ICDPASO Commercial Arbitration Rules Interpretation Series:Article 40 “Partial Award”

In order to improve hearing efficiency and resolve relevant disputes in a timely manner when conditions permit, modern arbitration rules have generally introduced the system of partial award. The partial award system empowers the Arbitral Tribunal to render decisions in advance on those claims within a case that have been clearly heard and can be adjudicated independently, serving as a key procedural design for optimizing the dispute resolution process.

I. Rule Text

Article 40. Partial Award

1. If the Arbitral Tribunal deems it necessary or if the parties make a request to which the Arbitral Tribunal agrees, the Arbitral Tribunal may make a partial award on some of the claims of the parties before making a final award.

2. The partial award shall be final and binding on the parties.

3. If the parties reach a partial mediation, the Arbitral Tribunal may, at the request of the parties, prepare a consent award on the partial mediation.

Ⅱ. The Main Purpose and Significance Analysis of “Partial Award”

The core purpose of this article is to authorize the Arbitral Tribunal to handle complex disputes in a flexible and incremental manner. By considering necessity, timeliness, and feasibility, and rendering an advance decision on those parts where the facts have been ascertained and liability can be determined based on those facts, the overall efficiency of the arbitration proceedings is enhanced, and the timely realization of the parties' legitimate rights and interests is ensured.

First, this provision helps balance procedural efficiency and fairness. In complex arbitrations involving multiple disputes, the partial award allows the Arbitral Tribunal to break the case down into manageable parts, avoiding delays in deciding all issues due to a few complex points. Rendering a partial award in advance on those claims with clear facts and well-defined legal relationships enables the creditor to quickly obtain enforceable relief, alleviating financial pressure, and realizing the procedural value that “justice delayed is justice denied”.

Second, this provision helps clarify the focus of the dispute and promotes the development of the proceedings. For example, if a partial award can be made in advance on the key liability issue of whether a contract has been breached, it can significantly narrow the scope of disputes in subsequent proceedings. Based on this, the parties can focus more on subsequent issues such as the calculation of damages, or may even be more inclined to settle the compensation part due to liability being established, thereby efficiently concluding the entire dispute.

Finally, incorporating “partial mediation” within the framework of this article highlights the integrated advantages of arbitration and confirms the central role of party autonomy in the arbitration process. Allowing the parties to reach mediation at any time on any part of the dispute, such as a specific item within the disputed amount or one of multiple claims, under the auspices of the Arbitral Tribunal, and having the tribunal formalize it as a “consent award”, a legal document with enforceability equal to an arbitral award, makes the partial award system not just an adjudicative tool, but also a platform encouraging phased mediation and promoting the flexible resolution of disputes. This reflects the modern arbitration concept of “combining mediation with arbitration”.

It should be noted that in the provisions of Arbitration Law of the People’s Republic of China, a partial award is also referred to as an “preliminary rulings”.① In academic theory, it is generally accepted that an preliminary rulings, being a final award on part of the parties’ arbitration claims, is essentially a partial award, and the two terms are not distinguished.

Ⅲ. Analysis of Article 40, Paragraph 1: Initiation Requirements, Applicable Timing, and Content of the Partial Award

This paragraph establishes an initiation model similar to the “Interlocutory Award” in Article 39, balancing the Arbitral Tribunal’s case management authority with the parties’ procedural autonomy. First, “if the Arbitral Tribunal deems it necessary” is the primary basis for a partial award, granting the Arbitral Tribunal the procedural initiative to proactively identify and advance partial awards. When determining whether it is necessity, the tribunal typically exercises its discretion, considering factors such as whether it would improve overall procedural efficiency, whether it would enable the timely realization of some of the parties’ rights, and whether the specific claim has been heard and is ripe for decision. Second, parties may proactively apply for a partial award on specific matters. However, such an application must be reviewed and approved by the Arbitral Tribunal to prevent parties from abusing procedural rights and to ensure that making the partial award indeed serves the overall interests of procedural economy and case management.

Regarding the applicable timing, like the interlocutory award, the partial award is made before the final award is rendered.

Regarding the content, the partial award addresses “some of the claims of the parties”. This implies two key conditions: First, the relevant part of the claim must be severable. The matter to be decided in the partial award must be factually and legally independent from other claims, and its adjudication must not prejudge or materially affect the hearing of other pending claims. For example, claims for payment under the same contract relating to different stages or different natures, or the determination of liability for breach versus the calculation of damages, are generally considered severable. Second, the Arbitral Tribunal must have conducted sufficient hearings on that part of the claim, with the relevant facts ascertained and the applicable legal issues clarified, meeting the conditions for making a final determination. This aligns with the provisions of the Arbitration Law of the People’s Republic of China.① The Arbitral Tribunal will not make a partial award on a claim that still requires extensive factual investigation.

Ⅳ. Analysis of Article 40, Paragraph 2: Legal Effect of the Partial Award

This paragraph succinctly confers finality on the partial award. “Finality” means that its adjudication of specific claims has the same legal effect as a final award, which is the fundamental guarantee of the value of the partial award system. First, parties cannot appeal the partial award itself to another Arbitral Tribunal or court. Second, the same party cannot re-initiate arbitration or litigation regarding the same claim already decided by the partial award, based on the same reasons. Third, in subsequent proceedings or in the final award, the Arbitral Tribunal must be bound by the factual findings and legal conclusions in that partial award and cannot alter or revoke them on its own.

“Binding on the parties” emphasizes the enforceability of the partial award. Once a partial award is made, the parties are obligated to perform it. If a party fails to perform voluntarily, the other party has the right to apply to a competent court for recognition and enforcement of that partial award, based on the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”) or the domestic law of the place of enforcement. This allows the rights holder to realize part of its substantive rights without waiting for the entire case to be concluded.

It is important to note that the finality of the partial award does not preclude the making of the final award. For the remaining claims not yet decided, the arbitration proceedings continue and ultimately conclude with a final award. The final award will consolidate and confirm the partial award(s) already made and deal with the remaining matters. The arbitration proceedings for the entire case may thus consist of one or more partial awards plus a final award, together forming a complete award system.

From a comparative law perspective, most arbitration rules provide for a partial award system. For example, the LCIA Arbitration Rules stipulate that the Arbitral Tribunal may make separate awards on different issues at different times, and these awards shall have the same legal status as any other award made by the tribunal.② All awards are final and binding on the parties.③ The SCC Arbitration Rules provide that the Arbitral Tribunal may make a partial award on an independent issue or part of a disputed issue,④ with the effect of the partial award uniformly addressed by the provisions on the “effect of an award”.⑤ The ICC Arbitration Rules⑥, the AAA Commercial Arbitration Rules⑦, the SIAC Rules⑧ and the HKIAC Administered Arbitration Rules⑨⑩ do not provide detailed regulations on the partial award system, merely noting its existence in “definition” clauses or provisions on the “form of award”.

Ⅴ. Analysis of Article 40, Paragraph 3: Confirmation of Partial Mediation

This paragraph is a distinctive and highly practical provision within the ICDPASO Commercial Arbitration Rules. It allows the parties to negotiate and reach mediation on a part of a complex dispute, such as a specific item within the disputed amount, or one of several claims, under the auspices of the Arbitral Tribunal. The Arbitral Tribunal then formalizes the content into a consent award, granting it legal effect. According to Article 64 of the Arbitration Law of the People’s Republic of China, a consent award made by the Arbitral Tribunal based on a mediation agreement has the same legal effect as an arbitral award.⑩① This means the consent award is legally binding on both parties, who cannot renege. If one party fails to perform the consent award, the other party can directly apply to a court for enforcement, providing a solid guarantee of effectiveness for parties resolving disputes through phased mediation and eliminating the risk of subsequent backtracking.

The partial mediation system and the partial award system can work in tandem. A partial award is a compulsory decision made by the Arbitral Tribunal through its discretion on a disputed matter. Partial mediation, on the other hand, is a process where, under the Arbitral Tribunal’s auspices, the parties reach a consensus to eliminate part of the dispute, transforming it into a mediation agreement, which is then confirmed by the Arbitral Tribunal. Both ultimately produce legally enforceable documents, but the former highlights the adjudicative function of arbitration, while the latter emphasizes the mediation function within the arbitration process. Together, they enrich the toolkit available to the Arbitral Tribunal for efficiently and flexibly resolving complex disputes.

Ⅵ. Conclusion

Article 40 of the ICDPASO Commercial Arbitration Rules embodies a comprehensive design incorporating advanced concepts of modern international commercial arbitration. The partial award system, by handling complex disputes in stages, aims to prevent the escalation of damages while simultaneously creating conditions for resolving the remaining issues subsequently. The awards it produces are final and enforceable, ensuring the practical effectiveness of proceeding in stages. The confirmation mechanism for partial mediation provides parties with another path that is more cooperative and less adversarial, broadening the avenues for dispute resolution and fully respecting the willingness of commercial entities to resolve their own disputes. The combination of these two mechanisms not only empowers the Arbitral Tribunal to manage proceedings more effectively and deliver justice but also grants parties more strategic choices and a greater sense of procedural control.