Agreeing on a convenient place for arbitration for both parties is a sort of art. A neutral arbitration location has to be chosen assuming the parties have equal bargaining power. The choice depends to a large extent on the amount of the contract. Of course, the top of mind is renowned and prestigeous venues such as the International Court of Arbitration or the London International Court of Arbitration but they are very expensive. Resolving disputes on contracts that are relatively small for business is economically inexpedient here. There are more convenient neutral jurisdictions for these cases, such as for instance Panama.
Arbitration in Panama is considered worldwide an effective albeit not so costly platform. So, if you have chosen to start arbitration in Panama, it is worth considering some of the local specifics.
Asking an explanation
Entrepreneurs who decide to resolve a financial dispute in Panama should note that the parties have the right to request an interpretation of the arbitral decision or part of it if they do not understand something or disagree.
Arbitration awards in Panama can be challenged on grounds of serious irregularity affecting the tribunal, the proceedings or the award.
However, it would be fair to say that usually, a party wishing to challenge an arbitration award will face an uphill struggle. Even where challenges are made, the tribunal tends to uphold the original award.
Enforcement of Foreign Arbitral Awards in Panama
Without effective enforcement, there really is no effective dispute resolution.
Winning a dispute and obtaining a positive decision in most cases does not in itself ensure the restoration of violated rights. Accordingly, the more efficiently the decision of a particular jurisdiction can be executed, the more attractive it will be from a business point of view. At the same time, as practice shows, sometimes the main difficulties arise precisely at the stage of enforcement of the decision, making the process of its implementation more time-consuming and costly even in comparison with the dispute itself.
The enforcement of international arbitration awards in Panama is based on the New York Convention, which includes 140 states today, Panama as well. Enforcement can also be carried out on the basis of the Inter-American Convention. This means that the recognition and enforcement of awards in Panama are incomparably safer from a legal point of view than of the national courts as the risk of refusal to recognize and enforce the award will be significantly lower.
Should you have any queries, please fill out the form below to contact our legal advisors. Consultation on the initiation of arbitration in Panama will help understand the peculiarities of the country's legal requirements. Our specialists are highly qualified and have many years of successful experience in dealing with the execution of arbitration awards abroad. We are ready to provide you with the necessary consulting and accompanying services in the dispute resolution process in Panama, as well as in another jurisdiction at your request.