The basic concept of arbitration as one of the main forms of alternative dispute resolution (ADR) is that the dispute is not considered by the state judicial authority, but by an independent entity outside the traditional judicial system. The parties forward the dispute between them for consideration to arbitration center and independent arbitrator decides upon the issues brought before him and makes a decision that is binding on the parties.
Arbitration may take two forms: institutional arbitration and ad hoc arbitration. Both forms are applicable to international commercial disputes.
Institutional arbitration is carried out by international arbitration institutions. Each institute develops its own procedural rules for resolving disputes. Among such institutions are the London Court of International Arbitration (LCIA), the International Chamber of Commerce (ICC), the Arbitration Institute of the Stockholm Chamber of Commerce (SCC), and the Dubai International Arbitration Centre (DIAC).
Ad hoc Arbitration
The essence of the ad hoc procedure is that the parties themselves appoint the arbitrator, who not necessarily has any connections to a particular arbitration institution. The arbitrator follows his own rules during the arbitration process.
Ad hoc arbitration proceedings have the potential to be more responsive to the needs of the parties and tend to be faster and less expensive than the institutional arbitration process. However, many parties to arbitration proceedings choose institutional arbitration, justifying their choice by a greater degree of predictability that is provided by clearly defined rules and established procedures, despite that fact that often it is more expensive.
We share the view that institutional arbitration proceedings are better suited for large corporations and businesses from different jurisdictions, whereas, ad hoc arbitration is a practical option for those who seek efficient and cost-effective dispute resolution methods.
Contact IQ Decision UK attorneys to find out what is the best way to settle your dispute. Our lawyers possess a wealth of experience in finding impartial and fair solutions to the international commercial conflicts that both parties consider acceptable and satisfactory through renowned international arbitration institutes and respected independent adjudicators.