One of the advantages of arbitration proceedings over domestic court proceedings is the opportunity for the parties to select the person(s) who will decide the issue in question — the arbitrator(s). In arbitration, the parties can nominate arbitrators with specialized, up-to-date know-how relevant to the technical background of the issues in dispute.
The number of arbitrators forming the tribunal must be an uneven number under Section 17 of the Arbitration Act of Thailand (2002) (the “Act”). If the parties nominate an even number, the appointed arbitrators must choose another arbitrator to make the number uneven. If the parties fail to agree on the number, Section 17 provides that a sole arbitrator will be appointed instead. In Thailand, how arbitrators are appointed is generally left to the parties, who typically agree that the rules of the administering institute will dictate the procedure; failing that, the Act governs.
Section 19 of the Act requires that an arbitrator be “independent and impartial” and possess any particular qualifications agreed by the parties. The meanings of “independent” and “impartial” are themselves often disputed. Broadly speaking, independence refers to the absence of close relations between an arbitrator and a party, while impartiality refers to the arbitrator’s lack of prejudice toward a party or the matter in dispute — though both definitions remain fairly vague in practice.
Some guidance comes from the International Bar Association (IBA), via its Guidelines on Conflicts of Interest in International Arbitration (the “Guidelines”). While not legally binding, the standards in the Guidelines are widely accepted, and both parties and arbitrators often cite them when independence or impartiality is in question — for example, to determine what facts an arbitrator must disclose before accepting an appointment, or under what circumstances a party may nominate or challenge an arbitrator.
Common issues assessed when determining whether an arbitrator is adequately independent and impartial include:
- The relationship between a party and the arbitrator
- The relationship between a party and an arbitrator’s law firm
- The relationship between an arbitrator and a party’s counsel
- Prior appointments as an arbitrator (including repeated appointments by the same party)
- Ex-parte contacts immediately prior to appointment
- Non-disclosure of any of the above
None of these factors alone determines that an arbitrator lacks independence or impartiality — that determination depends on the circumstances of each case. Even where no issue raises sufficient doubt at one stage of the proceedings, the arbitrator remains duty-bound to disclose any such issue that arises later, for the parties’ consideration.
If a party believes an appointed arbitrator is not independent or impartial, that party has the right to challenge the arbitrator. The challenge procedure is governed by the relevant arbitration institute’s rules and the Act. Where it is determined that an arbitrator was not independent or impartial at the time of appointment, or has since ceased to be, that arbitrator is removed from the tribunal and replaced.
Notably, Section 23 of the Act imposes criminal sanctions — somewhat unusual compared to most other jurisdictions’ arbitration legislation — on an arbitrator for wrongfully demanding, accepting, or agreeing to accept an asset or other benefit in exchange for doing or omitting to do any act in their duties.
Choosing the right arbitrator — with the right skill set to make sound decisions — is among the most important, and often most difficult, decisions in arbitration proceedings. Whether the right choice is someone with formal legal training and experience, or someone with specialized, hands-on technical expertise, depends on the nature of the dispute. Competent legal counsel with solid arbitration experience can help parties make the right choice of arbitrator, and can also identify grounds that may make challenging an arbitrator advisable.