Answer By law4u team
Arbitration is a widely used method of dispute resolution, especially in commercial, international, and cross-border transactions. One of its main appeals is the confidentiality it offers, shielding parties from public exposure and protecting sensitive business information. However, this confidentiality also raises questions about transparency and public access to arbitral awards. The answer varies depending on the type of arbitration, applicable laws, institutional rules, and subsequent legal actions like court enforcement.
Public vs. Private Nature of Arbitral Awards
1. Arbitral Awards Are Generally Private
Arbitral proceedings, including the final award, are typically private. Most arbitration agreements and institutional rules emphasize confidentiality, which means:
The hearings are closed to the public.
Documents submitted are not accessible to outsiders.
The final award is shared only with the involved parties.
2. Court Enforcement Can Make Awards Public
If a party fails to comply with an arbitral award, the other party may approach a court to enforce it. In such cases:
The award may be submitted as evidence.
Court filings are generally public records, potentially exposing the contents of the award.
Parties can request sealing of records, but this depends on court discretion and local rules.
3. Institutional Rules and Policies
Different arbitration institutions have varying practices:
ICC (International Chamber of Commerce): May publish anonymized summaries of awards, with party consent.
LCIA (London Court of International Arbitration): Emphasizes confidentiality but may allow publication with redaction.
ICSID (International Centre for Settlement of Investment Disputes): Often publishes full awards because it deals with state-investor disputes, involving public interest.
4. Confidentiality Clauses in Contracts
Most arbitration agreements contain explicit confidentiality clauses that restrict:
Disclosure of award details
Sharing any part of the proceedings with third parties
Violating such terms may result in legal penalties or claims for breach of contract.
5. Investor-State Arbitration: A Transparency Exception
Investor-State arbitration (ISDS), under treaties like Bilateral Investment Treaties (BITs) or institutions like UNCITRAL, often mandates public access due to:
Use of taxpayer funds
Public policy implications
Requirements under treaties and transparency rules (e.g., UNCITRAL Rules on Transparency 2014)
6. Growing Trend Toward Transparency
There is increasing global pressure—especially in international disputes—for greater transparency, including:
Publishing arbitral awards on institutional websites
Public hearings in certain ISDS cases
Disclosure requirements under national laws or treaties
Example
Scenario:
A multinational company (Company X) enters into a supply agreement with a local distributor (Company Y) in another country. The contract includes an arbitration clause stating that disputes will be resolved through LCIA arbitration in London. A disagreement arises, and Company X wins a $5 million award.
What Happens Next?
The award is not published publicly by default since it’s private commercial arbitration.
Company Y refuses to pay, so Company X files for enforcement in a UK court.
The award becomes part of public court records, which legal databases or journalists can access.
Since both parties signed a confidentiality clause, Company Y requests the court to seal the documents, but the court only partially redacts them.
If this case had been under ICSID, the award would likely have been published in full due to investor-state transparency obligations.
Key Takeaway:
While arbitration is usually private, any interaction with public court systems or international transparency frameworks can make awards partially or fully public.
