Consolidation of Multi-Party Arbitrations in Construction and Energy Projects

Authors: Atty. Ahmet Berker & Atty. Deniz Nalbant

Introduction

Large-scale construction and energy projects are inherently complex structures involving multiple contracts and numerous stakeholders operating simultaneously. In such project where employers, main contractors, subcontractors, suppliers and financiers play active roles, the technical and legal interconnections between contracts frequently give rise to disputes of a “multi-contract” or “multi-party” nature. Where arbitration clauses across these contracts are not drafted in a coordinated manner, a single dispute may result in multiple parallel arbitration proceedings. This inevitably leads to increased costs and makes the efficient and consistent resolution of disputes significantly more challenging.

The International Chamber of Commerce (“ICC”) 2024 Dispute Resolution Statistics[1] indicate that the energy and construction sectors were among the most frequently encountered industries in ICC arbitration cases filed in 2024. According to the same statistics, approximately 33% of the 2,392 parties involved in cases commenced in 2024 were part of multi-party disputes. Of these cases, 57% involved multiple respondents, 28% involved multiple claimants, and 15% involved both multiple claimants and multiple respondents. In 81% of multi-party cases, the number of parties ranged between three and five, with some proceedings involving as many as 40 parties.

In response to the procedural challenges posed by such complexity, leading arbitral institutions have, in recent years, updated their rules to clarify procedural mechanisms such as joinder and consolidation. These mechanisms are of critical importance not only for saving time and costs, but also for reducing the risks of parallel proceedings and inconsistent or conflicting awards.

This article examines the harmonisation of arbitration clauses and the consolidation of arbitral proceedings in light of the ICC Rules governing multi-party arbitrations.

1. Harmonisation of Arbitration Clauses

One of the most fundamental risks in multi-contract projects arises where arbitration clauses are drafted inconsistently across different contracts. In such cases, even if disputes arise out of the same project, separate arbitral proceedings may be initiated before different tribunals under different procedural frameworks. This significantly increases the risk of inconsistent decisions, both substantively and procedurally.

Accordingly, during the contract negotiation stage, parties should strive to adopt:

• the same arbitral institution,
• the same seat of arbitration,
• the same procedural rules, and
• where possible, the same arbitrator appointment mechanism.

Harmonised arbitration clauses directly enhance the applicability of consolidation and other multi-party procedural mechanisms.

2. The Concept of Consolidation

Consolidation refers to the process by which two or more arbitration proceedings, initially commenced separately and typically directed against the same respondent, are merged into a single arbitral proceeding.

It is important to distinguish consolidation from joinder (Article 7 of the ICC Rules), multi-party claims or mass claims. Consolidation is permissible only where specific conditions are satisfied.

The principal objectives of consolidation are:

• to reduce the time and cost burden arising from parallel proceedings, and
• to prevent inconsistent or contradictory arbitral awards.

2.1. ICC Arbitration Rules and the Authority to Consolidate

Article 10 of the ICC Arbitration Rules expressly sets out the conditions under which multiple arbitration proceedings may be consolidated. Where consolidation is ordered, the proceedings are conducted before a single arbitral tribunal. For consolidation to be possible, the arbitrations must be subject to the ICC Rules; arbitrations governed by other rules cannot be consolidated pursuant to Article 10.

“ICC Arbitration Rules – Article 10

Consolidation of Arbitrations

The Court may, at the request of a party, consolidate two or more arbitrations pending under the Rules into a single arbitration, where:

a)   the parties have agreed to consolidation; or
b)   all of the claims in the arbitrations are made under the same arbitration agreement or agreements; or
c)   the claims in the arbitrations are not made under the same arbitration agreement or agreements, but the arbitrations are between the same parties, the disputes in the arbitrations arise in connection with the same legal relationship, and the Court finds the arbitration agreements to be compatible.

In deciding whether to consolidate, the Court may take into account any circumstances it considers to be relevant, including whether one or more arbitrators have been confirmed or appointed in more than one of the arbitrations and, if so, whether the same or different persons have been confirmed or appointed.

When arbitrations are consolidated, they shall be consolidated into the arbitration that commenced first, unless otherwise agreed by all parties.”

Consolidation is initiated upon a party’s request. Upon such request, the tribunal (or the Court, as applicable) must first assess whether the requisite conditions are met and then balance the advantages and disadvantages of consolidation. Notably, the wording of Article 10 (“the Court may consolidate”) confirms that the ICC Court retains discretionary authority; even where the conditions are satisfied, consolidation is not mandatory.

Article 10 provides for three principal consolidation scenarios:

1) Agreement of the Parties (Article 10(a))

This is the simplest and least controversial basis for consolidation.

2) Claims Made under the Same Arbitration Agreement (Article 10(b))

The critical factor here is not whether the underlying contracts are the same, but whether the arbitration agreement or clause is identical.

For example: Parties A, B, C and D have entered into both Contract X and Contract Y. A and B are parties to the first arbitration based on Contract X, while A, C and D are parties to the second arbitration based on Contract Y. If both contracts contain the same arbitration clause, consolidation may be permitted even though the parties are not identical across both proceedings[2].

3) Different Arbitration Agreements with Compatible Clauses (Article 10(c))

Where claims are made under different arbitration agreements, consolidation may be ordered if:

• the arbitrations involve the same parties,
• the disputes arise out of the same legal relationship, and
• the arbitration agreements are deemed “compatible.”

The ICC Rules do not define “compatibility”, which provides valuable flexibility in practice and allows the Rules to remain responsive to evolving commercial realities.

Examples of potentially incompatible arbitration clauses include those providing for:

• different arbitrator selection or appointment mechanisms,
• different seats of arbitration,
• different arbitration languages, or
• different numbers of arbitrators.

For this reason, it is strongly recommended that arbitration clauses in multi-contract projects be drafted as uniformly as possible.

2.2. Consolidation in Practice: Selected ICC Decisions

In Petroci v. MRS Holdings[3], Logistics International v. Mozambique and EMATUM (V)[4], Privinvest v. Mozambique and EMATUM (II)[5], and Cominière and Jin Cheng v. AVZ and GLH[6], the parties submitted consolidation requests directly to the ICC Court.

These decisions demonstrate that the consolidation authority conferred by Article 10 of the ICC Rules is actively applied in practice and that the ICC Court enjoys broad discretionary powers in this respect.

Conclusion

In multi-party arbitrations, contractual precautions taken before disputes arise can significantly mitigate future procedural challenges. Harmonisation of arbitration clauses, express regulation of consolidation mechanisms and clarity in arbitrator appointment procedures directly enhance the efficiency of dispute resolution.

The consolidation authority provided under Article 10 of the ICC Rules serves as an important guide for complex, multi-party projects. Nevertheless, it should be borne in mind that consolidation is not available in all circumstances, that the ICC Court’s discretion may be limited by the facts of each case, and that consolidation decisions are administrative in nature and final.

 

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FOOTNOTES

[1] ICC Dispute Resolution Statistics 2024, [https://iccwbo.org/wp-content/uploads/sites/3/2025/06/2024-Statistics_ICC_Dispute-Resolution.pdf]

 

[2] Smitha Menon and Charles Tia, “Joinder and Consolidation Provisions under 2021 ICC Arbitration Rules: Enhancing Efficiency and Flexibility for Resolving Complex Disputes”, Kluwer Arbitration, 2021.

[3] [https://jusmundi.com/en/document/decision/en-societe-nationale-doperations-petrolieres-de-la-cote-divoire-petroci-v-mrs-holdings-ltd-the-iccs-decision-to-consolidate-arbitration-friday-26th-january-2018#decision_18787]

[4] [https://jusmundi.com/en/document/decision/en-logistics-international-sal-offshore-and-logistics-international-investments-llc-v-the-republic-of-mozambique-proindicus-sa-and-empresa-mocambicana-de-atum-sa-ematum-composition-of-the-tribunal-wednesday-1st-january-2020]

[5] [https://jusmundi.com/en/document/decision/en-privinvest-shipbuilding-s-a-l-holding-v-the-republic-of-mozambique-proindicus-sa-and-empresa-mocambicana-de-atum-sa-ematum-judgment-of-the-high-court-of-justice-of-england-and-wales-2024-ewhc-3188-tuesday-10th-december-2024]

[6] [https://jusmundi.com/en/document/other/en-congolaise-dexploitation-miniere-sa-cominiere-and-jin-cheng-mining-company-limited-v-avz-international-pty-ltd-and-green-lithium-holdings-pte-ltd-press-release-of-avz-minerals-limited-on-related-arbitration-proceedings-update-wednesday-27th-september-2023]