"What do International Arbitration lawyers do?"

Key Facts

Arbitration is a form of 'alternative dispute resolution' (i.e. a way to resolve a dispute outside of the court process). 

An arbitrator or panel of arbitrators are appointed by the parties to the dispute to make a binding decision (known as the 'award'). Once this decision/award is made, there are very limited grounds of challenge. 

The arbitration can be either: 

  • ad-hoc: the parties determine the rules appropriate for that arbitration; or

  • administered: the arbitration is conducted under the help of one of a number of arbitral organisations such as:

    • the International Chamber of Commerce, ​

    • the International Centre for Dispute Resolution, or

    • the London Court of International Arbitration. 

International Arbitration deals with cases/disputes between two or more parties that are located in different countries. Usually, when two or more companies enter into a contract (and those two companies are in different jurisdictions), they'll include an arbitration clause in the contract. This means they both agree to arbitrate any dispute arising from that contract rather than pursue litigation. 

International Arbitration usually crops up in cross-border commercial disputes like joint ventures or corporate transactions such as mergers and acquisitions. It can also frequently come up in the investments world where a foreign investor is involved. 

What do arbitration lawyers do?

A client will usually approach a lawyer when a dispute has arisen in connection with another company/business/individual and that dispute arises from a contract which includes an arbitration clause. 

The arbitration lawyer will:

  • review the contract and associated documentation 

  • analyse who else may be involved in the dispute (and interview any potential witnesses) 

  • advise clients on the strength of their argument 

  • liaise with lawyers in other countries (i.e. the country where the other party is located) to understand the local jurisdction 

  • draft the relevant legal papers to request arbitration 

  • draft witness statements 

  • undertake lots of research to determine loopholes and the weight of a client's argument 

Use of commercial arbitration

Commercial arbitration is generally the preferred dispute resolution procedure for international transactions. The UK is a primary attraction for arbitration for the following reasons:

  • English law provides contractual certainty 

  • the English judiciary is seen as reliable, neutral and impartial 

  • there is support for the arbitral process by the English courts and the Arbitration Act 1996 

  • the UK is a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention)

So what are the advantages and disadvantages of parties going through the arbitration process when they could just go down the litigation process if it's clear who is right/wrong?

Advantages 

  • confidentiality (two big companies may not want it plastered all over the news that they are having a dispute - arbitration provides protection from that as it's all confidential!)

  • tribunal expertise and neutrality through party-appoint of arbitrators (both sides can agree who they want to be the arbitrator)

  • flexibility in terms of procedure - the process can be quicker if needed and both sides can choose how much they wish to disclose in the process 

  • it's a final binding decision - there are only limited grounds on which an award can be challenged 

Disadvantages 

  • reluctance of tribunals to dispose of weak cases 

  • reluctance of tribunals to impose rigorous case management

  • length of time it can take to grant the final 'award' 

  • limited grounds for challenges and appeals - this is a negative too because what if the arbitrator just got it wrong!?