Page 0012

12

Second, in anticipation of the pipeline of arbitration

matters arising from BRI projects, we are seeing a

number of arbitration institutions in Asia updating

their arbitration rules and guidelines. 2017 saw

CIETAC establish a separate arbitration centre for

resolving public-private partnership disputes and

adopt specific rules for international investment

arbitrations (building on a lead established by the

Singapore International Arbitration Centre in 2016).

In 2018, the Hong Kong International Arbitration

Centre will update its arbitration rules, with changes

likely to be made to further facilitate the resolution

of complex disputes involving multiple parties and

contracts - a common feature in BRI projects.

Separately, in 2016, the International Academy of

the Belt and Road published the 'Blue Book', which

includes arbitration rules.

Third, with the significant amounts potentially at

stake in BRI disputes, third-party funding likely will

take on added importance. This is particularly the

case because of the significant growth in available

funds, the number of funders with an Asian

presence, and legislative developments liberalising

the regulation of third-party funding in key Asian

jurisdictions such as Singapore and Hong Kong.

Furthermore, contingency fee arrangements are

widespread in China - and much welcomed by

Chinese parties - so third-party funding is but

a natural step in a similar direction.

Fourth, we expect the wave of China-related

construction arbitrations to continue. As Chinese

construction contractors follow the Chinese money

into BRI projects around the world, and many

Chinese contractors are able to price competitively

to win roles on global projects, Chinese parties will

become a fixture in major construction disputes

around the world at many levels in the supply chain.

Finally, given the nature of BRI investments - often

involving massive sums invested in regulated sectors

- over the longer term, there likely will be an

increase in the number of investor-state disputes,

as investors in BRI projects seek recourse under

relevant bilateral and multilateral treaties against

host states. Already, we are seeing significantly

increased interest in - and familiarity with - such

treaties among our Chinese clients who are investing

abroad. One interesting question is how this might

affect the approach taken by the Chinese

government in its negotiations and treatment of

such treaties, as outbound investment continues

to grow from Chinese companies - in BRI projects

and more generally.

China's Belt and Road initiative:

opportunities and risks

4

Silk Road Economic Belt

21st Century Maritime Silk Road

Europe

Southeast

Asia

South China Sea

South Pacific

Russia

Central Asia

Mediterranean Sea

Middle

East

South Asia

Indian

Ocean

China's Belt and Road

' Given the vast number and scale

of international infrastructure

projects under China's BRI,

in Asia, the Middle East, Africa

and Europe, we expect to

see an increase in related

arbitrations. Given our expertise

in infrastructure disputes, we are

well placed to advise parties on

the issues that are likely to arise.'

Erin Miller Rankin, Partner, Arbitration

BMI Research (A Fitch Group Company)

Index

  1. Page 0001
  2. Page 0002
  3. Page 0003
  4. Page 0004
  5. Page 0005
  6. Page 0006
  7. Page 0007
  8. Page 0008
  9. Page 0009
  10. Page 0010
  11. Page 0011
  12. Page 0012
  13. Page 0013
  14. Page 0014
  15. Page 0015
  16. Page 0016
  17. Page 0017
  18. Page 0018
  19. Page 0019
  20. Page 0020
  21. Page 0021
  22. Page 0022
  23. Page 0023
  24. Page 0024
  25. Page 0025

Related Issues