Jonathan C. Hamilton, Francisco Jijon and Ernesto E. Corzo, “Arbitrator Challenges in Latin America” (2015)

Latin America has become a stronghold in global arbitral practice. Burgeoning arbitration in the region is indicative of the trust that many states and private parties have placed in this mechanism as a way of resolving disputes. Latin America now has hundreds of institutions and rules governing arbitration, many of which establish standards of independence and impartiality. In practice, these standards have been applied in various commercial and investor-state cases with varying outcomes. As the region’s caseload continues to increase, so will opportunities for the application and analysis of arbitrator challenges.

In recent years, dispute resolution has experienced a sustained transformation, fueled by the way international business and trade are conducted in a multipolar world.  Multilingual proceedings, multi-jurisdictional issues of law, and increasing reliance on different arbitral rules shape the growth of arbitration.  As more individuals fill the ranks of arbitration to deal with an ever-expanding docket of cases, the potential for conflicts of interest invariably increases.  This complexity has led to an overlap of rules aimed at regulating those individuals involved in the process such as arbitrators, counsel, and parties to disputes.  In the United States, for example, specific states have distinct sets of rules regarding professional responsibility and conflicts of interest.  At the international level, various guidelines apply to conflict of interest situations, which may result in divergent practices.

Against this background, this chapter focuses on arbitrator challenges that arise in arbitration proceedings in Latin America.  Part I summarizes the context for arbitration in Latin America.  Part II discusses standards used by local or international arbitral institutions when dealing with the issue of impartiality and independence of arbitrators in the region.  Part III discusses selected case studies from the region relevant to the use of arbitrator challenges in both investment and commercial arbitration.

2. Latin American Arbitration and Arbitrators

Arbitration is booming in Latin America, due in large part to the development of a comprehensive supporting legal framework and infrastructure.  During the past three decades, most states in the region overhauled their domestic arbitration laws, entered into various treaties providing for arbitration, and ratified a treaty framework for the recognition of arbitral awards.[1] Notwithstanding the skepticism of certain states,[2] arbitration remains the preferred dispute resolution mechanism under bilateral investment treaties,[3] as well as new multilateral agreements such as the Pacific Alliance, the region’s largest economic and trade bloc.[4]

Latin America now accounts for a significant proportion of the world’s arbitrations.  In 2014, cases involving Latin American states made up more than 33% of the cases registered at the International Centre for Settlement of Investment Disputes (“ICSID”), more than any region in the world.[5] Meanwhile, private parties have embraced commercial arbitration,[6] and cases involving parties from Latin America regularly account for 10% of all cases registered at the International Chamber of Commerce (“ICC”).[7] This is in addition to the arbitration proceedings handled by over 165 arbitral institutions in Latin America, 70% of which were established no more than two decades ago.[8] These local and regional centers administer increasingly complex matters, with more than 10% of the cases involving foreign entities and up to 22% of these arbitrations involving more than two parties.[9]

In both international and local cases, party autonomy is generally encouraged in the selection of arbitrators, sometimes subject to limitations such as nationality, character, and/or competence.  In ICSID, for example, a majority of the arbitrators on a tribunal must be nationals of states other than the state party to the dispute and the state whose national is a party to the dispute,[10] and arbitrators must be persons of high moral character with recognized competence in the fields of law, commerce, industry, or finance, who may be relied upon to exercise independent judgment.[11] A survey of local arbitral institutions found that 77% of institutions had one or no requirements for selecting arbitrators, 42% followed requirements that arbitrators be on a roster, 27% followed requirements that arbitrators be nationals, and 24% followed requirements that arbitrators be licensed.[12]

Gone are the days when arbitrators were primarily heads of state.[13] Today, arbitrators are often sophisticated practitioners and jurists with years of experience in the region.  At ICSID, approximately 170 arbitrators have been appointed in cases involving a Latin American state, of which over 60% are Spanish speakers.[14] Moreover, eleven arbitrators have been appointed at least ten times, and the top 10% of arbitrators account for almost 40% of the appointments.[15] Although similar data are not available for other institutions, anecdotal evidence suggests that many arbitrators repeatedly are appointed in matters before local institutions as well.

3. Standards for Disqualification of Arbitrators

Together with the growth of arbitration in the region, the potential for, and limits of, arbitrator disqualification in Latin America are issues of particular interest.  Although some have opined that absolute independence and impartiality of the arbitrator may not be possible,[16] a balance must be struck to guarantee the integrity of the arbitration and due process and to avoid the use of ad hoc challenges as a guerilla tactic.

In the context of Latin American arbitration, the most common standard for disqualification is the existence of “justifiable doubts as to the arbitrator’s impartiality or independence.” This test has been adopted by international arbitration rules that are commonly applied in arbitration relating to Latin America, including, for example, the Arbitration Rules of the United Nations Commission On International Trade Law (the “UNCITRAL Arbitration Rules”),[17] and the Rules of Procedure of the Inter-American Arbitration Commission (the “iacac Arbitration Rules”),[18] as well as the rules of other international centers that sometimes are involved in Latin American arbitration matters.[19]

For arbitrations before ICSID, the Convention on the Settlement of Investment Disputes Between States and Nationals of Other States (the “ICSID Convention”) provides that arbitrators may be disqualified for a “manifest” lack of high moral character, competence, or independence.[20] Although the “manifest” requirement has been considered less subjective than the “justifiable doubts” standard, some recent cases involving Latin American states may have blurred the line by considering how a third party would perceive the arbitrator’s conduct.  For example, in Blue Bank v. Venezuela, a challenge was accepted on the grounds “that a third party would find an evident or obvious appearance of lack of impartiality on a reasonable evaluation of the facts in this case.”[21] Similarly in Burlington Resources v. Ecuador, a challenge was accepted where there was manifest evidence of “an appearance of lack of impartiality.”[22]

At the local level, many arbitral institutions across Latin America follow the “justifiable doubts” test.[23]  In other jurisdictions, institutions have preferred to incorporate by reference the local rules for disqualification of judges where the jurisdiction of that specific institution is located.  For instance, according to Article 7(1) of the Rules of Procedure of the Center for Arbitration and Conciliation of Bogota’s Chamber of Commerce, arbitrators can be disqualified for the same reasons specified in the Code of Civil Procedure for judges.[24]

The following summary illustrates various standards and strategies established across Latin America.

Institution: Arbitration and Mediation Center of the National Chamber of Commerce of Mexico City

Standard of Disqualification: Article 8.3.  The Commission shall take the necessary measures to secure the appointment of an independent and impartial arbitrator. Article 15.1.  Either party may initiate the disqualification of an arbitrator within fifteen days following the notification of the appointment of the arbitrator or within fifteen days of the date it becomes aware of the circumstances described in Articles 8 to 12 of these Rules.

Institution: Center for Arbitration and Mediation of the Chamber of Commerce Brazil—Canada

Standard of Disqualification: Article 5.1.  Members of the List of Arbitrators and/or others designated by the parties can be appointed as arbitrators, with the provisions of article 4.4.1 of these Rules, the CAM/ CCBC Code of Ethics and the requirements of independence, impartiality and availability always being observed.

Institution: Arbitration and Conciliation Center of the Bogota Chamber of Commerce 

Standard of Disqualification: Article 7.1.  The arbitrators are prevented and can be disqualified for the same reasons specified in the Code of Civil Procedure for judges.  Also they can be disqualified in the event that they do not fulfill the requirements agreed to by the parties to the arbitration agreement.

Institution: Arbitration and Mediation Center of the Santiago Chamber of Commerce     

Standard of Disqualification: Article 12.1.  An arbitrator may be recused only if:  (a) There are circumstances that justifiably put his independence and impartiality in doubt...

Institution: Mediation and Commercial Arbitration of the Argentine Chamber of Commerce         

Standard of Disqualification: Article 11.1.  The parties may object to any of the arbitrators when there are justified doubts regarding his impartiality or Independence or if he/she does not possess the qualifications agreed to by the parties.

Institution: International Center for Conciliation and Arbitration of the Costa Rican-AMCHAM Chamber of Commerce of Costa Rica      

Standard of Disqualification: Article 17.  The arbitrator may be challenged for the same reasons established in the Civil Procedural Code in regards to the judges, as well as for the presence of circumstances that give rise to justifiable doubts about their impartiality or independence.           

Institution: Arbitration and Mediation Center of the Quito Chamber of Commerce     

Standard of Disqualification: Article 75.  The duties and obligations of the arbitrator, in addition to those identified in the Arbitration and Mediation Act and the Arbitration and Mediation Rules, are the following:  (a) to act with absolute impartiality and neutrality...

Institution: Center for Conciliation and National and International Arbitration of the Lima Chamber of Commerce Standard of Disqualification: Article 30.  The arbitrators may be challenged only on the following grounds:  ...(b) When circumstances exist that give rise to justifiable doubt as to his/her impartiality or independence.

Some local institutions have attempted to provide definitions of independence, thus establishing a test that can be applied to the facts of each particular challenge.  For instance, Article 8 of the Code of Ethics of the Arbitration and Mediation Center of the Chamber of Commerce of Quito lists the different situations where bias or lack of independence occurs:

[When the arbitrator]:  has economic or personal interest in the outcome of the dispute; maintains an ongoing business relationship, directly or indirectly, with any of the parties; has maintained professional business relationship directly on the subject matter of the dispute; keeps substantial social or kinship relationship with any of the parties.[25]

Where such definitions are unavailable, decision-makers may look to the International Bar Association’s Guidelines on Conflict of Interest in International Arbitration (IBA Guidelines), which include the well-known green, yellow, and red lists which provide examples of potential conflicts of interest.[26] Although the IBA Guidelines “are not legal provisions and do not override any applicable national law or arbitral rules chosen by the parties,” as they themselves recognize,[27] multiple tribunals in Latin America have recognized their persuasive authority and have “frequently been guided by them.”[28] As recognized in Universal v. Venezuela, the IBA Guidelines are “the preeminent set of guidelines for assessing arbitrator conflicts, [but they] are indicative only.”[29]

Finally, parties have tried to raise an arbitrator’s alleged lack of independence or impartiality in legal proceedings outside the arbitration or institution.  In one private arbitration in Peru, arbitrator Fernando Cantuarias Salaverry was challenged by one of the parties based primarily on his previous representation of another mining company related to the dispute.  After the tribunal rejected the challenge, the challenger pursued criminal charges against Dr. Cantuarias for an alleged general misrepresentation and for procedural fraud in connection with his functions as arbitrator.  In the course of considering a writ of habeas corpus filed by Dr. Cantuarias, the Peruvian Constitutional Court determined that criminal proceedings should not be used as an excuse to examine the underlying claim submitted to arbitration, over which the arbitral tribunal had jurisdiction.[30]

4. Arbitrator Challenges in Practice

Because questions of independence and impartiality may be fact-specific in nature, it is instructive to consider how institutions and tribunals in Latin America have decided particular arbitrator challenges.  Although a comprehensive analysis is impossible given that the circumstances and outcome— and in some instances even the occurrence—of challenges are confidential, this section illustrates how arbitrator challenges have been resolved by drawing from publicly available decisions and the authors’ recent experience.

4.1 Experience as Arbitrator in Other Proceedings

Arbitrators are sometimes appointed by the same party or counsel in multiple cases, and may occasionally be privy to pleadings and evidence that are unavailable to the other members of the tribunal.[31] In some cases, arbitrators have been challenged for participation in other proceedings on the basis of a perceived lack of independence or impartiality.

(a)        In Blue Bank v. Venezuela, an investment arbitration before ICSID, the claimant challenged an arbitrator based on (i) repeat appointments by the respondent in investment arbitrations and (ii) alleged systematic findings in favor of states.  Following the challenge, the arbitrator resigned after making a note of his independence.[32]

(b)       In Tidewater Inc. v. Venezuela, an investment arbitration before ICSID, the claimant challenged an arbitrator who had been appointed multiple times by Venezuela and Venezuela’s counsel, including in ongoing arbitrations.  The challenge was rejected.[33]

(c)        A party to an international commercial arbitration challenged an arbitrator who was also sitting on a tribunal in a parallel investment arbitration involving the same factual circumstances.  The challenger argued that because the parallel proceeding was further advanced, the arbitrator could have had to give an opinion on issues germane to the commercial matter.  Following the challenge, the arbitrator tendered his resignation, which was accepted by the other members of the arbitral tribunal.

(d)       A party to an international commercial arbitration challenged an arbitrator who was also sitting on a tribunal in another arbitration involving similar factual circumstances.  The challenger argued that the arbitrator had access to information and evidence to which neither the other members of the arbitral tribunal nor the party in the case had access.  The opposing party argued that most of the information at issue was publicly available and that the challenger was in any case a shareholder of a party involved in the parallel case.  Following the challenge, the arbitrator tendered his resignation, which was accepted by the other members of the arbitral tribunal.

(e)        A party to an international commercial arbitration submitted a request for disqualification of an arbitrator who was also sitting on a tribunal in a parallel arbitration involving the same factual circumstances, which had not been disclosed.  The opposing party argued that the arbitrator did not need to disclose something that could already have been known to the parties, and that insistence on disclosure was absurd and artificial.  Following the challenge, the arbitrator resigned.

(f)        A party to an international commercial arbitration challenged the appointment of a presiding arbitrator who was appointed by the opposing party and was sitting on a tribunal in an unrelated investment arbitration.  The challenger expressed discomfort with the possibility of the arbitrator hearing evidence on the opposing party’s conduct, which the challenger would not be able to know or confront.  The arbitral institution decided not to confirm the arbitrator’s appointment.

4.2       Experience as Counsel

Many arbitrators in Latin America have been or are engaged in practice as counsel.  Although a party’s appointment of its own counsel is uncommon, arbitrators have been challenged for previously having represented the challenging party or for acting as counsel for third parties.

(a)        In Blue Bank v. Venezuela, Venezuela challenged an arbitrator who was a partner in an international law firm, another office of which represented other claimants against Venezuela in separate ICSID cases.  Taking into account the extent of the connection and coordination within the arbitrator’s law firm, the Chairman found that “a third party would find an evident or obvious appearance of lack of impartiality on a reasonable evaluation of the facts in this case.”[34] The challenge was accepted and the arbitrator was disqualified.[35]

(b)       A party to an international commercial arbitration challenged an arbitrator who had counseled a third party in an unrelated, unresolved matter against the challenger.  The arbitrator resigned, denying any direct connection between the two cases, and professing to have formed part of the counsel team in that other case for a short time.

(c)        A party to an international commercial arbitration moved to disqualify an arbitrator who previously had acted as its legal counsel.  The challenger argued that the previous representation could raise questions as to independence and impartiality due to an apparent conflict of interest.  The opposing party argued that the prior relationship between the arbitrator and the challenger benefitted the challenger and did not constitute a conflict of interest affecting the arbitrator’s independence or impartiality.  The challenge was accepted and the arbitrator was disqualified.

4.3       Statements Regarding Parties and Counsel

Collegiality between arbitrators and counsel is the norm in Latin American arbitration.  The arbitration community is growing internationally and locally, but it remains common for practitioners to work together or know each other well.  In some cases, arbitrators have been challenged on the basis of relationships with a party’s counsel allegedly calling into question the arbitrator’s impartiality and independence as well as statements made about party’s counsel.

(a)        In Burlington Resources v. Ecuador, an investment arbitration before ICSID, Ecuador challenged an arbitrator who (i) had allegedly been appointed by the claimant’s counsel in an “unacceptably high number of cases,”[36] (ii) had not disclosed prior and contemporaneous appointments by the claimant’s counsel in other proceedings, and (iii) had submitted an explanation letter in response to the challenge in which he criticized the ethics of Ecuador’s counsel.  Although the Chairman did not consider the first two grounds sufficient for disqualification, he considered that a third party might reasonably conclude that the arbitrator’s statements “manifestly evidence[] an appearance of lack of impartiality with respect to the Republic of Ecuador and its counsel.” [37] The challenge was accepted and the arbitrator was disqualified.[38]

(b)       In Perenco v. Ecuador, an investment arbitration before ICSID, Ecuador challenged an arbitrator that had said in an interview that “recalcitrant host countries” were one of the most pressing issues in international arbitration.  The other members of the tribunal concluded that the context of the challenged arbitrator’s statements had the overall effect of painting an unfavourable view of Ecuador in such a way as to give a reasonable and informed third party justifiable doubts as to [his] impartiality.[39] The challenge was accepted and the arbitrator was disqualified from serving on the tribunal. [40]

(c)        A party to an international commercial arbitration submitted a request for disqualification alleging that the challenged arbitrator (i) had active participation in ongoing and pending cases against one of the parties’ counsels, and (ii) had a direct interest in the dispute as a shareholder of one of the parties.  The challenge was accepted and the arbitrator was disqualified from serving on the tribunal.

(d)       A party to an international commercial arbitration challenged the appointment of a presiding arbitrator who had publicly questioned the ethics of the party’s counsel during a conference.  The challenger alleged personal animosity and hostility that called into question the arbitrator’s impartiality.  The challenge was accepted and the arbitrator was not appointed to the tribunal.

(e)        A party to an international commercial arbitration challenged the appointment of a presiding arbitrator who had publicly praised the opposing party’s counsel.  The challenger alleged that the effusive tenor of the arbitrator’s statements reflected more than a collegial relationship, and raised justifiable concerns as to the arbitrator’s impartiality.  The arbitrator acknowledged the statements and denied having a close personal friendship with the opposing party’s counsel.  The challenge was accepted and the arbitrator was not appointed to the tribunal.

5. Conclusion

In summary, Latin America has become a stronghold in global arbitral practice.  Burgeoning arbitration in the region is indicative of the trust that many states and private parties have placed in this mechanism as a way of resolving disputes.  Latin America now has hundreds of institutions and rules governing arbitration, many of which establish standards of independence and impartiality.  In practice, these standards have been applied in various commercial and investor-state cases with varying outcomes.  As the region’s caseload continues to increase, so will opportunities for the application and analysis of arbitrator challenges.

[1]             See Jonathan C. Hamilton, Three Decades of Latin American Commercial Arbitration, 30 U. Pa. J. Int’l L., 1099 (2009).

[2]             Bolivia denounced the icsid Convention in May 2007, while Ecuador did it in July 2009, and Venezuela in January 2012.

[3]             See Compendium of Latin American Arbitration Law, White & Case LLP Int’l Disp. Q. (2009), available at http://www.whitecase.com/files/Uploads/Documents/latincompendium.pdf.

[4]             Angeles Villareal, Congressional Research Service, The Pacific Alliance:  A Trade Integration Initiative in Latin America 2 (Oct. 2, 2014), http://fas.org/sgp/crs/row/R43748.pdf (“The economies of the four [Pacific Alliance countries] are among the most liberalized in the world.”).

[5]             Int’l Ctr. for Settlement and Investment Disp., The icsid Caseload Statistics, Issue 2015-1 11 (2015), https://icsid.worldbank.org/apps/ICSIDWEB/resources/Documents/ICSID%20 Web%20Stats%202015-1%20(English)%20(2)_ Redacted.pdf.

[6]             Jonathan C. Hamilton & Michael Roche, Survey of Trends in Latin American Arbitration, White & Case LLP Int’l Disp. Q. (2009), http://www.whitecase.com/idq/summer_2009_1a/.

[7]             See 25(1) ICC Int’l Ct. of Arb. Bull., ¶¶ 7-8 (2014). The total number of cases registered in20i3 was 2,120, with 221 cases involving parties from Latin American countries, see 24(1) iCC Int’l Ct. of Arb. Bull., ¶¶ 7-8, (2013). In 2012, out of 2,036 filed cases, 226 involved parties from Latin American countries.

[8]             For a cumulative list of arbitral institutions identified in Latin America, see Inst. for Transnat’ l Arbitration, The Inaugural Survey of Latin American Arbitral Institutions 10 (2011), http:// www.whitecase.com/files/upload/fileRepository/LAL-itasurvey.pdf [hereinafter Inaugural Survey].

[9]             Id. at 12-13.

[10]            See World Bank, Convention on the Settlement of Investment Disputes Between States and Nationals of Other States, Art. 39 [hereinafter ICSID Convention], available at https:// icsid.worldbank.org/ICSID/StaticFiles/basicdoc_en-archive/ICSID_English. pdf.

[11]            See id, Art. 14.

[12]            Inaugural Survey, supra note 8, at 15. For roster requirements, see, e.g., Rules of Arbitration, Conciliation and Amicable Resolution of the Chamber of Commerce of Cali, Art. 30.1 (“Para arbitrar procesos de mayor cuantía [es requisito s]er abogado titulado y con tarjeta profesional.”); Arbitration and Conciliation Rules of Centro de Arbitraje y Conciliación de la Cámara de Comercio de Guatemala, Art. 28 (“Únicamente en arbitrajes de derecho, la designación de Árbitros deberá recaer en abogados”); Arbitral Rules of Tribunal de Arbitraje General de la Bolsa de Comercio de Buenos Aires, Art. 5 (“Los Árbitros deberán poseer título universitario reconocido por el Estado. Por lo menos dos de ellos deberán ser abogados con diez años de antigüedad en el ejercicio de la profesión; si el restante no lo fuere, deberá acreditar una vinculación profesional con empresas durante igual lapso.”); Arbitration Rules of Câmara de Arbitragem do Mercado, Art. 3.4.1 (“O terceiro árbitro deverá ter formação jurídica, e ser escolhido dentre os membros integrantes do Corpo de Árbitros da Câmara de Arbitragem.”); Rules of the Arbitration Center of the Bar Association of Lima, Arts. 32.2-32.3 (“Los requisitos para aceptar el cargo de Árbitro en los procesos arbitrales seguidos ante el Centro, son aquellos establecidos por la Ley, el presente Reglamento y el acuerdo de las partes, de ser el caso. En especial se deberá cumplir con los siguientes requisitos:  2.Si se trata de árbitro de derecho, tener título de abogado1. 3. Si se trata de árbitro de derecho, tener el título de abogado, y una antigüedad de no menos de seis (06) años en el ejercicio de la profesión.”); Rules of Arbitration, Centro de Conciliación y Arbitraje Nacional e Internacional de la Cámara de Comercio de Lima, Arts. 25.3-25.4 (“3. En el arbitraje nacional que deba decidirse en derecho, se requiere ser abogado, salvo acuerdo en contrario. De ser el caso, no se requerirá ser abogado en ejercicio ni pertenecer o estar inscrito o habilitado por ninguna asociación o gremio de abogados nacional o extranjera. 4. En el arbitraje internacional, en ningún caso se requiere ser abogado para ejercer el cargo.”).

For requirements on nationality, see, e.g., Arbitration Rules of Centro de Conciliación y Arbitraje de la Corte de Arbitraje Internacional para el MERCOSUR de la Bolsa de Comercio de Uruguay, Art. 12.2 (“En el caso de arbitrajes derivados de litigios internacionales, el Consejo del Centro procurará designar a personas de nacionalidad diferente a la de las partes en conflicto.”); Arbitration Rules of Cámara Nacional de Comercio de la Ciudad de México, Art. 8.3 (“La Comisión tomará las medidas necesarias para garantizar el nombramiento de un árbitro independiente e imparcial; y, cuando el arbitraje sea internacional, tendrá en cuenta la conveniencia de nombrar a un árbitro de nacionalidad distinta al de la nacionalidad de las partes.”); Rules of International Commercial Arbitration of the Santiago Arbitration and Mediation Center, Santiago Chamber of Commerce, Art. 9.4 (“If the litigation is resolved by one single arbitrator, the nationality thereof shall be different from that of the litigating parties, unless CAM Santiago deems otherwise after consulting the parties, who may oppose this for good reason. The same shall apply to the president of a three-member tribunal.”). Other institutions do not have a preference on nationality, for example Rules of Arbitration, Centro de Conciliacion y Arbitraje Nacional e Internacional de la Camara de Comercio de Lima, Art. 25.2 (“Salvo acuerdo en contrario de las partes, la nacionalidad de una persona no será obstáculo para que actúe como árbitro.”); Arbitration Rules of the Amcham Arbitration and Mediation Center Brazil, Art. 6.2 (“Any individual with legal capacity and trusted by the Parties, without restrictions as to his/her nationality, may act as arbitrator.”); Arbitral Rules of Centro de Mediación y Arbitraje de la Cámara de Comercio de Nicaragua, Art. 8 (“Salvo acuerdo en contrario de las partes, la nacionalidad de una persona no será obstáculo para que actúe como árbitro.”).

For licensing requirements, see, e.g., Arbitration Rules of Câmara de Arbitragem do Mercado, Art. 3.4.1 (“O terceiro árbitro deverá ter formação jurídica, e ser escolhido dentre os membros integrantes do Corpo de Árbitros da Câmara de Arbitragem.”); Rules of Arbitration and Conciliation, Centro de Conciliação e Arbitragem da Câmara de Comércio Argentino-Brasileira de São Paulo, Art. 3.2.1 (“Nos casos em que as partes não tiverem nomeado árbitros, ou que não exista acordo entre as mesmas neste aspecto, seguir-se-á o seguinte procedimento:  O Secretário Geral requererá às partes que cada uma nomeie um árbitro membro do Corpo Arbitral do Centro de Conciliação e Arbitragem da Câmara.”); Rules of Arbitration, Câmara Mineira de Mediação e Arbitragem (CAMINAS), Art. 3.1 (“Deverão as Partes, preferencialmente, indicar Árbitros dentre os profissionais integrantes do Quadro de Especialistas da CAMINAS.”).

For other requirements, see, e.g., Rules of the Arbitration and Mediation Center of the Chamber of Commerce of Quito, Art. 74.1 (“Para ser autorizado como árbitro de este Centro se requiere:  [t]ener al menos 35 años.”); Rules of the Arbitration Center of the Bar Association of Lima, Art. 32.1 (“Los requisitos para aceptar el cargo de Árbitro en los procesos arbitrales seguidos ante el Centro, son aquellos establecidos por la Ley, el presente Reglamento y el acuerdo de las partes, de ser el caso. En especial se deberá cumplir con los siguientes requisitos:  [s]er mayor de edad.”); Rules of Arbitration, Conciliation and Amicable Resolution of the Chamber of Commerce of Cali, Art. 30.2 (“Requisitos para integrar las listas de árbitros:  Para arbitrar procesos de mayor cuantía:  1. Ser abogado titulado y con tarjeta profesional; 2. Tener experiencia mínima de diez (10) años en ejercicio de la profesión de abogado o el desempeño como profesor en alguna disciplina jurídica.”).

[13]            For example, Mexico and France agreed to arbitrate the ownership of the Clipperton Island in 1909, appointing the King of Italy to settle the dispute; Peru and Chile agreed to settle issues of territorial boundaries in the area of Tacna and Arica through arbitration, appointing U.S. President Calvin Coolidge in 1925; Costa Rica and Nicaragua agreed in the Cañas-Jerez Treaty of 1858 to arbitrate a boundary dispute along the San Juan River, appointing U.S. President Grover Cleveland as sole arbitrator; Colombia and Venezuela agreed in the Arosemena-Guzman Treaty of September 14, 1881 to settle their boundary dispute through arbitration, appointing the King of Spain as sole arbitrator; and Argentina and Paraguay agreed to arbitrate a boundary dispute in the Chaco region, appointing as arbitrator U.S. President Rutherford Hayes in 1878.

[14]            See Latin American Investment Arbitrator Survey, Latin Arb. L., http://latinarbitrationlaw .com/latin-arbitration-law-arbitrators (last visited Apr. 15, 2015).

[15]            Id.

[16]            Urbaser s.a. & Consorcio de Aguas Bilbao Bizkaia, Bilbao Biskaia Ur Partzuergoa v. Argentine Republic, ICSID Case No. ARB/07/26, Decision on Claimant’s Proposal to Disqualify Professor Campbell McLachlan, Arbitrator, ¶ 40 (Aug. 12, 2010) (“No arbitrator and, more generally, no human being of a certain age is, in absolute terms, independent and impartial. Simply put, every individual is conveying ideas and opinions based on its moral, cultural, and professional education and experience.”).

[17]            UNCITRAL Arbitration Rules, A/65/465, Art. 12(1) (Dec. 6, 2010), http://www.uncitral.org/ pdf/english/texts/arbitration/arb-rules-revised/arb-rules-revised-2010-e.pdf [hereinafter 2010 UNCITRAL Rules] (“Any arbitrator may be challenged if circumstances exist that give rise to justifiable doubts as to the arbitrator’s impartiality or independence.”).

[18]            18          Inter-American Commercial Arbitration Commission Rules, Art. 7.1 (Apr. 1, 2002), available at https://www.adr.org/cs/groups/international/documents/document/dgdf/mday/ ~edisp/adrstg_002003~1.pdf (“Any arbitrator may be challenged if circumstances exist that give rise to justifiable doubts as to the arbitrator’s impartiality or independence.”).

[19]            See, e.g, London Court of International Arbitration Rules, Art. 10(3) (Oct. 2014); Arbitration Rules of the Arbitration Institute of the Stockholm Chamber of Commerce, Art. 15(1) (Jan. 2007).

[20]            ICSID Convention, supra note 10, Art. 14(1) (“Persons designated to serve on the Panels shall be persons of high moral character and recognized competence in the fields of law, commerce, industry or finance, who may be relied upon to exercise independent judgment. Competence in the field of law shall be of particular importance in the case of persons on the Panel of Arbitrators.”); id., Art 57 (“A party may propose to a Commission or Tribunal the disqualification of any of its members on account of any fact indicating a manifest lack of the qualities required by paragraph (1) of Article 14. A party to arbitration proceedings may, in addition, propose the disqualification of an arbitrator on the ground that he was ineligible for appointment to the Tribunal under Section 2 of Chapter IV.”).

[21]            Blue Bank Int’l & Trust (Barbados) Ltd. v. Bolivarian Republic of Venezuela, icsid Case No. ARB/12/24, Decision on the Parties’ Proposals to Disqualify a Majority of the Tribunal, ¶ 69 (Nov. 12, 2013).

[22]            Burlington Resources, Inc. v Republic of Ecuador, icsid Case No. ARB/08/5, Decision on the Proposal for Disqualification of Professor Francisco Orrego Vicuña, ¶ 80 (Dec. 13, 2013).

[23]            See, e.g, Centro de Conciliación y Arbitraje Nacional e Internacional de la Cámara de Comercio de Lima, Arbitration Rules, Art. 30; Centro de Arbitraje y Mediación de la Cámara de Comercio de Quito, Arbitration Rules, Art. 9; Consejo de Conciliación y Arbitraje de la Cámara de Comercio de Santo Domingo, República Dominicana, Arbitration Rules, Art. 17; Centro Internacional de Conciliación y Arbitraje (CICA) de la Cámara Costarricense Norteamericana de Comercio (AMCHAM), Arbitration Rules, Art. 17; Centro de Mediación y Arbitraje de la Cámara de Comercio e Industria de El Salvador, Arbitration Rules, Art. 26.

[24]            Rules of Procedure of Centro de Arbitraje y Conciliación de la Cámara de Comercio de Bogotá para los Arbitramentos que Surtan ante el Mismo, Art. 7.1.

[25]            Code of Ethics for Arbitrators, Mediators, Secretariat y Experts of the Arbitration and Mediation Center of the Chamber of Commerce of Quito, Art. 8.

[26]            Int’l Bar Ass’n., Guidelines on Conflict of Interest in International Arbitration (Nov. 28, 2014), http://www.ibanet.org/Publications/publications_IBA_guides_and_free_materials. aspx [hereinafter 2014 IBA Conflict Guidelines] (last visited Apr. 15, 2014); Int’l Bar Ass’n., Guidelines on Conflict of Interest in International Arbitration (May 22, 2004).

[27]            2014 iba Conflict Guidelines, supra note 35, ¶ 3.

[28]            Tidewater Inc. & Others v. Bolivarian Republic of Venezuela, icsid Case No. ARB/10/5, Decision on Claimant’s Proposal to Disqualify Professor Brigitte Stern, Arbitrator, ¶ 41 (Dec. 23 2010); see also ICS Inspection & Control Servs. Ltd. (United Kingdom) v. Republic of Argentina, pca Case No. 2010-9, Decision on Challenge to Arbitrator, ¶ 22.2 (Dec. 17, 2009) (“Although the IBA Guidelines have no binding status in the present proceedings, they reflect international best practices and offer examples of situations that may give rise to objectively justifiable doubts as to an arbitrator’s impartiality or independence.”); Azurix Corp. v. Argentine Republic, ICSID Case No. ARB/01/12, Decision on Annulment, ¶ 263 (Sept. 1, 2009); edf Int’l S.A., saur Int’l s.a. & León Participaciones Argentinas s.a. v. Argentine Republic, icsid Case No. arb 03/23, Decision on Disqualification, ¶¶ 25, 34, 50, 60 (June 25, 2008).

[29]            Universal Compression Int’l Holdings, s.l.u. v. Bolivian Republic of Venezuela, icsid Case No. ARB/10/9, Decision on the Proposal to Disqualify Professor Brigitte Stern and Professor Guido Santiago Tawil, Arbitrators, ¶ 74 (May 20, 2011).

[30]            Fernando Cantuarias Salaverry, Decision of the Peruvian Constitutional Court, exp No. 6167-2005-PHC/TC, Part IV §1 (Feb. 28, 2006). In connection to impartiality, Magistrate Gonzales Ojeda’s remarked:

“[I]n certain cases, each party choose an arbitrator, and these, in turn, a President of the Arbitral Tribunal. So if the necessity of his impartiality can be predicated upon the latter, this is not necessarily the case with respect to the arbitrators designated by the parties.” Id.

[31]            One tribunal has opined that an arbitrator

“cannot reasonably be asked to maintain a ‘Chinese wall’ in his own mind:  his understanding of the situation may well be affected by information acquired in the other arbitration.”

Encana Corp. v. Republic of Ecuador, uncitral, Partial Award on Jurisdiction, ¶ 45 (Feb. 27, 2004).

[32]            Blue Bank Int’l & Trust (Barbados) Ltd. v. Bolivarian Republic of Venezuela, icsid Case No. ARB/12/24), Decision on the Parties’ Proposals to Disqualify a Majority of the Tribunal, ¶ 70 (Nov. 12, 2013).

[33]            Tidewater Inc., icsid Case No. ARB/10/5.

[34]            Blue Bank Infl, icsid Case No. ARB/12/24, ¶ 69.

[35]            Id, , ¶ 71.

[36]            Burlington Resources, Inc. v Republic of Ecuador, icsid Case No. arb /08/5, Decision on the Proposal for Disqualification of Professor Francisco Orrego Vicuña, T ¶ 20 (Dec. 13, 2013) (citation omitted).

[37]            Id., T ¶ 80.

[38]            Id., T ¶ 81.

[39]            Perenco Ecuador Ltd. v. Republic of Ecuador & Empresa Estatal Petroleos del Ecuador, ICSID Case No. ARB/08/6, Decision on Challenge to Arbitrator (PCA Case No.IR-2009/1), T ¶ 48 (Dec. 8, 2009).

[40]            Id. at 11.

Latin America now has hundreds of institutions and rules governing arbitration, many of which establish standards of independence and impartiality.  In practice, these standards have had varying outcomes.  As the caseload continues to increase, so will opportunities for the application and analysis of arbitrator challenges.

Jonathan C. Hamilton