Author: Julian D.M. Lew*
Published: December 2020
Confidentiality and Publication
In reviewing the need for transparency, we can also focus on the practical, legal and political challenges which arbitration faces at this time. The question is whether the calls for transparency are necessary or helpful for international arbitration today or part of the attacks on arbitration generally. What is transparency? What must be transparent? For whose benefit is transparency? Is there a right to transparency? What relevance has transparency in international arbitration? How does transparency co-exist with privacy and confidentiality?
In recent years, there has been an increased interest in many countries, particularly in the liberal western democracies, for extensive transparency about many and different issues – political, social and personal. There seems to be a view that privacy does not matter, or at least its scope is much diminished. Governments, businesses and people are fair game generally and for the media in particular. So too international arbitration; there are those who consider the issues, the parties and other participants should be public knowledge.
Lawyers enjoy the opportunity for publicity, especially where information can be obtained which can be used against an opponent in negotiations or witness examinations, or even against the tribunal sometimes.
There have also been challenges to the international arbitration system from non-direct participants, questioning the privacy and confidentiality of the arbitral process. Unlike courts, the arbitral process is private. No one knows what transpires without being actively involved. No one knows there is a dispute; what is in dispute; or who the disputing parties are. There are of course general principles drawn from rules or systems adopted, but the content of those rules or their application remains private in each arbitration.
This is true for all kinds of arbitration, be it commercial or investment, and irrespective of whether the dispute involves private entities, multi-national entities, or state parties. The degree of confidentiality, however, differs from case to case – in practice, parties may seek to keep particular matters confidential such as trade secrets, know-how, business plans or even the nature of the dispute.
I was in a case many years ago involving a joint venture between a manufacturer of a large consumer product and the government of a state. An arbitration was commenced concerning responsibility for the collapse of the joint venture arrangements. Throughout the whole process there were media reports describing the stage of the proceedings, including: the directions of the tribunal, the content of the hearings, the arguments made by both sides, meetings arranged and held and even the content of the negotiations between the parties. There was no confidentiality agreement and basic privacy was compromised. At the end, the tribunal had to order parties to keep the matter confidential.
Now, the question is, what was the practical value to the media of knowing all these details about my case? Or, was it simple voyeurism, to embarrass the government or put pressure on the joint venture partner?
*Head of the School of International Arbitration, Centre for Commercial Law Studies, Queen Mary University of London.