Parties wishing to initiate arbitration often have two key concerns in addition to whether a case has merit: the costs and duration of the proceedings. These concerns were recently addressed by the London Court of International Arbitration (the “LCIA”) in a report published on 30 December 2024, entitled “Facts and Figures – Cost and Duration: 2017-2024” (the “2017-2024 Report”). The most important takeaway is that the overall median cost of a quantified LCIA arbitration was USD 117,653, with a mediation duration of 20 months.
In the report, the LCIA analysed the cases concluded by a final award in the period between 1 January 2017 and 12 May 2024, i.e., a total of 616 cases. Among these 616 cases, 568 had a quantified amount in dispute, and 48 were unquantified. Interestingly, they were evenly split between a sole arbitrator and a panel of three arbitrators:
In this note, we will review the main findings of the 2017-2024 Report.
Costs of LCIA Arbitration
According to Rule 28 of the LCIA Arbitration Rules, arbitration costs are defined as costs “other than the legal or other expenses incurred by the parties themselves”. They typically include LCIA administrative charges and arbitral tribunal fees.
The LCIA fee system differs from other arbitration institutions, such as the International Chamber of Commerce or the Singapore International Arbitration Centre, by employing an hourly rate system for administrative charges and arbitrator fees rather than basing costs on the value of the dispute. This approach provides greater flexibility. The downside is that hourly rates can make it difficult for parties to estimate the total cost of arbitration at the outset.
According to the 2017-2024 Report, the median arbitration costs for quantified cases amounted to USD 113,000, and USD 204,000 for unquantified cases.[1] The overall median cost of an LCIA arbitration was USD 117,653, up slightly from USD 97,000 in the 2013-2016 Report. This modest increase reflects the LCIA’s commitment to maintaining competitive pricing even amid inflation and rising case complexities.[2]
It also underlines the correlation between arbitration costs and arbitration duration:[3]
- for cases with a duration of less than six months: up to USD 50,000;
- for 90% of cases with a duration of between seven and twelve months: up to USD 100,000;
- for more than 50% of cases with a duration of over 24 months: above USD 300,000.
The LCIA also compared LCIA costs with costs reported by other international institutions. As the former LCIA Director General, Professor Dr Jacomijn (Jackie) van Haersolte-van Hof, noted, the “latest report on Costs and Duration demonstrates that LCIA arbitration costs are lower than the estimated costs of the compared institutions across almost all amounts in dispute, and most notably for larger cases.”[4]
Duration of LCIA Arbitration
According to the 2017-2024 Report, the median duration of the cases in which the amount in dispute was quantified was 20 months.[5] For cases with an unquantified amount in dispute, the median duration is slightly longer, i.e., 21 months.[6] Compared to the 2013-2016 Report, this represents an increase of five months in duration for quantified cases and four to five months for unquantified cases.
The 2017-2024 Report underscores the correlation between the total duration of arbitration and the amount in dispute:[7]
- for cases not exceeding USD 1 million: 12 months;
- for cases between USD 1 million and USD 10 million: 20 months;
- for cases between USD 10 million and USD 100 million: 25 months;
- for cases exceeding 100 million: 32 months.
The 2017-2024 Report also shows the impact of the COVID-19 pandemic on the overall duration of arbitration. Cases initiated or pending in March 2020 experienced initial delays as parties and tribunals adjusted to new working conditions. Interestingly, the pandemic did not have an entirely negative impact on arbitration timelines. While some cases saw delays due to disruptions or parties struggling to adapt, others benefited from the efficiency of remote processes.[8] For example, virtual hearings reduced scheduling conflicts, expedited certain procedural stages and eliminated travel time for parties and arbitrators.
The LCIA also notes a surge in case filings during the pandemic. Many disputes arose directly from pandemic-related issues. These cases often involved larger claim values and greater complexity, underscoring the need for a reliable and adaptable arbitration framework.
Conclusion
The 2017-2024 Report showcases the LCIA’s ongoing commitment to delivering efficient and cost-effective arbitration. In fact, by comparison with the previous study, the 2017-2024 Report demonstrates that “costs and duration have remained relatively stable”.[9] By maintaining transparent costs and focusing on timely resolutions, the LCIA continues to stand out as a leading choice for international dispute resolution.
[1] “Facts and Figures – Cost and Duration: 2017-2024”, LCIA publication (30 December 2024), p. 12.
[2] “Facts and Figures – Cost and Duration: 2017-2024”, LCIA publication (30 December 2024), p. 12.
[3] “Facts and Figures – Cost and Duration: 2017-2024”, LCIA publication (30 December 2024), pp. 12-13.
[4] “LCIA Releases Updated Costs and Duration Analysis 2024”, LCIA publication (30 December 2024).
[5] “Facts and Figures – Cost and Duration: 2017-2024”, LCIA publication (30 December 2024), p. 8.
[6] “Facts and Figures – Cost and Duration: 2017-2024”, LCIA publication (30 December 2024), p. 8.
[7] “Facts and Figures – Cost and Duration: 2017-2024”, LCIA publication (30 December 2024), p. 9.
[8] “Facts and Figures – Cost and Duration: 2017-2024”, LCIA publication (30 December 2024), p. 11.
[9] “Facts and Figures – Cost and Duration: 2017-2024”, LCIA publication (30 December 2024), p. 3.