Can the arbitrator require security for fees and expenses during the Chatime arbitration?

According to Chatime's 2025 Franchise Disclosure Document, the arbitrator has the authority to require parties to provide security for arbitration fees and expenses. Specifically, after accepting the appointment and during the arbitration, the arbitrator may require the parties to deposit security or additional security to cover the arbitrator's fees and expenses. The arbitrator can then use this security to pay for those fees and expenses.

However, the arbitrator is explicitly prohibited from ordering a party to provide security for the arbitration costs that will be incurred by the opposing party. This means that while a Chatime franchisee may be required to secure funds for their own share of the arbitrator's fees and expenses, they cannot be compelled to cover the franchisor's arbitration costs.

This arrangement provides a degree of protection for Chatime franchisees, as they are not responsible for securing the franchisor's costs. However, franchisees should still be prepared to potentially lodge security for their own arbitration expenses, which could include the arbitrator's fees. It is important to note that the fees and expenses of the proceeding may be awarded by the Arbitrator to the prevailing party. If not awarded, the parties shall bear their own fees, costs and expenses, and the charges of the arbitration service and arbitrator shall be split between the parties.