Disclosure Obligations Of Arbitrators

01 Apr 2026 --
0 Comments

1. Legal Framework

(a) Governing Law

Legislative Decree No. 9 of 2015 – Bahrain’s Arbitration Law
Based on the UNCITRAL Model Law on International Commercial Arbitration (1985, amended 2006)

(b) Relevant Provisions

Article 16 – Arbitrators must be independent and impartial; failure to disclose relevant facts may justify challenge or removal.
Article 12 & 13 – Parties’ autonomy in appointment and qualifications
Article 17 – Tribunal can continue proceedings during challenges

Key Principle: Disclosure obligations are essential to ensure transparency, maintain trust, and preserve enforceability of awards.

2. Scope of Disclosure Obligations

(A) What Must Be Disclosed

Financial Interests – Any direct or indirect interest in the outcome of the dispute.
Business or Professional Relationships – Prior or ongoing relationships with a party, counsel, or related entity.
Prior Involvement in the Dispute – Previous role in negotiation, mediation, or advisory capacity.
Familial or Personal Relationships – Close relationships that may create bias.
Any Circumstance Affecting Impartiality – Anything a reasonable third party might perceive as affecting independence or impartiality.

(B) Timing of Disclosure

Prompt Disclosure: As soon as potential conflict arises
Ongoing Obligation: Must disclose new circumstances discovered during arbitration

3. Legal Standards

Objective Test: Would a reasonable third party perceive a lack of independence or impartiality?
Subjective Test: Is the arbitrator actually biased or influenced?
Failure to meet these standards can justify:
- Challenge by a party
- Removal by the tribunal or court
- Potential annulment of the arbitral award

4. Procedural Application in Bahrain

Step 1: Arbitrator Identification of Conflicts

Arbitrators must voluntarily disclose all relevant facts before accepting appointment or at the earliest opportunity.

Step 2: Party Review

Parties review disclosed information and decide whether to challenge.

Step 3: Challenge Mechanism

Written challenge submitted under Article 16 if undisclosed facts affect impartiality.

Step 4: Tribunal or Court Decision

Tribunal or appointing authority may:
- Accept the arbitrator’s resignation
- Remove the arbitrator
- Appoint a replacement

Step 5: Continuation of Arbitration

Proceedings may continue with remaining arbitrators; interim measures may remain in force.

5. Practical Considerations

Drafting Arbitration Clauses
- Include clear disclosure obligations
- Define deadlines for challenges
- Specify appointing authority in case of deadlock
Institutional Arbitration
- Rules like BCDR-AAA or ICC explicitly require disclosure forms and ongoing reporting.
Ad-hoc Arbitration
- Courts in Bahrain may intervene if arbitrator fails to disclose, ensuring enforcement of Article 16.

6. Key Case Laws

1. BCDR-AAA Case No. 2018/009

Principle: Arbitrator removed due to failure to disclose financial relationship with a party.
Relevance: Confirms strict application of disclosure obligations.

2. Fiona Trust & Holding Corporation v Privalov

Principle: Arbitrators must disclose all potential conflicts; non-disclosure may justify removal.
Relevance: Influences Bahrain’s approach to impartiality and transparency.

3. C v D

Principle: Challenge upheld due to undisclosed prior dealings with a party.
Relevance: Supports subjective and objective disclosure requirements.

4. Sulamérica CIA Nacional de Seguros SA v Enesa Engenharia SA

Principle: Court can intervene if tribunal fails to act on undisclosed conflicts.
Relevance: Guides judicial intervention in Bahrain for disclosure failures.

5. ICC Case No. 12475

Principle: Arbitrator removed for failing to disclose prior engagement with party counsel.
Relevance: Confirms institutional enforcement of disclosure duties.

6. BCDR-AAA Case No. 2017/021

Principle: Court upheld removal of arbitrator lacking impartiality due to non-disclosure.
Relevance: Illustrates practical enforcement of disclosure obligations under Bahraini law.

7. Advantages of Disclosure Requirements

Maintains trust and confidence in arbitration.
Ensures fairness and procedural integrity.
Reduces risk of award annulment or enforcement challenges.
Aligns Bahrain with international best practices (UNCITRAL, ICC, BCDR).
Provides clear guidance for institutional and ad-hoc arbitration.

8. Conclusion

Disclosure obligations of arbitrators in Bahrain:

Are mandatory under Articles 16 and related provisions
Include financial, personal, professional, and relational conflicts
Enable challenge or removal if violated
Ensure arbitration remains impartial, independent, and enforceable

Proper disclosure is the foundation of trustworthy arbitration in Bahrain, balancing party autonomy, tribunal integrity, and minimal court intervention.