The Attorney-Client Privilege in International Arbitration: Legal Transplants, Conflict of Laws, and a Transnational Approach

Document exchange has become an almost inescapable component of international commercial arbitration, irrespective of the legal tradition of the lex arbitri, the lex causae, and the legal systems of the parties’ home countries. It is a legal transplant from the practice of litigation in international common law systems, which has developed into a transnational practice in arbitration. Although parties expect the attorney-client privilege, as an exception to the general disclosure obligations, to be protected within this practice, existing rules do not provide guidance on how to do so, and choice of law principles are unwieldy and yield troubling results. This article suggests that a wholesale importation of the broadest national rule of privilege connected to the case would be inconsistent with party expectations relative to the scope of privilege itself, the dimensions of the search for truth, and equal treatment. Rather, the international arbitration practice having evolved around discovery is akin to the results of a legal irritant in the lex arbitri and the practices around privilege should develop similarly. A transnational approach to privilege issues in such a case is best considered a procedural approach or solution: it would begin with the arbitral tribunal requesting submissions from both parties relative to the scope of document exchange and the parties’ proposals for application of attorney-client privilege. The main disadvantage of such a transnational approach is that the rules on privilege will not be known to the parties when a document is created or an act of communication takes place. Despite this drawback, the authors submit that this procedural approach is still the best available since it is the only approach that will be able to reconcile the conflict of laws with regard to privilege as it presents itself in the specific arbitration. It is their suggestion that the Privilege Task Force working on an instrument to deal with privilege in international arbitration will provide the arbitral tribunal with significant latitude to resolve the issue in the individual case before it.