International Commercial Arbitration- An Overview

Author:Mr Praveen Medikundam
Profession:Mascot Technologies,Inc.
 
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Arbitration is intended to provide a quicker, less expensive, and more private alternative to litigation. This voluntary and intelligent assent to an alternative dispute resolution mechanism allows for decision making other than by law-involves commitment and credibility. International commercial arbitration has increased in popularity and use over the past decade as the business community has begun to realize the allure of arbitration proceedings. Instead of submitting claims to a prolonged and potentially expensive suite in a civil court system, contacting parties can submit their claims to binding arbitration- the method often forgotten by professional is at once the most effective and most sensible discussion among parties themselves. The desirability of arbitration is obvious- the process is expedient, relaxes the formal rules of the judiciary, allows the parties to structure the proceedings and choose a convenient forum, and usually reduces the cost of dispute resolution. While cost and delay my vary in degree with judicial intervention into the finality of an arbitral award, privacy would appear lost in all cases where the court system assumes a public role in the settlement.This article examines the role of commercial arbitration in international context.Most commonly, arbitrants do not carefully and specifically delineate in their arbitration agreement that the arbitration is to be decided based on designated principles of substantive law and that deviation from this directive is the ground for vacation of the award.Choice of law clauseIn the United States, when arbitrants have expressed some preference of law in the arbitration context, this has most often been in the form of a general contractual reference, such as a typically worded choice of law clause. A choice of law clause could appear either within an arbitration clause or as a clause within a contra t that is subject of arbitration. A simple choice of law clause typically has been viewed as encompassing substantive law and not procedural law, for example, if a choice of law clause invokes the law of the country A in a case before the courts of country B, country B's law will govern the procedural matters, but the country B's court will determine the rights of the parties based on country A's substantive law. Since the remedy should reflect the substantive right, one would ordinarily expect the appropriate remedy to be that of chosen state. In arbitration context, the choice of law clause...

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