Navigating the Surge in International Arbitration: Frequently Asked Questions

Navigating the Surge in International Arbitration: Frequently Asked Questions

There has been a notable increase in the utilisation of international arbitration, which is now widely recognised as the preferred dispute resolution mechanism for cross-border and multijurisdictional transactions. But what exactly is international arbitration?

This FAQ guide aims to provide answers to frequently asked questions regarding the precise nature of international arbitration and what are its key features.

What is International Arbitration?

International arbitration offers an alternative to the traditional approach of resolving disputes through formal court proceedings in a national court. If, and only if, the parties agree to arbitrate their dispute, an independent neutral arbitrator and/or a panel of arbitrators will make an award/decision which is binding on the parties.

A final award is typically enforceable in most domestic courts around the world and, subject to the arbitration rules which apply, there is generally no right to appeal the award and very limited grounds on which any award can be set aside. 

My contract lacks an arbitration clause. Can I still arbitrate? 

Yes, you can. As the parties will need to agree to submit their dispute to arbitration, the most common way for the parties to do so is to incorporate an arbitration clause into the underlying agreements/contracts. However, parties can still refer their dispute to arbitration through a submission agreement if no pre-existing arbitration clause exists.

What are the Key Features of International Arbitration?

Enforceability of Awards: One of the most significant advantages of international arbitration is the enforceability of arbitral awards across different jurisdictions. The Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958, widely known as ‘The New York Convention,’ has been ratified by over 170 countries, making it often easier to enforce a non-domestic arbitral award than a foreign court judgment.

Neutrality and Impartiality: Arbitrators are typically chosen by the parties or a designated institution, ensuring a neutral and impartial decision-making process. This neutrality is crucial for cross-border disputes, as it minimises the risk of home-country bias or concerns about unfamiliar domestic judicial systems.

Flexibility and Autonomy: Parties have the freedom to tailor the arbitration process to their specific needs, including selecting specialist arbitrators, specific procedural rules (e.g., ICC 2021 Rules, LCIA 2020 Rules, etc.), the ‘seat’ of arbitration, and the language of proceedings. This flexibility allows for a more efficient and customised resolution process.

Whilst traditional domestic court proceedings can often take years to resolve, many of the governing rules of international arbitration provide that subject to suitability, the parties may elect to a ‘fast track’ or ‘accelerated’ procedure which seeks to render a final award within 3 – 6 months from the beginning of the proceedings.  

Confidentiality: Unlike domestic court proceedings, which are often public, international arbitration is usually conducted privately, allowing parties to agree to keep the existence and content of the arbitration confidential.

How can RFB Legal assist me? 

If you need advice or assistance regarding International Arbitration matters or wish to refer your dispute to International Arbitration, please contact Jonathan Chan (j.chan@rfblegal.co.uk) or our Arbitration Team (Arbitration@rfblegal.co.uk).