Confidentiality In Arbitration

Confidentiality is often cited as one of the main advantages of arbitration over litigation. However, it is quite recent that confidentiality gains significant attention in the field of arbitration. For better understanding, this paper first presents several situations under which confidentiality would become an issue, followed by a comparison between the concepts of confidentiality and privacy. Values of confidentiality to arbitration are then examined: to save public image, to protect sensitive information such as IP, business secrets and other types of proprietary rights, to avoid being pushed to unfavorable places in disputes chains, to facilitate the settlement of the disputes.The second chapter reviews the legal basis of confidentiality in arbitration. It is widely agreed that confidentiality may be contracted for by parties. A survey on the rules of some important international and national arbitral institutions demonstrates that most institutions keep silence regarding to the issue of confidentiality with the exceptions of WIPO and LCIA rules. The world could be roughly divided into two parts according to different jurisdictions'attitudes upon implied confidentiality in arbitration, with England and Australia as the representative of each part.The following third chapter then discusses who is bound by a duty of confidentiality, the extent of and the exceptions to that duty as well as remedies in case of breach of that duty. It argues that a more nuanced approach to confidentiality in arbitration may preserve the values of arbitration while at the same time enhancing the competing values to be gained by greater transparency. In particular, the article advocates the adoption of a presumption that arbitral awards should be made publicly available, unless both parties object, to promote the development of the arbitration system.This paper is concluded with the author's suggestions to parties to arbitration and the position China could take. For parties who expect and wish arbitration to be conducted privately and matters raised to be treated as confidential, a favored approach is to draft a detailed confidentiality agreement. For courts and tribunals which may be requested to address the issue, this paper argues that decisions should be made for the greater interest after weighing various factors involved in the arbitration.