CYIL Vol. 7, 2016

ONDŘEJ SVOBODA – JAN KUNSTÝŘ CYIL 7 ȍ2016Ȏ a B.A. degree in International Area Studies from the Faculty of Social Sciences, Charles University in Prague. From 2009 to 2010 he studied international relations and politics at the University of Kent under the Erasmus programme. Currently, he is attending a Ph.D. course in international public law at the Faculty of Law of Charles University. His main fields of interests include international investment law, WTO law and the European Union’s common trade policy. Mgr. Bc. Jan Kunstýř, LL.M . is currently interning in the Arbitration/Litigation department of Fried Frank Harris Shriver & Jacobson in London. He graduated from the Faculty of Law, Charles University in Prague and holds an LL.M. in Investment Treaty Arbitration from Uppsala University. He holds the equivalent of a B.A. degree in International Area Studies from the Faculty of Social Sciences, Charles University in Prague. Furthermore, he spent a year as an exchange student at the Tokyo University of Foreign Studies. His main fields of interest are international Commercial and Investment Treaty Arbitration, Financial Law and Space Law. Introduction Large international arbitrations can have enormous financial consequences for the parties involved. Legal fees and expenses are usually difficult to predict and often exceed their estimates. It is therefore no surprise that three quarters of law firms acknowledge that funding is now a central part of their discussions with clients. 1 Sometimes a specialised company, a third party funder (TPF), agrees to pay some or all of the claimant’s or the respondent’s costs in exchange for a percentage of the proceeds of a successful case, or a multiple of the financed costs, or another agreed upon amount. Third party funding has been one of the hottest topics in international arbitration practice for several years, and it can be expected that it will remain under the spotlight for a long time. Demand for such funding will most likely grow, especially as expenses associated with investment treaty arbitration have been continuously increasing. 2 As of 2016, some estimate that at least 40% of the current investment arbitration claims have either secured or explored potential funding from TPFs. 3 In fact, thanks to a practice called crowdfunding, which enables funding a project by raising many small sums of money from a large number of people, anybody can become a TPF in investment arbitration. 4 1 Global Litigation Top 50 2015 (The Lawyer Market Reports), p. 4. 2 SUSANNA KHOURI, KATE HURFORD, CLIVE BOWMAN, ‘Third party funding in international commercial and treaty arbitration – a panacea or a plague? A discussion of the risks and benefits of third party funding’ (2011) 8(4) Transnational Dispute Management, p. 1. 3 ICCA-Queen Mary Task Force on Third-Party Funding in International Arbitration, Draft Report on Security for Costs and Costs (1 February 2016), p. 16. 4 See Invest4Justice Litigation Crowdfunding accessed 9 May 2016.

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