International arbitration is similar to domestic court litigation, except it takes place before private adjudicators known as arbitrators rather than a domestic court. It is a private, enforceable, consensual, neutral, binding, and enforceable method of resolving international disputes that is often faster and less expensive than domestic court proceedings.
International arbitration has emerged to allow parties from various legal, linguistic, and cultural backgrounds to resolve their issues in a final and binding manner, often without the formality of their own legal systems' procedural standards.
How Are International Arbitration Awards Enforced?
Arbitration rulings, unlike traditional court verdicts, can be enforced in most countries thanks to the New York Convention, which went into effect on June 7, 1959. Today, the New York Convention has been adopted by over 150 nations, implying that arbitration judgements can be enforced in almost 3/4 of the countries recognized by the United Nations.
The governing law of a contract, or the law of tort relating to a contract, the arbitration laws of the seat of arbitration, and the New York and Washington conventions are the primary laws on which international arbitration lawyers fight a case (alternatively known as the ICSID Convention).
What Is Fast-Track International Arbitration?
To guarantee that disputes are resolved quickly, the parties can agree to resolve arbitrations using "fast-track" or "expedited" arbitration, which is arbitration with procedural procedures designed to ensure that issues are resolved quickly. It's also a good idea to choose a competent arbitrator and competent legal counsel with extensive experience in international arbitration law and process. There is also a provision which gives an option to go for fast-track arbitration and finish the entire process in 6 months.
International Commercial Arbitration's Advantages and Disadvantages
Despite its popularity as an alternate technique for resolving international commercial disputes, international commercial arbitration has both strengths and weaknesses in many areas. The neutrality of arbitrators or international arbitration institutions, the enforceability of arbitral awards in foreign countries, the flexibility of the arbitration process, and the confidentiality of arbitration proceedings are frequently cited as the most beneficial features of international commercial arbitration, despite some criticisms. While the expense and slowness of this method make it inherently disadvantaged.
A Neutral Decision
Parties to international commercial contracts are virtually always from different nations. Because of this feature of international commercial treaties, arbitration is a better option for resolving disputes than going to the national court of the opposing party. Parties can either nominate an arbitrator from another country or request an appointment from an international arbitral tribunal. They gain neutrality in the selection of legislation, venue, procedure, and tribunal in this way.
An Enforceable Decision
The final award of an arbitral tribunal is a directly enforceable decision both nationally and internationally since it is a binding decision rather than a recommendation. In this regard, an arbitral tribunal's decision differs from that of a national court of law. International accords governing the execution of arbitral rulings, such as the New York Convention, are more widely accepted than reciprocal judgement enforcement.
Flexibility of Arbitral Process
There are no set rules that must be followed during an arbitration process. International commercial arbitration gives the parties a lot of freedom in deciding on procedural rules and deadlines, as well as choosing a technically expert decision-maker who is most suited to their specific dispute.
Unlike hearings in national courts, international commercial arbitration is essentially a private process in which the press and public are not permitted to attend, and the confidentiality of arbitral proceedings is sometimes regarded as one of the most fundamental benefits of arbitration.
Cost and Delay
The parties must pay the arbitrators' fees and expenses, making international commercial arbitration an expensive process. It may also be necessary to pay an arbitral institution's administrative fees and expenditures.
It may be difficult to schedule hearing dates due to busy arbitrators, counsel, and clients from distant counties, and the requirement to agree on most procedural stages slows the process.