The Vietnam International Arbitration Centre ("VIAC" or the "Centre") has issued its 2026 Arbitration Rules (the "2026 Rules"), which apply to arbitrations commenced on or after 1 July 2026. Among the changes, the 2026 Rules address third-party funding ("TPF") for the first time, by requiring a funded party to disclose its funding agreement and the identity of its funder (Article 16.7).
TPF is a new concept for arbitration practice in Vietnam, but it has long been an established source of finance for claims in international arbitration, and most leading institutions and several Asian jurisdictions now regulate it. By addressing TPF, VIAC brings its rules closer to international practice and signals that funded cases are expected to become part of its caseload.
This article is the first in Asia Legal's series on TPF. It aims to give businesses and fellow practitioners a first, practical understanding of the mechanism, and is structured in three parts:
Part 1: Third-party funding – concept, benefits and risks;
Part 2: How leading arbitral institutions and jurisdictions regulate third-party funding;
Part 3: Third-party funding under the 2026 Rules – what has changed and what remains open.
PART 1: THIRD-PARTY FUNDING – CONCEPT, BENEFITS AND RISKS
1. What is third-party funding?
1.1 Definition
There is no single, universally accepted definition of TPF. In its most common form, TPF is an arrangement under which a person who is not a party to the dispute (the "funder") pays all or part of the costs of the proceedings, such as legal fees, arbitration fees and expert fees, in return for a share of whatever the funded party eventually recovers.[1]
What distinguishes TPF from an ordinary loan is that funding is usually provided on a non-recourse basis. If the case is lost, the funded party owes the funder nothing, and the funder bears the loss of its entire investment. Because the funder carries the risk of the dispute itself, it prices that risk into its return, which is commonly set as a multiple of the amount advanced, a percentage of the sums recovered, or whichever of the two is higher. In economic terms, a funder therefore resembles an investor buying a stake in the outcome of a case more than a lender.
Some instruments define TPF more broadly. The ICSID Arbitration Rules 2022, for example, also cover funds provided by way of donation or grant, not only funding provided in exchange for a share of the outcome.[2] The EU–Vietnam Investment Protection Agreement ("EVIPA") adopts a similar functional definition and, in addition, requires a funded disputing party to disclose the existence of funding and the funder's name and address.[3] Although EVIPA has not yet entered into force, it shows that Vietnam has already accepted, at treaty level, that TPF should be addressed through transparency rather than prohibition.
1.2. Common forms of funding
In practice, TPF takes several forms, each of which serves a different commercial purpose:
Single-case funding: the funder finances one specific claim, usually on the claimant's side. This remains the most common model and is the one that institutional rules mainly have in mind.
Portfolio funding: the funder finances a group of claims belonging to one company or handled by one law firm. Since losses in some cases can be offset by gains in others, the risk is spread and the cost of funding is usually lower than for a single case.
Defence-side funding: this is less common, because a successful defence produces no award to share. Where it is used, the funder's return is linked to other benchmarks, such as the amount the respondent avoids paying.
Award monetisation and enforcement funding: the funder pays the award creditor an upfront sum, or finances enforcement, in exchange for a share of what is eventually collected. This model is particularly relevant where the award debtor resists payment or holds assets in several jurisdictions.
Several related tools sit close to TPF. After-the-event insurance covers a party's exposure to the other side's costs if it loses, while conditional or contingency fee arrangements allow counsel to share the risk of the case with the client. Whether these arrangements fall within the term "TPF" depends on how each set of rules defines it. As discussed in Part 3, this question is directly relevant to the 2026 Rules, which do not define the term.
1.3. How a funding arrangement typically works
A funding arrangement usually goes through the following stages:
Screening and due diligence: the funder reviews the merits of the claim, the likely amount of recovery, the expected duration and budget of the proceedings and, above all, whether an award can actually be enforced against the respondent's assets. Professional funders are selective and generally only invest where the expected recovery is substantially larger than the budget required.
Term sheet and funding agreement: once the funder decides to invest, the parties agree on the budget, the funder's return, the order in which proceeds will be distributed, the funder's role in key decisions such as settlement, and the circumstances in which either side may terminate the arrangement.
Conduct of the proceedings: the funded party and its counsel continue to run the case, while the funder monitors progress and releases funds in tranches according to the agreed budget.
Distribution of proceeds: if the claim succeeds, the sums recovered are distributed according to an agreed order of priority, often called a "waterfall", which typically repays the funder's investment and return before the balance goes to the funded party.
Each of these stages raises a legal question that may later reach the tribunal: what information the funder may see, who decides whether to settle, and how the funder's return interacts with the allocation of the costs of the arbitration. This explains why institutional rules, including the 2026 Rules, have begun to address TPF directly rather than treating it as a purely private arrangement between the funder and the funded party.
2. Benefits of third-party funding
TPF has grown from a niche product into a mainstream tool of dispute finance. According to one recent study, around 16% of the cases heard before ICSID between July 2022 and April 2025 involved TPF.[4] This growth rests on several practical benefits, which are not limited to parties in financial difficulty.
Access to justice: arbitration requires significant upfront spending on advances on costs, counsel and experts, often long before any award is rendered. A party with a strong claim may therefore be unable to pursue it, sometimes because the counterparty's breach is the very cause of its financial difficulty. TPF allows such a claim to be decided on its merits rather than abandoned, or settled at a heavy discount, for lack of funds.
Risk transfer and balance-sheet management: companies with adequate resources also use TPF, but for different reasons. By shifting the cost and risk of a dispute to the funder, they can keep working capital in their business, avoid recording large legal expenses with an uncertain outcome, and turn a legal claim into an asset that can be valued and financed. For listed companies and companies preparing for a transaction, the effect on financial statements can be material.
An independent check on the merits: a professional funder invests only after its own due diligence on liability, quantum and enforceability. A decision to invest is therefore a commercially motivated second opinion on the strength of the case. Conversely, repeated refusals by funders are a signal that the party and its counsel should not ignore.
Equality of arms: where a small or medium-sized business faces a much larger counterparty, funding narrows the gap in resources that each side can deploy. This reduces the risk that the dispute is decided by which side can bear the cost of the proceedings for longer, rather than by the merits.
Flexibility for law firms and clients: TPF allows law firms to offer fee structures other than hourly billing, while the client remains free to choose its counsel. For in-house legal teams, it also brings budget certainty to cases that would otherwise be difficult to justify internally.
3. Risks and concerns
The benefits of TPF come with risks, both for the funded party and for the integrity of the proceedings. These risks explain why institutions and legislators have chosen to regulate TPF, instead of leaving it entirely to the terms of private contracts.
The cost of funding: because the funder bears the risk of losing its entire investment, funding is considerably more expensive than a conventional loan. In Essar v Norscot, for example, the funder advanced around £647,000 and was entitled, on success, to the greater of 300% of the amount advanced or 35% of the recovery, and the award ultimately included just over £1.94 million in funding costs.[5] A party considering TPF should therefore assess its likely net recovery after the funder's share, not only the gross value of its claim, and compare the cost of funding with that of other available sources of finance.
Control over the proceedings: a funder has a strong economic interest in how the case is run and may seek a say in the choice of counsel, the strategy, the budget and, above all, settlement. Excessive control may conflict with the funded party's autonomy and with counsel's duties to the client, and may give the other side grounds to challenge the conduct of the proceedings. For this reason, Hong Kong's Code of Practice requires the funding agreement to confirm that the funded party retains control of the proceedings.[6] In practice, the balance between protecting the funder's investment and preserving the client's control is one of the most heavily negotiated points in any funding agreement.
Conflicts of interest: the funding market is relatively small, and funders are repeat players. An arbitrator may have links to a funder, for example through earlier appointments in cases financed by the same funder, or through a law firm that has a funding relationship with it. Such links cannot be disclosed or assessed if the funder's identity is unknown, and they may later lead to a challenge against the arbitrator or an application to set aside the award. The 2024 IBA Guidelines on Conflicts of Interest in International Arbitration respond to this risk by treating an entity with a controlling influence on a party, or a direct economic interest in the award, as potentially bearing the identity of that party.[7] This is the main reason why the disclosure of the funder's identity has become the core of most institutional rules on TPF.
Confidentiality and privilege: to assess and monitor a case, a funder needs access to pleadings, evidence and legal advice. Sharing these materials may breach confidentiality obligations under the arbitration agreement or the applicable rules and, in some jurisdictions, may put legal privilege at risk. A funded party therefore needs to control what it shares, when and on what terms, usually through a confidentiality agreement with the funder.
Adverse costs and security for costs: since the funder is not a party to the arbitration agreement, the tribunal generally has no jurisdiction to order it to pay costs. This is the main concern for respondents: a claimant with few assets, funded at little risk to itself, may pursue a claim and then be unable to pay the respondent's costs if the claim fails. The presence of a funder has therefore become a relevant factor in applications for security for costs.
Withdrawal of funding and speculative claims: a funder may withdraw mid-way through the proceedings if its assessment of the case changes, leaving the funded party without resources at a critical stage. The grounds and consequences of termination therefore need to be agreed carefully at the outset. Critics also argue that TPF encourages speculative claims. In practice, the selectivity of professional funders limits this risk, since a funder has no interest in financing a claim it expects to lose, but the concern remains part of the policy debate.
PART 2: HOW LEADING ARBITRAL INSTITUTIONS AND JURISDICTIONS REGULATE THIRD-PARTY FUNDING
1. Rules of leading arbitral institutions
Over the past decade, most leading arbitral institutions have added TPF provisions to their rules. None of them prohibits TPF, and none requires the funding agreement to be produced in full as a matter of course. Their focus is narrower and practical: making the funder visible so that conflicts of interest can be identified, and giving the tribunal tools to deal with the consequences of funding.
1.1. ICC
Article 11(7) of the ICC Arbitration Rules 2021 requires each party to promptly inform the Secretariat, the tribunal and the other parties of the existence and identity of any non-party that has entered into an arrangement for the funding of claims or defences and has an economic interest in the outcome of the arbitration.[8] The provision sits within the rules on arbitrator independence. This placement shows that its purpose is to enable conflict checks, not to regulate the funding relationship itself.
1.2. SIAC
Rule 38 of the SIAC Arbitration Rules 2025 contains one of the most detailed regimes among the leading institutions.[9] It provides for:
the disclosure of the existence of the funding agreement and of the identity and contact details of the funder, at the outset or as soon as practicable after the agreement is concluded, with a continuing duty to update that disclosure;
a prohibition, once the tribunal is constituted, on entering into a funding agreement that would create a conflict of interest with a member of the tribunal;
a power for the tribunal to order further disclosure, including the funder's interest in the outcome and whether the funder has committed to cover adverse costs;
an express statement that disclosure does not, by itself, indicate the funded party's financial status;
a power to take the funding agreement into account when apportioning costs, and to impose measures for non-compliance.
The SIAC model is notable because it covers the whole life of a funding arrangement, from disclosure to costs, rather than disclosure alone. It also anticipates the tactical use of TPF, for instance a funding agreement concluded after the tribunal is constituted in order to create a conflict and disrupt the proceedings.
1.3 HKIAC
The HKIAC introduced TPF provisions in its 2018 Administered Arbitration Rules. Article 44 requires disclosure of the funding agreement and the identity of the funder, and Article 34.4 allows the tribunal to take funding arrangements into account when deciding the costs of the arbitration.[10] The latter provision is significant in practice, since it opens the possibility for a successful funded party to recover its funding costs from the losing party.
1.4 ICSID
Rule 14 of the ICSID Arbitration Rules 2022 requires a party to file a written notice of the name and address of any funder and, where the funder is a legal person, of the persons and entities that own and control it. Rule 53 requires the tribunal to take TPF into account when deciding on an application for security for costs.[11] The requirement to disclose the funder's owners reflects a concern specific to investor-State disputes, where States want to know who ultimately stands behind a claim brought against them.
1.5 CIETAC
Article 48 of the CIETAC Arbitration Rules 2024 requires the funded party to disclose the existence of the funding agreement, the financial interest involved and the funder's identity. The tribunal may order further disclosure and, when allocating costs, may consider both the funding arrangement and whether the party complied with its disclosure obligation.[12] As the rules of a leading Chinese institution, they show that the regulation of TPF is no longer confined to arbitral centres in common law jurisdictions.
1.6 Comparison and assessment
Institution
Rules
Mandatory disclosure
Further powers of the tribunal
ICC
2021 Rules, Art. 11(7)
Existence of funding and identity of the funder
Conflict checks within the independence regime
SIAC
2025 Rules, Rule 38
Existence of funding; identity and contact details of the funder; subsequent changes
Further disclosure; bar on conflicting funding; costs; sanctions
HKIAC
2018 and 2024 Rules, Arts. 44 and 34.4
Existence of funding and identity of the funder
Funding taken into account in costs
ICSID
2022 Rules, Rules 14 and 53
Name and address of the funder; its owners and controllers
Further disclosure; funding considered in security for costs
CIETAC
2024 Rules, Art. 48
Existence of funding; financial interest; identity of the funder
Further disclosure; funding and compliance considered in costs
[1] Trần Nguyễn Phước Thông (2022) ‘Tài trợ của bên thứ ba trong tố tụng trọng tài trên thế giới và khuyến nghị cho Việt Nam’ [Third-party funding in arbitral proceedings worldwide and recommendations for Vietnam], Tạp chí Dân chủ và Pháp luật, 19 December. Available at: https://danchuphapluat.vn/tai-tro-cua-ben-thu-ba-trong-to-tung-trong-tai-tren-the-gioi-va-khuyen-nghi-cho-viet-nam-3004.html (Accessed: 31 October 2026).
[2] ICSID Arbitration Rules 2022, r. 14. See also Favro, A. (2022) ‘New ICSID Arbitration Rules: a further step in the regulation of third-party funding’, Kluwer Arbitration Blog, 3 June. Available at: https://legalblogs.wolterskluwer.com/arbitration-blog/new-icsid-arbitration-rules-a-further-step-in-the-regulation-of-third-party-funding/ (Accessed: 31 October 2026).
[3] EU–Vietnam Investment Protection Agreement (signed 30 June 2019), arts 3.28 and 3.37. See Trần Đức Bảo Duy and Nguyễn Hương Giang (2026) ‘Nghĩa vụ công khai tài trợ bên thứ ba theo Điều 3.37 EVIPA: Đánh giá tính khả thi và đề xuất hoàn thiện pháp luật Việt Nam’ [Third-party funding disclosure under Article 3.37 EVIPA: feasibility and proposals for Vietnamese law], Luật sư Việt Nam, 27 August. Available at: https://lsvn.vn/nghia-vu-cong-khai-tai-tro-ben-thu-ba-theo-dieu-3-37-evipa-danh-gia-tinh-kha-thi-va-de-xuat-hoan-thien-phap-luat-viet-nam-a178308.html (Accessed: 31 October 2026).
[4] McDonald, P. and Tonova, S. (2026) ‘Global uptick in third-party funding in international arbitration’, Out-Law (Pinsent Masons), 31 March. Available at: https://www.pinsentmasons.com/en-gb/out-law/analysis/global-uptick-third-party-funding-international-arbitration (Accessed: 31 October 2026).
[5] Essar Oilfields Services Ltd v Norscot Rig Management Pvt Ltd [2016] EWHC 2361 (Comm). See also Osborne Clarke (2021) ‘Court confirms third party funding costs may be recoverable in arbitration’, Osborne Clarke Insights, 13 July. Available at: https://osborneclarke.com/insights/court-confirms-third-party-funding-costs-may-be-recoverable-in-arbitration (Accessed: 31 October 2026).
[6] Code of Practice for Third Party Funding of Arbitration (Hong Kong, 2018). See HFW (2026) ‘Funding options in Hong Kong-seated arbitrations’, HFW Insights, 17 July. Available at: https://www.hfw.com/insights/funding-options-in-hong-kong-seated-arbitrations/ (Accessed: 31 October 2026).
[7] IBA Guidelines on Conflicts of Interest in International Arbitration (2024), General Standard 6(b) and its Explanation. See Bayrou, S. (2024) ‘Conflicts of interest in international arbitration’, Clyde & Co Insights, 17 July. Available at: https://www.clydeco.com/en/insights/2024/07/conflicts-of-interest-in-international-arbitration (Accessed: 31 October 2026).
[8] ICC Arbitration Rules 2021, art. 11(7). See Budak, S.A., Uluç, Ş. and Arda, İ.N. (2021) ‘An overview of third party funding in the 2021 ICC Arbitration Rules’, Hergüner Bilgen Özeke Newsletter, Summer/Fall. Available at: https://www.theworldlawgroup.com/writable/documents/news/An-Overview-of-Third-Party-Funding-in-the-2021-ICC-Arbitration-Rules.pdf (Accessed: 31 October 2026).
[9] Singapore International Arbitration Centre (2025) SIAC Arbitration Rules (7th edn), effective 1 January 2025, r. 38. Available at: https://lexmea.de/en/gesetz/siac-arb/38 (Accessed: 31 October 2026).
[10] HKIAC Administered Arbitration Rules 2018, arts 44 and 34.4. See Cleary Gottlieb Steen & Hamilton (2018) ‘The HKIAC Council approves the 2018 Administered Arbitration Rules’, Alert Memorandum. Available at: https://www.clearygottlieb.com/-/media/files/alert-memos-2018/the-hkiac-council-approves-the-2018-administered-arbitration-rules.pdf (Accessed: 31 October 2026).
[12] CIETAC Arbitration Rules 2024, art. 48. See DLA Piper (2024) ‘Reshaping the landscape for third-party funding in China: new CIETAC Arbitration Rules on TPF’, DLA Piper Insights, 10 January. Available at: https://www.dlapiper.com/insights/publications/2023/12/reshaping-the-landscape-for-third-party-funding-in-china-new-cietac-arbitration-rules-on-tpf (Accessed: 31 October 2026).
Three common features emerge from these rules. First, mandatory disclosure is limited to the existence of funding and the identity of the funder, which is the minimum needed for conflict checks and leaves commercially sensitive terms, such as the funder's return, protected. Second, further disclosure is left to the tribunal's discretion, reflecting the view that issues such as security for costs are best decided on the facts of each case. Third, the more recent rules link TPF to costs, so that funding is treated not only as a question of independence but also as a factor in allocating the financial consequences of the case. As discussed in Part 3, the 2026 Rules adopt the first two features but not yet the third.
2. Experience of selected jurisdictions
Institutional rules govern the procedure. Whether a funding agreement is lawful and enforceable remains a matter for national law, and the experience of the following jurisdictions shows the different approaches taken to that question.
2.1 Singapore
In common law systems, TPF historically ran up against the doctrines of maintenance and champerty, which prohibited a stranger from supporting another person's litigation in exchange for a share of the proceeds. In 2017, Singapore amended its Civil Law Act to abolish these torts and expressly permit TPF for international arbitration and related court and mediation proceedings, provided that the funder meets the capital and other requirements of the Civil Law (Third-Party Funding) Regulations 2017. From 28 June 2021, the framework was extended to domestic arbitration and to proceedings before the Singapore International Commercial Court, and lawyers acting in funded cases are bound by professional conduct rules on conflicts of interest and disclosure.[1] The Singapore model reflects a staged approach: TPF was first allowed where users are most sophisticated, and only extended once the market and its safeguards had matured.
2.2 Hong Kong
Hong Kong added Part 10A to its Arbitration Ordinance, which took effect on 1 February 2019 and removed the common law prohibitions for arbitration and related proceedings. A Code of Practice sets standards for funders, including the requirement for a written funding agreement, the funded party's right to independent legal advice and its control over the proceedings. The funded party must disclose the funding agreement, the identity of the funder and any termination of the agreement. Since December 2022, lawyers have also been able to enter into outcome-related fee structures for arbitration within statutory limits.[2] Hong Kong thus illustrates a "light-touch" model, in which legislation removes the legal obstacle and a code of practice, rather than a licensing regime, sets the standards of conduct.
2.3 England and Wales
England and Wales is one of the largest funding markets, yet its framework rests largely on case law. In Essar v Norscot, the English High Court held that the power of an arbitral tribunal to award "other costs" may in principle extend to the costs of funding.[3] In R (PACCAR Inc) v Competition Appeal Tribunal, however, the UK Supreme Court held that funding agreements under which the funder receives a percentage of damages may constitute damages-based agreements, which are unenforceable unless they meet strict statutory requirements. The Civil Justice Council recommended reversing this outcome in June 2025, and the Government announced in December 2025 that it would legislate, but no such bill was included in the King's Speech of 13 May 2026.[4] The English experience shows that legal certainty about the enforceability of funding agreements matters as much as procedural rules: a single judgment has left a mature market in uncertainty for several years.
2.4 Malaysia
Malaysia provides the most recent example in the region. The Arbitration (Amendment) Act 2024 and the Code of Practice for Third Party Funding 2026 put in place a TPF regime effective from 1 January 2026. The regime disapplies maintenance and champerty for arbitration funding, requires the funding agreement and the funder's identity to be disclosed within 15 days of signing, sets a minimum capital of MYR 10 million for funders and prohibits funders from controlling the proceedings or the settlement.[5] Malaysia's approach goes further than disclosure alone, since it also regulates the financial capacity and conduct of funders directly.
2.5 Lessons for Vietnam
Two observations can be drawn for Vietnam. First, Vietnam's starting point differs from that of the common law jurisdictions above. As a civil law system, Vietnam has no doctrine of maintenance and champerty to abolish. The obstacle to TPF in Vietnam is therefore not a prohibition, but the absence of rules that give users confidence about the validity of funding agreements, the protection of confidential information and the treatment of funding costs.
Second, the regional experience shows that institutional rules and legislation play complementary roles. Institutional rules can secure transparency within each case, but only legislation can settle questions such as the validity of funding agreements, the qualifications required of funders and the interaction between funding and the professional conduct rules for lawyers.
PART 3: THIRD-PARTY FUNDING UNDER THE 2026 RULES – WHAT HAS CHANGED AND WHAT REMAINS OPEN
1. The new provisions
1.1 Content of the provisions
The 2026 Rules address TPF at three points:
the Request for Arbitration and the Statement of Defence must each include information on any TPF agreement (Articles 7.2(h) and 9.2(e));
a party that has entered into a TPF agreement must disclose this fact to the Centre and the Arbitral Tribunal in its Request for Arbitration or Statement of Defence, or as soon as possible after concluding the agreement, and the disclosure must include the name and contact address of the funder (Article 16.7);
beyond what the parties have disclosed, the Arbitral Tribunal may, after considering the parties' views, require further disclosure of information contained in the TPF agreement (Article 16.7).
1.2. Legal context
The Law on Commercial Arbitration 2010 does not address TPF, and no Vietnamese statute expressly recognises or prohibits it. Vietnamese commentators generally consider that funding agreements rest on the principle of freedom of contract under the Civil Code, while noting that the absence of specific rules may cause difficulties in practice.[6] Some have also recommended that TPF be addressed when the Law on Commercial Arbitration is next amended.[7] Against this background, the 2026 Rules do not create the legal basis for TPF, which still derives from general contract law. What they provide is the first procedural framework for funded cases at VIAC.
1.3. Assessment
The 2026 Rules follow the disclosure model of the ICC and SIAC: mandatory disclosure is limited to the existence of funding and the identity of the funder, and anything further is left to the tribunal. This light-touch approach appears well suited to a market in which TPF is still at an early stage. It addresses the most immediate risk, namely an undisclosed link between a funder and an arbitrator that could later put the award at risk, without imposing regulatory burdens that might deter funders before the market has developed.
The provision also has a signalling effect. For international funders, the existence of clear disclosure rules indicates that VIAC arbitration is a forum in which funded cases are anticipated and can be managed. For Vietnamese businesses, it confirms that funding a claim is a recognised practice rather than an irregular arrangement to be hidden from the tribunal. Over time, this may make VIAC more attractive for disputes in which one party needs external finance to bring or defend a claim.
2. Questions left open
As a first step, Article 16.7 is deliberately concise. Several questions are therefore left to practice or to future guidance from VIAC.
Scope of the obligation: the 2026 Rules do not define a "TPF agreement". It is unclear whether the term covers a lawyer's contingency fee arrangement, after-the-event insurance, a portfolio funding facility, or financing provided by a parent company. Funding by a shareholder rarely raises conflict concerns, but it may still fall within the literal wording. Until the scope is clarified, the prudent course is to read the obligation broadly, since the consequences of failing to disclose are far more serious than the cost of disclosing.
Recipients of the disclosure: Article 16.7 refers to disclosure to the Centre and the Arbitral Tribunal. Where the information is included in the Request for Arbitration or the Statement of Defence, the other party will receive it with that document. Where disclosure is made later, the rules do not expressly require the other party to be informed, whereas the ICC Rules require notice to all parties.[8] The other party has a legitimate interest in this information, both to check the independence of the arbitrators and to consider its position on costs. The tribunal can close this gap through procedural directions at the first case management conference (Articles 16.2 to 16.5).
Costs: under Article 41.2, the Arbitral Tribunal may order a party to pay all or part of the other party's legal costs or other reasonable costs. The rules do not say whether the funder's return can form part of these costs, or whether the existence of funding is relevant to their allocation. Two readings are possible. On a narrow reading, the funder's return is a cost of financing rather than a cost of the arbitration and is not recoverable. On a broader reading, as in Essar v Norscot, it may be recovered as an "other reasonable cost". Without clearer guidance, a funded party should not assume that it will recover the funder's return from the other side, and should price its funding on that basis.
Security for costs and consequences of non-disclosure: the 2026 Rules do not link TPF to applications for security for costs, nor do they set specific consequences for a failure to disclose. In practice, the consequences of non-disclosure are most likely to surface later, through a challenge against an arbitrator or an application to set aside the award once an undisclosed link between the funder and an arbitrator comes to light. The absence of an express sanction in the rules therefore does not make non-disclosure a safe option.
Confidentiality: Article 42.3 prohibits the parties, among others, from disclosing information or documents relating to the dispute to third parties, unless the parties agree otherwise or the law provides otherwise. A funder needs exactly this information, both before deciding to invest and while monitoring the case. Since the 2026 Rules contain no specific exception for funders, a funded party should obtain the other party's consent or a direction from the tribunal before sharing case materials, and should bind the funder by a confidentiality undertaking. For new contracts, parties may also consider including in the arbitration clause an express permission to disclose information to actual or prospective funders and insurers.
Arbitrator independence: Article 12.2 requires arbitrators to disclose, throughout the proceedings, any circumstances that may affect their independence and impartiality. The disclosure of the funder's identity is what makes this obligation workable in funded cases. The 2024 IBA Guidelines remain a useful reference for assessing whether a relationship between an arbitrator and a funder should be disclosed.[9]
CONCLUSION
The 2026 Rules mark the first time that VIAC has formally recognised TPF in its rules. The approach taken is cautious and consistent with international practice: it makes the funder visible without regulating the funding relationship itself. For businesses, this opens a recognised path to finance claims that might otherwise not be pursued. For lawyers and arbitrators, it raises new questions on scope, costs, confidentiality and conflicts of interest, to which the experience of the ICC, SIAC, HKIAC, ICSID and CIETAC offers useful answers. The next parts of this series will examine these questions in more depth, including the structure of funding agreements and the position of TPF under Vietnamese law.
[1] Civil Law Act 1909 (Singapore), ss. 5A and 5B; Civil Law (Third-Party Funding) Regulations 2017. See Ministry of Law Singapore (2021) ‘Third-party funding to be permitted for more categories of legal proceedings in Singapore’ [Press release], 21 June. Available at: https://www.mlaw.gov.sg/news/press-releases/2021-06-21-third-party-funding-framework-permitted-for-more-categories-of-legal-preceedings-in-singapore/ (Accessed: 31 October 2026). See also Yeap, A. and Poon, K. (2021) ‘Singapore extends scope of permissible third-party funding’, Rajah & Tann Asia – Arbitration Asia, 30 June. Available at: https://arbitrationasia.rajahtannasia.com/singapore-extends-scope-of-permissible-third-party-funding/ (Accessed: 31 October 2026).
[2] Arbitration Ordinance (Cap. 609) (Hong Kong), Parts 10A and 10B; HFW (2026).
[4] R (on the application of PACCAR Inc) v Competition Appeal Tribunal [2023] UKSC 28. See also Akin Gump Strauss Hauer & Feld (2026) ‘UK Government omits PACCAR fix from 2026 King’s Speech, leaving litigation funding reform uncertain’, Akin Gump Alerts, 14 May. Available at: https://www.akingump.com/en/insights/alerts/uk-government-omits-paccar-fix-from-2026-kings-speech-leaving-litigation-funding-reform-uncertain (Accessed: 31 October 2026).
[5] Arbitration (Amendment) Act 2024 (Malaysia); Code of Practice for Third Party Funding 2026 (Malaysia). See Dearness, M. and Manoosegaran, A. (2026) ‘Malaysia embraces third party funding in arbitration: a new era begins’, Omni Bridgeway Insights, 3 February. Available at: https://omnibridgeway.com/insights/blog/blog-posts/global/2026/02/03/malaysia-embraces-third-party-funding-in-arbitration-a-new-era-begins (Accessed: 31 October 2026).
[6] Đào Thu Trang, Hủn Vi Đan Thùy and Dương Ngọc Phương (2024) ‘Về mô hình “tài trợ của bên thứ ba” trong tố tụng trọng tài thương mại ở Việt Nam qua pháp luật’ [The third-party funding model in commercial arbitration in Vietnam], Luật sư Việt Nam, 31 May. Available at: https://lsvn.vn/ve-mo-hinh-tai-tro-cua-ben-thu-ba-trong-to-tung-trong-tai-thuong-mai-o-viet-nam-qua-phap-luat-1717079921-a144130.html (Accessed: 31 October 2026).
[9] IBA Guidelines on Conflicts of Interest in International Arbitration (2024), General Standards 6(b) and 7(a); Bayrou (2024).
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