With support from economists at The Brattle Group, the London Court of International Arbitration (LCIA) has released a new analysis on costs and duration, which will help users determine which institution is best placed to administer a particular case. The new report, which is a follow-up to LCIA’s 2015 analysis, uses actual data, rather than just estimates based on cost schedules, to give users a greater insight into costs, and demonstrate the cost-effectiveness of LCIA arbitration in comparison with institutions operating on an ad valorem basis.
For the updated costs and duration report, the LCIA engaged Brattle as an independent party to update the LCIA’s statistics, provide additional comfort to users about the accuracy and robustness of the data, and improve further the quality of the discussion about costs and duration. Alexis Maniatis, president of Brattle, emphasized the important contribution the report makes to discussions regarding costs and duration:
With the release of the LCIA’s costs and duration report, The Brattle Group is creating a neutral platform for discussion of users’ needs and preferences that brings the rigor that Brattle’s clients have come to expect of our analysis to the broader conversation around costs and duration. This raises the bar for such analyses, and we welcome all institutions to participate in future studies. The Brattle Group’s international arbitration activity now spans all nine of our offices, and we are committed to a growing and deepening presence in the community.
The new analysis covers all cases administered under the LCIA Rules that reached a final award in the four years between 1 January 2013 and 31 December 2016. The analysis demonstrates the cost- and time-efficiency of arbitration at the LCIA as compared to other arbitral institutions. Key findings from the report include:
- The median total duration and median arbitration costs of LCIA arbitrations remain low, at only 16 months and USD 97,000, respectively;
- The median time taken for arbitrators to prepare a final award on the merits of a dispute after all submissions have been made is only 3 months, even for the largest cases: arbitrators are consistently performing their core task swiftly and efficiently;
- Smaller cases are resolved particularly quickly, with over 70% of cases with an amount in dispute under USD 1 million being completed within 12 months; and
- Arbitration costs are lower at the LCIA than estimates for other leading arbitral institutions: tribunal fees are on average 50% lower, administrative charges are on average 40% lower.