At a Glance

• The number of arbitration cases referred to the London Court of International Arbitration (LCIA) has increased steadily over the past decade, with the exception of a downturn during the COVID-19 era. 
• Trends indicate that parties are claiming higher sums of money under the LCIA Rules. 
• In a new development, the LCIA is seeing more recently concluded contracts being challenged.

On 31 May 2024, the London Court of International Arbitration (LCIA) released its Annual Casework Report for the year 2023 (Report). The Report provides an interesting insight into LCIA’s caseload over the past year, showing an upward trend in using arbitration for resolving international disputes. Some of the key takeaways include:

• In 2023, the LCIA received a total of 377 referrals, including 327 referrals for LCIA arbitration. This is up from 333 referrals in 2022. The Report states that, with the exception of the COVID-19 pandemic, which caused an unprecedented spike in the number of cases, followed by a dip, arbitration referrals have grown steadily over the past ten years.
• Similar to 2022, Transport & Commodities (36%) continue to be the leading industry sector for LCIA arbitrations, followed by Banking & Finance (16%) and Energy & Resources (14%). 
• Almost half of the LCIA arbitration cases commencing in 2023 concerned agreements that had been concluded up to two years prior to the referral. 
• Sales of goods agreements were the most frequent type of agreements in LCIA arbitrations (31%). Services agreements took up 17% of disputes, and shareholders agreements were 15% of disputes.
• Of the cases referred to the LCIA, 96% were of international nature, with 79% of the parties coming from outside the United Kingdom. Interestingly, the number of Asian parties decreased from 24% in 2022 to 8% in 2023, whilst the number of parties from Africa has doubled to 8%. 
• Parties engaging in LCIA arbitrations claimed higher monetary sums in 2023, with nearly one-third claiming more than USD 20 million. 
• Diversity remains an important issue on the LCIA’s agenda. The Report reveals that 48% of the court-appointed arbitrators were women (45% in 2022) and that the number of female co-arbitrator appointments increased by 16% to 39%. However, the parties only selected 21% female arbitrators, an increase of 2% compared to 2022.
• The number of state entities in LCIA arbitrations remained high in 2023, with 11% of all parties having been states or state-owned parties.
• Unlike the year before, when the LCIA received no challenges, the LCIA received five challenges to arbitrators pursuant to Article 10 of the LCIA Rules in 2023.

The increasing number of arbitration referrals highlights the popularity of the LCIA as an international institution, and arbitration as a dispute resolution mechanism. The Report shows that geopolitical and economic challenges, such as wars and fluctuating energy prices, impact businesses and their supply chains, causing more disputes. As a corollary, nearly one-third of all LCIA referrals in 2023 concerned the sale of goods contracts. Moreover, due to the challenging environment businesses are operating in, agreements are now being challenged earlier than before.