SCC Express - the latest addition to the SCC disputes toolkit

The Stockholm Chamber of Commerce (SCC) recently launched a new process for dispute resolution called the SCC Rules for Express Dispute Assessment (or SCC Express for short).¹  It is a form of early neutral evaluation which is being promoted as a means for parties to obtain insight into how a matter might be determined should it proceed to arbitration. In this update, we look at the circumstances in which this new tool can be used, and comment on the extent to which it might be put to good use in practice. 

What is it?

The SCC states that the mechanism is a "consent-based, confidential and efficient process designed to give parties a [neutral] legal assessment of their dispute in three weeks, for a fixed fee (EUR 29,000)". It is a tool designed to "give the parties an idea of how an arbitrator would assess or decide their dispute", so as to help parties reach settlement, or to narrow the scope of the dispute and increase the efficiency of an ensuing arbitration.²

Appointment of the neutral assessor will be left to the SCC, taking into consideration all relevant factors such as any proposals made by the parties, the nature and circumstances of the dispute, the applicable law, and the nationality and language of the parties.³ The SCC's guidelines state that these would be the same factors that guide the appointment of arbitrators.

Consent of both parties is required and the findings of the neutral assessor are non-binding.⁴ However, the parties can agree to (1) make the findings contractually binding; and also (2) appoint the neutral assessor as an arbitrator to confirm the findings in an arbitral award.

When is it appropriate?

SCC Express is likely to be an attractive option in straightforward disputes that require a speedy resolution, or disputes between parties where the relationship has not turned adversarial and they trust each other to accept the outcome of the proceeding without the need for legal enforcement.⁵

However, we would query how realistic it is to expect parties to agree that the findings should be binding (or subsequently confirmed in an award) – it is difficult to see in what circumstances the 'losing' party would be prepared to do so. What is more likely is that the indication from the neutral assessor as to how a matter might ultimately be determined by an arbitral tribunal would lead to a negotiated settlement.  

SCC Express could also be of interest in more complex disputes if parties want an early indication as to the likely outcome of their dispute. However, parties using it for this purpose need to bear in mind the following potential limitations:

• in contrast to court litigation (where the preliminary views of counsel or a judge might be a good indication of what the local court would do), the different legal traditions and backgrounds of arbitrators are a factor in international arbitration which mean that the assessment of a dispute by a neutral assessor may be different to that of the tribunal that is appointed in due course;
• in the context of high stakes international arbitration requiring the resolution of significant factual and legal issues, while the process may offer the parties an opportunity to assess the merits of their claim, it is unlikely that all relevant facts and legal issues would be addressed within the short time frame (with a limited scope of oral and written testimonies and submissions), especially where the dispute is a particularly complex one; and
• as a result, it is unlikely to provide a satisfactory resolution to complex disputes.

Considerations when adopting SCC Express as part of the contractual disputes process

The SCC provides model wording to be adopted where the parties want to incorporate SCC Express into their dispute resolution clause. Given its limited application, careful thought will need to be given as to whether it would be appropriate and, if adopted into a clause: 

(a)  whether it should be included as a contractual pre-condition to arbitration; and

(b)  if such a condition precedent would be enforceable at law.

Careful consideration is required when any contractual escalation procedure is drafted – whether including SCC Express or not – so early legal advice should be sought. 

Authors: Julian Lim and Emma Johnson

1. https://sccinstitute.se/om-scc/nyheter/2021/scc-express-designed-to-fill-a-gap-in-the-dispute-resolution-spectrum.
2. https://sccinstitute.se/om-scc/nyheter/scc-forecasts/scc-forecast-a-brand-new-tool-in-the-toolbox/.
3. Article 6 of the SCC Rules for Express Dispute Assessment.
4. Article 2(4) of the SCC Rules for Express Dispute Assessment.
5. https://sccinstitute.com/media/1800128/scc-express-guidelines_2021.pdf.