KEY ISSUES IN ARBITRATION OF DERIVATIVES AND COMPLEX FINANCIAL DISPUTES: VIRTUAL PUBLIC CONSULTATION ON THE REVISION OF THE P.R.I.M.E. FINANCE RULES

Arbitration can provide an effective alternative to the courts for the resolution of disputes concerning derivatives and other complex financial products. In particular, given the inherent flexibility and emphasis on party autonomy, the arbitral process can be crafted to address the specific issues most likely to arise. Further, an arbitral tribunal experienced in financial markets law and practice can be appointed to resolve the dispute where appropriate. The advantages of arbitrating such disputes are explored in more detail in our article here.

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Public consultation underway for new P.R.I.M.E. Finance Arbitration Rules

P.R.I.M.E. Finance provides a specialist platform to resolve complex banking and financial disputes.  Since its inception in 2012, the organisation has been committed to providing users with a market-leading dispute resolution experience.  Following the cooperation between P.R.I.M.E. Finance and the Permanent Court of Arbitration (PCA) in December 2015, cases commenced under the P.R.I.M.E. Finance Arbitration Rules are administered by the PCA.

The current version of the P.R.I.M.E. Finance Arbitration Rules came into force in February 2016.  The rules closely follow the text of the UNCITRAL Arbitration Rules but have been tailored to enhance their applicability in banking and financial disputes.

Following the development of the arbitration landscape over the past few years – particularly in the context of complex commercial arbitrations – P.R.I.M.E. Finance has released a draft of its revised arbitration rules and invited the public to comment.  The changes aim to offer a comprehensive and clear set of best practice procedural rules, with particular features tailored for banking and financial arbitrations.

Some noticeable changes include enhanced efficiency and greater transparency.  The draft rules contain detailed provisions on emergency arbitrator procedures, expedition, joinder and consolidation, as well as the Tribunal’s power to coordinate proceedings and provide early determination under certain circumstances.  The proposed revisions also mandate the disclosure of third-party funding arrangements and encourage the publishing of arbitration awards.

The review of the existing P.R.I.M.E. Finance Arbitration Rules began in 2020 and involved pre-eminent banking experts and dispute resolution practitioners across multiple jurisdictions.  Herbert Smith Freehills Partner Kathryn Sanger is a member of the Drafting Group. Partner Dr Mathias Wittinghofer is a member of P.R.I.M.E. Finance’s panel of experts.

The public consultation is open until 22 March 2021.

P.R.I.M.E. Finance’s release is available here.

Kathryn Sanger
Kathryn Sanger
Partner, Hong Kong
+852 2101 4029
Nicholas Peacock
Nicholas Peacock
Partner, London
+44 20 7466 2803
Mathias Wittinghofer
Mathias Wittinghofer
Partner, Frankfurt
+49 69 2222 82521
Hannah Ambrose
Hannah Ambrose
Senior Associate, London
+44 20 7466 7585
Aaron Tang
Aaron Tang
Associate, Hong Kong
+852 2101 4102