
access to Information Act and Cabinet confidences: A Discussion of New Approaches, 1996, at 4.
135)The S.D. Myers tribunal did give room for considering Canada's Cabinet confidences law
insofar as it felt compelled to take under consideration the "personal" legal rights of Canada as a
OMallky / The Law and Practiceof InternationalCourts and Tribunals 8 (2009) 27-90 73

In both instances, the tribunals first noted that they were not strictly
bound by the laws or rules of evidentiary procedure of the state party. This
is consistent with arbitral precedent that tribunals are not bound per se
to follow municipal procedural rules on evidence, which would arguably
extend to rules on the confidentiality of possible evidence. 3 6 Moreover, it
is a well established principle of arbitration that parties are obliged to give
full cooperation to the tribunal in providing relevant evidence.1 37 This is
not to say that the law of the state party is wholly irrelevant, as the S.D.
Myers tribunal pointed out, it is important for tribunals to take into con-
sideration relevant domestic laws if for no other reason than they indicate
what the "personal" legal rights and obligations of the state party are. Nev-
ertheless, tribunals should consider a number of different legal obligations
incumbent upon it when performing this analysis, which means looking to
different, relevant sources of law, in order to weigh the equities. The instruc-
tion of the S.D. Myers tribunal describes the types of considerations that
should be reviewed:

The Tribunal recognizes that this issue must be decided in the context
of this NAFTA Chapter 11 dispute which is being conducted under
the UNCITRAL Rules (which afford to the Tribunal considerable
discretion in the management of the dispute) and which potentially
38
embraces consideration of international and domestic law.'

Tribunals in the past have not felt compelled to follow the designation of
documents by a state party as subject to governmental privilege, by simply
accepting the application of the domestic law of the state party. This does
not mean, however, that tribunals will not look to the provisions of a state
law, but it is up to the state party to give a reasoned explanation as to why
the law should be applied.

party to the arbitration. S.D. Myers v. Canada, NAFTA /UNCITRAL, unnumbered (2002)
Procedural Order No. 10 (Explanatory Note). Found a http://ita.law.uvic.ca.
'36)Mojtaba Kazazi, supra note 116 at 233 and 234. See reference to the Mexican claims com-
mission case Parkerv. UnitedMexican States whereby it was stated: "As an international tribunal,
the Commission denies the existence in international procedure of rules governing the burden of
proof borrowed from municipal procedure. On the contrary, it holds that it is the duty of the
respective Agencies to cooperate in searching out and presenting to this tribunal all facts throw-
ing any light on the merits of the claim presented."
137) Id
111S.D. Myers supra note 135 at 2.
74 OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90

What has not been found compelling are refusals by state parties to
an arbitration to produce documents because those documents are neces-
sary for pursuing a domestic judicial action against the private party. That
was the case in an investor-state arbitration held under the UNCITRAL
Rules between a European investor and an Asian state. 3 9 In this particular
instance the investor party requested that documents be produced which
had been initially stored in his office, located within the respondent state.
The state party's security police had, prior to the initiation of the arbitra-
tion, raided the offices of the investor party and taken numerous docu-
ments relevant to the arbitration. It was also clear that the state party had
developed a file of relevant information as part of its investigation. When
the investor party sought the production of those documents (including
the file the police had on him), the state party denied production based
upon its belief that it had a right to withhold the documents as they were
needed to effect its prosecution in the national court. The tribunal rejected
such reasoning, and ordered the state party to turn over copies of all of the
documents it had seized, as well as the contents of the file it had built on
the investor. 40
What can be surmised from the above is that tribunals may very well
apply the law of governmental privilege of the state party when confronted
with such objections. However, where state parties withhold such documents
by simply alleging, "that the documents are related to or contain information
protected by our law on governmental privilege", tribunals have not accepted
such reasoning at face value. Even if the law authorizes governments to with-
hold such information due to a special governmental privilege by simply
designating it as such, an international tribunal, which by its very nature,
operates under separate procedural laws (e.g. the UNCITRAL Rules), may
require a state party to provide a reasoned explanation as to why it is enti-
tled under municipal or international law to withhold these documents.' 4 '

'3 ) Unpublished, UNCITRAL, unnumbered (August 15, 2005), Procedural Order No. 3.
140) Id. The tribunal's ruling was as follows: "The Arbitral Tribunal notes Respondent's objection

that the procedural file relating to these proceedings cannot be released at this time since judicial
proceedings are still ongoing. The Arbitral Tribunal can see no reason, however, why it would not
be possible to release copies of such documents."
141) In this respect, the Working Party noted in regard to Article (f) that, "the IBA Rules of

Evidence reflect the belief that some internal documents are properly producible in international
arbitration, even documents that may not be producible in a state court in certain nations". IBA
Working Party, supra note 5, at 20.
O'Malley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90 75

2. Governmental Privilege- The FactualBasis

As previously explained, tribunals should require a reasoned explanation
as to why the documents in question should be withheld on the basis of
governmental privilege from a state party which is resisting a Request to
Produce. A "document by document" approach whereby a government or
institution is required to give sufficient information and justification to
sustain the claim of special sensitivities per each document (or category of
documents) has been employed by tribunals in the past. 41 2 The Pope tribu-
nal made that point in their procedural order as follows:

In the Canadian Measures Affecting the Export of Civilian Aircraft

case, 14 April 1999, the WTO panel stated that where a state is justi-
fied in withholding information, it is to be expected that it should
'explain clearly the basis for the need to protect that information.' So
4
too does this Tribunal expect clarity.

This approach will often require the state party to produce a "privilege log"
which describes the dates of the documents, a general description of their
character and a summary reason for why they are being withheld. As noted
above, when analyzing issues concerning document production, a tribunal
may feel that the procedure has not progressed to a stage where it can make
a decision based upon the information provided by the state party and the
stated need of the private party. It is the second of those two factors which
may give a tribunal reason to postpone ordering document production
while it waits to see whether the "need" of the private party will truly out-
weigh the assertion of privilege by the state party. This point was made by
the Glamis tribunal in one of its procedural orders:

The decision by the Tribunal to defer some decisions until a later time
is driven by two factors. The starting point for the Tribunal is that it
should not override privileges unnecessarily. Simultaneously, the ques-
tion of Claimant's need for a particular document cannot be assessed
with accuracy at this early point in the arbitration. This is particularly
the case give the fact that Claimant in many instances has other docu-
ments, or entirely different means of proof, available to it to establish
142)S.D. Myers v. Canada, supra note 135.
'43) Pope & Talbot v. Canada,supra note 134.
76 O'Maley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009) 27-90

a proposition. In deferring a decision, the Tribunal anticipates that

such decision will not be made until, or following, the hearing on the
merits of the claim.144

It can be taken from the above quote that tribunals have felt that it is pru-
dent to proceed with caution when overruling an assertion based on gov-
ernmental privilege. Parties should thus make provision in their Requests
for explaining to a tribunal, when requesting documents that may be sub-
ject to a claim of governmental privilege, why in relation to the current
phase of the proceeding such documents are valuable to the tribunal's under-
standing of the case.
In sum, it can be said that the "document by document" approach of
looking to each particular document or category of documents in order to
determine the grounds for claiming the privilege is a useful and preferred
approach by tribunals. In so doing, however, tribunals may wish to ensure
that the record of the procedure is developed enough that they may assess
whether the serious, and complicated issue of the assertion of governmen-
tal privilege can be properly analyzed.

G. Objections to Document Production Based on Considerationsof Equality

and Fairness
Issues of fairness and equality are considerations which continually under-
pin arbitral procedure. They also come into play and can be determinative
of whether or not evidence should be discoverable. The IBA Rules of Evi-
dence provide for this principle in Article 9(2)(g), wherein it states that
tribunals may exclude evidence or deny document production based on
"considerations of fairness or equality of the Parties that the Arbitral Tribu-
nal determines to be compelling". 145 The Working Party's comment on this
Article is essentially that it should be considered a "catch-all" provision,
which allows tribunals to deny document production if to do so would be
unfair for a reason not expressly set forth within the list of objections found
in Article 9.146

144) Glamis April 21, 2006 Order.

145)IBA Rules, supra note 4, Art. 2(g).
146)IBA Working Party, supra note 5 at 20.
OMalley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90 77

The concepts of equality and fairness as applied under Article 9( 2 )(g) by

arbitral tribunals can be broken down into two subdivisions, both of which
have an impact on the issue of document production within arbitration. For
the purposes of this article, these two different aspects will be referred to as
a) the equal and fair treatment of a party; and b) the equality of arms as
between the parties. The analysis of these two subsets of the equality issue
and how they relate to the issue of document production is set forth below.

1. The Equal and FairTreatment of a Party Under Article 9( 2 )(g)

A tribunal is primarily concerned with the fairness and equality of a proce-
dure because it is a de minimis rule of international arbitral procedure
found most often in the applicable lex arbitri.4 7 The UNCITRAL Model
Law ("Model Law") Article 18 states that the parties shall be "treated with
equality and each party shall be given a full opportunity of presenting its
case". 48 This principle is thus a matter of mandatory domestic law or the
lex arbitriand is focused on the conduct of a tribunal or how the tribunal
has "treated" the parties. The equal treatment rule comes into greatest
effect when a tribunal's actions are challenged in front of a court as being
patently "unfair" and "unequal", such as during a setting aside action. In
this regard the equality standard sets a boundary around the arbitral proce-
dure and acts as a restriction upon the freedom of a tribunal's right to
conduct the arbitration.
There are different formulations of this concept in the various arbitra-
tion laws enacted within different states. However, as a general description
of what equal treatment means, the following quote summarizing the
French perspective on the matter is instructive:

The principle of equality should not be given a strictly mechanical

meaning; it does not mean that each party should have precisely the
same number of days in which to prepare its submissions or exactly the
same time to present its oral pleadings, for example. What matters is
that a general balance be maintained and that each party be given an
equal opportunity to present its case in an appropriate manner. 49

147)UNCITRAL Model Law art. 18 supra note 21, at 14.

148)Id
149)E. Gaillard & J. Savage, eds., FouchardGaillardGoldman on InternationalCommercialArbi-
tration, p. 947 (Kluwer Law International, 1999).
78 O'Malley/ The Law andPracticeofInternationalCourts and Tribunals 8 (2009) 27-90

The Swiss Federal Tribunal has also fashioned the equal treatment require-
ment in a similar manner by stating that equal treatment "implies that the
proceedings be regulated and conducted in such a way that each party has
the same opportunities to present its case." 5 °
Cognizant of the fact that all tribunals are bound by this duty, it is abso-
lutely appropriate that Article 9( 2 )(g) be included within the IBA Rules.
One can certainly imagine a situation where a tribunal limits the amount
of document production it will allow within an arbitration to only certain
subject matters or to certain types of documents. 'here it does undertake
such restrictions it must apply them equally between the parties, so that
where a party submits a Request to Produce which in the estimation of the
tribunal would be inconsistent with what it has previously allowed, then it
could deny the document production under Article 9( 2 )(g) as being unfair
or unequal. In terms of being a "catch-all" provision, Article 9( 2 )(g) gives
tribunals necessary flexibility in that it allows them to refuse Requests for
reasons which are not set forth in Article 9, but nevertheless relate directly
to the consistent administration of the procedure. As mentioned above,
situations may arise where a legal privilege available to one party allows it
to exclude certain documents from the procedure, while the opposite party
has no such rule it can rely on. In this case Article 9( 2 )(g) would allow the
tribunal to extend this protection to both parties. Thus, in this regard,
tribunals should use Article 9(2)(g) as a means of ensuring that it conducts
the proceedings in accordance with the equality and fairness requirements
of the lex arbitri.

2. The Equality of Arms Between the Parties Under Article 9( 2 )(g)

Considerations of equality and fairness in regard to the conduct of an arbi-
tration are not confined merely to whether the arbitral tribunal itself has
treated the parties in an impartial and equitable manner.' 5' In theory, both

150) Quoting DFT of 7 January 2004 [4, p. 196/2003] as reported in Tobias Zuberbueler, Chris-

toph Mueller, & Philipp Habegger (eds.), Swiss Rules ofInternationalArbitration,A Commentary,
pp. 146-147 (2005).
's0 Methanex v. UnitedStates ofAmerica, supra note 69, Final Award of the Tribunal on Jurisdic-
tion and Merits, para. 54 at 26 "In the Tribunal's view, the Disputing Parties each owed in this
arbitration a general legal duty to the other and to the Tribunal to conduct themselves in good
faith during these arbitration proceedings and to respect the equality of arms between them, the
principles of'equal treatment' and procedural fairness being also required by Article 15(1) of the
UNCITRAL Rules".
 OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90 79

of the parties to an arbitration should have a fundamentally equal oppor-

tunity to present their case, or to argue the matter on an even playing field.
Where one party is able to prevent the other from doing so, or even to
frustrate another party's ability to obtain the evidence it needs, the ques-
tion may arise as to whether the arbitration procedure is in fact fair, and
equal. In other words, a tribunal has the right to ensure that the parties to
a dispute are acting in good faith. Often times this issue is referred to as the
"equality of arms" doctrine, and it has been defined before by the Euro-
pean Court of Human Rights as follows:

The 'equality of arms' principle is an attempt to ensure that both sides

of the dispute are given equal opportunity to present their case and to
receive legal assistance and advice.' 52

In regard to arbitration, this principle has been described by commentators

as a reference to ensuring procedural equality in a manner that is not always
fulfilled by a strict, formalistic administration of the procedure, and which
may take into account factual circumstances which are outside the confines
of the record. While considering a concept similar to equality of arms, that
of "abuse of process", the Waste Managementtribunal opined that indeed a
tribunal may have a right to use its powers to ensure that neither party
is using the arbitral procedure in an abusive manner, by "protecting the
integrity of the Tribunal's processes or dealing with genuinely vexatious
claims". 5 3 Reference to this concept can also be found in the United Nations
Convention on the Law of the Sea.'
The Waste Managementtribunal's quote above suggests that tribunals can
consider whether an arbitration procedure is truly fair to both parties by
looking to whether the actions taken outside of the procedure by the par-
ties themselves are consistent with fair play and good faith. 55 The tribunal
in the ICSID case Libananco Holdings Co. Limited and Republic of Turkey
expounded upon this doctrine and explained that it applies directly to arbi-
tral procedures as follows:

152)Dombo Beheer B.V v. The Netherlands (1993) 18 E.H.R.R. 213.

153)Waste Management v. Mexico (No 2) (ICSID Case ARB(AF)/00/3, Decision on Jurisdiction
of 26 June 2002), para. 49 at 19.
"15 UNCLOS art. 294.
'55 Petrochilos, supra note 9 at §4.87.
80 OMalley / The Law andPracticeofInternationalCourts and Tribunals 8 (2009)27-90

... like any other international tribunal, it [the Libananco tribunal]

must be regarded as endowed with the inherent powers required to
preserve the integrity of its own process - even if the remedies open
to it are necessarily different from those that might be available to a
domestic court of law in an ICSID Member State. The Tribunal would
express the principle as being that parties have an obligation to arbi-
trate fairly and in good faith and that an arbitral tribunal has an inher-
ent jurisdiction to ensure that this obligation is complied with; this
principle applies in all arbitrations, including investment arbitration,
and to all parties, including states (even in the exercise of their sover-
56
eign powers). 1

This doctrine, insofar as it is accepted, is certainly applicable to issues

regarding evidentiary procedure. Applying it may entail, for example, a
recognition by the tribunal that one party has a dominant position vis-a-
15 7
vis the other, and has access to information which the other does not.
This factor has been considered by international tribunals before when
fashioning their evidentiary orders, and tribunals could conceivably be
within their rights should they wish to take steps to order that evidence be
made available to both parties in order to correct this imbalance. 5 ' The
equality of arms doctrine has been interpreted to mean that tribunals have
a right to take measures to ensure that parties are not allowed to benefit
from unethical or illegal means of gathering evidence at the cost of their
opponent.' 1 9 What follows is an analysis of relevant case law in which the

116) Libananco Holdings Co. Limited and Republic of Turkey (ICSID Case No. ARB /06/8 Decision on
Preliminary Issues 23/06/2008) 1 at 36-37, available at http://www.globalarbitrationreview.
com/ files/ReasonedDecisionon Preliminarylssues.pdf.
157) In relation to this point, Professor Wayne Mapp in his book on the Iran-United States

Claims Tribunal mentions this principle in relation to the liberality of tribunals with regard to
the admission of evidence. "The reason for this liberality was considered by the International
Court of Justice in Corfu Channel (merits) case (United Kingdom v Albania). The Court noted
that states exercise exclusive territorial control within their frontiers and thus the claimant state
is not usually in a position to "furnish direct proof of facts giving rise to responsibility." This is
equally true of claimants before the Iran-United States Claims Tribunal, since claimants of either
state would find it extremely difficult to obtain any evidence beyond what they had in 1979 from
the territory of the respondent government." Wayne Mapp, The Iran-UnitedStates Claims Tribu-
nak The First Ten Years 1981-1991 p. 266 (1993).
18) Id.
09) Methanex v. United States ofAmerica, supra note 69, Final Award of the Tribunal on Jurisdic-
tion and Merits. para. 54 at 26.
O'Malley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009) 27-90 81

equality of arms standard has been applied, followed by concluding com-

ments on this issue.

a. The Admissibility and Production of Documentary Evidence if a Party's

Efforts to Obtain the Evidence Are Tainted by Illegal or Unethical Actions
The equality of arms standard came to bear in the NAFTA arbitration
Methanex v. the United States ofAmerica, however, not in connection with
the "discoverability" of documents, so much as the admissibility of evi-
dence. In this instance the investor party attempted to introduce evidence
into the arbitration that it had apparently secured through the use of a
private investigator. The state party objected to the introduction of such
evidence on the basis that it had been procured from a third-party illegally;
the specific allegation being that it had been taken from the trash cans of
the third party and thus was done so by trespass.' 6
After weighing the evidence regarding how the documents were obtained
and moreover the witness statements of the individuals involved, the tribu-
nal opined that the parties, "owed in this arbitration a general legal duty to
the other and to the tribunal to conduct themselves in good faith during
these arbitration proceedings and to respect the equality of arms between
them...,"1 6, The Tribunal believed that this was in fact a duty inherent
in arbitration procedure but also implied within the UNCITRAL Rules.
Once it had determined that the investor party had indeed committed
trespass in gathering the evidence, the tribunal shifted the burden to the
investor party to show why, irrespective of the trespass, the evidence should
be admissible.162 Interestingly, the tribunal also looked at the material value
of the document, however, judging that the investor party had indeed
gained the documents by trespass, and that the information contained
therein had been largely established by other means (e.g. witness testi-
mony), the tribunal excluded the documents from the proceedings.
As mentioned above, the tribunal considered this matter with regard to
the issue of admissibility of the evidence, and not "document production"
per se. Nevertheless, the standard used by the tribunal is instructive as it is
160)Ibid.
161)The tribunal did not make specific reference to IBA Rule 9(2)(g) but instead referred to
general notions of good faith and UNCITRAL Rule 15(1) which has a similar formulation to
that of the IBA Rules. Methanex v. UnitedStates ofAmerica, supra note 64.
Methanex v.UnitedStates ofAmerica, supra note 69. Part Il Chapter I§§ 55-56.
1621)
82 O'Malley / 7he Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

clear from its analysis that parties should not benefit from an illegal action
which puts the other party at a disadvantage, and therefore causes the pro-
63
cedure to become unequal.'

b. The Equality and Fairness of an Arbitral Procedure in Light of a Party's

Use of its Sovereign Power or Influence to Disrupt the Evidentiary Procedure
In an arbitration under the United Nations Convention for the Law of
the Sea ("UNCLOS") between the states of Suriname and Guyana over a
boundary dispute, a question arose in regard to the good faith, or lack
thereof, of actions taken by Suriname in regard to certain documents which
Guyana had sought to discover.'64 The documents concerned were Dutch
language historical records which were contained within the archives of
the Netherlands Ministry of Foreign Affairs, and were alleged to relate to
certain key aspects of the dispute concerning the proper boundary deter-
mination. Through inter-governmental pressure Suriname had successfully
prevented Guyana from being able to obtain the requested evidence from
the Dutch foreign ministry. Suriname's justification for this action ranged
from concerns over confidentiality, to its stated position that there was no
65
principle of international law obliging it to make this evidence available.
Guyana petitioned the tribunal for assistance in gaining access to the
documentary evidence it sought, and in particular requested an order
restraining Suriname from interfering in its efforts in obtaining the docu-
ments from the Dutch government. "" The tribunal's powers in this matter
were derived from the UNCLOS Convention, and its own procedural
rules (the IBA Rules were not a part of this procedure). In this regard, it
was repeatedly emphasized by the tribunal that the "principles of equality
of arms" and the duty of the parties to act in "good faith cooperation" with
the procedure were guiding its decision on the matters.
Technically, Suriname had not violated the law, however, by using its
political influence with the Dutch government, it had effectively blocked
the ability of Guyana to gather evidence. The tribunal felt that Suriname's
actions had pushed the equilibrium out of balance as it was actively pre-

163) Ibid.,
supra note 69. Part II Chapter I % 59-60.
'64) Guyana v. Suriname, Permanent Court of Arbitration, unnumbered, Procedural Order
No. 1 (2005), http://server.nijmedia.nl/pca-cpa.org/upload/files/Order/o201%20fin%20rev.pdf.
'65) Guyana v. Suriname,supra note 164.
'' Ibid.
OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009) 27-90 83

venting Guyana from gaining access to documents which were held by a

third-party, and which ultimately Suriname itself was likely to use. The
principle of equality of arms persuaded the tribunal to use its power over
the evidentiary procedure to prevent Suriname from using evidence it took
from files in the Netherlands foreign ministry, unless it provided the full
167
and complete file to Guyana (or asked the Netherlands to do so).
Suriname's use of inter-governmental pressure, which derives from its
sovereign status, to put its opponent at a disadvantage is similar to the
situation where a state party uses its sovereign powers to gain advantage
over a private opponent. Just such a problem confronted the Libananco
tribunal, whereby it became known that a state party had intercepted numer-
ous emails and other communications involving the investor party as part
of a criminal investigation it had launched. Moreover, one of the private
party's main witnesses had also declined to give testimony due to alleged
intimidation he had received in connection with the state party's criminal
investigation.
After reviewing the submissions by the parties on this point, the tribu-
nal invoked the principles underlying the equality of arms doctrine as the
basis for issuing a procedural order to address the complaints of the private
party. In so doing, the tribunal balanced two competing concerns, one, the
right of the state party to conduct criminal investigations, and two, the
right of the private party to have a fair procedure. The tribunal opined
that, "The right and duty to investigate crime, accepted by the Tribunal
above, cannot mean that the investigative power may be exercised without
regard to other rights and duties, or that, by starting a criminal investiga-
tion, a state may baulk an ICSID arbitration."' 68 Carrying forth this prin-
ciple into practical terms, the tribunal fashioned an order based on a rule
of separation, which is to say ordering that all information gained in the
criminal investigation not be made available to agents of the government,
including those in the employ of the government and counsel for the state

The force of the tribunal's decision in this matter is somewhat undercut by the fact that
67W)
Suriname, in the second day of hearings on this issue, made an offer similar to the one which was
adopted in the tribunal's final award, which nevertheless was rejected by Guyana. However, the
precedent still has merit, as Suriname itself could not sustain its position outright in light of the
principle of "equality of arms" which guides international dispute resolution procedure. Guyana
v. Suriname, Permanent Court of Arbitration, Transcript from 8 July 2005. Found at www.pca-
cpa.org.
1s) Libananco, supra no. 156.
84 O'Malley / The Law andPracticeof InternationalCourts and Tribunals 8 (2009)27-90

party involved in the arbitration. 169 Also, the tribunal ordered that the state
party ensure the free access to individuals whom the private party wished
to call as witnesses. The tribunal also made it clear that it intended to exclude
from the procedure evidence or information which the private party could
show had come from the criminal investigation by the state party.

c. Conclusions Regarding the Equality of Arms Doctrine and Document

Production
As the Methanex tribunal pointed out in the dictum to its award, it is
wrong for a party to be able to influence the procedure of an arbitration as
a result of actions which are illegal. Activities which break the law are not
the only ones which disrupt the equality of arms between parties, however.
As the Guyana and Suriname example shows, tribunals can act to correct
perceived imbalances in the equality of arms between the parties which
arise from the use by one party of its dominant political position over the
other. This is consistent with a point made by the Methanex tribunal
whereby it opined that it would be wrong for a state party to use its sover-
eign powers to gather evidence to the disadvantage of a private party (even
where it is not illegal to do so), and the decision by the Libananco tribunal
whereby it ordered the state party not to use the information it gained
access to as a result of its criminal investigation, to its benefit during the
arbitration. 170
In relation to the issue of document production, the principle of equal-
ity of arms would seem to mean that parties should not be granted docu-
ment production if their knowledge of the requested evidence has come
about through the use of surreptitious investigations or intrusive actions
which break municipal or international laws.17 ' This could also be the case
where a party has become aware of evidence due to the use of its sovereign
police powers. In a general sense, where one party is able to use its position
to disrupt another's reasonable efforts or ability to prepare the case, keep
privileged documents confidential, or otherwise exercise the normal rights

69) Libananco,supra no. 156, at 42 through 45.

76) Methanex v. UnitedStates, supra note 69.
'70 Methanex v. United States ofAmerica, supra note 69. Part II Chapter I at 462. In particular
the tribunal makes reference to the fact that it would be particularly onerous if a state party were
to use assets of the state (e.g. intelligence gathering apparatus) for the purpose of spying on the
opposing party.
O'Malley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90 85

of a party to participate in a procedure, the "equality of arms" or, as stated

in the IBA Rules of evidence Article 9( 2 )(g), "considerations of fairness
and equality" have been implicated. This may mean that a tribunal may
order document production, or deny it based upon which route it believes
will best bring about a fair result.

III. Drawing Adverse Inferences and Seeking Court Assistance

The final part of this article is dedicated to reviewing two articles of the
IBA Rules which do not deal directly with a Request to Produce but
nevertheless have an important impact upon the ability of parties to
procure documents. In the first instance, the well recognized practice of
drawing an adverse inference as it is practiced under the IBA Rules is
reviewed. Secondly, the issue of court assistance in obtaining documents
from parties who are not involved in the arbitration, as allowed under IBA
Rules Article 3(8) will also be discussed.

A. DrawingAdverse Inferences
As arbitral tribunals lack the authority to impose punitive sanctions upon
counsel or parties for failures to comply with procedural orders, the ability
of a tribunal to compel a party to comply with its order to produce docu-
ments is limited. As the tribunal noted in the Waste Management Inc. v.
UnitedMexican States arbitration the "ultimate sanction for non-disclosure
[of documents] is the drawing of an adverse inference against the non-dis-
closing party". 172 The IBA Rules of Evidence provide for drawing adverse
inferences in Article 9(4) of the Rules, whereby it is stated, "If a Party fails
without satisfactory explanation to produce any document requested in a
Request to Produce to which it has not objected in due time or fails to
produce any document ordered to be produced by the Arbitral Tribunal,
the Arbitral Tribunal may infer that such document would be adverse to
the interests of that Party."
As the Working Party Commentary states, the drawing of adverse infer-
ences where parties have failed to comply with a tribunal's order is a well
recognized principle of international arbitration procedure. Its use can be

172) Waste Management v. Mexico, supra note 111, Procedural Order (October 1, 2002).
86 O'Malley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009)27-90

traced back to the jurisprudence of the Mexican Claims Commission arbi-

trations, in particular what is often referred to as the Parker Case.7 3 In that
case the tribunal described the basic rule, which has subsequently been
adopted and followed by arbitrators since:

... In any case where evidence which would probably influence [the
Commission's] decision is peculiarly within the knowledge of the claim-
ant or of the respondent Government, the failure to produce it, unex-
plained, may be taken into account by the Commission in reaching a
decision.

The drawing of a negative or adverse inference allows for the tribunal to

adopt positions that are detrimental to the arguments of the party who has
failed to comply with the procedural order. A tribunal may accept the exis-
tence or the non-existence of a fact depending upon which is adverse to the
non-complying party. In any case, adverse inferences are a direct reference
to a tribunal's ultimate decision on the merits of a case, and it is only when
considering the merits that the inference should be drawn.' 74 Thus it is
not correct for a tribunal to draw an adverse inference during a procedural
stage of an arbitration, and then move forward through the remaining
phases as though the adverse inference is established on a particular point
in contention.' 75 Nevertheless, as was stated forcefully in the dissenting
opinion of the Iran-US Claims Tribunal case, FredericaLincoln Riahi v. The
Islamic Republic of Iran, tribunals should, as a matter of good order, pro-
vide reasoned analysis of a decision to, or not to, draw an adverse inference
from the non-compliance by a party and the effect the inference has had
76
on a decision on the merits.
There is a considerable amount of arbitral precedent on this issue, a read-
ing of which provides guidance as to how adverse inferences ought to be
drawn. Fortunately for this author, a well developed distillation of the rules
concerning the drawing of inferences from the non-compliance of a party

173) JI. Case v. Iran, 3 Iran-US Cl. Trib. Rep. 62, 66, No. 57-244-1 (June 15, 1983), referring

to the ParkerCase.
741) Waste Management v. Mexico supra note 111, Procedural Order No. 2 (November 27, 2002).
175)Id.

'76) FredericaLincoln Riahi v. Iran, Iran-US Cl. Trib., No. 485 (1992). Available at http://assets.
cambridge.org/97805218/67146/excerpt/9780521867146_excerpt.pdf.
OMalley / The Law and Practiceof InternationalCourts and Tribunals 8 (2009)27-90 87

with an order to produce documents has already been provided in an

article by Jeremy K. Sharpe published in 2006.177 Mr. Sharpe's analysis
essentially produced five basic rules. T-hese rules include the following
requirements: a) that tribunals insist that inferences be corroborated by
all available evidence from the party requesting the inference to be drawn,
b) the documentary evidence not produced must have been accessible to
the non-producing party, c) the inference must be reasonable and consis-
tent with the facts of the case, d) the party seeking the inference must
provide primafacie evidence in favour of the inference to be drawn and,
finally, e) that the party opposed to the inference must have been aware of
its duty to produce the documents. 78 For a further in-depth analysis of the
how and when of drawing an adverse inference, the reader is referred to
Mr. Sharpe's excellent article.
Drawing adverse inferences could cause concern to the arbitrator wish-
ing to draft the air-tight final award. After all, for the tribunal inclined
towards anchoring its reasoning on solid facts, to use an inference as a basis
for drawing a conclusion instead of strong factual evidence can pose con-
ceptual difficulties. The right to draw an inference is, however, tied directly
to an arbitrator's right to decide the merits according to the evidence avail-
able to him or her, or as was phrased in a decision on a challenge to an
award administered under the rules of the Zurich Chamber of Commerce,
the right of free appreciation of the evidence.' 79 In its decision on the
request to set aside the tribunal's award, the Swiss Federal Tribunal made it
clear that drawing an adverse inference under the IBA Rules of Evidence
does not violate the duty to treat the parties equally or the right of a party
to be heard, and is consistent with a tribunal's right to render an award on
the evidence available to it.' 0
In conclusion, it must be said that the adverse inference is the quickest
and most effective tool available to tribunals who wish to enforce their
procedural orders. Inferences are directly tied to an arbitral tribunal's right
to decide the merits of a case based upon the evidence available to it. Tri-
bunals should not back away from drawing an adverse inference when it is

Im Jeremy K. Sharpe, Drawing Adverse Inferences from the Non-Production of Evidence, 22

ArbitrationInternational4, 549, 549-571(2006).
178)Id at 550.
179)X v. A., Decision of 28 March 2007, 25 ASA Bulletin 3, 610, 610-617 (2007).
180) Id
88 O'Malley/ The Law andPracticeofInternationalCourts and Tribunals 8 (2009)27-90

clear that a party is obstinately refusing to cooperate with a tribunal's order

to produce evidence.

B. Local CourtAssistance in ObtainingEvidence Under the IBA Rules

Article 3(8) of the IBA Rules gives parties the option to seek the assistance
of a tribunal in securing document production from third parties not
involved in the arbitration. The text of the Article reads in part as follows:

If a Party wishes to obtain the production of documents from a person

or organization who is not a Party to the arbitration and from whom
the Party cannot obtain the documents on its own, the Party may,
within the time ordered by the Arbitral tribunal, ask it to take what-
ever steps are legally available to obtain the requested documents.

The rest of Article 3(8) requires the party seeking document production to
describe and justify the need for the documents, and moreover allows for
the tribunal to take whatever legal options are open to it. It is safe to say,
however, that tribunals will likely interpret Article 3(8) as a measure of last
resort, and will tend to take up an application by a party to approach a
local court only after it is convinced that there are gaps within the eviden-
tiary record which need to be filled.'
Assuming a party has convinced a tribunal that it is necessary to pursue
document production from a third party, the text of Article 3(8) has lim-
ited effect in as much as it simply prompts the tribunal to look around for
whatever legal options are available to it. An example of the type of laws
which compliment Article 3(8) would be Article 27 of the UNCITRAL
Model Law on International Commercial Arbitration which states, "The
arbitral tribunal or a party with the approval of the arbitral tribunal may
request from a competent court of this State assistance in taking evidence.
The court may execute the request within its competence and according to
8 2
its rules on taking evidence."
What is of crucial importance to this issue is whether the lex arbitriof
the relevant jurisdiction allows a court to assist a tribunal. In that regard
jurisdictions have split over whether Article 27, or laws similar to it, truly

i Methanex v. United States ofAmerica, supra note 69, Part II Chapter H § 25.
i' UNCITRAL Model Law on International Commercial Arbitration, (1985, with amend-
ments as adopted in 2006) Article 27.
OMalley / The Law and PracticeofInternationalCourts and Tribunals 8 (2009) 27-90 89

authorize courts to order third parties to produce documents for use in an

arbitration to which they are not a party. As an example, in BNP Paribas&
Others v. Deloitte Touche LLP the English Courts interpreted Section 43
of the English Arbitration Act of 1996, which is similar to UNCITRAL
Model Law Article 27, as excluding this possibility. 83 This interpretation
of Article 27 was previously arrived at by the Hong Kong High Court in
VibroflotationAG v. Express Builders Co. in a 1994 decision. However, in a
subsequent decision to BNP Paribas,the Alberta Court of Appeal in Can-
ada interpreted the local version of Article 27 in an opposite manner, and
ruled that it does allow Alberta courts to order document production from
third parties to an arbitration, if they should agree to do so upon a request
from a tribunal.' 84
Thus the usefulness of IBA Rules Article 3(8) largely depends on whether
or not rules like UNCITRAL Model Law Article 27 will in fact grant courts
the right to assist tribunals in pursuing third-party document production.
There are some laws, however, which do not necessarily require parties
to seek a tribunal's assistance before approaching a local court. One such
law which has been interpreted in this manner in the past is Rule 1782 of
Section 28 of the U.S. Federal Rules of Civil Procedure.'85 Whether 1782

183)BNP Paribasv. Deloitte & Touche, EWIHC 2874 (Comm).

NO Jardine Lloyd Thompson Canada v. Western Oil Sands Inc., Alberta Court of Appeal, 2006
ABCA 18, 13 B.L.R. (4th) 1, 32 C.C.L.I. (4th) 3, 21 C.P.C. (6th) 190.
1"1)28 U.S.C. § 1782: Assistance to foreign and international tribunals and to litigants before
such tribunals (a) The district court of the district in which a person resides or is found may order
him to give his testimony or statement or to produce a document or other thing for use in a
proceeding in a foreign or international tribunal, including criminal investigations conducted
before formal accusation. The order may be made pursuant to a letter rogatory issued, or request
made, by a foreign or international tribunal or upon the application of any interested person
and may direct that the testimony or statement be given, or the document or other thing be
produced, before a person appointed by the court. By virtue of his appointment, the person
appointed has power to administer any necessary oath and take the testimony or statement. The
order may prescribe the practice and procedure, which may be in whole or part the practice and
procedure of the foreign country or the international tribunal, for taking the testimony or state-
ment or producing the document or other thing. To the extent that the order does not prescribe
otherwise, the testimony or statement shall be taken, and the document or other thing produced,
in accordance with the Federal Rules of Civil Procedure. A person may not be compelled to give
his testimony or statement or to produce a document or other thing in violation of any legally
applicable privilege. (b) This chapter [28 USCS 1781 et seq.] does not preclude a person
within the United States from voluntarily giving his testimony or statement, or producing a
document or other thing, for use in a proceeding in a foreign or international tribunal before any
person and in any manner acceptable to him.
90 OMalley / 7he Law and PracticeofInternationalCourts and Tribunals 8 (2009) 27-90

actually does allow parties to an arbitration to utilize local courts in obtain-

ing documents is still an open question. Nevertheless, assuming it does
grant a party the right to petition a Federal District Court directly for
assistance, does Article 3(8) impose upon that party a duty to route such
requests through the tribunal first? In the Methanex arbitration this issue
came to the fore when the investor party announced its intention to seek
court assistance in securing documents via Rule 1782. While the investor
did notify the tribunal of this intention, it was clear that it was operating
under the assumption that the tribunal's acquiescence was not required. 186
In essence, the Tribunal agreed, and did not sanction or express disapproval
of the investor's attempts to secure evidence through the local courts.
Article 3(8) allows tribunals to assist in the procurement of evidence as
a means of filling gaps within the evidentiary record. The effectiveness of a
tribunal's attempt to secure evidence will most likely be impacted more by
the local arbitration law or lex arbitri as opposed to Article 3(8). In any
event, Article 3(8) should be seen as prescribing a manner by which tribu-
nals may assist in securing evidence, and not as a restriction upon the par-
ties' freedom to pursue documentary evidence from third parties apart
from the tribunal's involvement.

IV. Conclusion
There is no doubt that more can be written on the subject of documentary
evidence in international arbitration. With the continued expansion of
arbitration in both subject matter, and volume, of cases, the need to develop
standardized procedures will only increase with time, and one of the areas
where this is most crucial is evidentiary procedure. In the end, standardiza-
tion meets the needs of the parties who use arbitration as it enhances the
predictability of outcome; a facet of any dispute resolution process which
is highly desirable to parties.

'S Methanex v. UnitedStates ofAmerica, supra note 69, Part II Chapter G § 21.