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Future bright for international arbitration
New research from a global law firm paints a positive picture moving forward for the arbitration of cross-border disputes.
Jerome Doraisamy
A study published by White & Case, in collaboration with Queen Mary University of London, has shown an all but unanimous favourability for international arbitration, with 97 per cent of respondents regarding it their preferred method of resolving cross-border disputes.
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In addition, 99 per cent of respondents are likely to choose international arbitration in the future, the study noted.
Speaking to Lawyers Weekly about the findings, Sydney-based White & Case partner Max Bonnell said: “You can expect that international arbitration will become even more common than it already is.”
The reasons for this, he explained, are enforcement and confidentiality.
“International arbitration allows for relatively straightforward and uncomplicated enforcement, which is then much easier to enforce in other countries than [relying on the] judgment of courts,” he said.
“People are also attracted to the confidentiality of international arbitration, as confidentiality is the default option amongst plaintiffs.”
An overwhelming number of the survey’s respondents feel that the use of international arbitration will increase in the energy, construction and infrastructure sectors, at rates of 85 per cent and 82 per cent respectively.
“The reason why [use of such arbitration in these sectors] is expected to increase is simply that international arbitration is already a default option and more and more projects in those fields are becoming international in nature,” he said.
Movement away from the courts in the resolution of such disputes, he argued, will ultimately be a good thing for the legal profession.
“There are finite government resources and taking the billing off the courts through arbitration can be seen as a positive thing,” he suggested.
Elsewhere, the study found that 60 per cent of respondents felt that progress had been made in gender diversity in international arbitration practices.
It also found, however, that only 31 per cent and 24 per cent of respondents felt similar progress was being made in cultural and ethnic diversity respectively.
Mr Bonnell responded to the latter by conceding that, “There’s formal areas in diversity which need to be explored, and they include ethic diversity.”
But the increase in female representation in arbitration was a positive step, he noted.
“If you look at what arbitration was like when I started practicing in the area nearly 20 years ago, almost all of the tribunals were composed of white men in late middle age,” he recounted.
“We are no longer staring at walls of pale 60-year-old faces, and that’s a positive thing for everyone.”
