Professional Ethics in Latin American Arbitration: An Imperative for 2030

Arbitration in Latin America faces a critical challenge: consolidating its legitimacy amid widespread corruption and distrust in legal institutions. In Peru, where prominent arbitrators have recently been linked to corrupt practices in arbitral awards, professional ethics is not merely an ideal but an urgent necessity to restore confidence. My tenure as President of the Specialized Chamber for the Elimination of Bureaucratic Barriers at INDECOPI demonstrated that transparency and impartiality are vital for resolving conflicts impacting businesses and citizens. For instance, issuing a transversal precautionary measure that halted a restrictive labor regulation from the Ministry of Labor prevented an economic collapse for thousands of companies by safeguarding labor outsourcing, underscoring how ethical decisions can have broad impact.

The IBA Conference, with sessions like "Regulatory change amid perennial political uncertainty," highlights the need for arbitrators who uphold integrity during unstable times. The International Bar Association’s Code of Ethics (IBA Guidelines, 2014) sets minimum standards, but in LATAM—especially Peru—we require stricter codes and concrete actions: sworn statements of assets and income, declarations of interests and potential conflicts, and voluntary waivers of communication, financial, banking, and tax secrecy. These measures, requested by arbitration centers or parties, reinforce independence and rebuild trust.

In a hypothetical public procurement case, I would arbitrate a dispute between a municipality and a supplier over a contract annulled for alleged irregularities. Leveraging my INDECOPI experience, I would assess the process’s legality, submitting public sworn statements to ensure impartiality, delivering a resolution that protects competitiveness without ethical compromise. Another example: a dispute between two firms over a service contract disrupted by an ambiguous municipal rule. I would use my regulatory expertise to determine the rule’s applicability, proposing a transparent solution that avoids favoritism and bolsters trust in the award.

References:

• International Bar Association. (2014). IBA Guidelines on Conflicts of Interest in International Arbitration.

• Kaufmann-Kohler, G., & Potestà, M. (2020). Investor-State Dispute Settlement and National Courts. Springer.