18 July 2017
Confidential and Restricted-Access Information in International Commercial Arbitration
(Elliott Geisinger, Partner, Schellenberg Wittmer Ltd)

By Elan Krishna, Senior Associate, Clifford Chance Asia

The YSIAC Lunchtime Event titled ‘’Confidential and Restricted-Access Information in International Commercial Arbitration’’, was held at Clifford Chance, Singapore, on 18 July 2017. The event attracted over 130 attendees, comprising corporate counsel, practising lawyers and academics.

The instructive session centered on the topic of confidentiality in arbitration, rather than confidentiality of arbitration (on which much has been written). The issue of confidential information is a significant one and arises frequently in international commercial arbitration, for example, in determining the impact of certain regulations (such as anti-trust regulations), on the conduct of proceedings, and the need for redacted information.

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Welcome Address delivered by Kevin Nash

Members of the audience

First, Mr Geisinger observed that confidentiality restrictions are meant to protect various legally recognised interests: (1) private interests (such as trade secrets and pricing strategies), (2) public interests (such as defence secrets and interests of the community represented by the State, like competition law), and (3) hybrid interests (such as data protection and legal privilege).

Second, he noted that while most institutional rules provided for general and broad powers of arbitrators to conduct proceedings as they deem appropriate and to decide on the admissibility of evidence, making such determinations in practice is often a complicated exercise.

He gave the example of an arbitration where he sat as an arbitrator. The disclosing party was given the choice of providing redacted documents or unredacted versions which would be disclosed to a limited group of individuals. The disclosing party chose to provide redacted documents and when there was a dispute as to the extent of the redactions, Mr Geisinger and his tribunal members had to render a 21-page procedural order to resolve the issue.

This raises the broader question of whether an arbitral tribunal should be given access to unredacted documents that one party does not have access to. Similar issues would arise when a party's expert issues "censored" and "uncensored" versions of expert reports. Mr Geisinger cautioned that this raises natural justice and due process concerns, and that an arbitral tribunal should be extremely slow to seek information that the least-informed party to the arbitration does not have access to.

To deal with this issue, it is increasingly common for parties and arbitral tribunal to agree to restrict the circle of recipients of confidential material. The terms "Counsel eyes only", "Tribunal's eyes only" and "Confidentiality clubs" have become part of the arbitration vocabulary. Mr Geisinger warned that whatever arrangement is agreed, there is still a need for appropriate confidentiality undertakings, including undertakings on the destruction of documents after the arbitration is completed. Such arrangements would only work if there is sufficient trust in the parties given access to the confidential material.

Third, the issue of confidentiality also arises in the issuance of the award. Arbitral tribunals have dealt with this by a variety of means, including, (1) issuing a single award without the confidential information, and (2) issuing two awards: one with "complete" reasons, and another "redacted"/ "censored" award.

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Elliott Geisinger

Left to Right: Lijun Chui and Elliott Geisinger

Mr Geisinger noted that the form of the award was a crucial issue, and one that required the parties' agreement or the arbitral tribunal's ruling on at an early stage. Otherwise, there might be major problems downstream. For example, if there were no parties’ agreement or tribunal’s ruling on whether the award was to contain reasons, and the arbitral tribunal did not set out its reasoning for its decision in the award, parties would face difficulty deciding whether or not to challenge the award, or would have no basis for such a challenge. Equally, at the enforcement of award stage, the enforcing court would not be able to decide whether the reasoning of the arbitral tribunal was open to scrutiny.

Fourth, Mr Geisinger discussed the notions of due process and equal treatment in dealing with the issue of confidentiality in arbitration. He noted that while these could be waived (unilaterally or by agreement) and that the arbitral tribunal had broad powers in the conduct of proceedings, such powers should be exercised with restraint and it was paramount to maintain trust between the parties and the arbitral tribunal.

He also highlighted the lack of uniformity in national legislation on the issue of confidentiality in arbitration, as well as the concomitant need to have regard to the law and judicial practice at the seat of the arbitration and the place of enforcement.

Finally, he closed by noting that there was no single response in practice because there was no single legal standard and a wide diversity in potential scenarios. His general recommendation was to identify potential confidentiality concerns as early as possible in the proceedings and to seek agreement between the parties and the arbitral tribunal at the outset.
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