Law

Introduction
Arbitration is becoming increasingly important means of international business dispute resolution.  Several international commercial courts in the modern day are offering arbitration mechanism to solve large scale commercial disputes.  In addition, arbitration is the sole option of dispute resolution that is easily accessed among the international business communities and this provides the reason why this mechanism has gained popularity in most states around the globe.

Supportive laws have been put in place in most states and this favors the major clauses that are provided in the laws of arbitration.  The national courts all over the world have settled to recognize the international commercial arbitration awards. Consequently, this has increased the number of disputes resolved by the way of arbitration

Arbitration in international business
Instead of following court procedures which are typically expensive and involving, arbitration proves to be the option where cases are handled quicker and cheaper.  Instead of the judges and the juries in courts, arbitration involves the arbitrators who act like judges.  The arbitrators take full responsibility to determine the nature of violation against a business and making decisions on the appropriate compensation process.
The international business investing companies or individuals automatically sign an agreement which require a broker or brokerage firm to settle all business disputes through arbitration.  The signing is prior to the investment companies or business entities accessing a brokerage account. This gives international businesses and individuals a mandate to exclusively forward their disputes to arbitrators and not to the conventional courts.

Arbitration process requires consciousness in keeping time. Otherwise, the possibilities of recovering the lost funds or any form of compensation may not take effect. The arbitration laws have clearly stated in their provisions known as statutes of limitations.  This provision does not however remain similar in different states but keep on changing from one nation to another.  This therefore means that individuals from a given country will be served according to the existing statutes in his country.  

In most nations, business disputes are initially filed by the Financial Industry Regulation Authority Dispute Resolution.  This begins the process of arbitration.  In some states like in New York in the U.S, the claims can be filed with the exchanges such as the NSE (New York Stock Exchange). In some situations where the arbitration process does not seem to be complicated especially those involving small business, an individual may be required to appear before a hearing.

The classification of claims as simple or complex is based on the amount money in question.  Simple claims are characterized by money value of less than twenty five thousand U.S Dollars. To solve simple claims, the arbitrator goes through the papers presented to him by the broker and the claimant.

The arbitrator carefully examines every element of the documents and all written details showing the real incident of business violation.  During this process the claimant does not need to travel and therefore arbitration is considered to be a cheaper option of resolving international business disputes. A case of a claimant in Canada can be solved in London while the claimant is still in the home country carrying out other business processes.   It does not require the person to travel all the way from Canada to London in order to give a testimony or answer any questions concerning the issue.

Mediation is a procedure which may be performed before the actual arbitration process.  Businesses or individuals may choose to take an option of mediation or arbitration.  Significant time and money is saved in mediation far much than the arbitration process.  It has also been found that mediation is not such confrontational like arbitration. However, individuals are encouraged to seek arbitration in cases where mediation does not yield desirable results.

Arbitration has received considerable support regarding the resolution of the international business disputes.  However, the process need rigorous consideration before one enters into the arbitration involvements.  There are possibilities that the brokerage firm or the broker as an individual turn bankrupt at some stage or the dissolution of the firm altogether. The declaration of a broker or brokerage firm as bankrupt means that the business or individual represented by the bankrupt-declared firm or broker can not be compensated or recover his money.  International business disputes involving claims of less than twenty five U.S Dollars may be solved by arbitration process or mediation clinics provided by majority of law schools in the U.S especially in New York, Illinois, Pennsylvania and California. It actually does not require the hiring of a lawyer to represent an individual in arbitration.

International standards in matters related to arbitration have been ensured in the U.S through the American Arbitration Association (AAA).  The association endeavors to provide support to international business parties in resolving disputes in internationally accepted standards.  In an effort to attain international standards in offering arbitration services, the AAA has built up an International Centre for Dispute Resolution (ICDR) which is mandated the responsibility to exclusively administer the international matters of the association.
The centre, ICDR, has a repute of its organization with internationally recognized expertise and multilingual staff.  This gives the centre an honored capacity to handle international dispute resolutions. The fast action in the progression of matters typical in ICDR makes it to be identified as unique and one of its own.  In fact, some courts tend to be very slow to effect justice. It should be known that the delayed justice is always the denied justice. Another striking feature of ICDR is the nature of high sensitivity to cultural differences.  This feature attracts international business companies and individuals to seek arbitration with the center.
Most international business disputes can be handled because the fee charged is affordable.
 
In Netherlands, the Permanent Court of Arbitration (PCA) is charged the responsibility of handling arbitration matters.  The organization is based in Hague although it is open both to states and the parties seeking arbitration.  It is not a court as it may be presumed from the acronym.  PCA is only an administrative organization whose sole function is to serve as a registry which is permanent and easy to access.  This makes it possible for the international arbitration procedures and allied procedures like the commission of inquiry and reconciliation to be carried out.

International business communities will only be interested in the desirable arbitration type to solve their disputes. In several incidents, arbitration is done by an impartial adjudicator who resolves disputes without favoring any of the either parties. The adjudicator will make decisions based on the arguments of both parties.  The recommendation of both parties will be a guideline of the adjudicators decision.  He (the adjudicator) entirely sticks to the two parties ruling.

From the adjudicator point of view, we see great disparities between arbitration and the conventional judicial proceeding, expert determination, mediation and alternative business dispute resolution. However, the term arbitration has sometimes been used to mean judicial proceeding or simply the court.  

International business communities opt for arbitration to solve their business disputes because of major factors.  These factors highly sought for in arbitration are not found in most courts or any judicial proceedings.  Arbitration allows a client to select an arbitrator who has competence in arbitration process and good command in language or communication.  For instance, technical arbitration matters require highly competent arbitrators to intervene the process of decision making.

The fast way of carrying out tasks in arbitration has attracted several international business communities to turn to arbitration.  Arbitration is rated to be fastest way of dispute resolution than the usual litigation and court procedures which often turn out to be slow and sometimes ineffective.

Arbitration process is one of the most flexible and cheap means to solve international business disputes. The flexibility in its law provision which an individual can customize on which state to take the arbitration and the most affordable rates have made most international communities to select arbitration to be a method of choice in business dispute resolution.

Unlike court judgments which often take a long time, arbitration decisions are easy and quick to effect and do not involve any publicizing. The ease to enforce arbitration decision is provided for by the New York Convention.  Contrary, most legal systems in various countries have stiff regulations which make decision enforcement to be very difficult.

An advantage comes out of the stiff regulations by majority of legal systems.  The courts do not allow or offer limited options for placing an appeal against the award provided by arbitration. This is perceives as an advantage since it provides immunity to people seeking arbitration over court judgments or even hearings.
Majority of arbitration agreements are contained in what may be termed as ancillary agreements.  In some cases, the agreements are contained in small prints enclosed within other agreements. The small prints are not easily visible. Consumers and employees are left with doubts whether they have agreed to the compulsory binding the before dispute arbitration by taking up a job or purchasing a product.

In case the arbitration is binding and compulsory, the two parties who seek arbitration have to forego their rights and then access the courts. They are subject to involve a judge or a jury to give a decision and possible remedies regarding their case. The involvement of a judge or a jury limits the freedom typical in arbitration although this rarely happens.

The attorneys fee is not easily recovered or even traced in some arbitration systems and agreement.   This unfeasibility to recover the attorneys fee makes it hard for the employees and consumers to have permission to get full access to legal representation.  Majority of arbitration codes and agreements, just like courts, will however provide some relief for this situation.

The natural incentive has a propensity to rule against those seeking arbitration in case an arbitrator or arbitration forum completely depends on the corporation for repeat business. The limited ways to make appeals haunts as a major limitation presented by procedures of arbitration.  The limitation indicates that biased or flawed decisions can never be withdrawn or reversed without difficulty.

Arbitrators are not able to enforce interlocutory procedures against one party. This is a serious limitation where a single party is allowed to take precaution against the other party so as to escape the arbitration award enforcement.  A party can however take a position of another party to include the repositioning assets offshore.  It is also difficult to discover any problem associated with the process of arbitration.  The conventional way of carrying out the arbitration process is fast and often with less rigor.  The nature of rushing and not being keen to detail can pose great dangers of not recognizing flaws.  This is a different case with court procedures which always employ rigorous procedures which ensure no flaws are made.

The attorneys have extremely low potential to make billings as compared to pursuing the disputes via court procedures or sometimes trials. Unlike court judgments the arbitration awards are by no means autonomously enforceable. This means that a party that is seeking to enforce an arbitration award must resort judicial explanations.  This is known as an action to confirm an award. This therefore shows the involvements of arbitration in judicial procedures despite of the process being claimed to be devoid of legal systems.
Some of the cases are not arbitral. Due to the nature of cases, the process of arbitration can seem not to apply in such cases. In general, there are two groups of officially authorized procedures which are never subject to arbitration.  The first one is that which lead to a determination which the parties may not have the same opinion upon.  The second one is that which the legal orders free from or restrict some individuals from the arbitration exposure. This is mainly done for the rationale of providing resistance to the frail parties such as the consumers against rich companies.

Sometimes a case leads to results where two involved parties do not reach a conclusion.  In these cases where the procedures lead to a determination where the parties do not agree upon, the arbitration will then be declared null and void. A number of procedures in courts may have judgments which bind commonly all members of the public or the public authorities in their competence for their interest.  Through this element, both parties are privileged. Examples of the cases that are never arbitral include the antitrust matters in the U.S. In the same way, crime related matters, and status family law are never well thought-out to be arbitral.  The reason attributed to this is the power of the parties to enter into a concord which has distinct border line.   Nevertheless, some of the disputes involving two parties with private rights may be determined by arbitration actions.

Some cases encompass unlike segments which makes one part to be handled using arbitration actions while others cannot. For example, a dispute of violation into patented product can contain two sections.  The initial part is the substantiation of the claim that a violation into patented product has been made and this first segment can be solved by means of arbitration.  The second segment of the case is the actual validation of the patent which cannot be made by arbitration but a more complex mechanism. Arbitration does not apply here since patents are subject to a bureaucratic system of public registration.  For that reason, the arbitral panel may have little to do to order the involved body to approve any patent registration that is based upon its verdict.

Similarly, arbitration may not apply in situations when the legal order excuses the exposure of some individuals to arbitration.   The legal order may make these provisions to protect the frail individuals in the society such as consumers against rich companies.  A country like Germany for example, has laws that protect the tenants from disputes over the renting of the living space.  Were it not for such provisions in Germany, there would be much disturbance from arbitration interference.

The validity of arbitration concord with consumers in the same country is determined prior to signing by either party.  This is also pertinent only when the documents have been signed do not contain other contents other than the agreement of the arbitration.

There are a number of critical procedures that have to be carried out in arbitration.  To start with, it is necessary to make an arbitration agreement between the two parties.  Hypothetically, arbitration is an approval process which a party cannot be strained to accept unless he agrees to make a completely consensual agreement.  The hypothetical perception seems to differing from the realistic feature.

Larger fraction of arbitration agreements is made on situations where the employees and consumers have diminutive or no bargaining power at all.  Furthermore, arbitration clauses have for all times been written and preserved deep within the user manuals which are provided when purchasing products.  The nature of the products can be tangible or intangible ones and both of these come with the arbitration clauses deep hidden and not easily to view. While these agreements are fully contained in the websites, they often entail a number of mouse licks and long searches before reaching the eye of the consumers to ready.  Yet in some other circumstances, the approval does not make a great deal of sense.

There are two broad categories of arbitration agreements Agreement that disputes should at all times be determined by arbitration and that the agreement that is devised following that a dispute has already taken place.  Standard contracts other than those with arbitration clauses stand for the first type of agreement. Another type of agreement, which is the second type, can also be termed as submission agreement. This type of agreement states that arbitration shall only be appropriate in circumstances after a dispute has already taken place.

Most business communities and consumers may give support to the second type of agreement of arbitration. However, the legal significance dictates on the choice of arbitration agreement to be taken.  For instance, in some countries belonging to Commonwealth, have a provision that each individual party has to bear the costs in a typical arbitration clause.  This however does not apply to a submission agreement.

International Court of Justice
Arbitration generally has not been such a uniform process among different states. However, state laws have taken an initiative in keeping with the lack of formality of whole procedure of arbitration.  The ratifying of the laws in various states and nationals maintain the principles of arbitration clauses even in situations where the normal formal language which is connected with legal contracts is deficient.  State laws have authenticated the process of arbitration despite the apparent disadvantage. Examples of these clauses have been adapted by the London where the English law is said to apply, sometimes calling it an appropriate clause of arbitration.

Several states have their courts upholding those clauses that specify the dispute resolution other than the conventional methods following the particular system of legal provision. For instance, there is a provision which states that the arbitrators must not necessarily make decision based on the strict law rather on a general rule should consider the laws of practical business. An additional condition states that arbitration modus operandi is based on the internationally established principles of law which is governing the contractual relation.

The agreement to further the disputes to arbitration process has an extraordinary position before the law.  For instance in dispute involving a contract, the most likely resistance system is to plead that the contract is invalid and therefore any claim that will be based upon it will automatically be null and void.  This always follows that if one of the parties claims that the contract is void, then all the clauses in the agreement will be declared void.

London court of international arbitration The LCIA (London Court of International Arbitration) has presence in national courts which are operational in a number of states. These courts perform arbitration procedures under the mandate of LCIA. The respect for the agreements by the parties to arbitrate provides that there should be no court proceedings on the merit of the dispute which can be presented before national courts. The LCIA in addition provides that all the disputes which are covered by the agreement should be referred to arbitration procedure.

There are a few situations where there is need to apply the interventions and various mechanisms of the court to address the issue of arbitration. These situations which necessitate the invocation of the court include the removal or appointment of arbitrators, the process of collecting evidence and other circumstances as dictated by the laws of arbitration. The court may be asked to order for support or immunity procedures in cases the arbitrators do not have coercive powers.

The LCIA also recognizes and enforces the foreign awards of arbitration. The award of the parties can only be successful at the end of the proceedings of arbitration, when the parties are capable of enforcing the award in case it is not complied with willingly. It is at the LCIA that the national provisions for the domestic awards enforcement are of integral role to all the businessmen seeking international commercial process of arbitration. In most individual states, the awards that originate from proceedings of international arbitrations are enforced under the domestic awards regime which has proved imperative to international business community.

The whole picture created from the LCIA is that the process of arbitration involves different parties to refer present their various disputes to arbitration process. In other words, the international laws of arbitrations do not exclusively comprise of statutory laws but an integration of international provisions. The arbitration rules which are associated with the international disputes form the basis of international arbitration.

The LCIA ensure that individual states have a mechanism for Institutional Arbitrations. Institutional Arbitration refers to the form of arbitration which takes place prior to any recognized centre of arbitration.  An example of such recognized centre of arbitration is The London Court of International Arbitration which has strived to create an allowing legal climate for the growth of a legal body which can well be referred to as Arbitration Jurisprudence. The development of Institutional Arbitration has been made possible by the highly specialized institutions of arbitration having a permanent arbitration Secretariat to oversee the arbitration processes and the places where the proceedings of arbitration are conducted.

One of the most important advantages of institutional arbitration it offers highly trained staffs who administer the whole process of arbitration. This gives the international business community trust to seek arbitration process as a way to solve their disputes.  Particularly the LCIA, the staff serving at the arbitration proceedings is highly trained which makes businessmen all over the world to seek arbitration services in London.

UNCITRAL
The rules existing at the LCIA are of international standards and are never associated to any national system. The UNCITRAL Model Law is one fine example of such laws that are designed to apply in all states. However, individual states have a responsibility to include the arbitration laws of UNCITRAL, the LCIA and other sets of laws of arbitration for better serving the parties seeking arbitration. The UNCITRAL Arbitration Rules shall only apply where there is an agreement in writing between the parties to a particular contract. After such agreements, the disputes are then settled according to the UNCITRAL Rules of arbitration subject to the modifications which the parties may choose to agree in writing. The arbitral tribunal conducts the arbitration in such a way that it judges suitable given that the parties are given an equal treatment and that during the proceedings, each party is accorded with full opportunity of putting forward his case. The awards made according the UNCITRAL Rules of arbitration derive the powers of the provision that in situations where there are three arbitrators, the award or any decision of the arbitration tribunal shall be made considering the arbitrators majority. Sometimes there is no such majority or the arbitration tribunal authorizes to cause questions of procedure. In this case, the arbitrator who presides may make his own decision subject matter to revision. Apart from the final award, the arbitral tribunal shall be entitled to make interlocutory, interim or sometimes partial awards. These awards are only made in writing and represent the final binding on all parties. When this happens, the parties undertake to perform the award with no much ado. The tribunal then states the reasons concerning the award unless there is an agreement from the parties that the reasons should not be provided.

Article 26 of the UNCITRAL Arbitration Rules provide that if any party makes a request, the arbitral tribunal is allowed to take any interim step which it considers necessary in accordance to the subject matter of the presented dispute. These measures include but not limited to the ordering of the sale of any perishable goods or ordering their deposit with the third party. The interim measure being taken by the arbitral tribunal can be in forms of interim award of which the security for the total cost of such steps is required by the arbitral tribunal.The International Chamber Of Commerce The International Chamber of Commerce (ICC) makes policy on arbitration. The Rules of Arbitration of the ICC which has its headquarters in Paris can trace back their origin to 1922. Since then, these rules have gained a powerful and persistent influence on the international arbitration development. The Commission on Arbitration which is an organ of the ICC aims at creating a forum for the experts to put together ideas and create a change in new policies on practical issues which relate to international arbitration. At the same time, the ICC formulates policies for the settlement of international business disputes and the procedural and the legal aspects of arbitration. The Commission on Arbitration under the ICC aims to take a close look on the settlement of disputes with regard to the modern development which include the novel technologies. The ICC and the Commission on Arbitration with its well formed Task Forces and allied groups have made presence in over 90 member states with about 500 members from all the states under it. This presence includes the international law firm partners, the law professionals, experts in providing service in various resolutions of disputes, the in-house counsel and the trade executives in international organizations and in all member companies.  

Cases A number of cases have been solved by the way of arbitration in courts. For instance, the U.S Supreme Court has within the recent past listened to argument that may decide a paramount issue involving consumer arbitration. These issues include the question when the courts can actually vacate the award of an arbitrator and the whole scope of exclusion as provided in Section 1 of the U.S Arbitration Act. The case, Green Tree Financial Corp. v. Randolph which was heard on October 4th, came as a result of the purchase of a mobile home by Larketta Randolph. Randolph challenged that Tree Financial Corp of Alabama that financed her purchase fell short to disclose the basic requirements that the buyer purchases an insurance of vendors single interest which can protect the prospective lender in the process of the buyer happens to default.   The lawsuit was dismissed by the federal district court and instead decided Green Trees motion to compel arbitration under the contract terms. The court reasoned that since the contract was rather silent on each partys responsibility for arbitration fee payment the potential arbitration cost might seem to be very dear for the ordinary consumer. Prior to making the final conclusion, the 11th Circuit maintained that it had the authority to hear the consider hearing the appeal because of the dismissing of the case by the federal district court and because the compelling arbitration was a final order that had a potential to have an appeal.  

The Supreme Court then offered certiorari on two main issues the potentially and the procedural dispositive of the whole case and the other substantive. The procedural issue was to determine whether it is possible to hold unenforceable the arbitration clause in case it does not specify the procedure of paying the fees. Subject to this, the American Arbitration Association (AAA) filed an amicus brief in the case that was only addressing the substantive issue.  The Association, in its brief, urged the Supreme Court to declare that the clause of arbitration which does not speak of fees payment was ambiguous to the court ruling and hence was to be construed to preserving enforceability. Additionally, the AAA brought into attention of the Supreme Court the Consumer Due Process Protocol of the association which grants the standards and procedures for fair decision of consumer disputes.

Conclusion
Generally, arbitration has drawn a lot of importance in the past decades and further continues to be of significance among the international business communities. However, one issue still remains unsolved the uniformity in operation. The latest development has seen efforts to bring some uniformity in arbitration.  There have been generally accepted principles governing the process of arbitration.  These laws have been recognized to promote some standards which can facilitate the making of judgments on pragmatic basis and bearing in mind diverse countries.  Owing to the importance of arbitration in solving disputes, countries should strive to include this important element to support the business community in their tasks.  With all countries around the globe embracing the system, it will be easier to make arbitration operations uniform.