CYIL Vol. 7, 2016

ONDŘEJ SVOBODA – JAN KUNSTÝŘ CYIL 7 ȍ2016Ȏ amount of hourly fees, without the corresponding invoices or other details. The Siag tribunal accepted this. Prof. Francisco Orrego Vicuña, one of the most influential arbitrators 32 dissented, although not on the issue of substantiation of costs, but more generally on the allocation of costs: “I believe that a more adequate approach would be to require each party to pay one half of such costs, particularly taking into account the fact that the Claimant agreed to pay attorney’s fees only on a successful recovery. While there is nothing unusual in such arrangement, it entails the acceptance of the Claimant of a degree of risk that should not entirely be shifted to the Respondent, particularly in view of the amounts involved.” 33 Looking back at the issues pointed out by the draft report one by one: In summary, the ICAA-Queen Mary draft report has come up with recommendations based on the case law. While the report has not been published and its recommendations are not final the authors think it appropriate to at least mention their proposal: 1) When a party is funded by a TPF it typically assumes an obligation to reimburse the TPF for the costs advanced, in the case of successful recovery. This should be sufficient for tribunals to accept that a funded party has incurred costs. 2) The fact that a party’s costs have been funded should generally not be regarded as a relevant factor in determining whether or not costs are to be allocated based on the outcome of the case. 3) It is not appropriate for tribunals to award funding costs (such as a conditional fee, ATE-premium, or litigation funder’s return), as they are not procedural costs incurred for the purpose of an arbitration. 4) In principle, a tribunal will lack jurisdiction to issue a costs order against a third-party funder. Whether or not to include these or similar recommendations explicitly in investment treaties, arbitration rules or arbitration laws is a matter for discussion. The latest survey indicates that the clear majority of 71% of practitioners, arbitrators, academics and experts think that third party funding is an area which require regulation. 34 Nonetheless, as we can see above, tribunals have already taken a uniform approach towards this issue. Conclusion This article has indicated just a few of questions relating to an issue of third party funding. As international investment arbitration faces various challenges to its legitimacy, this issue is certainly the type which policymakers often consider 32 RISHAB GUPTA AND KATRINA LIMOND, Who is the most influential arbitrator in the world? GAR (11-1 2016). 33 S iag and Vecchi v. The Arab Republic of Egypt , ICSID Case No. ARB/05/15 Dissenting Opinion of Francisco Orrego Vicuña (1 June 2009). 34 2015 International Arbitration Survey: Improvements and Innovations in International Arbitration, Queen Mary, White and Case (2015) p. 41.

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