Latest News
INTERNATIONAL ARBITRATION VS. LITIGATION
The resolution of disputes in the existing court systems has its advantages. Judges are independent at most times, they file fees as much less than arbitration fees as possible and there also exists a write to appeal. Notwithstanding these and the other positive attributes, however, the effort to obtain the judgment of the court is time-consuming and requires legal expertise in the jurisdiction where litigation is filed. Also, it is often more difficult for businesses to maintain their work relationships between a public legal battle. On the contrary, the confidential nature of arbitration may take at least some of the tension out of the public business conflict. The arbitration forum also brings down the favor of the ability to select the arbitrator, language of the proceedings, and place of hearings as well. Along with these, complicated rules of procedure and evidence can be modified or excluded in arbitration unlike in court proceedings. The parties can contemplate the extent of the award or the type of damages, beforehand, which allows the parties themselves to draft an appropriate arbitration clause and plan with proper reserves. The greatest strength of international arbitration is to design procedural and substantive flexibility. Carefully drafted arbitrator clause results in significant control over the way a dispute is decided and how much it can cost to achieve the resolution. 90 percent of the international contracts happen to include an arbitration clause. International commercial arbitration gets an increasing amount of attention from investors and corporations. They turn towards arbitration as the preferred method of dispute resolution of international business disputes.
The one thing that makes arbitration more attractive than the courts is the speed of resolution in most nations, if not all. The U.S. federal court system collected some data that shows that the median time to get to the trail is over 23 months. In the case of arbitration, in the U.S. the time that takes from a claim to reaching a decision is 16.7 months, on average. The London-based Centre believes that for Effective Dispute Resolution, of over 3000 commercial disputes that are subjected to mediation in London each year, around 70-80 percent settles with just one or two days, while the further of 10-15 percent settles just a few weeks later. According to the Korean Commercial Arbitration Board, the matters that are brought for international arbitration are possessed in five months on average, whereas the similar matters brought in the Korean court system can take up to two to three years. This clearly shows that commercial arbitration offers distinct time-saving benefits.
The difference that lies between the enforceability of a court judgment and that of an arbitral award even favors the use of arbitration. There is no effective international treaty that would facilitate the enforcement of foreign judgments whereas the same isn’t true when it comes to the matter of arbitral awards. There are present, 142 countries out of 192 United Nations Member States that have adopted the New York Convention, and the majority of international arbitration agreements are within its application. If an arbitration award, under the New York Convention is issued in any country that is a party to the Convention every other party to the convention would be legally obligated to enforce the award. Arbitration is now often included in the bilateral investment treaties negotiated at an increasing number as a means to resolve disputes between foreign states and private oversees investors. The smooth enforcement is yet another reason why international arbitration continues to grow.
- Time-saving
- Control over the dispute
- Commercial arbitration
