Withdrawing an arbitration claim: consent, costs and ending the case

A party that wants to withdraw an arbitration claim must prepare the ending of the proceedings separately from the question of costs. Under Section 608(2)(2) ZPO, the tribunal must generally end the arbitration after withdrawal. The respondent may object where the respondent has a legitimate interest in a final determination of the dispute.

Article 34(2)(2.1) of the Vienna Rules contains a comparable rule for VIAC proceedings. Whether the tribunal or, before the case is transferred, the Secretary General deals with the ending depends on the procedural stage. Withdrawal alone therefore does not settle who bears which costs.

This article addresses only the withdrawal of an arbitration claim that has already been filed, a possible objection by the respondent, the form in which the case ends and preparation for the costs decision. Amendments, settlements, partial awards and missed procedural acts raise separate questions.

What Section 608 ZPO provides on withdrawal

Section 608(1) ZPO identifies an award on the merits, an arbitral settlement and an order under paragraph 2 as forms in which arbitration ends. Withdrawal therefore leads to an order ending the proceedings when the requirements of paragraph 2(2) are met.

As a rule, the tribunal must end the arbitration when the claimant withdraws the claim. This concerns the pending arbitration itself. It must be kept separate from whether the underlying claim still exists, has become time-barred or could be brought again in a permissible proceeding.

When the respondent may object to withdrawal

The respondent does not need to consent to every withdrawal. An objection has particular weight where the respondent has a legitimate interest in a final determination of the dispute. The tribunal must recognise that interest before it can refuse to end the case as a consequence of the withdrawal.

The concrete procedural record is decisive. The review should identify the relief sought, any opposing position, steps already taken and the reason a final determination is requested. A general statement that the respondent wants to continue is not enough to explain that interest.

Which body ends the proceedings

In ordinary arbitration, the tribunal issues the order ending the proceedings. In a VIAC case, Article 34 of the Vienna Rules distinguishes whether the case has already been transferred to the tribunal. Before that transfer, the Secretary General may declare the ending in the cases listed in Article 34(3).

This distinction affects the correct recipient and procedural communication. The withdrawal should therefore be sent to the body identified in the case and its receipt should be recorded. An email without a verifiable version or time can create avoidable uncertainty later.

How to prepare the costs decision

Under Section 609 ZPO, the tribunal decides on reimbursement of costs when the arbitration ends unless the parties agreed otherwise. It exercises discretion in light of the circumstances, including the outcome of the proceedings. Withdrawal therefore does not produce an automatic allocation of costs.

For VIAC cases, Article 38 of the Vienna Rules provides for the determination, on a party’s request, of the costs fixed by the Secretary General, reasonable party costs and other expenses. The conduct of the parties and their representatives may also be taken into account. A party seeking reimbursement should document the relevant items, advances and procedural contribution clearly.

Separate withdrawal from a new arbitration

The order ending the case generally addresses the pending arbitration. It is therefore not automatically a decision on the merits of the underlying claim. Whether a new arbitration is permissible and useful depends on the arbitration agreement, the dispute and the applicable rules.

Limitation periods and contractual forfeiture periods are not automatically protected because a case was once filed. A separate time-limit overview is needed before withdrawal. The guide to preparing a VIAC request for arbitration explains which information should be clear from the outset when a new case is commenced.

Documents that matter for the review

The review should include the arbitration agreement, applicable rules, request for arbitration, all withdrawal statements, the respondent’s submissions and previous orders. In a VIAC case, add Secretariat notices, evidence of case transfer and payment requests.

Also arrange advances, invoices, payment records and the current procedural timetable. Withdrawal must be distinguished from covering another party’s unpaid VIAC advance. A partial award addresses a different issue because it resolves part of the dispute before the final award. The article on a timely response in arbitration provides a further example of why the procedural record and receipt dates matter.

Common questions about withdrawing an arbitration claim

Does the respondent have to consent to withdrawal of an arbitration claim?

Consent is not generally required. The respondent may object where there is a legitimate interest in a final determination of the dispute. The tribunal assesses whether that interest is recognised on the facts and procedural record.

Does withdrawal end the case immediately?

The withdrawal itself is not the order that ends the case. Under Section 608 ZPO, the proceedings end through the required order. In a VIAC case, it must also be checked whether the case has already been transferred to the tribunal.

Who pays the costs after withdrawal?

Withdrawal does not automatically determine the allocation. Under Section 609 ZPO and, for VIAC cases, Article 38 of the Vienna Rules, the tribunal decides reimbursement and allocation under the applicable agreement and the circumstances of the case.

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Next step

Contract, arbitration clause, correspondence and deadlines should be collected. It can then be assessed whether negotiation, preservation or arbitration is central.