VIAC Rules 2021 Key Changes and Features in Ukrainian Arbitration Forum

VIAC Rules 2021 Key changes and features II UKRAINIAN ARBITRATION FORUM Ema Poto nik (Legal Counsel, VIAC) Vienna, December 2021

Main differences to other Institutions and Rules Lean and flexible rules to adapt proceedings to the needs of the parties Joinder of third parties possible at any stage of proceedings and in any form, to be decided by arbitral tribunal (Art 14) Expedited proceedings as opt-in mechanism without monetary threshold; parties choice re number of arbitrators is respected (Art 45) Fall-back seat Vienna (Art 25) Provision on TPF (Art 13a) Competitive fee structure with predictable costs VIAC Portal as of March 2021 online file sharing platform Separate set of Investment Arbitration and Mediation Rules PAI status to operate in the Russian Federation as of July 2019 2/22

VIAC Rules 2021 Revision of the VIAC Rules for Arbitration and Mediation (Vienna Rules and Vienna Mediation Rules 2021) Newly drafted VIAC Rules of Investment Arbitration and Mediation (Vienna Investment Arbitration Rules and Vienna Investment Mediation Rules 2021) 3/22

VIENNA ARBITRATION AND MEDIATION RULES (COMMERCIAL RULES) 4/22

Vienna Rules and Vienna Mediation Rules 2021 Previous updates: 2001, 2006, 2013, 2016 (Mediation), 2018 New version of the VIAC Rules of Arbitration and Mediation entered into force on 1 July 2021 and apply to all proceedings that commence after 30 June 2021 6 Annexes: Annex 1: Model Clauses Annex 2: Internal Rules of the Board Annex 3: Schedule of Fees Annex 4: VIAC as Appointing Authority Annex 5: VIAC as Administering Authority Annex 6: Supplementary Rules for Disputes Relating to Succession 5/22

VR and VMR 2021 Overview of changes I VIAC's competence has been redefined in Article 1 para 1 VR and Article 1 para 1 VMR to explicitly include investment proceedings as well as VIAC acting as Appointing or Administering Authority and unilaterally foreseen arbitration agreements. All new proceedings are administered by VIAC through our electronic case management system as of 1 January 2018 and the VIAC Portal for the secure exchange of case related documents has also been available to parties and arbitrators since 1 March 2021; the provisions on the submission of statement of claims and on the transmission of documents have been adapted accordingly (Articles 7, 12 and 36 VR and Articles 1 and 3 VMR). Third-party funding is now used in many proceedings. The definition in Article 6 para 1.9 and the provision in Article 13a VR are intended to create the framework for this instrument, especially to ensure the independence and impartiality of the arbitrators through appropriate disclosure. 6/22

VR and VMR 2021 Overview of changes II The Vienna Rules now explicitly state that oral hearings may be conducted in person or by videoconferencing technology - for further information see the "Vienna Protocol - A Practical Checklist for Remote Hearings); the arbitral tribunal shall decide on this, taking into account the views of the parties and the particular circumstances of the case (Article 30 para 1 VR). The same applies to mediation sessions (Article 9 para 3 VMR). other means (e.g. remote via Arbitral tribunals are entitled at any time during the proceedings to assist the parties in their endeavors to reach a settlement (Article 28 para 3 VR). 7/22

VR and VMR 2021 Overview of changes III A further provision to increase the efficiency of the proceedings is contained in Article 32 para 2 VR, which now sets a time limit for the issuance of the award, i.e. the award shall be rendered no later than three months after the last hearing concerning matters to be decided in an award or the filing of the last authorized submission concerning such matters, whatever is the later. The arbitral tribunal may now, at any stage of the arbitral proceedings, at the request of a party, make a decision on costs pursuant to Article 44 paras 1.2 and 1.3 and order payment (Art 38 para 3 VR) and need not wait for the final award in this respect. 8/22

VR and VMR 2021 Overview of changes IV In determining the advance on costs, the VIAC Secretary General has more flexibility to address the greater complexity, esp. in multiparty proceedings (Articles 42 VR). The Schedule of Fees in Annex 3 has also been revised. While the registration fee and administrative fees for low amounts in dispute have remained the same, the administrative fees for amounts in dispute above EUR 100,000 as well as the arbitrators fees for amounts in dispute above EUR 200,000 have been increased to reflect the increased complexity in proceedings as well as the extended services of VIAC (HighQ file sharing platform, electronic case management database). 9/22

VR and VMR 2021 Overview of changes V The following model clauses were added to the Arbitration and Mediation Clauses: Arb-Med-Arb-Clause, Clauses, Model Clause for VIAC as Appointing Authority and the Model Clause for VIAC as Administering Authority, and the Model Clause for Disputes Relating to Succession. The new Annexes 4 and 5 contain detailed rules for cases in which VIAC is requested to act as Appointing or Administering Authority. Annex 6 contains supplementary rules for disputes relating to succession, which take into account the special features of arbitration proceedings foreseen in a disposition of property upon death. Mediation 10/22

Comparison Total Costs Tribunal VIAC vs. other Institutions up to EUR 2 mio. Total Cost of Arbitration Arbitral Tribunal - EUR 1 to EUR 2 Mio 3/4 250 000 SCC 20 ICC 21 DIS 2018 * (incl Expedited) HKIAC 2018 SIAC 2016 VIAC 2021 200 000 150 000 Costs 100 000 50 000 - 1 10 000 35 000 50 000 100 000 150 000 200 000 250 000 500 000 750 000 1000 000 1500 000 2000 000 Amount in Dispute 11/22

Comparison Total Costs Sole Arb. VIAC vs. other Institutions up to EUR 2 mio. Total Cost of Arbitration Sole Arbitrator - EUR 1 to EUR 2 Mio 90 000 80 000 SCC 20 ICC 21 DIS 2018 * (incl Expedited) HKIAC 2018 SIAC 2016 VIAC 2021 70 000 60 000 50 000 Costs 40 000 30 000 20 000 10 000 - 1 10 000 35 000 50 000 100 000 150 000 200 000 250 000 500 000 750 000 1000 000 1500 000 2000 000 Amount in Dispute 12/22

(Arb-)Med-Arb-Combinations Advantage of costs in combined proceedings No charge of a further registration fee in the subsequently commenced proceedings No charge of a further administrative fee in the subsequently commenced proceedings Possible reduction of the arbitrators fee by the Secretary General Parallel proceedings may be commenced or continued, except the mediation clause precludes it Award on agreed terms and recorded settlement Parties commence arbitral proceedings, nominate the arbitrators and adjourn these proceedings for mediation proceedings If the parties terminate the mediation by settlement, the arbitration proceedings can be continued and the arbitral tribunal render an award on agreed terms If the mediation was not successful, the arbitration proceedings will also be continued and terminated by arbitral award 13/22

VIENNA INVESTMENT ARBITRATION AND MEDIATION RULES (FOCUS: SPECIAL FEATURES) 14/22

Vienna Investment Rules and Vienna Investment Mediation Rules 2021 New VIAC Rules of Investment Arbitration and Mediation entered into force on 1 July 2021 6 Annexes: Annex 1: Model Clauses Annex 3: Schedule of Fees Annex 4: Appointing Authority Annex 5: Administering Authority 15/22

Vienna Investment Arbitration Rules 2021 Special features I Scope of Application (Article 1) (1) An agreement to submit a dispute to arbitration in accordance with the VIAC Rules of Investment Arbitration (hereinafter Vienna Investment Arbitration Rules ) may be expressed in a contract, treaty, statute or other instrument, or through an offer by a party in a contract, treaty, statute or other instrument which is subsequently accepted by the other party by any means, including by the other party s commencement of arbitration. (2) Where the parties have agreed to submit their dispute to arbitration in accordance with the Vienna Investment Arbitration Rules, the parties shall be deemed to have agreed that the arbitration shall be administered by VIAC. 16/22

Vienna Investment Arbitration Rules 2021 Special features II Waiver of Immunity (Article 4) Identical provision in the commercial rules (Article 46 para 2) Third-Party Funding (Articles 6 para 1.11 and 13a) Identical provision in the commercial rules (Articles 6 para 1.9 and 13a para 1 and 2) Article 13a para 3: If it deems it necessary, the arbitral tribunal may order the disclosure of specific details of the third party funding arrangement and/or the third-party funder s interest in the outcome of the proceedings, and/or whether or not the third party funder has committed to undertake adverse costs liability. 17/22

Vienna Investment Arbitration Rules 2021 Special features III Third-Party involvement: Joinder of Third Parties (Article 14) for contract-based arbitration Amicus Curiae (Article 14a) for treaty or statute-based arbitration: Non-Disputing Parties (para 1) / "Non-Disputing Treaty Parties (para 2) In order to allow for submissions by these stakeholders, which are typical and necessary in investment proceedings initiated on the basis of a treaty or statute. Consolidation of investment proceedings (Article 15 para 1): only permitted if both proceedings are administered by VIAC. 18/22

Vienna Investment Arbitration Rules 2021 Special features IV Constitution of the Arbitral Tribunal Number of arbitrators (Article 17 para 2): The dispute shall in principle be decided by a panel of three arbitrators; only where the amount in dispute does not exceed EUR 10 million, a sole arbitrator shall decide. However, the Board may determine, taking into account the views of the parties, that the difficulty of the case or other relevant circumstances justify the appointment of a panel of arbitrators. Appointment of the chairperson by the Board (Article 17 para 5): The Secretary General shall transmit a list of candidates for appointment as chairperson to the parties and allow them to strike one name from the list and rank the remaining candidates in order of preference. The Board shall appoint the candidate with the best ranking. If two or more candidates share the best ranking, the Board shall select one of them. Nationality of the arbitrators (Article 17 para 8): It is expressly stipulated that the nationality of the arbitrators should be different from the nationality of the parties, unless the parties have agreed otherwise. 19/22

Vienna Investment Arbitration Rules 2021 Special features V Duration of Proceedings Early dismissal of claims (Article 24a): To prevent "frivolous claims" a party may request for the early dismissal of claims, counterclaims and defenses if they are manifestly outside the jurisdiction of the arbitral tribunal, manifestly inadmissible or manifestly without legal merit. Settlement (Article 28 para 3): To enable an amicable solution in investment proceedings, it is expressly stated that the arbitral tribunal is entitled to assist the parties in their endeavors to reach a settlement at any time during the proceedings. 6-month time limit for rendering of award (Article 32 para 2): To further increase procedural efficiency. An award must be rendered no later than six months after the last hearing concerning matters to be decided in an award or the filing of the last authorized submission concerning such matters, whatever is the later. The Secretary General may extend the time limit pursuant to a reasoned request from the arbitral tribunal or on its own initiative. 20/22

Vienna Investment Arbitration Rules 2021 Special features VI (Limited) Transparency: Transparency and publication of certain limited information on the arbitration in the public interest (Article 41): VIAC may also publish anonymized summaries of awards. This is without prejudice to the agreement of the parties on the UNCITRAL Transparency Rules. 21/22

Thank you! Vienna International Arbitral Centre of the Austrian Federal Economic Chamber Wiedner Hauptstrasse 63, 1045 Vienna, Austria T +43 (0)5 90 900 4398 F +43 (0)5 90 900 216 E office@viac.eu W www.viac.eu