SPECIAL REPORT 23
SEOUL
LIKE SINGAPORE, SOUTH KORE A HA S LONG-ESTABLISHED ARBITRATION INFRA STRUCTURE AND HA S BEEN MAKING EFFORTS TO POSITION ITSELF A S A LE ADING ARBITRATION CENTRE IN A SIA , HAVING BEING TIPPED A S “ARBITRATION’S RISING STAR”. 2 THOUGH IT CONTINUES TO MAKE STE ADY GROWTH, SUPPORTED BY KORE A’S FORMIDABLE EXPORT SECTOR, SEOUL IS YET TO BECOME A SERIOUS ALTERNATIVE TO SINGAPORE FOR A COMPANY WITH A BIG ARBITRATION BURNING A HOLE IN THE CORPORATE POCKET. SOME MIGHT ARGUE THAT KUAL A LUMPUR HA S STOLEN ITS CLOTHES (SEE PAGE 24). South Korea’s arbitration infrastructure has age on its side: its state- established arbitral body, the Korean Commercial Arbitration Board (KCAB), was established in 1970 under an Arbitration Act dating from 1966. Regular revisions to the Arbitration Act, based upon the UNCITRAL model law, have kept it fresh. The latest crop of proposed revisions would strengthen a tribunal’s ability to order interim relief and simplify the enforcement process. This is complemented by domestic courts with power to grant interim relief in support of arbitration andwhich are generally happy to do so. The KCAB’s arbitration rules, overseen by the Supreme Court and last revised in 2011, are also about to be updated again to institute an emergency arbitrator systemand to develop existing provisions on joinder and the KCAB’s confirmation of arbitrators.
There are signs that these efforts are paying off, buoyed at least in part by South Korea’s large and active international trade links and, to a lesser extent, by itsmaritime (including shipbuilding) and financial industries. International arbitrations commenced annually at KCAB have crept up, froman average of 47 per year in 2001-9 to 76 per year in 2010-2014, though the rate of growth year-on-year has been far fromconsistent. Of those arbitrations commenced in 2014, 70% concerned international trade, while finance andmaritime came in at 9% and 8% respectively. 3 In 2013, and again in amove reminiscent of Singapore, Seoul got its own state-sponsored ADR hearing centre, the Seoul International Dispute Resolution Center (Seoul IDRC). Unlike Singapore, it is not clear that Seoul is yet attracting very high value, high complexity or fully international arbitrations. The average claimvalue of an international arbitration commenced at the KCAB in 2014was less than USD 2.6million and 54% concerned payment issues. 4 On the other hand, partly owing to the simple nature of the disputes that are administered by the KCAB, the average duration of the centre’s international cases completed in 2014was a very respectable 12months. There will bemany, including clients of the authors, who wish some of KCAB’sWestern counterparts were as fast. Anecdotal evidence, however, suggests that the KCAB has some way to go to convince all of its potential users – beginning with domestic users – that it is a reliable and consistent option for resolution of complex international disputes. When it is able to do so, the infrastructure is in place for success.
THE AVERAGE DURAT ION OF THE CENTRE ’ S INTERNAT IONAL C A SES COMPLE T ED IN 2014 WA S A VERY RESPECTABLE 12 MONTHS .
2 Article by Kanishk Verghese published on 1 October 2013 and available at: http://www.legalbusinessonline.com/features/seoul-arbitration’s-rising-star/57823. 3 KCAB 2014 Annual Report, p.11; “Trends in International Arbitration: A NewWorld Order” (FTI Consulting, February 2015), p.3. 4 KCAB 2014 Annual Report, pp.13-14
Made with FlippingBook Online newsletter