THE SCOPE OF THE PRIVACY POLICY IN ARBITRATION 2 November 2021

THE SCOPE OF THE PRIVACY POLICY IN ARBITRATION

1. INTRODUCTION

Today, the concept of confidentiality is of great importance in the parties' will to resolve their disputes through commercial arbitration. The reason for this will is that the proceedings before the national courts are open to the public. With the open proceedings, the parties' non-public information might be disclosed. Since the arbitration proceedings are not open to the public, the disclosure risk of the parties’ non-public information is also eliminated. The scope of the confidentiality principle may have been determined in the arbitration agreement which concluded between the parties. However, the parties may have remained silent in terms of the scope of the confidentiality principle in the arbitration agreement that they concluded.

2. THE SCOPE OF THE PRIVACY POLICY IF THE PARTIES AGREE ON PRIVACY

The parties may determine the issues with the confidentiality agreement such as which information between the parties will be accepted as confidential information, how this information will be stored and the obligations that they will have in case of such confidential information is disclosed to third parties. In this context, if the parties have agreed on confidentiality, they will determine the scope of the confidentiality principle within the framework of the relevant agreement.

3. THE SCOPE OF THE PRIVACY POLICY IF THE PARTIES DO NOT AGREE ON PRIVACY

It has been mentioned above that the parties may determine which information they will accept as confidential information with the confidentiality agreement concluded between them. In the absence of such agreement, it is controversial that which information will be considered as "confidential information".

According to the doctrine, The content of confidentiality in arbitration consists of the dispute itself, the dispute resolution authority, all kinds of information, documents and evidence related to the arbitration, written and oral agreements between the parties, the address of the place of arbitration, the identity of the arbitrators, the content of the arbitral award, the hearings, the negotiations of the arbitral tribunal and, the mail correspondence between the secretariat of the arbitration, institution or the arbitrators.

However, it should be noted that arbitration proceedings differ from each other in essential elements. It will not be correct to determine the scope of the privacy policy without considering the relevant features.

As a result, if the parties do not agree on the scope of confidentiality in arbitration proceedings, the scope of confidentiality will be determined in accordance with the law governing the arbitration and the regulations in that law.

4. THE SCOPE OF THE PRIVACY POLICY IN TERMS OF THE TURKISH INTERNATIONAL ARBITRATION ACT

The Turkish International Arbitration Act No. 4686 (IAA) applies in arbitration proceedings where the place of arbitration is determined as Turkey and if the dispute has a foreign element. There is no provision which states the arbitral proceedings will be held in secrecy or that the parties will not disclose the information and documents obtained during the arbitration proceedings to third parties within the scope of the IAA. Along with that, there is no restrictive regulation in the IAA, regarding the arbitral tribunal's judgment that the parties are under the obligation of confidentiality and that they cannot disclose the information that they obtained during the trial to third parties.

On the other hand, in Article 6 of the IAA, it is regulated that the arbitral tribunal can make precautionary injunctions and precautionary seizure decisions. In the relevant article, it is stated that the arbitrators can take all kinds of precautionary injunctions that can be implemented. The arbitrators may decide that whether a party does a certain act or not and that in case the parties do not comply with these decisions given by the arbitrators, they can order compensation for the damage and loss.

The arbitration in Turkish law does not directly impose the obligation of confidentiality on the parties. However, it can be concluded that the arbitrators can make a precautionary decision on confidentiality by way of interpretation under the IAA. However, this precautionary decision will automatically disappear when the decision of the arbitrator or arbitral tribunal becomes enforceable or if the case is rejected by the arbitrator or the arbitral tribunal. For this reason, the parties' obligation of confidentiality may not continue after the arbitral award is made regarding the information and documents submitted during the arbitration proceedings.

5. THE SCOPE OF PRIVACY POLICY IN DIFFERENT ARBITRATION RULES

1. ICC RULES

Article 22/3 of the ICC Arbitration Rules states: ‘‘Upon the request of any party, the arbitral tribunal may make orders concerning the confidentiality of the arbitration proceedings or of any other matters in connection with the arbitration and may take measures for protecting trade secrets and confidential information.’’

In addition, in accordance with Article 1 of the Internal Rules of the International Court of Arbitration in annex number two of the ICC Arbitration Rules, The President or the Secretary-General of the Court may authorize researchers undertaking work of an academic nature to acquaint themselves with awards and other documents of general interest, with the exception of memoranda, notes, statements and documents remitted by the parties within the framework of arbitration proceedings. (art. 1/5). Thus, such authorization shall not be given unless the beneficiary has undertaken to respect the confidential character of the documents made available and to refrain from publishing anything based upon the information contained therein without having previously submitted the text for approval to the Secretary-General of the Court. (m.1/6)

As a result, when the ICC Arbitration Rules are examined, it is remarkable that the scope of the articles in terms of confidentiality is not fully clear and is open to interpretation.

2. UNCITRAL ARBITRATION RULES

The UNCITRAL Arbitration Rules, which were revised in 2013, also regulate the confidentiality obligation in a similar and narrow scope.

In Article 34, paragraph 5 of the aforementioned rules, it is regulated that arbitral awards may be published in case of consent of the parties or for the fulfillment of legal obligations of one of the parties, in order to protect or obtain a legal interest, or to use in legal proceedings with authorized institutions and courts. However, it is also stated in the 3rd paragraph of Article 28 that the hearings will be confidential.

3. ICSID ARBITRATION RULES

There is no apparent rule in ICSID Arbitration regarding the confidentiality obligation. Arbitration committees examine each case and decide on confidentiality in line with these reviews. In the first paragraph of Article 39 of the ICSID arbitration rules, it is stated that the parties to the arbitration proceedings should request provisional measures if they want a confidentiality decision regarding the proceedings and that the duration of this decision should also be regulated if a confidentiality decision is made by the arbitral tribunal.

The scope of confidentiality in ICSID arbitration is about the publicity of the proceedings and the publication of the decisions.

6. CONCLUSION

When the different arbitration rules are examined, it is seen that a comprehensive confidentiality principle does not exist in terms of the relevant arbitration rules. For this reason, in arbitration proceedings, the parties must consider the confidentiality agreement that we have mentioned above in order to regulate the scope of confidentiality as their demands.

REFERENCE:

TÜYSÜZ Cemre, MİLLETLERARASI TİCARİ TAHKİMDE GİZLİLİK YÜKÜMLÜLÜĞÜ, Public and Private International Law Bulletin, Volume: 37, Issue: 2, 846–873.