Arbitration

Arbitration is a private dispute resolution process, conducted away from public scrutiny. It is a consensual process where the parties submit their disputes for resolution to an arbitral tribunal that usually is composed of one or three arbitrators.

The arbitration agreement is normally included in the principal contract between the parties. However, the parties may consent to arbitration separately in the absence of an agreement.

The arbitral process allows disputants the freedom to appoint their own preferred arbitrators and engage their own counsels as well as decide in the procedure and rules by which the arbitration process is to be conducted.

Types of Arbitration

There are essentially two types of Arbitration:

Institutional Arbitration

An Institutional arbitration is managed by a specialized arbitral institution like IAMCH, and has its own set of rules. The primary advantage of an institutional arbitration is that, parties benefit from an established format for arbitration with a proven track record from an institution which specializes in assisting parties with the arbitral process.

Ad Hoc Arbitration

In an Ad-Hoc Arbitration, the rules of arbitration are set only by parties and the tribunal. An ad hoc arbitration is where the parties do not select an institution to administer their arbitration. The entire process offers the parties an opportunity to be flexible, but with less support.

Advantages of Arbitration

  • Time and Cost Efficiency – The process of Arbitration is less lengthy and cheaper as compared to litigation. Speedy disposal of cases in a timely and procedural manner gives an edge to this method of dispute resolution.
  • Confidentiality – Arbitration proceedings are done in private conferences and meetings, and parties sometimes agree to keep the terms of the final resolution confidential.
  • Enforceability – Arbitral awards are final and binding on the parties and not subject to appeals on merits of the case.
  • Flexibility – The parties to the arbitration agreement can choose to agree on any procedure for carrying out the arbitration process, which makes it less formal.