ERDEM-NEWSLETTER-2018-metin

144 NEWSLETTER 2018 Consequences of the Failure to comply with Document Production Orders Consequences of the failure to comply with document production orders may be at the risk of negative impression by the arbitral tribunal, the risk of adverse inferences to be drawn by the arbitral tribunal, and disadvantages in the allocation of costs for the non-complying party. Risk of Negative Impression by the Arbitral Tribunal Arbitration, as an alternative dispute resolution mechanism, is based on party consent, aiming to resolve disputes before an arbitral tribunal, instead of through the state courts. Within this context, the parties who have agreed contractually to resolve their disputes through arbitration are under obligation to make the necessary efforts in good faith to ensure effective dispute resolution. The first possible consequence of the failure to comply with a document production order is that this may give a negative impression to the arbitral tribunal, who will decide the outcome of the case on its merits. Accordingly, any non-cooperative acts of the parties would, without any doubt, draw the attention of the arbitrators. Adverse Inferences The possibility for the arbitral tribunal to draw adverse inferences in case of the parties’ failure to produce requested documents is set forth under Art. 9/5 of the IBA Rules. Accordingly, if a party fails, without satisfactory explanation, to produce any document requested in a request to produce, to which it has not objected in due time, or fails to produce any document ordered to be produced by the arbitral tribunal, the tribunal may infer that such document would be adverse to the interests of that party. It should be emphasized that a request from the parties is not necessary in order for the arbitral tribunal to draw adverse inferences. Accordingly, within the scope of their authority to freely assess the evidence, the arbitrators have discretion to decide on this matter.