On 20 January 2025, the Hong Kong International Arbitration Centre (“<span class="news-text_medium">HKIAC</span>”) released a new Practice Note on Compatibility of Arbitration Clauses under its Administered Arbitration Rules. The guidance clarifies how the HKIAC determines whether arbitration agreements are compatible for consolidation (Article 28) and multi-contract arbitrations (Article 29) under the 2018 and 2024 Rules.
The HKIAC emphasizes that compatibility does not require identical clauses but must ensure procedural efficiency and uphold party consent. A significant factor affecting compatibility is the method of tribunal appointment. The guidance recommends using HKIAC’s model arbitration clause and ensuring consistency in seat, number of arbitrators, procedural language and governing law.
When reviewing compatibility, the HKIAC considers whether consolidation would be procedurally unworkable, affect party consent or alter procedural agreements, potentially exposing awards to challenge. The HKIAC has found clauses incompatible where they specify different numbers of arbitrators or procedural languages, though variations in governing law or co-arbitrator appointment mechanisms may still be deemed compatible in certain circumstances.
This new guidance provides practical insights for parties drafting arbitration clauses in multi-contract transactions, helping to reduce procedural complexities and risks in future disputes.
This guidance can be found through this link: <a href="https://www.hkiac.org/news/hkiac-issues-practice-note-compatibility-arbitration-clauses" target="_blank" class="news-text_link">https://www.hkiac.org/news/hkiac-issues-practice-note-compatibility-arbitration-clauses</a>
