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Arbitration for dispute resolution

Regardless of how hard the world of business and commercial transactions tries to follow all of the rules and legal norms, disagreements are unavoidable. They primarily concern contract disputes, sales negotiations, territorial conflict, and disagreements with customers/suppliers/partners/employees. The time spent resolving an international dispute, rather than doing business, is the most valuable resource.

An effective strategy developed after negotiations and the preparation of a detailed agreement (which contains information about the parties' rights and obligations, reducing the possibility of a conflict situation arising from this agreement) is an effective way to resolve business disputes. Also, by incorporating procedures into daily business operations that clearly and precisely allocate obligations between participants, the likelihood of a conflict situation can be reduced.

If disagreements do arise, there are several options for resolving them outside of court:

  • Negotiations involve not only the parties to resolve, but also an independent third partner who assists the participants in identifying all possible solutions to a business dispute.
  • Mediation – a mediator can help the parties reach an amicable resolution to a business dispute.
  • Reconciliation is a procedure similar to mediation with one major difference: the mediator offers the participants a non-binding option for resolving the conflict.
  • Arbitration – centered on the legislation, the tribunal makes the ultimate and is taken and implemented.

This article explains in detail how to resolve a business dispute through arbitration and what the assistance of a lawyer entails.

What are the advantages of alternative dispute resolution (ADR)?

ADR can be used to resolve international commercial disputes without the need for a court hearing, which has several advantages:

  • saving time and money; 
  • process adaptability; 
  • participant control; 
  • confidentiality; 
  • consideration of only important issues for both parties; 
  • assistance in maintaining business relations by conflict parties.

Arbitration is a modern business world alternative and mandatory process for resolving commercial disputes that has been incorporated into business contracts. A significant advantage of ADR is that it allows for the resolution of a business dispute at an early stage, before the involvement of a court or tribunal is required. ADR can be used before, during, and possibly even after the trial. Arbitrage is one of the most widely used methods.


Arbitration is a way of resolving a disagreement outside of trial in which the sides grant permission for one or more people to decide on their case after all evidence has been obtained and all arguments have been merited. This method differs from the previous three different dispute resolution methods.

Arbitration decisions, unlike mediation and negotiations, are binding on the parties. Arbitration is required in two ways: the arbitrator's decision must resolve the dispute even if one of the parties disagrees, and the arbitrator's judgment cannot be appealed or changed by a trial or appellate court.

International arbitration could be used to resolve conflicts between huge companies, insurance providers, or even individuals. Although arbitral awards are less formal and require less time to come to a resolution than litigation, both parties have made opening arguments and turned over evidence. The appellate jurisdiction when resolving an enterprise complaint through dispute resolution is limited.

Arbitration can be mandatory or optional. In the first instance, the mind is made up, the court can enforce it, and it can be tried to appeal on very limited grounds. In the second option, the arbitrator's judgment is advisory and can only become final if both sides consent to it.

Arbitration Types

Arbitration is a dynamic process, so you should always consider how it works. There are two types of arbitration:

  • institutional arbitration will operate on the basis of regulations developed by arbitration institutions; 
  • special arbitration will operate on the basis of rules developed by the parties.

What precisely is institutional arbitrage?

Procedures for Arbitration are similar in national and international organizations. However, there may be privacy and cost differences in some areas. The selection of an arbitrator is an important consideration when drafting an arbitration clause. A qualified dispute resolution lawyer can advise you on the best arbitration institution to use when resolving a business dispute through arbitration.

Among the arbitral institutions are:

  • Chamber of Commerce International (ICC).
  • London International Arbitration Court (LCIA).
  • International Center for Dispute Resolution (ICDR) (ICSID).

What exactly is ad hoc arbitration?

Ad hoc arbitration is a method wherein the disputants select regulations on their own, with no involvement from the arbitration organization. When helping to solve a complaint through ad hoc arbitration, the sides regularly use a methodology developed by organizations with a major presence in certain global regions, such as the UN Commission on International Trade Law, to save time.

The main advantage of ad hoc arbitration is that the rules can be tailored to each specific conflict. Ad hoc arbitration for business disputes may not be appropriate for companies that require institutional support and access to experts in the process. The main point is that any method of arbitration must comply with the laws of the country where it is held.

​​Formalities of arbitration

When considering cases in international arbitration, three arbitral tribunal may be present. Generally, the method is as follows: evey side selects each arbitrator, who would then select a third. Unless otherwise agreed in advance, a democratic majority is generally adequate, rather than a majority verdict of the arbitration panel.

An arbitration discussion board is an institution which demonstrates the specifications for arbitration, as determined by the arbitration clause. The American Arbitration Association («AAA») is a well-known platform for arbitration.

The AAA, for example, maintains a list of «approved arbitrators», who are frequently former judges or experienced lawyers. They could agree to have the dispute arbitrated for a fee. Arbitration is more private than litigation.

When resolving disputes in business relationships through arbitration, the arbitrator will regulate all requirements and restrictions on the process based on the provisions of the arbitration platform. Participants in some arbitration proceedings are required to submit statements about their positions as well as related materials to the arbitrator. He will then investigate and make a determination. Arbitration proceedings are open to create hearings before arbitration panels more conveniently.

Arbitrating a commercial dispute is typically an expensive process. However, it has more practical advantages over litigation and other forms of alternative dispute resolution.

When and how does arbitrage come into play?

Arbitration is appropriate for resolving business conflicts that require specific knowledge and confidentiality in order to protect trade secrets. This procedure is also appropriate when the case involves a worldwide component, as there may be conflicts with multiple legal jurisdictions. Arbitration is a popular method for resolving labor disputes. Furthermore, many contracts include clauses requiring that any disputes arising from noncompliance with the contract's terms be resolved through arbitration.

Before commencing arbitration or entering into a contract containing an arbitration clause, you should be aware that the arbitrator has the authority to make a decision and that you have the option to waive your right to litigate.

The following are arbitration features:

  1. Process that is voluntary and private.
  2. Less formal and systemic in nature.
  3. Quick and inexpensive.
  4. Giving all participants the opportunity to present evidence and arguments.
  5. The court may enforce the arbitration award.

Is arbitration suitable for highly disagreements?

Industries associated in the negotiated settlement of complex resolving disputes frequently use this method of conflict resolution because it is overseen by a qualified arbitrator. This makes the work easier because no experts are necessary to explain technical difficulties to the prosecutor (as there would be if the trial began in a civil proceeding).


There are several methods for resolving international disputes, but it is preferable to use alternative methods, one of which is arbitration, if you want to save money and time. This method has gained popularity because it allows you to resolve business disputes without involving a jury, with the assistance of a third uninterested party.

Arbitral award is a residential, low-cost, and convenient way for sides to settle a conflict situation. Please contact IQ Decision UK if you require advice and assistance in resolving complex commercial disputes. A variety of conciliation consulting services are available through our service offerings. Our skilled professionals employ a variety of strategies that are tailored to each client's specific needs. Contact our experts for professional legal advice and assistance in resolving conflicts through arbitration.


What exactly is arbitration?

Arbitration is a legally binding method of resolving disputes. The parties' right to submit the dispute to arbitration is dependent on the existence of an arbitration agreement or an arbitration clause in the contract, which was concluded and signed by the parties.

What are the benefits of resolving a disagreement through arbitration?

The following are the primary benefits of arbitration proceedings:

  1. efficiency and flexibility; 
  2. streamlined evidence and procedure rules; 
  3. confidentiality; 
  4. impartiality of the arbitration court; 
  5. lower costs when compared to litigation;
  6. mandatory enforcement of the arbitral award is a possibility.
What types of arbitration are there?

Arbitration cases are typically classified as follows:

  • institutional arbitration, in which a specialized institution is appointed to administer the arbitration process; 
  • special arbitration; 
  • domestic and international arbitration.
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