OLG Frankfurt am Main on the Consideration of Independent Internet Research by an Arbitration Tribunal
The decision of the Higher Regional Court of Frankfurt am Main dated March 26, 2021 (Case No.: 26 Sch 18/20) deals with the extent and conditions under which arbitration tribunals may use information they have independently researched on the internet in their arbitral award. This topic is of considerable practical importance in the realm of arbitration, especially for parties from the fields of commercial and trade law, who place significant emphasis on an efficient and reliable arbitration process.
Background of the Proceeding
The subject of the decision was the question of whether and to what extent an arbitration tribunal can rely on information during decision-making that it has obtained outside of the actual presentations of the parties – particularly through its own internet research. In the underlying case, a party had objected to the tribunal reaching results from internet research without explicit hearings or opportunities for comment, and having used them in its decision-making.
The Higher Regional Court of Frankfurt am Main had to particularly evaluate whether this approach constituted a violation of the right to be heard (§ 1036 Abs. 2 ZPO in conjunction with § 1042 ZPO) and the fundamental principle of a fair trial, as well as what standards apply to the inclusion of such sources of knowledge.
The Inclusion of Independent Investigations by the Arbitration Tribunal
Principle of Procedural Autonomy and Right to Be Heard
Arbitration tribunals are fundamentally entitled to largely shape the proceedings independently. However, this procedural autonomy finds its limit in the mandatory procedural principles, particularly the right of each party to be heard and the preservation of the principle of contradiction.
The court emphasized that the parties must at all times have the opportunity to comment on all decision-relevant facts and arguments. This generally also applies to information and facts that the arbitration tribunal does not take from the parties’ presentation but obtains independently – for example, through internet research. The standard here is particularly § 1042 Abs. 1 ZPO, which stipulates the essential fundamental principles of the right to be heard for arbitration.
Permissibility and Limits of Internet-Based Independent Research
In the specific case, the court clarified that conducting independent research by the arbitration tribunal is fundamentally permissible, provided that the information obtained is made available to the parties in a timely manner and they are given the opportunity to comment. What is crucial is that the parties are not restricted in their procedural rights by surprising or unilaterally considered investigations.
In particular, for decision-relevant circumstances that have not already been introduced by the parties’ presentations, consideration cannot be given without prior notification to the parties and an opportunity for comment. Thus, the tribunal may not base its judgment on facts to which the parties have not been able to respond.
In the present context, the arbitration tribunal had proceeded more transparently and sufficiently communicated the results of its research, which is why the court could not determine a significant procedural violation.
Evaluation and Practical Relevance for Arbitration
Significance for Party Autonomy and Procedural Fairness
The decision clarifies that the flexibility of arbitration leaves room for independent investigations, but this scope is limited by fundamental procedural safeguards. A violation of the right to be heard leads to the contestability or denial of enforceability of an arbitral award pursuant to § 1059 Abs. 2 No. 1 b) ZPO.
When research results are independently obtained, transparency and timely information of the parties are imperative. Emphasizing these principles serves the acceptance and reliability of arbitral decisions both domestically and internationally.
Notes on International Arbitration Proceedings
Special attention is warranted for this issue in the context of international arbitration proceedings. The requirements for compliance with procedural principles, and particularly the right to be heard, must also be observed in international contexts. Violations can endanger the recognition or enforcement of an arbitral award, particularly under the New York Convention.
Consequences for Practice
The present decision strengthens the formal fairness of arbitration proceedings and delineates the scope of independent fact-finding. Parties are obliged to closely follow procedural developments and ensure full awareness of their opportunities to respond.
Especially in the corporate context of an increasingly digitized procedural practice, the decision shows how important adherence to fundamental legal principles is in arbitration as well.
For companies, investors, and private individuals involved in arbitration proceedings domestically or abroad, or who are dealing with questions of procedural conduct, it is recommended to closely observe current case law. Should you have further questions on the outlined issues, the attorneys from MTR Legal, with extensive experience in arbitration, are at your disposal.
