On the first day of the 2022 International Council for Commercial Arbitration ("ICCA") Congress in Edinburgh, Brandon Malone, the now recently retired Chair of the Scottish Arbitration Centre ("SAC"), launched the SAC's new institutional Rules. Prior to the launch of the SAC Rules, the SAC promoted Scotland as a place for international arbitration, but it did not itself administer arbitrations. The introduction of the SAC Rules and the newly established Court of the Scottish Arbitration Centre places the SAC in a position to supervise the conduct of arbitrations should parties choose to avail themselves of the Rules and the SAC's processes. The SAC has also developed an electronic case management system for use in arbitrations it administers.

The new Court of the Scottish Arbitration Centre will be presided over by Lady Wolffe, a former Senator of the College of Justice. Until her retirement from the bench, Lady Wolffe was a nominated Commercial Judge. The Court of the Scottish Arbitration Centre will have the power to interpret the SAC Rules, appoint arbitrators to the tribunal and to determine applications for the use of an expedited procedure available in cases of exceptional urgency.


Why might parties decide to use the SAC to administer their disputes, rather than one of the more established institutions like the London Court of International Arbitration or the International Chamber of Commerce? Lower costs could be one factor. The filing fee payable when the Statement of Claim is lodged with the SAC will depend on the amount in dispute. Claims worth £10,000 or under will attract a fee of £350 and those between £10,000 and £50,000 a fee of £500. The filing fee for a claim worth more than £50,000 will be capped at £1,500 regardless of how large the claim is. These costs reflect favourably against the LCIA's £1,950 flat registration fee and the ICC's $5,000 flat filing fee.

The SAC's administrative fees are also favourable compared to other institutions. For the highest value cases – those with a value above £350,000 – the fee will be £6,350 plus 0.5% of the amount in dispute over the £350,000 threshold. Thus, the administrative fee for a claim of £1,000,000 would be £9,600. This compares to administrative fees of £25,000 at the ICC and those calculated on a time-spent basis at the LCIA.

Details of the likely range of fees payable to arbitrators appointed by the Court of the Scottish Arbitration Centre are not yet available. Our recent experience of arbitrators appointed by bodies in Scotland has varied between hourly rates for arbitrators of £300 and £425. Many of those arbitrators are also likely to be appointed by the Court of the Scottish Arbitration Centre and, at this stage, we do not anticipate any particular shift in the fees charged by those arbitrators. By comparison, the LCIA allows arbitrators to charge a rate of up to £500 per hour, or higher in exceptional cases, though our experience is hourly rates of between £275 (which is a bit of an outlier) and £400. The ICC has a scale which sets minimum and maximum limits on an arbitrator's fees based on the value of the claims in dispute. The arbitrator's fees are fixed and approved by the ICC Court taking account various factors, not just the time spent. These factors include the complexity of the arbitration and the speed in which the draft award is produced after trial.

SAC rules vs the Arbitration Act

The new SAC Rules should not be confused with the existing Scottish Arbitration Rules which are found in the Arbitration (Scotland) Act 2010. The latter sets out rules for the conduct of every arbitration in Scotland (subject to some which parties might choose not to apply) regardless of whether there is an institution administering the arbitration. The SAC Rules are procedural rules that apply only to arbitrations which the SAC is appointed to administer.

The SAC Rules have been developed with the benefit of experience as to how other arbitral institutions have operated their own rules. The processes involved will be familiar to those who have experience of arbitrating under the rules of other institutions. However, one of the distinctive features of the SAC Rules is their reflection of contemporary concerns in dispute resolution. Issues of equality, information security and environmental concerns are all addressed in specific sections of the SAC Rules.

Equality and neutrality

Article 8 of the SAC Rules requires all parties to have regard to the Equal Representation in Arbitration Pledge and Racial Equality for Arbitration Lawyers when proposing or appointing an arbitrator. The Rules expressly provide that any agreement between the parties as to the gender, race or ethnicity of the arbitrator(s) shall have no effect, though that is subject to a saving provision protecting the parties' ability to submit their dispute in accordance with the tenets of any religion.

With regard to neutrality, where the parties are of different nationalities the Rules impose a requirement on the SAC, when appointing any sole or presiding arbitrator, to consider the nationalities of the parties (and any other appointed arbitrators) and the desirability of the sole or presiding arbitrator to be of a different nationality to the parties. For these purposes, Scotland is to be considered a country. This means that where, for example, one party is based in Scotland and the other in another nation of the United Kingdom, the Centre will require to give consideration as to whether the appointed arbitrator (or presiding arbitrator) requires to be "neutral". However, whilst there is express provision for Scotland to be considered a country for the purposes of the Rules, there is no similar provision for the other nations of the United Kingdom. It remains to be seen, therefore, if in a dispute between, say, a Scottish based company and one based in Wales, the Centre would consider an arbitrator from England to be "neutral" or whether the arbitrator would have to be based outside of the United Kingdom.

Data protection and security

The SAC Rules also make specific provision for consideration of data protection and information security matters. Article 22 imposes on the tribunal a requirement to consider, at an early stage, whether any specific information security measures (in respect of both electronic and physical information) should be adopted. The tribunal also must consider whether personal information will be processed and how that will be done with regard to applicable data protection legislation.

Green Protocols

Article 23 of the SAC Rules provides that all parties shall be mindful of the environmental impact of the arbitration and shall consider the application of the Green Protocols developed by the Campaign for Greener Arbitration. Separate Green Protocols exist for lawyers, parties, arbitrators and arbitral institutions. Some of the Protocols have quite wide reach – such as a reduction in the use of single use items – whilst others have more obvious application specifically to arbitrations. Those include not using paper where possible and being mindful about travel. Whilst the wording of the Rule is somewhat relaxed – it would be possible to "consider" the application of the Green Protocols without much enthusiasm – it does provide a clear direction that environmental impact should be a consideration when making decisions as to the procedure to be followed in the arbitration.

This goes beyond what a tribunal is required to consider under the general rules for arbitrating in Scotland. We have experience of arbitrators being reluctant to allow witnesses to give evidence at hearings by video link to save them having to travel from other parts of the UK or beyond. Under the general rules, an arbitrator is required to give consideration to the costs, but not the environmental impact, of travel. In practice, a requirement to consider preventing unnecessary travel should mean that parties arbitrating under the SAC Rules can be more confident that witnesses based far away from hearing venues will be able to give evidence remotely. This saves on the cost – and environmental impact – of their travel. This will allow parties to lead factual witnesses, who they might not otherwise have led, due to travel cost implications, and open the pool of available expert witnesses.

Time will tell whether the introduction of the SAC Rules and the Court of the Scottish Arbitration Centre will see those who have disputes requiring formal resolution move away from the more established arbitral institutions. The lower administration costs will almost certainly be attractive. What we may find is that those lower costs entice those who would not have otherwise made use of an arbitral institution to administer their dispute – and, instead, administer it themselves on an ad hoc basis – rather than a rush of disputes that would have otherwise been administered by the LCIA or ICC.


Craig Watt

Partner & Solicitor Advocate

Jamie Reekie

Senior Associate & Solicitor Advocate