Statement: Arbitration will be the prevalent form of dispute resolution for international businesses in the 21st century.
Arbitration has already become the preferred method of dispute resolution in international commercial contracts in the 21st century, and we believe it will stay in that way.
Corporate parties tend to avoid going to courts because litigation is expensive, public, and time-consuming. A court proceeding initiated is a public acknowledgment of a breakdown between the commercial parties. Arbitration though, is more private. Usually, if the parties don’t disclose it to the public, no one can know the parties are in dispute.
Besides, courts are national, either Party A’s, or Party B’s country’s courts can be chosen as the jurisdiction in their contract. Yet, it is unfair for Party B when Party A’s national jurisdiction is chosen as a method of settlement, and the same for vice versa. International arbitration resolves this problem as it does not belong to, or in other words, it is independent of, any country.
Further, an arbitral award is more easily enforced in foreign countries than a court judgment. In most of the cases, a judgment from a foreign court requires a separate court proceeding to become enforceable in the country. This duplicates the time, effort, and money spent to resolve one single dispute. However, as long as the given country is a party to the New York Convention, the arbitral award is enforced easefully without a need to bring an action on the award in a local court.
We do not claim that the courts will be eliminated, litigation will be always there; however, in light of our arguments above, we’re of the opinion that arbitration will become a more popular and common method of settlement among parties in international contracts.