Summary

May 2024

In this comprehensive overview, we explore various elements of international arbitration such as its concepts, characteristics, fundamental principles, international legal framework, governing institutions, and its procedure. The following points have been discussed :

  • International arbitration is an important mechanism for resolving disputes between parties of different nationalities. It offers an effective alternative to national courts.
  • The sources of arbitration include international conventions, bilateral treaties, institutional regulations, or contractual clauses that provide for this mode of conflict resolution.
  • Fundamental principles of arbitration, such as party autonomy, neutrality and impartiality, confidentiality, adversarial process and party equality, as well as the enforcement of arbitral awards, constitute essential pillars. These principles ensure the efficiency and integrity of the arbitration process.
  • Arbitral institutions play a crucial role in promoting and facilitating international arbitration by providing rules, procedures, administrative services, lists of qualified arbitrators, and other functions.
  • The international legal framework for arbitration includes a set of instruments: international conventions, institutional arbitration rules, national arbitration laws, as well as consideration of custom and jurisprudence.
  • The arbitration procedure, regulated by various sets of rules, generally follows a standard process.

International arbitration is therefore an essential tool in our legal system. It offers an efficient, impartial, and neutral means to resolve international disputes. Its importance is undeniable in the international context, particularly concerning international trade and relations between states.Moreover, the flexible nature of the legal framework for international arbitration allows parties to adapt it and choose the legal regime that best suits their needs. The system also places great emphasis on the fundamental principle of party autonomy, which is inevitably advantageous. In addition to its flexibility and promotion of party autonomy, international arbitration presents other undeniable advantages, as we have observed, such as the possibility for parties to choose arbitrators specialized in the relevant field, ensuring a fair and informed decision-making process.

Introduction

I. Concepts and Characteristics

International arbitration is a dispute resolution mechanism between parties of different nationalities, typically states or commercial entities. Arbitration is a process where parties agree to submit their dispute to one or more arbitrators, who will render a final binding decision. Within this framework, an arbitral tribunal is established solely to resolve the specific dispute. Instead of resorting to national courts, which are judicial proceedings, parties may choose arbitration as a method of conflict resolution, constituting a private dispute settlement (1). Arbitration plays a significant role in dispute resolution as it provides an effective alternative to national courts.

International arbitration is commonly utilized in cross-border commercial disputes, as well as in investment disputes or other areas of international law (2).

International arbitration is known to offer several advantages, such as (3):

  • Confidentiality : Arbitration proceedings are often more confidential as they are generally conducted privately.
  • Choice of arbitrators : Parties can select one or more arbitrators, allowing them to choose experts in the field of the dispute to make informed and fair decisions.
  • Speed and efficiency : Arbitration is often faster and more efficient due to less formal and more flexible procedures.
  • Choice of applicable law
  • Cross-border enforcement : Arbitral awards are easier to enforce across borders thanks to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

Regarding its sources, international arbitration often relies on international conventions, bilateral treaties, or contractual clauses that provide for this method of dispute resolution. We will address this point in detail below (4).

Moreover, arbitration can be ad hoc (parties appoint arbitrators themselves) or institutional (parties entrust the appointment of arbitrators to a specific arbitration institution) (5).

In an international context, where parties likely originate from different jurisdictions, arbitration helps avoid difficulties associated with the diversity of national legal systems, as well as challenges in determining the competent court in the absence of a choice of forum.

International arbitration is thus an essential tool, especially for international trade, as it enables parties to resolve their disputes neutrally, efficiently, and impartially. This can promote legal certainty and confidence in international transactions.

It is important to note that arbitration is just one of several dispute resolution methods. Others include (6):

  • Negotiation, allowing parties to reach an agreement directly.
  • Mediation, involving a neutral third party to assist parties in reaching an amicablesettlement.
  • International judicial proceedings, enabling parties to bring the dispute before international courts such as the ICJ or the ECHR.

These are the main existing methods of resolving international disputes. These various methods offer parties a range of options to effectively resolve their international disputes, tailored to their specific needs. Choosing the right resolution method often depends on the nature of the dispute, as well as the parties’ preferences and practical considerations such as confidentiality and costs (7).

Regarding the various existing categories in the field of arbitration, there are several depending on the specific area. Here are the main ones (8):

  • Commercial arbitration : Involving disputes arising from commercial transactions between national or international businesses (9).
  • Investment arbitration : Involving disputes between investors and states, often arising from bilateral investment treaties (BITs).
  • Public international arbitration : Involving disputes between states.
  • Labor arbitration : Involving disputes between employers and employees.
  • Sports arbitration : Involving disputes in the field of sports.

It is important to note that each category of arbitration has its own rules and procedures tailored to the particular characteristics and stakes of the disputes involved. These rules and procedures may also vary depending on the arbitration institutions involved.