23.07.2019

Arbitration at the forefront

 Show Interest

Arbitration at the forefront

 Show Interest
ARBITRATION- The rejuvenation of  the Life of Law

Our world is getting smaller, our disputes are becoming larger and yet not confined by national borders. We are living in a global village where communication is both instantaneous and continuous with all kinds of digital communications allowing us to expect immediate responses and ongoing engagement. Global trade and international transactions compel us to expand our horizons without leaving our neighbor the African region.In general the benefits of arbitration are often considered to be lower costs, greater efficiency and speed and the ability to choose expert adjudicators to resolve specialized disputes. I need to point here that domestic and international arbitration are structurally different and should not be conflated.

My recent cases in different jurisdiction have shown a paradigm shift of arbitration globally. Commercial arbitration has been a long and widespread tradition and practice for domestic and international disputes. Today thousands of domestic arbitrations and international commercial and investment arbitrations take a work force in law firms, as consultants, experts and arbitrators.

Both international trade and investment are the fundamental for the future prosperity of most countries.  It would be obvious that most countries try to provide incentives to foreign countries to invest capital and know how, as foreign investors need legal security for investments, including substantive legal protection and trustworthy system. Substantive legal protection is provided by domestic legal system. Investors are ready to invest in countries if they have dispute settlement system available which is fully independent.

We need not forget that for an international economic development be it Mauritius or other countries, an efficient system of dispute settlement is absolutely mandatory and necessary,   and trustworthy for foreign investors. We need to bear in mind also that it does not mean that the instrument of international law on investment protection should counter act on the sovereignty of natural resources or over national infrastructure. This does not mean also that there is no room for improvement regarding the respective dispute resolution mechanism

 My experience denotes that arbitration procedures have become too long and complex at times. The reason is implied partly of the kind of dispute which is more than commercial arbitration, legislatives, court decisions, etc. Before the start of a case, I am amazed of much time counsel for both sides request for submission of their memorials and possibly a procedure for document disclosure. Effective case management from the beginning, in collaboration with counsel becomes very important.

I meant earlier is that arbitration was a consideration to lower cost and bring more efficiency. But on the other side, the complexity and length then makes the procedure often more costly. Large team of lawyers with support staff on both sides, together with expenses and costs of witnesses and experts, court reporters and interpreters have to be paid. In these cases, the growing idea of third party financing is not surprising at all. Nonetheless the usual complaint that international arbitration has become too expensive is on the one hand correct, but too simple also, though efficient case management may help. We need to point that it may vary depending on the arbitration rules the parties have selected, the arbitrators’ fees and the amount of dispute.

Although confidentiality and transparency are of major importance, parties do demand for load of transparency. This is agreed at the right beginning prior to the case starting. Nowadays many awards are being reported by the media and the hearings are open in the public in Washington without compromising on efficiency.

 As most of the cases have financial implications, there should be a second instance for appeal which might bring more predictability and consistency of the jurisprudence. Concerning party autonomy parties, counsel, and institutions do many efforts to find best players for the selection of arbitrators. It is hard at times to see how a permanent tribunal could be composed of even better judges , may be for those who find it attractive to accept to spend all their working time on permanent appointment.

 We learn daily and things keep changing incrementally, simultaneously and synchronically. Relevant parties should have a thorough know-how of management structure with specific tools like project management which in the near future might help to reduce the cost of Arbitration on a worldwide basis. We should embrace ADR with a broader and global mindset in order to keep pace with the going trend as we are living in a global village with different traditions, cultures and habits leading to one destination.

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