The CIArb’s Survey into the Costs of International Arbitration has now been published. It’s a fascinating survey worthy of study and discussion. Here’s a brief summary of some of the findings:
“What did they spend it on? Regardless of the nature of the dispute and the amount of money that a party spent (whether claimant or respondent), the cost breakdown by percent was remarkably much the same. Six cost categories were listed in the survey; Chart 12 illustrates the percentages allocated to each one. 74% of party costs were spent on external legal costs (including where applicable barristers’ fees), with the remaining 26% spread across the other headings. For example, as Chart 12 indicates, out of a total expenditure of £1,000,000, the costs a party would incur might be distributed as follows:
■ £740,000 for external legal fees
■ £100,000 for experts’ fees and expenses
■ £80,000 for external expenses
■ £50,000 for witness fees
■ £30,000 for management costs”
“Of the 74% of costs referred to on the preceding page, Chart 13 shows that, irrespective of the nature of the dispute, parties spent 19% on the pre-commencement/commencement of the arbitration, 25% on the ex-change of pleadings, 5% on discovery, 14% on fact and expert witnesses,* and the remaining 37% on the hearing (before, during and after). To illustrate the practical application of these percentages, a party with external legal costs of £740,000 might have spent:
■ £140,600 on pre-com/com work
■ £185,000 on the exchange of pleadings
■ £37,000 on discovery
■ £103,600 on witness costs
■ £273,800 on the hearing (before, during and after)”
________________________
To make sure you do not miss out on regular updates from the Kluwer Arbitration Blog, please subscribe here. To submit a proposal for a blog post, please consult our Editorial Guidelines.
