Arbitration is an alternative dispute resolution method in which parties choose to forgo litigation and instead resolve their conflict through an arbitral tribunal. This method is popular in business dealings due to the speed, flexibility, and confidentiality it offers.
Nature of Arbitration
Arbitration is a private judicial process in which a dispute is decided by an independent arbitrator appointed by the parties. The decision of the arbitral tribunal is binding and enforceable, just like a court decision. Arbitration can be either international or domestic, depending on the nature of the dispute and the location of the parties involved.
This alternative method can be used if the parties have included an arbitration clause in their contract.
Selection of Arbitrator
Arbitrators play a key role in arbitration proceedings. They must be independent, impartial, and competent in the matters under dispute. The parties may select one or more arbitrators, depending on the complexity of the case. In many instances, each party appoints one arbitrator, and a third arbitrator called the chairperson, is selected by the appointed arbitrators or an arbitral institution.
Governing Law and Place of Arbitration
The parties may choose the governing law and the place of arbitration, both of which are important as they can influence the outcome of the dispute and the enforcement of the arbitral award. The governing law could be the national law of one of the parties.
Advantages of Arbitration
Arbitration offers several advantages over traditional court proceedings:
- Speed: Arbitration proceedings are usually faster than court litigation, enabling the parties to resolve their disputes more quickly.
- Confidentiality: Arbitration is a confidential process, meaning that information related to the dispute remains private.
- Flexibility: The procedures can be customized to meet the specific needs of the parties.
An important characteristic of an arbitral award is that it is a single-instance decision. This means that the arbitral tribunal’s decision is final and not subject to appeal, except in cases explicitly provided by law.
For the success of an arbitration case, selecting a qualified arbitrator and obtaining assistance from experienced lawyers who can ensure the proper conduct of the procedure and protect the interests of the parties are essential. If you require more information or are seeking an experienced legal team with expertise in arbitration proceedings, please contact us.
