COVID-19 and War in Ukraine Impact International Arbitration Cases

Last summer, experts predicted a significant uptick in international arbitrations (especially those held via international arbitral institutions) would outlast the COVID-19 crisis. Unfortunately, despite our strongest wish that COVID-19 would be behind us by this summer, we are still in the throes of the pandemic. COVID-19 has disrupted businesses across the globe causing widespread supply chain issues and leading to new arbitration disputes – many based on claims of breach of contract and answered by defenses of inability to perform. Despite these disruptions, however, the number of international arbitrations taking place in the first half of 2022 has decreased, with experts predicting there will likely be another increase in 2023.

That predicted increase may also be related to another world crisis – the war in Ukraine.  According to The National Law Review, the war itself, as well as the resulting sanctions imposed on Russia by countries and companies across the globe, has already affected international trade, including the world’s access to energy. It seems clear that such widespread, cross-border disturbances will lead to an increase in international disputes.

Thankfully, international arbitral institutions provide a private and flexible venue through which to resolve such disputes. For example, in June 2022, the International Centre for Settlement of Investment Disputes published updated rules and regulations, which are intended to make cases more efficient, including offering expedited arbitration rules to reduce case times by 50%. These new rules went into effect on July 1, 2022.

In a time of seemingly persistent global upheaval, international arbitral institutions stand ready to facilitate resolution of any resulting disputes, as do we.

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