Q&As

How does the ICC calculate its advance on costs?

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Published on LexisPSL on 23/04/2015

The following Arbitration Q&A provides comprehensive and up to date legal information covering:

  • How does the ICC calculate its advance on costs?
  • Provisional advance
  • Advance on costs
  • Can I challenge the advance on costs?

How does the ICC calculate its advance on costs?

In International Chamber of Commerce (ICC) arbitration, the parties are required to pay a substantial amount of the costs of the arbitration 'up front' to cover the tribunal's and the ICC's fees and expenses. Separate advances will often be set throughout the course of the arbitration and it is not possible to say in advance how much the arbitration is going to cost. Advisors can often give an indication of the costs of previous similar disputes but the inevitable twists and turns of case mean that no one can predict the eventual cost.

In considering the costs of the arbitration, parties must be aware that any advance set by the ICC is intended only to cover the tribunal and ICC's fees, in addition the parties will have to bear their own legal fees (some of which will hopefully be recoverable from the opposing party)—see: Costs in international arbitration—Allocation and recoverability of costs.

Provisional advance

Once the ICC has received the Request for Arbitration from the claimant (see Practice Note: ICC (2012)—starting an arbitration), the Secretary-General will usually request a provisional advance on costs from the claimant. This is intended to cover the costs of the arbitration until the Terms of Reference have been drawn up—see Practice Note: ICC (2012)—Terms of Reference.

This is usually calculated by adding together:

  1. the administrative

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