One of the reasons commercial parties choose to take their disputes to arbitration is that the award is not published. It’s private between the parties, and kept confidential. In court proceedings, the judgment is nearly always made public.
This layer of confidentiality helps to protect the reputations of the parties, and keeps any sensitive information out of the public realm.
The duty of confidentiality is usually an implied term to the arbitration agreement, when the seat of the arbitration is England and Wales. It extends to all aspects of the arbitration, including the hearing, the evidence, and the award itself.
But there are circumstances in which confidentiality is lifted.
In this article, we look at the reasons why confidentiality may be compromised in arbitration.
Parties who regularly arbitrate their disputes, or who are weighing up the pros and cons of arbitration or litigation should be aware that confidentiality is not always sacrosanct in arbitration.
Appealing an award may lift confidentiality
Pursuant to the Arbitration Act 1996, parties to an arbitration are able to challenge the award on the grounds of:
- The substantive jurisdiction of the tribunal (s.67)
- A serious irregularity, which has caused substantial injustice (s.68)
- A point of law (s.69)
The appeal of the award is heard in the courts, and the courts will usually publish their decision.
That means that the parties’ expectation of confidentiality in arbitration is not absolute once they seek the involvement of the courts. The courts may publish confidential information from the arbitration in certain circumstances.
Underlying reasons why confidentiality may be lifted
There are various exemptions to the duty of confidentiality, and these are set out in Ali Shipping Corporation v Shipyard Togir [1998] 1 Lloyd’s Rep 643 (CA). Confidentiality can be lifted where:
- The parties consent to it.
- There is an order or permission of the court.
- It is reasonably necessary for the protection of the legitimate interests of an arbitration party.
- It is in the interests of justice to do so.
- For example, publishing the judgment may be necessary for winding up proceedings in another country.
- It is in the public interest to do so.
- It is necessary for the transparent administration of justice.
- There are points of law and practice that are of general interest (such as the approach to a re-hearing).
Do the institutional rules affect confidentiality?
The institutional rules vary on how they approach confidentiality.
Article 30 of the LCIA Rules reflects the position at common law in the UK. It mandates that awards and material created for the arbitration must be kept confidential except where disclosure may be required of a party:
- By a legal duty,
- To protect or pursue a legal right, or
- To enforce or challenge an award in legal proceedings before a state court or other legal authority.
The courts have the ultimate power in deciding whether or not they publish their judgment on an arbitral issue. In Mordchai Ganz v Petronz FZE & Abraham Goren [2024] EWHC 1011 (Comm), Dame Clare Moulder DBE (sitting as a judge of the High Court) said:
“I do not accept that the LCIA rules, in particular Article 30, prevent publication by the Court of its judgment. The supervisory jurisdiction of the Court is an entirely separate process and the decision by the Court whether to publish its judgment involves the consideration of the relevant factors in the circumstances of the case.”
The International Chamber of Commerce (ICC) Rules do not say that the arbitration must be confidential. But article 22.3 allows the arbitral tribunal to make orders about the confidentiality of proceedings, if a party requests it. The ICC may publish final awards, but parties can request for the awards to be anonymised.
Example case where confidentiality was protected
In CDE v NOP [2021] EWCA Civ 1908 the court anonymised its judgment to protect confidentiality.
The reason for that decision was that the court proceedings ran at the same time as an LCIA arbitration. The subject matter overlapped. One of the parties wanted to argue that the arbitral award was binding on the defendants in litigation. But the defendants were not party to the arbitration.
The first instance judge held the case management conference in private. The Court of Appeal was asked to determine whether this hearing, and the upcoming summary judgment application should have been held in public or in private.
The Court of Appeal said that court proceedings will always be held in public, unless one of the exceptions applies. The critical question was whether it was necessary to sit in private to secure the proper administration of justice. The court accepted that the case management conference involved confidential information and that it should have been held in private.
Cases where confidentiality was lifted
In Mordchai Ganz v Petronz FZE & Abraham Goren [2024] EWHC 1011 (Comm) the Commercial Court published a non-anonymised judgment on an arbitration claim. The judgment concerned challenges to an arbitration award.
The key issue in this case was that the court found that there was no arbitration agreement and therefore the tribunal had no jurisdiction. That’s because the Share Purchase Agreement and LCIA arbitration agreement within it were found to be not valid and binding, given the allegations of forgery.
There was also a broader issue of public interest; the desirability of public scrutiny as a means by which confidence in the courts can be maintained and the administration of justice made transparent. On that basis, the Court decided to publish the decision.
Similarly in Manchester City Football Club Ltd v Football Association Premier League Ltd [2021] 1 WLR 5513, the Court of Appeal allowed the unredacted publication of a first instance judgment which rejected challenges to the arbitral award.
Neither party supported the publication, but the court decided that publication would not disclose significant confidential information and it was in the public interest to do so. The public interest point was to illuminate how disputes between the Premier League and its member football clubs were resolved.
Key takeaways
Before challenging an arbitration award, the parties must remember that the court’s default position is to publish judgments. While the parties have an expectation of confidentiality in the arbitration itself, that expectation is weighed against other factors when the dispute comes to the courts.
If the parties' reasons against the publication of the judgment do not legitimately fall within one of the exceptions, then the court will publish the judgment.
