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to the funding of disputes within England and Wales8. This Code of
Conduct for Litigation Funders 9 obliges the funders to refrain from
steps that do or may cause the solicitor or barrister to act in breach of
their professional duties. However, this code is also criticized for not
having a binding nature. Further, its scope is limited to disputes in a
certain region, only.
The arbitration rules, in general, do not regulate the funding of
arbitration by third parties. The disclosure requirements and the rules
of conduct constitute areas that are open to further legislation.
Bearing in mind the fact that third party funding is a new concept,
it is quite heterogeneous, where both the funders, the funding method,
and the funding agreements widely vary, and it may be expected that
rules or guidelines for funding in international arbitrations are estab-
lished in the near future.
Conclusion
Third party financing is new, vibrant in international arbitration,
both appealing to arbitrators and parties, and also raises concerns
among the practitioners. While it promotes access to parties with weak
financial conditions, it raises questions and concerns governing impar-
tiality and independence of arbitrators. However, the arbitration costs
remain an unresolved issue when third party financing is concerned.
While the Guidelines of the IBA provide useful insight on how to
avoid or solve certain effects of third party financing on the healthy
functioning of arbitration, this remains an area to be regulated and clar-
ified. Beyond any doubt, third party financing will continue to stir
debates among scholars and practitioners in the near future.
204 NEWSLETTER 2015
8 See
tors.pdf (accessed on 18 September 2015).
9 January 2014, accessible on
2014/02/Code-of-conduct-Jan-2014-Final-PDFv2-2.pdf (accessed on 18 September 2015).