We know well, disputes will cause unpleasant experiences but it is an unavoidable part in any corporate relationships or organizations. Whenever there are disputes, a mechanism should take place to resolve these conflicts in a peaceful manner and achieving consensus between both parties who are invoked.
Arbitration is an alternative for resolving dispute rather than submitting it to the litigations i.e. local court. An international arbitration had become very popular in plenty of companies, enterprises or organizations that are established their business to distinct country.
There are two common types of international arbitration, institutional arbitration and ad hoc arbitration. Both types have pros and cons in aspect of processing time, procedural rules, processing cost etc. Nothing is a perfect way; you can choose either one which is the best fix to your current situation.
An institutional arbitration, as its name, it is administered by a specialized institute with a comprehensive set of its own procedural rules and laws. Each institution has the right to guide and assist in the arbitration process from choosing the arbitrators till the proceeding is completed with an award.
Some common institutions are, such as:
- London Court of International Arbitration (LCIA)
- United Nations Commission on International Trade Law (UNCITRAL)
- International Chamber of Commerce (ICC)
- International Centre for Dispute Resolution (ICDR)
Then why opt institutional arbitration? The advantages of an institutional arbitration are mentioned as following:
- Both parties and lawyers save their time and effort for determining the arbitration procedures and drafting the arbitration clause.
- Institutions are willing to help in deciding the venue and time of arbitration proceeding if both parties request to do so.
- Institutions also provide a list of arbitrators which are expert, professional and experienced in different fields to choose form.
- The availability of pre-established rules and procedures which ensure the hearing can be completed in timely manner and without any delay.
- The framework of arbitration is clearly clarify and formatted with proven record.
Each institution has the responsibility of monitoring the arbitration to make sure that a verdict is made within reasonable time.
- The award is final and binding. No review or appeal against it to ensure finality.
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