Points to ponder while selecting an Arbitration Institution
Choosing the right institution for arbitration can be a difficult task, but it is one of the most important decisions that the parties make when they agree to arbitration. While deciding to go for arbitration, the first and foremost decision is selecting between ad hoc arbitration or institutional arbitration. Both these types of arbitrations have their merits and demerits. With ad hoc arbitration, a little more thought is required from the parties because of the absence of any formal structure. Hence, it may be preferable for parties to create a detailed structure for the arbitration in the agreement by selecting an arbitration institution, the rules of which will govern the arbitration in case of any dispute that may arise. Institutional arbitration has several advantages like administrative assistance to the arbitral tribunal and parties and mechanisms for dealing with incomplete arbitration clauses and reluctant or non-participating respondents.
Therefore, it is of prime importance to select the 'right' arbitration institution. Parties can take into consideration different factors while choosing an institution. Factors such as;
- The cost-Each institution has its own administrative cost. The cost of arbitration for businesses may sometimes be the determinative factor on whether to pursue arbitration or not.
- Rules- The rules of the arbitration institution are also an important factor since the institution's rules will, in turn, help in the governance of the matter.
- Conduct of the Arbitral Proceeding- What is the procedure in which arbitral proceeding occurs in the institution.
- Reputation- While selecting the institution, it is vital to consider an institution's reputation regarding how timely and effective matters are resolved in that particular institution.
- The subject matter of the case- Parties should also consider the case and then decide which institution will be best for their case. There may be various regional arbitration institutions, but they might lack Real experience in administering disputes due to not having dealt with a sufficient number of cases related to the kind of dispute that may arise out of your contract.
There are numerous arbitration institutions around the globe. Some of the popularly recognized institutions are the London Court Of International Arbitration LCIA, International Court Of Arbitration ICC, Singapore International Arbitration Centre SIAC, Hongkong International Arbitration Centre HKIAC, German Arbitration Institute, Vienna International Arbitration Centre VIAC, Swiss Chambers Arbitration Institutions SCAI.
In conclusion, the choice must depend upon the particularities of the disputes that are likely to arise under the contract and the will of the parties involved with consideration to different factors mentioned above.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, or Religion, Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being. Further, despite all efforts made to ensure the accuracy and correctness of the information published, White Code VIA Mediation and Arbitration Centre shall not be responsible for any errors caused due to human error or otherwise.