2016.ANA METIN ingilizce.01

IBA Guidelines on Conflict of Interest

(“Guidelines”) was issued

in 2004. The IBA Arbitration Committee commenced a review process

of the Guidelines in 2012, and the revised version was published in

2014. The Guidelines do not provide legal provisions, but aim to act as

a guide or indicator to be adopted in commercial and investment arbi-

tration, and is expected to be applied with robust common sense

(Introduction, Art. 6).

Pursuant to these Guidelines, both arbitrators and parties are

expected to disclose any facts or circumstances that may give rise to

doubts as to an arbitrator’s impartiality or independence.

Third party funders constitute a novelty in the Guidelines as they

are included among the persons considered to bear the identity of the

party they are funding. As revised in 2014, this disclosure requirement

also concerns third party funders, as follows: The Guidelines state in

Art. 6(b) that a person may be considered bearing the identity of anoth-

er party, if such person has a controlling influence over a party, or a

direct economic interest in, or a duty to indemnify a party for the award

to be rendered in the arbitration. The explanations state that third party

funders may be considered to be the equivalent of the party.

This relationship needs to be taken into consideration when assess-

ing an arbitrator’s disclosure duty. The Guidelines also charge the par-

ties with the duty to inform the arbitrator, the tribunal and the other

party of any relationship between the arbitrator and such party or an

entity with a direct economic interest in, or a duty to indemnify a party

for, the award to be rendered.

Accordingly this duty of disclosure by the arbitrator and by the

parties comprises of any relationship between a third party funder and

an arbitrator.

While the Guidelines provide insight to the disclosure obligations

aiming to solve any conflict of interest due to funding, its non-binding

nature should be taken into consideration.

In UK, the Association of Litigation Funders (ALF) provides a

code of conduct whereby its members are expected to abide in relation

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These guidelines may be downloaded from

IBA_guides_and_free_materials.aspx (accessed on 18 September 2015).