The increasing demand for Code of Ethics for counsel in International Arbitration has stirred a lot of debate. Following IBA Guidelines, LCIA Rules 2014 has officially incorporated Code of Ethics for counsel in its arbitral rules. To what extent it impacts parties and practice of their Counsel? Is the notion of Global Standard Code of Ethics for counsel in International Arbitration likely to achieve its objectives such as fairness and equal treatment, increasing efficacy of arbitration or has it instead augmented further issues thus making arbitration an unfavourable option?
With the growing trend of arbitration on international level, the need for a standard code of ethics globally, have become crucial. The main characteristic of arbitration is efficiency of the process as compared to litigation. However, unethical conduct on behalf of counsel can lead to interruptions and delays in the arbitral proceedings, such as guerilla tactics, concealment of documents, witness encroachment etc. Therefore, there needs to be ethical rules to deal and eliminate such conduct.
IBA Guidelines had code of ethics in their guidelines. However, their effect as guidelines and complete contractual nature, were entirely party dependant.
Moreover, LCIA Rules 2014, is the first arbitration institution to incorporate code of ethics in their arbitration rules. But, the rules are not extensive and precise. Therefore, their coverage does not reach to intricate details. Thus as result, some ethical misconducts can go unpunished. Details as to, which rule must prevail in terms of conflicts with other code of ethics applying to counsel; and who shall regulate counsel ethical behaviour, still needs to be specially added to the code of ethics, in LCIA, as well as in general.
Moreover, it is still in debate as who shall police counsel’s ethical behaviour and exercise sanctions, in case of breach of code of ethics, by counsel. At present, tribunal exercises its inherent powers and regulates counsel behaviour. It also exercises punitive powers to sanction misbehaving counsel representing parties, where his/her actions seriously jeopardizes fairness and integrity of arbitral proceedings. However, it is still in debate as who shall police counsel’s ethical behaviour and exercise sanctions, in case of breach of code of ethics, by counsel. Therefore, for the purpose of clarity and in-order to remove doubts, it needs to be clear included in rules as to who shall regulate counsel ethical behaviour.
Additionally, the sanctions to be imposed in case of breach of code of ethics needs to be further developed and improved. Vague terms such as “any other measures” shall be replaced by the exactly what those measures are, so that there does not remains any uncertainty. Discretion of tribunal to interpret “any other measures” will lead to subjective interpretation of each and every arbitrator, thus leading to uncertainty and can risk integrity of arbitral proceedings.
Finally, the steps towards beginning of an ethical era in international arbitration has been initiated. Further developments over the time will positively fulfill the purposes of requirement of code of ethics, that is efficiency and fairness of the arbitral proceedings. Consequently, arbitration will become increasingly favourable throughout the than litigation due to certainty, fairness and speedy resolution of disputes.
For an efficient work environment either in a company, a government administrative sector or a judicial system, a code of ethics/conduct is essential. These code of ethics are in-order to avoid conflicts of interest and endow supervision on offer and acceptance of bribes, exploitation of a person’s position and control on forged information. The main objective is efficacy of a system. Similarly the main idea of arbitration is an inexpensive and speedy process as compared to litigation and so its efficacy is of utmost importance. However it’s been reported that quite often the counsel in arbitration are relying on guerilla tactics that is delaying tactics in arbitration resulting in litigation being more preferred. There is a code of ethics for arbitrators in arbitration but lacks any such code of ethics for counsel representing parties in order to police their actions.
In addition, it is also a known fact that lawyers in England and Wales have code of conduct. The actions of both barristers and solicitors are regulated by their respective regulatory authorities i.e. Bar Standards Board (BSB) and Solicitors Regulating Authority (SRA). Similar is the case with many other countries that have national sets of code of ethics for their lawyers. But the question then arises that, are these enough to maintain efficacy in International arbitration? Or a standard code of ethics is still required in-order to globalize ethical standards in International Arbitration, to attain essential standards of fairness and equality of treatment?
It has been in debate for quite a while now that a uniform code of ethics is required for counsel representing parties in International Arbitration. Michael Reisman in 1971 and later Detlev Vagts in 1996 documented the requirement of standardized ethical guidelines for counsel in International Arbitration. Furthermore the idea of the need for such ethical standards was also proposed by Jan Paulsson in 1992. The subject matter gained attention in recent years. The view regarding “no-man’s land” should not be allowed to continue related to ethical conduct of a counsel representing parties in arbitration was expressed by Catherine Roger in 2010.Furthermore, again in 2010, in Rio de Janeiro, at the International Council for Commercial Arbitration (ICCA), Doak Bishop in his speech pointed out the need for standardized Code of ethics for counsel in International Arbitration. What exactly the concept of no-man’s land in International Arbitration means? It means treating all parties to arbitration equally, fairly and impartially. Unethical conduct on behalf of any party’s counsel can lead to amplified costs, escalation in proceeding’s time and includes risking integrity of the arbitration process as a whole.
Furthermore, in terms of unethical behaviour, there are two types of unethical behavior that are considered here:
First, where a counsel engages in a conduct that is undeniably unethical for example tampering with evidence, making false statements and intimidating witnesses or tribunal etc.
Second, where although a counsel acts in accordance with its own national code of conduct but unintentionally his actions conflict with the codes of conduct of other jurisdictions involved in the respective arbitration. For example in United Kingdom a counsel, under its professional code of conduct, is not permitted to practice with, rehearse or coach the witnesses in relation to the evidence that witness is being called for. Thus if done so, this act will be considered unethical and result in breach of code of conduct. However, on the other hand, in United States the code of conduct allows the counsel to rehearse cross-examination with the witnesses and thus this act is completely ethical.Such conditions leads to difficulties where actions of a counsel representing one party are considered ethical in one jurisdiction but amount to unethical behaviour thus breaching code of conduct in another jurisdiction.
The first type of unethical behaviour is very straightforward and can easily be identified and dealt with. However, the second type of unethical behaviour gives rise to complications. Two major issues that arise due to second type of unethical behaviour are taken in account here:
First, identification of relevant ethical conduct or ethical rules that the counsel representing parties in arbitration need to comply with is an issue. Particularly, a counsel may find him/herself being subject to multiple code of ethics due to the jurisdiction in which they have to represent their parties for arbitration also known as double deontology. Possibly, three sets of code of ethics can be involved at a time in an international arbitration proceedings, which include code of ethics of the home bar of counsel representing each party and applicable set of code of ethics in the jurisdiction of selected seat of arbitration.This can lead to a greater difficulty that is in absence of any guidance how to resolve any conflict or inconsistencies between them? which ethical rules shall prevail? and what are the consequences and how to deal with them?
Second and the most crucial issue is the effect of different code of ethics applying to the different counsels representing either side of parties in arbitration. This has a potential to give rise to inequality and unfairness where counsel representing one party in arbitration can be subject to stricter rules as compared to the counsel representing the other party. To elaborate this point, the above mentioned example of United Kingdom and United States is elaborated here, that is, if a counsel representing one side is subject to code of ethics of United States he/she will be able to rehearse cross-examination with his/her witness. However, if the counsel representing the other side party in same arbitration is subject to code of conduct of United Kingdom, he/she will not be allowed to do the same with his/her witness thus it will be dealt unequally and unfairly.
To deal with such complications, giving rise to inequality and unfairness, the concept of a standardized code of ethics for counsels representing parties in international arbitration was coined to preserve and further enhance the integrity, reliability and certainty of arbitration proceedings thus making it a more favorable option than litigation. Simultaneously, it will also level the playing field for the counsels representing parties from different jurisdictions and diverse legal backgrounds.
There have been various initiatives that have investigated complexities related to regulating counsel’s conduct in arbitration and suggested solutions. In May 2013, the International Bar Association’s (IBA) arbitration commission adopted the IBA Guidelines for the Representation of Parties in International Arbitration (IBA Guidelines). Consequently, in 2014, LCIA became the first arbitration institution to initiate rules in relation to party representatives’ ethical conduct in its recently amended arbitration rules (LCIA 2014 rules).
In this paper, the notion of requirement of a standard global code of ethics, to what extent it has reached so far and what is its potential effect on the parties and their legal representatives is considered. It also details the code of ethics provided in IBA guidelines and its effect, followed by the initiative LCIA 2014 has taken to incorporate ethical rules in its arbitration rules and its effect. Moreover, the issues related to who shall regulate counsel ethics and the sanctions available, its impact and how far it minimizes the issues such as guerilla tactics are also considered further down in the paper.
EFFECT OF IBA GUIDELINES:
The International Bar association, in May 2013, published “Guidelines” for practitioners representing parties in International Arbitration. These set of guidelines have to be voluntarily agreed by the parties, in-order to be implemented to a respective arbitration procedure. Parties can choose among which guidelines shall apply and which ones to opt out from, according to their will and preferences. Whereas in contrast to a set of rules which will generally apply as a whole to the arbitration procedure and have to be agreed when going for a particular arbitration institution/ procedure/ seat.
A sequence wise concise summary of the guidance provided in IBA Guidelines is mentioned below:8
Guidelines 5 – 6: If there is a risk of conflict of interest arising, due to counsel’s relationship with the Arbitrator, the counsel should refuse to take instructions from a party in the respective arbitration. Moreover, where the tribunal finds conflict of interest arising, it has authority to exclude a counsel from that arbitration.
Guidelines 7 – 8: Other than when the tribunal is being composed, all sorts of ex parte interactions between the tribunal and the counsel are proscribed.
Guidelines 9 – 11: Counsel is forbidden from deliberately making any false factual submissions or put forward any evidence, he is aware of being false.
Guidelines 12 – 17: provides instructions in relation to production of documents, that are:
- The party ought to be advised by their counsel, to retain all possibly relevant documents;
- The counsel should not make or resist a document request for devious reasons such as for delaying;
- The party must be advised, by their counsel, of the obligation of providing responsive documents;
- The party should be advised by their counsel to look for and aid in search for responsive documents;
- The counsel ought to not, nor should advise the party to repress responsive documents.
Guidelines 18 – 24: The witness or expert can be assisted by the counsel in preparing their evidence. However, it must be ensured that the evidence produced is purely their own and not contaminated by the counsel.
Guidelines 26 – 27 provides remedies for the tribunal to exercise, in case of a misconduct by the counsel. The misconduct is defined as a breach of the IBA Guidelines or any action which is determined by the tribunal as against the duties of the counsel representing parties. The duties of the counsel are not explicitly mentioned in the Guidelines and is a total discretion of the tribunal to determine. However, the tribunal must take a remedial approach while determining and should fulfill the objective that is to conserve or reinstate the impartiality and integrity of the arbitral proceedings.
The list of remedies are listed in Guideline 26 for the tribunal to exercise when a counsel, representing a party in arbitration, misconducts. The list is detailed below:
- Counsel to be reprimanded;
- Adverse inferences can be drawn based on the arguments or evidence put forward by counsel;
- Costs of arbitration proceedings can be sanctioned on misbehaving counsel and the level of costs shall be determined with respect to the extent the tribunal is mislead, to reach a different allocation of costs due to counsel’s misconduct;
- Any other actions can be taken, as deemed appropriate by the tribunal to preserve impartiality and integrity of arbitral proceedings.
Limited power of arbitral tribunal over counsel:
Despite the ethical rules provided in IBA Guidelines, due to the contractual nature of these Guidelines there are limitations to the authority of tribunal that can be exercised over counsel. The major issue is that the IBA guidelines are applied to parties via their explicit agreement thus it binds them due to its contractual nature. However, the legal representatives are not party to the agreement thus the difficulty is that they cannot be held bound by these IBA Guidelines. Therefore the general expectation is that the tribunal can only exercise its authority over the parties and when it comes to the legal representatives, their powers are limited because the powers are derived from the agreement of arbitration between the parties in dispute, to which counsels are not part of it.
Further the IBA Guidelines’ contractual nature leads to two significant practical consequences: implications
First, the IBA Guidelines provide standard set of ethical conduct for the party representatives but the consequences are directed towards parties directly due to the contractual nature of the IBA Guidelines. The IBA Guidelines provide that the party representative acts on behalf of the party it is representing in the arbitral proceedings. Hence the obligations of duties imposed on the party representative can be held as an obligation of its respective party. Thus the party can be held liable for the actions of its representative. The practical approach is such that adverse cost orders can be imposed on the party or adverse inferences can be drawn from the evidence produced by that party for the misconduct of their representative/counsel.
Secondly, the sanctions available to the arbitral tribunal are fairly limited as to what is allowed in arbitration proceedings. It doesn’t extend to more vigorous punitive powers available to bar associations, such as suspending the counsel from practice or imposing financial penalties; or such that which can be imposed by courts, for example wasted cost orders against the counsel. The court has such power because the counsel is held as offices of the court. However there does not exist any such correlation between a counsel representing a party in arbitration and the arbitral tribunal.
INCORPORATION OF CODE OF ETHICS IN LCIA 2014 AND ITS EFFECT:
Director general of LCIA, Jacomijn van Haersolte-van Hof mentioned that, unlike at contrary instances, ethical conduct is required to be taken seriously by people now. Hence among all arbitral institutions, The London Court of International Arbitration (LCIA)is the first arbitral institution to incorporate compulsory guidelines for conduct of party representatives in its revised rules in 2014. In comparison to IBA Guidelines, the Guidelines of LCIA 2014 are considerably brief comprising of only seven paragraphs.
The “General Guidelines” with respect to practice, for legal representatives (including counsel) of Parties to arbitration, appear as an annex in revised LCIA Rules 2014.Article 18.1 provides a condition for legal representatives that they have to appear by name before the arbitral tribunal. Further, in Article 18.5 a compulsory condition is included that the parties must ensure their legal representatives have explicitly agreed to comply with these General Guidelines mentioned as annex to the revised LCIA Rules 2014. The counsel or any other legal representative have to explicitly submit to abide by these guidelines now, as to the effect that any breach will make them directly liable. This is to remove the impediment which used to arise in IBA Guidelines that it has a contractual nature limited to parties only and cannot practically cover legal representatives, as now even they explicitly enter into a contract of agreement.
Precisely these Guidelines further state the following as mentioned below:
- The parties’ representatives should not intentionally be a part of any activity that impedes fair arbitration proceedings or puts at risk the finality of the award. An example is, by repetitive challenges, which the counsel is aware of being unsubstantiated;
- They should not intentionally devise any false statements;
- They should also not provide any forged evidence nor shall assist in its production;
- If ordered by the tribunal to produce any document, it should not be concealed by the party representatives, nor shall aid its concealment;
- Any party representative should not attempt an undisclosed unilateral contact, during arbitration proceedings, with any member of the arbitral tribunal.
Furthermore in Article 18.6 of the LCIA Arbitration Rules 2014 the arbitral tribunal is given punitive powers to order sanctions against the counsel, in case of non-compliance with the General Guidelines for parties’ legal representatives. It explains that in an event of receiving a complaint from one party against another party’s legal representative, the arbitral tribunal should call an explanation, granting a reasonable opportunity to the concerned counsel whether that particular legal entity has violated the LCIA 2014 Guidelines or not. If a violation of the General Guidelines of LCIA 2014, by the legal representative, is determined by the arbitral tribunal, in such a scenario it may command either one or all of the following sanctions against the relevant legal representative:
- A written caution(article 18.6 (i);
- A written admonishment as to the future actions in the arbitration proceedings(article18.6 (ii);
- Undertake any other measures essential to meet within the arbitration; (article18.6 (iii);
- Adverse costs order (Art 28.4)
However the LCIA Rules 2014 provide a vague term with respect to the sanction of “any other measure necessary” mentioned above in point 3. It provides arbitral tribunal with wide discretion to exercise and determine what other measure is necessary and can prove to be subjective in each arbitral proceeding resulting in uncertainty. However, keeping in mind that the arbitrators are party appointed and where the arbitrators are given discretion as to impose sanctions, they are unlikely to implicate them as it will damage their relationship and chances of future appointment. The arbitral tribunal and arbitration institutions require the party to appoint them. Therefore, the tribunal are reluctant in imposing harsh sanctions especially in situations where the misconduct is more likely due to cultural confusion than deliberate treacherous play. 
Moreover, the guidelines provided in LCIA have the effect of rules but is titled as “guidelines”. This description can possibly create confusion as it to its application, that is, it is not an option as the name depicts but is a condition to abide by, once party representative agrees to represent a party in LCIA.
Moreover, at present the LCIA guidelines are very brief and simple rather than extensive and detailed, which makes them easy to understand and follow regardless of coming from diverse jurisdictions. On the other hand, the conciseness of these guidelines can be misconstrued to an extent that because of the absence of a certain misconduct being specifically mentioned in guidelines, it can go unpunished. Similarly it requires more details in terms of which rules will prevail if a conflict arises between sets of code of ethics applying to counsel and who shall be regulating counsel ethics. However, credit needs to be given for their step forward to initiate code of ethics in their rules.
WHO SHALL REGULATE?:
The need for determining as who shall have the power, to apply and enforce the ethical rules after their incorporation in international arbitration, is still in debate. There are various suggestions put forward to assure the most effective application and enforcement of ethical rules on international level.
A conference was held on 30th March 2016, sponsored by the Institute for Transnational Arbitration (“ITA”) and the American Society of International Law (“ASIL”) to examine the ethical responsibilities of counsel and who shall they be regulated by in International Arbitration.
The panelists – Doak Bishop (King & Spalding), Professor Erin O’Hara O’Connor (Vanderbilt University), Professor Marie-Claude Rigaud (University of Montreal), Professor Victoria S. Sahani (Washington & Lee University) and Mairée Uran Bidegain (ICSID) – although, could not conclude as to who shall regulate the counsel conduct; however did show intentions that there needs to be some regulation of the conduct of counsel in International arbitration.
The members of the panel identified potential regulators of code of ethics of counsel and suggested the arbitration institutions to incorporate ethical rules in their arbitration rules. Doak Bishop and Professor Marie-Claude Rigaud listedGlobal Arbitration Ethics Council; Arbitral Institutions; Arbitral Tribunals; National Bar Associations; and National Courts (of seat of arbitration or where the final award is enforced),as possible regulators. 
The following mentioned below are discussed in detail in hereafter:
- Global Arbitration Ethics Council
- arbitral institutions
- arbitral tribunals
1)- Global Arbitration Ethics Council:
The idea, to form a completely separate body to regulate counsel’s ethical behaviour in arbitration on international level, was recommended by Elliot Geisinger, president of the Swiss Arbitration Association (ASA). He proposed that “a truly transnational body to apply and enforce ethical principles” should be established. The suggestion is that all the significant international arbitral institutions and crucial arbitration professional associations including ASA should make a joint effort to establish a transnational committee. The exclusive issues relating to allegations of unethical conduct of Counsel’s in arbitration, shall be referred to the respective committee. This committee known as Global Arbitration Ethics Council will then have major power, rather than any arbitral tribunal or arbitral institution, to regulate, apply and enforce rules of ethics uniformly on global level.
This idea was suggested after reflecting upon IBA guidelines and LCIA 2014 rules. Consequently, it was concluded by several board members of the ASA that neither a local bar council nor arbitral tribunal would constitute a proper fora to decide upon allegations related to counsel’s unethical behavior in international arbitration.
A joint meeting was hosted by ASA to proceed with the discussions and practicalities relating to forming Global Arbitration Ethics Council. After analyzing the pragmatic data collected from bar councils of US and all of the Europe a second meeting was held on 27 June 2016 by ASA. The conclusion of the meeting, released on 3 October 2016, were:
First, practically there were no grievances filed with national supervisory establishments with respect to international arbitration.
Secondly, in reality, the raised issues that have been categorized as “counsel ethics”, has majorly been related to either orderly conduct and/or integrity of the proceedings of arbitration; admissibility and/or weight-age given to an evidence. The arbitral tribunal already possess extensive authority to deal with certain matters.
Furthermore a suggestion had been put forward that, like CIArb, internal disciplinary measures can be adopted by arbitration associations to deal with exclusive ethical issues.
However, the conclusion reached by the members was that, it is still too early, the time as yet has not come to establish an international organization to sanction the unethical Counsel for breaching the standards of ethics. It was also mentioned that further research and more experiments still required to be continued. 
2)- Arbitral Institutions:
Arbitral institutions are debated to be a suitable forum to police counsel’s ethical conduct. As supervisors they can play a significant role including appropriate sanctioning of misbehaving counsel for breach of code of ethics
In support of the above mentioned notion, Ms Uran Bidegan suggested that arbitral institutions can best serve as regulators because first, they are acknowledged internationally for imposing rules; secondly, they can authorize tribunals to police actions of counsel through enforceable rules; and lastly arbitral institutions already act as guardians to maintain justice and procedural integrity.
Furthermore, International Arbitration Survey titled as “Improvements and Innovations in International Arbitration” conducted by Queen Mary in 2015 also favoured arbitration institutions to serve as regulators.
The most significant support an arbitration institution can provide in regulation of counsel conduct, in international arbitration, is to incorporate code of conduct/ ethics in its rules by reference and bind counsel via explicit or implied consent to abide by them. Breach or non-compliance of such rules ought to lead to imposing sanctions against the respective counsel. The London Court of International Arbitration (‘LCIA’) has already taken a step ahead and incorporated rules related to counsel’s ethical conduct as an annex to LCIA 2014 rules. Once such Code of Conduct has been developed, the arbitration panel may provide appropriate procedures for their enforcement, subsequently.
Moreover, the other powerful upper hand an arbitration institution can haveis through the technique of blacklisting or suspending a misbehaving counsel from representing a client for a specific period. Such sanction could prove to be very efficient as the counsel would endeavor to avoid an embarrassing situation, where they have to refuse to their clients to represent them personally because they are debarred from a respective arbitration institution. As a substitute, a public announcement of caution to a misbehaving counsel on the institution’s webpage or other social website can be as effective to shame the counsel for their ethical misconduct. However, the technique of blacklisting is still in the process of debate and not adopted by any institution as yet.
Granting authority to arbitral institution over counsel conduct is in process of arguments. The president of ASA, Elliot Geisinger, has put forward his opinion considering the legitimacy of granting authority to arbitral institutions over deciding counsel ethical conduct is extremely questionable. The argument put forward by him is that both the party nor the counsel has any say in the constitution of arbitral institutions or their rules. The fact that counsel agrees to represent a party in a certain arbitral institution cannot be considered as their acceptance or submission to the arbitral institution’s authority or rules with regard to professional ethics.
However, the above mentioned argument is not quite supported, as it is contested on the basis that once the counsel agrees to represent a party in a respective arbitration institution, he/she impliedly submits to the ethical rules, applying to the counsels representing parties, of that arbitral institution. The notion of counsel being a non-signatory to the arbitration agreement shall not be confused with their consent to be bound by the rules of the arbitral institution. The consent can be implied as well. Once the arbitration institution formally brings to the notification of the counsel that by accepting to represent the respective party in arbitration proceedings under following arbitration institution, their conduct will be controlled by the arbitral institution, will suffice the requirement of deemed acceptance and claiming ignorance cannot be entertained any further.
Furthermore, dealing with issue of confidentiality, in terms of arbitration institution exercising authority over counsel’s conduct in arbitration, it is considered less of a controversial subject matter. Many considers that confidentiality in arbitration proceedings extends to institution itself in institutional arbitration and for that reason can be dealt by arbitral institution without breaching confidentiality. Therefore, even those opposing the entire idea of regulation of ethical conduct of counsel seems to acknowledge that regulation through arbitration institution is an acceptable option than others.
It should be borne in mind that although there is support in favour of arbitration institution as an appropriate institution to regulate ethical conduct of counsel, this support is not unanimous. The Secretary General of the ICC International Court of Arbitration, Andrea Carlevaris, at the conference “University of London’s Institute for Regulation and Ethics” in Queen Mary (dated: 11 September 2014) stated that in his opinion arbitration institution is not an appropriate option to regulate counsel’s ethical conduct. Further in support he mentioned that arbitration institution should only play an indirect role by means of other methods to regulate ethics.
Furthermore, Ms Uran Bigegain also mentioned that due to many possible reasons, arbitral institution cannot be upheld as a suitable choice and one such reason is the danger of disintegration. She stated that if around the globe every arbitration institution starts coming forth with their own set of ethical rules, it will rather result in inflexibility of arbitration, contrary to what is required and consequently will also end up in long delays and interruption in arbitration proceedings.
In conclusion of the above mentioned considerations, it appears that arbitration institution can be claimed as a better option compared to the others. It can have more control on the conduct of counsel as they can use wider options to pressurize counsel to abide by the arbitral ethical rules. They can have the power to make and adopt ethical rules. Also they can affirm arbitral tribunal’s authority to deal with the ethical conduct of counsel, simultaneously taking into consideration the global nature of international arbitration. The LCIA 2014 rules have already taken a step forward and incorporated ethical rules in their set of arbitration rules. Whether other institutions incorporate ethical rules in their arbitration rules, is still their discretion to be exercised.
3)- Arbitral Tribunal:
Whether arbitral tribunal should be given the authority to regulate ethical conduct is in debate. The proposition put forward to favour authorization of regulation by arbitral tribunal is that it is the most appropriate place to deal with ethical issues in relation to conduct of counsel as the tribunal is already aware of the set of facts as to what exactly happened. 
However, it is rebutted by the authors that the actual role of the arbitral tribunal is resolution of disputes between parties, not policing ethical behavior of parties’ representatives. There needs to be two separate authorities that is judicial authority, dealing with the cases based on merits; and disciplinary authority, who shall regulate and determine the breach of ethical conduct by counsels. Further in support it has be stated that it is not appropriate for an arbitral tribunal to determine the case on merits and simultaneously make a decision on ethical behaviour of counsel arguing the case. It can result in jeopardizing the independence and fairness of the tribunal and can cause interruption in the proceedings. As an example, in a matter relating concealing or destroying documents, the tribunal in-order to determine the issue might have to go through the privileged communications between the party and its counsel, thus tribunal’s impartiality can be severely risked and can be challenged, following the determination on ethical issue, when the tribunal reverts back to decide the case. 
It is also argued by some, that while determining whether counsel’s actions has lead to ethical misconduct, every tribunal will apply subjective interpretation, as a result it can lead to uncertainty in arbitration proceedings overall, which is against the objectives of arbitration. Therefore, arbitral institutions shall be given authority to maintain certainty and uniformity with respect to interpretation of ethical misconduct in arbitration. Moreover, a tribunal’s control over party chosen representative and sanctioning them, such as excluding them from arbitral proceedings, can lead to risking party autonomy which again is against the fundamental nature of arbitration.
Nonetheless, there had been mixed propositions and the current situation is that arbitral tribunal has inherent power in arbitration to sanction a misbehaving counsel in the circumstances of serious risk to fairness and integrity of the arbitral proceedings. If the arbitral tribunal’s power to sanction misbehaving counsel is removed then practically, the counsel will not have any kind of regulation or supervision with respect to ethical conduct in international arbitration.
In accordance with the present laws and rules the tribunal is under an obligation to assure and uphold fairness and integrity of arbitral proceedings. A general authority is conferred to arbitral tribunal, by arbitration laws and rules of institutions, to proceed with arbitration in an efficient manner and preserve the integrity of due process. UNCITRAL article 17.1 provides the tribunal with power and discretion to conduct the proceedings as it sees appropriate, such as to maintain equality between parties and ensure efficiency of the arbitration proceedings. Similar provisions are to provided in article 14.4(ii) of LCIA 2014 rules; article 22 of ICC arbitration rules; and s. 33 of Arbitration Act 1996.
Furthermore, as mentioned above, IBA Guideline 26 explicitly provides tribunal with remedies to exercise in case of misconduct by counsel representing parties, such as reprimand, adverse inference, costs orders or any other measures against misbehaving counsel as the tribunal deems appropriate. Similarly, article 18.6 of LCIA Rules 2014 provides tribunal with powers to exercise, in case of misconduct on behalf of party representing counsel, such powers include written admonishment, written caution as to conduct in future and any other measures deemed appropriate to fulfill the general duties of tribunal that are ensuring efficient and fair arbitration proceedings under article 14.1(i) and (ii) of LCIA Rules 2014.
Furthermore, under case law the tribunal has also established that they have inherent power to impose sanctions on misbehaving counsel even to the extent of disqualifying a counsel from representing party in arbitral proceedings where it becomes crucial to maintain integrity of arbitral proceedings. Such pertinent cases include Hrvatska Elektroprivreda, d.d. vs The Republic of Sloveniaand Rompetrol Group N.V. vs Romania, which are provided in detail, further in the document.
Hence, although there are arguments against conferring powers to tribunal to regulate counsel conduct. In reality, tribunal has inherent authority to exercise control over ethical behaviour of counsel in arbitration and where it becomes crucial the tribunal has also exercised these powers and imposed sanctions, accordingly.
In general, the power to sanction the counsel for their ethical misconduct vests with arbitral tribunal, till it is shifted to any other authority as mentioned above, such as Global Arbitration Ethics Council etc.
However, it is still a topic of debate that whether validly a counsel can be sanctioned by the arbitral tribunal. It is proposed by some critics that the arbitral tribunal’s responsibility is to resolve the dispute between the parties and does not extend to policing party representatives’ conduct thus complaints related to breach of code of ethics requires not to be entertained by them. However, this proposition is not upheld by many. Steven Bennett, in opposition of such propositions, have stated that, although policing counsel’s ethical conduct is not covered explicitly in job description of arbitral tribunal but tribunal does have a responsibility to effectively control the arbitration proceedings and maintain the fairness and integrity of arbitration. Such responsibility impliedly extends to regulating and promoting ethical and professional conduct of parties and their representatives and to impose sanctions for breach of code of ethics in-order to ensure just and fair arbitration proceedings.
Some of the sanctions available to tribunal to exercise are listed below which are detailed hereafter:
- Reprimanding counsel;
- Monetary sanctions; and
- Exclusion of counsel from arbitration proceedings
- Reprimanding counsel:
A caution to a party’s counsel can be imposed as a sanction, for breaching code of ethics. It is highly favoured by arbitral tribunal as it discourages party’s counsel due to the adverse effect on their reputation. The reprimanding of Counsel is even supported by Swiss critics. Felix Dasser, one of the Swiss critics, states that arbitral tribunal’s objectives include taking appropriate steps to uphold integrity of arbitral proceedings, these include reprimanding a counsel in-order to bring to an end disorderly actions of counsel. 
When it comes to profession, counsels are very mindful of their professional reputation. Any actions of counsel that can lead to unethical conduct, such as guerrilla tactics, can be controlled and stopped by putting them in danger of damaging their professional reputation by publicizing their unethical actions. Hence a caution to counsel added to the arbitration award after arbitral proceedings are concluded or given out as a preliminary decision while arbitration is still in process, which can damage counsel’s professional reputation severely, can prove as an effective sanction. The media that always looks out for spicy news as they spread rapidly and to a wide extent, such publication of reprimand of counsel is taken up by them right away. Thus such a grave risk will make the counsel very cautious with respect to their behaviour. 
Contrary to the above, the caution can even at times serve as a total opposite, that is the clients who favour such guerilla tactics will approach these counsels, who are proven to practice these tactics, thus their reputation instead of getting damaged can be built instead, if such approach is taken.
- Monetary sanctions:
Imposing cost sanctions on parties or their representatives for ethical misconduct, is highly encouraged and demanded including by international arbitral institutions rules. Arbitral institutions in their rules explicitly grant authority to the arbitral tribunal to take into account parties conduct throughout the proceedings. In general, cost sanctions are imposed on parties for their misconduct or even at times for their representative’s misconduct. However, cost sanction is not limited to just parties, it can be imposed on counsel for purely their unethical misconduct.
There are two types of cost/ monetary sanctions that are:
- Indirect Costs Sanction; and
- Direct Costs Sanction
These two types of sanctioned are discussed in detail below:
- Indirect Costs Sanction:
Indirect Costs Sanction is when the arbitral tribunal makes a costs order against the party for the breach of ethical conduct by its counsel. In the case of Pope & Talbot v. Canada,the Arbitral Tribunal explicitly stated in the interim award, they made against the Claimant on 26 June 2000, to pay the Respondent an amount of $ 10,000 (USD) no later than 11 October 2000. The Arbitral Tribunal clearly specified that Claimant Counsel’s (Mr. Appleton) conduct has resulted in the respective direction being made against the Claimant and they wanted that Mr. Appleton should voluntarily take upon himself those costs.
However, the arbitral tribunal are reluctant and infrequent in sanctioning the party for its counsel’s conduct. They are rather convinced that, based on principles of agency or commitment to a party to take part in arbitral proceedings, directly sanctioning a counsel for their conduct is more appropriate and acceptable.
- Direct Costs Sanction:
Rather than sanctioning a party for its counsel’s conduct as mentioned above, through direct cost sanctioning strategy, the arbitral tribunal finds it more efficacious to directly sanction the counsel for his/her misconduct. This direct cost remedy is highly effective against counsels- who promote or take part in delaying tactics also known as guerrilla tactics consequently collapsing the arbitration’s main essence of efficacy- because of its monetary nature which strikes them hard.
At many instances the local courts can provide extra policing on conduct of counsels by sanctioning them when their actions involve extreme guerrilla tactics or such unethical behavior that threatens arbitration process to a significant level. Apparently US courts are highly active in sanctioning the counsels or law firms that indulge themselves in unethical conduct or steer away from performing in accordance with the rules.Hence the courts have actively upheld cost sanctions imposed by arbitral tribunals on counsel for their unethical behaviour, in general.
In a pertinent case of Prospect Capital Corporation et al. v. Michael Enmon, United States District Court for the Southern District of New York gave a final decision on 9 March 2010. In this decision the respective court imposed a monetary sanction on an entire Texas-based law firm named Arnold & Itkin LLP, for acting in bad faith by bringing a frivolous case with the intentions of hindering arbitration proceedings and making misrepresentations to the court. In addition to the post judgment interest the firm was imposed a monetary sanction of an amount of USD 354,559/-.
The court in the above case established that it will take measures to discipline the counsel whose actions leads to harassment of their contestants and wastes court resources through exploiting legal process. In addition, the court also made clear that there are legal and ethical limitations that the litigants and their counsels are bound by. Thus the counsels are obligated to not sacrifice their duty to the court, in their endeavors to please their clients and expand their business.
Moreover, counsel against whom monetary sanctions are imposed as a result of their misconduct will take into account the factor that challenging such sanctions in court can result in further damaging their reputation on a large scale, as court proceedings are public. Hence, such sanctions are unlikely to be challenged in courts due to the consequent damage to the counsel’s professional reputation.
- Exclusion of counsel from arbitration:
The arbitral tribunal can exercise the authority to exclude the counsel from arbitration for his/her misconduct, however it is a quite contentious issue. In practice such a measure is usually avoided by tribunal to be taken that is to exclude a party chosen representative from the respective arbitration proceedings. Although tribunal has the power to impose such a sanction, they are rather reluctant to exercise it in reality. The major factor is that the tribunal will want to get appointed by the same counsel and party again as well, who chose them in the first instance. Similarly, even those arbitrators will be unwilling to impose such sanction, who are not chosen by the respective party, as it will restrain their future prospects of getting appointed by them.
Nonetheless, the arbitral tribunal has an inherent power to exercise such an extremely harsh punishment where the arbitration proceeding’s integrity is at risk. The arbitral tribunal is under an obligation to take all necessary measures to uphold integrity of arbitral proceedings. However, tribunal will go to such an severe extent in exceptionally compelling circumstances because excluding a party chosen counsel can jeopardize the fundamental nature of arbitration that is to uphold party autonomy, in addition to the fact, that it is the right of the party to get represented by a counsel of their choice. Cases where tribunal has taken such bold steps to exclude counsel from arbitration are mentioned hereafter:
Hrvatska Elektroprivreda, d.d. vs The Republic of Slovenia
In the pertinent case of Hrvatska Elektroprivreda, d.d. vs The Republic of Slovenia the arbitral tribunal furnished a bold example that if the integrity of arbitral proceedings are in a serious jeopardy due to actions of a counsel in capacity of representing party, the inherent power the tribunal possess to exclude the counsel from proceedings will be exercised; and in this case the authority was exercised by disqualifying the counsel from representing the party in respective proceedings.
In the abovementioned case the appointment of counsel, by the respondent, was disclosed moments before merits of the final hearing. After disclosure the tribunal came to know the fact that the counsel was a practicing barrister and was from the same chambers as that of the president of tribunal in London. The tribunal ruled that such an act of the respondent, can lead to an ordinary person reasonably doubting the independence and impartiality of any member of tribunal, in such circumstances. Consequently, the tribunal excluded the counsel from representing the respondent in respective proceedings in-order to uphold the integrity of the proceedings and not letting it get jeopardized due to presence of any doubts because of the actions of parties or their counsel.
Rompetrol Group N.V. vs Romania
Moreover, In the case of Rompetrol Group N.V. vs Romania he arbitral institution once again set forth an example that they have authority to exclude a counsel from arbitration for their misconduct.
However, simultaneously it was established that it is against essence of arbitration to exercise power over a party chosen counsel especially when it comes to disqualifying a counsel representing party thus it tribunal needs to be careful while exercising such authority.
It was held that authority of excluding a counsel from representing a party in arbitration should be used in highly exceptional circumstances and tribunal should restrain from exercising it frequently. Also, concurrently assuring that challenging a counsel, chosen by party, shall not become a convenient substitute for challenging tribunal.
The above case upheld the conception that although the tribunal’s authority of excluding a counsel from arbitration proceedings, should not be an option at convenience. However, the tribunal will also not hold back from exercising such an authority if it becomes important.
Therefore, it can be concluded from the above mentioned cases that arbitral tribunal holds inherent power to be able to exclude a party chosen representative. However, in practice the arbitral tribunal is usually reluctant to go against party autonomy and exclude their chosen counsel. Though when it is crucial to maintain the integrity of the proceedings and prevent further misconduct by any counsel, then in such circumstances the tribunal will proceed with any necessary steps accordingly, even if it includes exclusion of a counsel.
With the developing international arbitration culture the requirement for a globally standardized set of code of ethics has equally become more important. The main objective of arbitration is efficiency in resolution of disputes between parties. Therefore, to demolish unethical conduct on behalf of counsel representing parties, which cause hindrance in the arbitration proceedings, such a delaying tactics has become a major point of focus. After IBA Guidelines, LCIA is the first arbitration institution to incorporate ethical rules in its arbitration rules.
As detailed in this document, the rules yet requires to be more detailed. However, there still an attempt is made, that needs to be appreciated. It has played a role of a stepping stone for a developing ethical tradition in International Arbitration.
More details and clarity is required with respect to who shall regulate counsel ethical conduct. At present the authority vests with tribunal and they have exercised it effectively. However, a clear and official rule still requires to be incorporated as to who shall regulate in order to remove any sort of doubts.
Briefly, the basis are made for establishing a standard set of code of ethics and the impact is so far positive with respect to achieving efficiency in arbitration, except for the initial difficulties due to insufficient detailing in rules.