International disputes disrupted by arbitration `guerrilla´ tactics – Latham & Watkins

Arbitration is becoming more and more popular. The number of local litigators becoming arbitration practitioners is also increasing and this is a welcome development, according to Fernando Mantilla-Serrano, partner at Latham & Watkins in Paris and global co-chair of the firm´s international arbitration practice. However, he adds that some newcomers import with them their local “State-court” practices and tactics to disrupt the arbitral proceedings, which goes against the ethos of arbitration.

Arbitration, both commercial and investor-state related, is a growing global market, says Mantilla-Serrano. “Every single law firm today, big or small, is advertising as doing it.” Mantilla attributes the increase in popularity to economic activity, but believes another driving factor is also regional political and economic crises. He cites as an example those jurisdictions where a new government “for political or economic reasons, introduces legal changes to the regime that affect foreign investors and multinationals – natural resources often being the primary target”.
Mantilla-Serrano cites the fact that, while there is an increase in the number of challenges launched through international arbitration, there has not been a corresponding increase in those accepted, which he argues suggests it is being used to disrupt. He adds that this is “ultimately disserving the purpose of international arbitration”.
There is also a danger that international arbitration will lose the flexibility that makes it attractive, according to Mantilla-Serrano. “Although, we now have a sound and reflective attitude towards arbitration, I foresee that the biggest challenge will be trying to preserve its flexibility, avoiding too many rules and codes and, above all, avoiding the one-fits-all approach in the conduct of the proceedings.”