The new Ljubljana Arbitration Rules have entered into force

The Ljubljana Arbitration Rules ("LAP") were adopted by the Permanent Court of Arbitration of the Chamber of Commerce and Industry of Slovenia and entered into force on 1 June 2023. The new rules apply to all arbitration proceedings commenced after that date, even if the dispute arises out of a legal relationship for which an arbitration agreement was concluded before that date. The adoption of the new rules constitutes an update of the Ljubljana Arbitration Rules of 2014.

The most significant new provision is Article 25 of the LAP, which introduces the mandatory holding of a case management conference. The purpose of the conference is to increase the participation of the parties and the Arbitral Tribunal in the formulation of the timetable for the proceedings. As soon as a case is handed over to the Arbitral Tribunal, the latter must without delay start planning the proceedings and hold a management conference, which may be held in person, by videoconference, by telephone or by any other means. The guiding objective of the panel and of the parties at the conference should be to seek to establish procedural rules that increase the efficiency and speed of the proceedings. The parties shall thus have the opportunity to communicate to the panel their suggestions for the design and conduct of the proceedings. By holding a conference, the Chamber establishes personal contact with the parties, which may lead to better cooperation during the proceedings. The timetable for the proceedings may also be modified at a later stage, if necessary, after prior consultation with the parties.

The new arbitration rules also introduce the possibility of appointing an administrative secretary to the Arbitral Tribunal, subject to the consent of the parties. The provisions of Articles 16 and 18 of the LAP governing the impartiality, independence and availability of arbitrators and the confirmation and disqualification of arbitrators apply mutatis mutandis to the Registrar.

Another novelty brought by LAP is the use of means of telecommunication. Pursuant to Article 32 of the LAP, the Arbitral Tribunal may, after prior consultation with the parties and taking into account the relevant circumstances of the case, including the legitimate interests and expectations of the parties, decide that the oral hearing shall be held in person or remotely by videoconference, telephone or other appropriate means of communication. Telecommunications may also be used for the examination of witnesses and experts.

With regard to the formation of the Arbitral Tribunal, Article 13 of the LAP now provides that the parties may agree on the number of arbitrators. In the absence of agreement, the Board may decide whether the dispute shall be settled by a Arbitral Tribunal composed of a sole arbitrator or three arbitrators, taking into account the complexity of the case, the value of the subject matter in dispute, or other relevant circumstances of the case.

Article 45 of the LAP also contains a more significant amendment, which now takes into account the principle of good faith in addition to the principle of success in allocating the costs of arbitration proceedings. In deciding on the allocation of costs, the Arbitral Tribunal therefore considers the contribution of each party to the efficiency and speed of the proceedings. If a party to the arbitration has entered into an agreement with a third party for the financing of claims or defence, and if that party has an economic interest in the outcome of the proceedings, the party must now disclose the identity of that third party to the Arbitral Tribunal and to the other parties to the arbitration proceedings, in accordance with Article 16 of the LAP.

The new rules also bring an update to the expedited arbitration procedure. Unless the parties agree that the decision will be based on documentary material, the Arbitral Tribunal may now hold only one oral hearing or discussion (Article 48 LAP).

The new Ljubljana Arbitration Rules aim to make the arbitration process more functional and efficient. In doing so, they seek to bring the arbitration process closer to the parties, to keep up with recent trends in arbitration and to optimise the time and cost of the process.