• The effectiveness of international commercial arbitration system and a critical analysis?

      Mahdi, Muhammad Atiab (University of Bedfordshire, 2012)
      To resolve conflicts the alternative dispute resolution (ADR) has derived several procedures. In last few decades the ADR process becomes more important that it becomes more prevalent in international and domestic commercial contracts. The basic reason for this is the high cost of litigation, thus the parties are considering alternative methods to resolve disputes with the process which is cheaper and quicker. By using ADR the working relationship between parties will not lead to a break down. Therefore this report is based on a detailed examination of arbitration in International Commercial scenario. The report is given to define the effectiveness of the International Commercial Arbitration, the international system covering states and corporate with advantages and disadvantages of the international arbitration. The commentary also discusses the International Chamber of Commerce (ICC) alternative dispute resolution rules and the United Nations Commission on International Trade Law (UNCITRAL) rules. Furthermore, “ADR techniques fall into two discrete types. Those which seek to persuade the parties to settle and those that provide a decision. Where a decision is given then that decision may be binding on the parties, it may have an interim binding effect or may simply be a recommendation that the parties can accept or ignore”. 1 Arbitration is one of the techniques of ADR and it is very important in the international commercial sector. However to define arbitration there is no universal definition of arbitration. In different legal rules arbitration has been used differently. It has been defined in different ways by the different commentators but there are core principles that can be found in all definition. The arbitration is a private system of adjudication. The arbitration method has been used differently in different countries. Though there are distinctions between domestic and international arbitration but there are also similarities found in this method. We could find factors which could affect the international arbitration but not the domestic arbitration. The laws are likely to be different in international and domestic law e.g. international arbitration relies upon conventions for the enforcement of arbitral award. Moreover the similarities are that the parties to a dispute have option to go for mediation before choosing arbitration. Basically the arbitration agreement provides authority to the arbitral tribunal to hear and determine the dispute. It is choice of the parties to choose between the arbitration and mediation. The selection regarding arbitral tribunal could be found in arbitration agreement. The main purpose of arbitral process is to resolve disputes or differences between parties before the relationship gets end up. It is a judicial process but not as a mirror judicial proceedings by which the procedure is to meet the demands of the case. Thereafter the arbitral tribunal makes or delivers an award to settle dispute between the parties and the award is final and binding as to the matter which it decides. 2 The international institutions are very important regarding the proceedings of the arbitration and the treaties or conventions plays role for the enforcement and recognition of the arbitral award. to discuss the structure of the international commercial arbitration could lead to understand the effectiveness of the informal system as well as the critical view is a key factor to define whether the future of the system is secure and does it provide sufficient security to the parties around the world.