International Credit Dispute Arbitration Standard

Chapter 1 — General Provisions

The standard is adopted by the World Credit Organization (WCO) to resolve credit disputes quickly and fairly. Its legal foundations are the constitutional principle of freedom, the principle of public order and good morals, the principle of good faith and the principle of freedom of contract.

Key points

• Acts performed under the standard are governed by and protected under the laws of the District of Columbia and US federal law; jurisdiction lies with the International Moral Court or the courts of the District of Columbia and the US federal courts.
• A credit dispute is, in general, any dispute in which one side is alleged to have breached the principle of good faith.
• The International Credit Dispute Arbitration Commission resolves credit disputes under this standard by arbitration, independently, neutrally and impartially.
• To guard against moral hazard the Commission may require parties to prove their identity and open an integrity file; a party acting through a representative must file a power of attorney.
• Evidence must meet the ICE8000 Evidence Standard, failing which it is invalid or of low weight.
• Arbitration follows the principles of independence, neutrality, legality, reasonableness, fairness, justice, good faith, supervision and conciliation.
• A party that finds any provision unfair may publicly declare that it is not bound by it, provided it publicly states its reasons and notifies WCO in writing.
• A party that knows a provision has not been complied with yet continues with the proceedings without prompt written objection is deemed to have waived the objection.

Chapter 2 — Jurisdiction

The Commission accepts a case on the basis of an arbitration agreement reached before or after the dispute arose and a written application by one party. An arbitration agreement is an arbitration clause in a contract or any other written agreement to arbitrate.

• Default arbitration clauses in ICE8000 standards: the respondent may exclude the clause in writing within 7 days of receiving the notice of arbitration, whereupon the proceedings end at once; a respondent that files no defence in time is deemed to have excluded it.
• An agreement naming WCO, the WCO International Credit Dispute Arbitration Commission or the International Credit Dispute Arbitration Commission is deemed an agreement to arbitrate before this Commission under this standard.
• The Commission rules on the existence and validity of the arbitration agreement and on its own jurisdiction; where one party asks the Commission and the other asks a competent court, the court decides.
• The arbitration clause is separable from the rest of the contract; amendment, rescission, termination, expiry or invalidity of the contract does not affect it.
• Objections to the agreement or to jurisdiction must be raised before the first hearing or the first defence on the merits, and do not suspend the proceedings.
• Where a valid arbitration agreement exists, no party may sue in court on the disputes it covers, nor challenge the proceedings or the award in court.

Chapter 3 — Arbitral Organization

Qualifications of arbitrators

Good character, together with legal knowledge and corresponding competence shown by one of: eight years' arbitration work; eight years' practice as a lawyer; eight years as a judge; a doctorate in law or a professorship in legal research or teaching; legal knowledge combined with recognised expertise in economics, trade or another profession; or the International Certified Integrity Practitioner (ICIP) qualification with three years' practice.

Term and independence

• Within three months of appointment an arbitrator must obtain the international credit practice qualification, register, and become an individual member of WCO, failing which they are deemed to have resigned.
• Arbitrators serve one-year terms renewable indefinitely and cannot be removed unless serious dereliction, corruption or misconduct is established after a hearing before the International Moral Court.
• All arbitrators elect nine members to the Commission for three-year terms; the members elect one Chair and two Vice-Chairs.
• The Commission decides by majority on appointments and removal complaints, internal administration and external affairs, and supports arbitrators in their cases.
• Arbitrators and tribunals act independently; no body or individual may interfere.
• Panels of arbitrators are kept by specialism, with profiles.

Chapter 4 — Ordinary Procedure

Section 1 — Application, defence and counterclaim

• Proceedings begin on the day the Commission issues the notice of arbitration.
• The claimant files an Application for Arbitration with evidence and pays the fees. The application must identify the applicable standard, the parties and their contact details, the arbitration agreement, the claims and the facts and grounds, and carry the undertakings of the conscience oath clause; evidence must meet the ICE8000 Evidence Standard.
• Once the formalities are complete the case is accepted and a notice of arbitration issued, which the claimant serves on the respondent.
• The respondent files its defence within 15 days of receiving the notice; a counterclaim must be filed within the same period with the fee paid in advance.
• Documents are filed in five copies; failure to file a defence does not stop the proceedings; any person of sound mind aged 21 or over may act as representative.
• Applications to preserve evidence or assets are referred to the competent court; where the conditions are met the Commission may also order a third party holding ICE8000 credit status to freeze, seize or deposit the relevant assets.

Section 2 — Constitution of the tribunal

• Each party selects one arbitrator and both jointly select the third, who presides; if they cannot agree, lots decide who chooses; if a party fails to select in time, the Chair appoints.
• Lots may be drawn in person or by sealed post, whichever is more convenient for the parties.
• An arbitrator with an interest in the case must disclose it and withdraw; a party's challenge must be made in writing before the first hearing and is decided by the Chair.
• If an arbitrator cannot act, a replacement is chosen by the same procedure and the tribunal decides whether earlier steps are repeated.

Section 3 — Hearing

• The tribunal may hear the case orally or on documents; in documentary proceedings each side has at least two rounds of written submissions and a closing statement.
• Oral hearings proceed in three rounds: claims and evidence, argument and cross-examination, closing statements. Thirty days' notice is given of the first hearing.
• Hearings are private unless both parties request a public hearing; the record of a private case is strictly confidential.
• Each party bears the burden of proving its case; the tribunal may investigate, consult experts or appoint assessors; witnesses and experts must undertake to observe the standard and answer questions.
• If a party fails to appear the tribunal may proceed and decide in default. The venue is chosen to minimise cost and facilitate the arbitration.
• Parties who settle may ask for an award on agreed terms or withdraw the case; during the arbitration no party may lodge administrative complaints or complain to the media, and credit sanctions already in force are suspended.
• With the parties' consent the tribunal may mediate; if mediation fails, no concession made in it may be relied on in later proceedings.

Section 4 — Award

• The award is made within two months of the tribunal's constitution, extendable to three months by the Chair for good reason.
• The tribunal decides on the facts, in accordance with the universal values of humanity, the ICE8000 standards, international norms and usage, the law of the place of conduct (or the chosen law) and the contract.
• A three-member tribunal decides by majority; failing a majority, the presiding arbitrator decides. Votes are not secret and reasons must be given.
• The award is signed by all or a majority of the tribunal and sealed by the Commission; interim and partial awards are possible.
• The tribunal allocates the arbitration fees and may order the losing party to reimburse part of the winner's reasonable costs.
• The award is final and binding; no party may sue in court or ask any body to vary it.
• Within 30 days of receipt a party may request correction of clerical or computational errors or an additional award on omitted claims.

Section 5 — Enforcement

• Parties perform the award within the period it states, or immediately if none is stated.
• If a party fails to perform, the other may seek enforcement before a competent court under the New York Convention or applicable national law, and may pursue the defaulter's credit liability under the standard.
• Where the conditions are met the Commission may order a third party holding ICE8000 credit status to transfer or deposit the defaulter's assets or receivables.

Chapter 5 — Summary Procedure

Unless the parties agree otherwise, the summary procedure applies to disputes not exceeding USD 500,000.

• The parties jointly select a sole arbitrator within 10 days of the respondent receiving the notice; failing that, the Chair appoints one immediately.
• The respondent files its defence and any counterclaim within 15 days of receiving the notice.
• The tribunal may decide on documents or hold a hearing; 15 days' notice is given of a hearing, and in principle only one hearing is held.
• The award is made within 10 days of the hearing, or within 30 days of the tribunal's constitution in documentary proceedings.
• Matters not covered in this chapter are governed by the other chapters of the standard.

Chapter 6 — Procedure Agreed by the Parties

• Parties may agree their own procedure in writing, subject to approval and registration by the Commission; the Commission respects the agreement unless it is plainly defective.
• The agreement must be made before the application for arbitration, filed for approval within 15 days with the review fee paid; the Commission decides within 30 days.
• If the agreed procedure is not approved or is invalid, the arbitration agreement still stands and the Commission's own procedures apply.
• The Notice of Approval and Registration must be filed with the application; once the case is accepted the procedure cannot be changed. Matters not agreed are governed by the standard.

Chapter 7 — Liability for Breach and Remedies

Liability

1. Legal liability under the applicable law;
2. Credit liability: internal or public complaint, credit warning, internal, public or joint exposure;
3. Self-regulatory liability: public censure, fines, cancellation of the credit identity card, exclusion from practice;
4. Compensation for loss caused, and punitive damages where the breach amounts to malicious bad faith.

Remedies

• Credit complaints and sanctions under the ICE8000 complaint, warning and exposure standards;
• Arbitration before the International Credit Dispute Arbitration Commission under this standard, without any further written arbitration agreement;
• A hearing before the International Moral Court under the ICE8000 International Credit Dispute Hearing Standard;
• A complaint under the WCO Member Supervision Standard where the defaulter is a WCO member;
• Proceedings in the courts of the District of Columbia or the US federal courts.

Liability is pursued only on complaint: the injured party decides whether to act and may forgive the defaulter or reach a settlement. WCO is financially liable for its own fault.

Chapter 8 — Supplementary Provisions

• The official languages of the Commission are Chinese and English, unless the parties agree otherwise; interpreters may be provided by the Commission or by the parties.
• Service and notice may be made by integrity letter, ordinary mail, online public notice (effective 60 days after first publication) or any other lawful and reasonable means.
• The standard takes effect on publication; undefined terms bear the meaning given in the ICE8000 Glossary of the International Credit Evaluation Profession.
• The standard is revised from time to time; the latest version applies, but conduct before a revision is not bound by the new provisions.
• Copyright belongs to the World Credit Organization (WCO). Members may use the standard freely; non-members may use it free of charge for study, research and citation with attribution, but may not plagiarise it.
• Version numbers take the form ICE8000-a-b-c-d: a is the serial number, b the date first drafted, c the date last revised, d the number of revisions.
• The standard is interpreted by the World Credit Organization (WCO).