I. Introduction

International commercial arbitration (ICA) is the binding resolution of the merits of business disputes between or among transnational actors through the use of one or more arbitrators rather than the courts. 

II. Reasons for Choosing Arbitration

The use of ICA has mushroomed in recent years, for several reasons. There may be distrust of a foreign legal system on the part of one or more of the parties. They may wish to avoid long delays in the court systems. They may desire resolution of the dispute by someone with expertise in their business. They may wish to exercise more control by specifying the rules which govern the dispute. They may also wish to avoid the current problem of the lack of internationally recognized standards on the enforceability of foreign judgments. There is a proposed Hague Convention on Jurisdiction, Recognition and Enforcement of Judgments in Civil and Commercial Matters, but a number of issues remain unresolved in negotiations. For the European Union member countries, this has been already addressed through Council Regulation (EC) No. 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.

III. Institutional vs. Ad Hoc

There are essentially two kinds of arbitration, ad hoc or institutional. An institutional arbitration is one that is entrusted to one of the major arbitration institutions to handle, while an ad hoc one is conducted independently without such an organization, according to the rules specified by the parties and their attorneys. 

IV. State vs. Private Parties

Arbitrations may also be differentiated by those that involve states as a party, and those which do not. Special institutions are available for arbitrations in which states are a party. The Permanent Court of Arbitration [Documents Website at Cornell ]in the Hague was formed to handle arbitrations exclusively involving states, but since 1992 has broadened its mandate to include disputes involving states and private parties, as well as disputes involving international organizations. The International Center for the Settlement of Investment Disputes (ICSID) is concerned with disputes between a state and its foreign investors.

V. Specialized vs. General Purpose Institutions

There are a number of arbitral mechanisms which address arbitrations in a particular industry or concerning a particular topic. An example of the former is the set of the special rules governing construction industry disputes by the American Arbitration Association .Topic-specific dispute resolution may be illustrated by the World Intellectual Property Organization (WIPO) Arbitration and Mediation Center, and by the Court of Arbitration for Sport.

VI. Major General Purpose Institutions

The major international commercial arbitration organizations with years of experience include the International Chamber of Commerce (ICC) in Paris, the London Court of International Arbitration (LCIA), and the American Arbitration Association (AAA). The International Arbitral Centre of the Austrian Federal Economic Chamber has gained a reputation for the arbitration of disputes involving parties from Central Europe. Listings of other centers are available from the Juris International, and from the WWW Virtual Library Arbitration.

There has been a tremendous increase in arbitration options in the last 50 years. Previously, there were a few countries with well-developed arbitration practices and sympathetic national laws. The major arbitration organizations were the ICC and the LCIA. Interference with arbitration by the courts was a well-founded fear in many countries. Conversely, the necessary actions on the part of the national legal system in compelling witnesses and enforcing judgments were not were not always available.

There are several mechanisms by which foreign arbitration awards may be enforced. Countries may agree bilaterally to enforce arbitral awards, sometimes through a treaty of friendship, commerce and navigation or through a bilateral investment treaty (BIT), of which there are now an estimated 2000. Finally, a multilateral agreement may be implemented. 

Arbitration has been greatly facilitated by the widespread adoption of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958), which limits the grounds upon which arbitral awards may be attacked [FN1]. Most arbitration attorneys limit the universe of appropriate arbitration venues to those states that are a party to the New York Convention. For more information about finding treaties, see the ASIL Guide to Electronic Resources for International Law: Treaties Chapter.

Another important development in the spread of international arbitration was the adoption in 1976 of the United Nations Commission on International Trade Law (UNCITRAL)  arbitration rules intended for parties wishing to arbitrate without the use of an international arbitral institution. The UNCITRAL model law, later drafted in 1985, has served as the basis of many countries' arbitration legislation [FN2]. At least four states in the US have based their laws on the model law (California, Connecticut, Illinois, Oregon and Texas). For more information on UNCITRAL, see the ASIL Guide to Electronic Resources for International Law: Private International Law. For more information about researching UN materials, including those of UNCITRAL, see the ASIL Guide to Electronic Resources for International Law: United Nations Chapter.

Another recent trend is the conscious repositioning of countries through adoption of new or amendment of existing arbitration laws that remove impediments to the arbitration process, in an effort to attract more global business. Perhaps the most extreme example is the Belgian statute, which shields international arbitrations which are seated in Belgium from all judicial interference. Most statutes since 1980 have also included "trade usage" as a permissible source of arbitration law, again in an effort to attract global business on its own terms.   

VII. Internet Resources

Although many arbitration resources are not available on the Web, there are several good. The AAA, the ICC and the LCIA, have extensive content on their websites. The UNCITRAL website provides extensive documentation and lists those countries which have based their national legislation on the model law.

Excellent introductions to ICA and its resources include: International Commercial Arbitration: Locating the Resources by Jean Wenger and International Commercial Arbitration: Resources in Print and Electronic Format by Lyonette Louis-Jacques. Rosabel E. Goodman-Everard's Directory of Arbitration Websites and Information on Arbitration Available Online provides a very extensive listing of treaties, laws, journals, organizations and other websites. Mayer, Brown, Rowe & Maw requires free registration, but has a good collection of arbitral institutions, rules, articles, and a general introduction to arbitration. King & Spaulding has mounted materials from an October 2000 conference on ICA, including a detailed chart comparing the ICSID, UNCITRAL, AAA, LCIA, and ICC Rules.

The Transnational Law Database from the Center for Transnational Law at Muenster University is a valuable resource for arbitration research. It is organized by almost 80 transnational law principles, with references to doctrinal writing, arbitral decisions, and national laws relating to those principles. It is also possible to search the site and participate in an online discussion group.

VIII. LEXIS and WESTLAW Subscription Database Resources

LEXIS and WESTLAW can be extremely helpful in researching ICA. Two newsletters providing recent updates are available: Mealey's International Arbitration Report on LEXIS, and World Arbitration and Mediation Report on WESTLAW. Both LEXIS and WESTLAW have large law journals databases with many articles on International Commercial Arbitration. Specialized journals include Dispute Resolution Journal (on WESTLAW), American Review of International Arbitration (on LEXIS and WESTLAW), Croation Arbitration Yearbook (on LEXIS), Review of Arbitration in Central and Eastern Europe (on LEXIS), and Sweet and Maxwell's International Arbitration Review (on WESTLAW only: INTALR Database). LEXIS also includes the International Arbitration and Dispute Resolution Directory.

WESTLAW has recently added quite a few arbitration databases. Many seem to be culled from existing databases, but International Commercial Arbitration Institutions seems to include, for the first time, the legislation, rules, model clauses, award and decisions of several prominent arbitral institutions, including the London Court of International Arbitration, the Hong Kong International Arbitration Center, the Chinese International Economic Trade and Arbitration Commission, the Chinese Maritime Arbitration Commission, the Singapore International Arbitration Centre, the Stockholm Chamber of Commerce, the International Arbitral Centre-Vienna, the International Chamber of Commerce, the Institute of Arbitrators & Mediators Australia, the United Nations Commission on International Trade Law and the International Centre of the Settlement of Investment Disputes, WESTLAW also has an International Commercial Arbitration Legislation database, which includes the laws of a number of countries, as well as individual legislation databases for Australia, China, France, Germany, the Netherlands, Singapore, Sweden, Switzerland, and the United Kingdom, Separate files are also available for Canadian International Commercial Arbitration, Australian International Commercial Arbitration, and United Kingdom International Commercial Arbitration, all of which draw from several sources to provide decisions and other materials.

To learn about more arbitration-related WESTLAW resources generally, consult the WESTLAW Directory. An excellent table of LEXIS and WESTLAW resources is included in Lyonnette Louis-Jacques ICA webguide. More resources may be located on LEXIS through its Directory of Online Sources.

IX. Arbitral Awards

Arbitral awards are generally difficult to locate, even in print in libraries. On the Web, resources are even scarcer. ICSID provides the full text of selected cases and awards, as well as a list of concluded cases and awards, together with place of publication. Abstracts of awards and decisions concerning the UNCITRAL texts are available through the CLOUT database. Mark Chapman also organized in 1999 a helpful index of CLOUT abstracts by article of the Model Arbitration Law.

X. Arbitration Rules

Mayer, Brown, Rowe & Maw's International Arbitration site has a good collection of arbitration rules.

ICSID
Rules of Arbitration and Conciliation

Additional Facility Rules

LCIA Rules

ICC Rules

UNCITRAL Rules

Permanent Court of Arbitration Rules

AAA International Arbitration Rules

IBA Rules on the Taking of Evidence in International Commercial Arbitration

XI. National Arbitration Statutes

An important component to a successful arbitration is a statute receptive to arbitration in the country of the site of the arbitration. A distinction is often made in a nation's laws between domestic arbitrations, in which states tend to maintain a firmer hand through the court systems, and international arbitration, in which actors engaging sophisticated commercial transactions are freer to agree upon their own rules. What follows is an alphabetical listing of a sampling of national arbitration laws available on the Internet in English.

 

FOOTNOTES

FN1 - Under Article V, a court must recognize or enforce the award except in these situations: incapacity of the party; invalidity of the agreement; a party's lack of notice or other inability to present his or her case; an award outside the submission; an improperly constituted tribunal or a procedure which is illegal or outside the parties' agreement; a subject which cannot be arbitrated under national law; and a case in which recognition or enforcement would violate public policy.

FN2 - Australia, Azerbaijan, Bahrain, Belarus, Bermuda, Bulgaria, Canada, Croatia, Cyprus, Egypt, Germany, Greece, Guatemala, Hong Kong Special Administrative Region of China, Hungary, India, Iran, Ireland, Jordan, Kenya, Lithuania, Macao Special Administrative Region of China, Madagascar, Malta, Mexico, New Zealand, Nigeria, Oman, Peru, Republic of Korea, the Russian Federation, Scotland, Singapore, Sri Lanka, Tunisia, Ukraine, Zambia and Zimbabwe.