Choice of Arbitrators: Mastering the Nomination Process

The ability of the parties to appoint the arbitrators who will decide their dispute is one of the key selling points of arbitration. The process of nomination and appointment of arbitrators comes right at the outset of proceedings. It is fundamentally important for parties to get it right. This article provides a basic summary of the key factors parties should consider when deciding which arbitrator to nominate.

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Why does it matter?

Naturally, arbitrators play a crucial role in arbitral proceedings. A good selection of arbitrator(s) by the parties helps to ensure that the tribunal has the appropriate legal, technical and/or commercial expertise, experience, impartiality and balance to be able to dispose of the matters at hand fairly and efficiently. An appointed arbitrator (or panel) which lacks the requisite experience or expertise may take longer to decide the dispute, create inefficiency and additional cost, produce a lower quality award, and lose the confidence of the parties.

What rules govern the nomination of arbitrators?

The rules governing nomination and appointment of arbitrators are typically contained within the arbitration agreement applicable to the dispute. The arbitration agreement will ordinarily specify: (i) the number of arbitrators that will form the tribunal; (ii) whether those arbitrators must hold any particular qualifications; and (iii) by what method they are to be chosen.

TYPICAL MECHANISM

The relevant part of the arbitration agreement will generally envisage either: (i) a sole arbitrator agreed by the parties or appointed by the relevant arbitral institution; or (ii) a three-member tribunal, where each party to the arbitration is entitled to appoint one arbitrator, both of whom will then jointly and independently agree on a third arbitrator. The third arbitrator acts as chairperson (otherwise known as the presiding arbitrator). In the event of a failure by either party to nominate an arbitration or a failure by the party-appointed arbitrators to agree the presiding arbitrator, the relevant arbitral institution will generally act as the appointing authority.

It is important to consider whether any institutional rules apply, as a consequence of the arbitration agreement. These may be incorporated by reference. Each set of institutional rules contains different provisions about how arbitrators are to be nominated and appointed.

What if there are no specific provisions are made in the arbitration agreement for the selection of arbitrators?

If no specific provisions are made in the arbitration agreement as to the number of arbitrators and the process by which they are to be appointed, there are two potential alternative sources of rules.

Institutional rules

As stated above, the first consideration should be whether there are any applicable institutional rules, to the extent incorporated into the arbitration agreement. These will typically provide for a default position on number of arbitrators and process of appointment, in the absence of agreement between the parties. The default position can vary – sometimes significantly – depending on which institutional rules apply.

EXAMPLES

ICC RULES

The International Court of Arbitration of the International Chamber of Commerce (ICC) will ordinarily appoint a sole arbitrator save where it appears to the ICC that the dispute is such as to warrant the appointment of three arbitrators.^[1] The process for appointment depends on whether the tribunal is composed of a sole arbitrator or of three arbitrators (this number may be specified in the agreement or, if no number is specified, determined by the ICC). In the former case, the parties have 30 days to nominate jointly the sole arbitrator, failing which the ICC will appoint one.^[2] In the case of the latter, each party has 30 days to nominate its own arbitrator, failing which the ICC shall appoint the arbitrator(s).^[3] The third arbitrator shall be appointed by the ICC (unless there is some other procedure agreed by the parties, but in any case, where the parties are unable to agree, the ICC shall have the power to make the appointment).^[4]

LCIA RULES

The London Court of International Arbitration (LCIA) has an equivalent provision in the LCIA Rules to the ICC Rules, whereby the LCIA will ordinarily appoint a sole arbitrator unless the LCIA determines that in the circumstances a three-member tribunal is appropriate (or, exceptionally, more than three).^[5] As to the procedure for appointment, the LCIA retains the sole power to appoint arbitrators regardless what is agreed between the parties (albeit that it will take into account any written agreement or joint nomination by the parties etc.).^[6] It shall appoint the arbitrators promptly following delivery of the Response, or if no Response is received, promptly after 28 dates from the Commencement Date (unless it so otherwise determines).^[7]

UNCITRAL RULES

The United Nations Commission on International Trade Law (UNCITRAL) has produced a widely adopted set of rules that may be incorporated by reference to an agreement. If the UNCITRAL Rules apply, the parties are, by default, afforded 30 days to agree whether or not a sole arbitrator should be appointed, failing which three arbitrators shall be appointed.^[8] If the parties cannot agree on the identity of the sole arbitrator to be appointed, the appointing authority will make the appointment at the request of a party,^[9] and will do so as promptly as possible.^[10] If the tribunal is to be composed of three members, each party shall appoint one arbitrator, and the two arbitrators thus appointed shall choose the third arbitrator to act as the presiding arbitrator of the arbitral tribunal.^[11] If, within 30 days after the receipt of a party's notification of appointment of an arbitrator, the other party has not notified the first party of the arbitrator it has appointed, the first party may request the appointing authority appoint the second arbitrator.^[12] Similarly, if the duly appointed arbitrators cannot agree on a third arbitrator within 30 days after appointment of the second arbitrators, the appointing authority shall appoint the presiding arbitrator itself.^[13]

Law of the seat

If no institutional rules apply to the dispute, the final fallback will be the applicable domestic law governing the arbitration. What law applies will depend on the seat of the arbitration.

In the UK, the applicable domestic law is the Arbitration Act 1996. Under the Arbitration Act 1996, the default position is that the tribunal shall consist of a sole arbitrator (if no other agreement is made by the parties).^[14] Additionally, if there has been no agreement as to the procedure for appointment, the parties are required to jointly appoint the arbitrator not later than 28 days after service of a request to do so made by either party in writing.^[15} If the parties cannot agree, ultimately either party is then entitled to apply to court to appoint an arbitrator.^[16]

WARNING

It is generally considered unwise to name a specific arbitrator in the arbitration agreement itself (since the arbitrator in question may be unavailable or conflicted or otherwise unable to act). If an arbitrator has been so named, and is no longer appropriate for any such reason, it may then be necessary to obtain the consent of the counterparty to alter the choice, or, ultimately, to apply to court to appoint a new arbitrator. This can lead to increased costs and delays in the constitution of the tribunal and commencement of the arbitration.

What key factors should parties consider when considering which arbitrator to nominate?

The key factors to consider when deciding which arbitrator to nominate are:

the level of expertise required in the relevant field of law, industry, or subject matter of the dispute, as well as in arbitrations generally.
the arbitrator's impartiality, independence and any applicable ethical standards. If there are justifiable doubts as to an arbitrator's impartiality or independence, this may be used as a ground to challenge the arbitrator's appointment (see further detail below).
any actual or potential conflicts of interest the arbitrator may have. The IBA Guidelines on Conflicts of Interest in International Arbitration provide helpful guidance on this matter.
the amount of time the arbitrator has to devote to the proceedings.
applicable diversity or nationality requirements. Some institutions impose certain requirements e.g. to ensure that the nationalities of the arbitrators in a multi-person panel are different (unless otherwise agreed by the parties),^[17] or emphasise the need to consider diversity (e.g. the LCIA's EDI Guidelines).

On what grounds could the appointment of an arbitrator be challenged?

The grounds on which the appointment of arbitrator may be challenged will depend on which institutional rules and/or domestic laws apply.

Most institutional rules provide for the appointment of arbitrators to be challenged (within certain applicable time limits).

EXAMPLES

LCIA Rules

The LCIA Rules permit challenges to arbitration for reason of serious illness, refusal to act, or being "unable or unfit" to act, justifiable doubts as to the arbitrator's impartiality or independence, as well as acting in violation of the arbitration agreement, not acting fairly or impartially as between the parties or not conducting or participating in the arbitration with reasonable efficiency, diligence and industry.^[18]

ICC Rules

Under the ICC Rules, a party may challenge an arbitrator for "an alleged lack of impartiality or independence or otherwise".^[19]

If there are no applicable institutional rules, or if a person has already exhausted any available recourse it may have, or if it is otherwise permissible in the applicable domestic law, it may be possible to apply directly to the court to remove the arbitrator. The domestic law that will apply will depend typically on the seat of the arbitration.

For example, in the UK, a party to arbitral proceedings may apply to court to remove an arbitrator if (i) circumstances exist that give rise to justifiable doubts as to their impartiality; (ii) they do not possess the qualifications required by the arbitration agreement; (iii) they are physically or mentally incapable of conducting proceedings or there are justifiable doubts as to their capacity to do so; or (iv) they have refused or failed properly to conduct proceedings, or to use all reasonable despatch in conducting the proceedings or making an award, and that substantial injustice has been or will be caused to the applicant.^[20]

Additionally, when the Arbitration Act 2025 comes into force on 1 August 2025, arbitrators in the UK (including people who have been approached in connection with appointment as arbitrators) will be under a general duty to disclose to the parties any circumstances which might reasonably give rise to justifiable doubts as to their impartiality in relation to the proceedings, as soon as reasonably practicable.^[21] Breaches of this duty may also give rise to challenges against awards.

For further examples regarding challenges to arbitrators, please see articles from the Travers Smith arbitration team regarding H1 and another v W and others [2024] EWHC 382 and Halliburton Company v Chubb Bermuda Insurance Ltd [2020] UKSC 48.

Conclusion

The selection of arbitrators is a critical step in the early stages of arbitration proceedings. There are a number of factors that parties must consider carefully when making their selection. The rules governing the process of selection of the arbitrators will depend on the arbitration agreement, any applicable institutional rules and, ultimately, any applicable domestic legislation.

Footnotes