A Negotiation Perspective on the Agreement to Arbitrate and Its Completion

Abstract

Looking at the 2018 International Arbitration Survey it seems that users of arbitration rank flexibility of procedure as one of the most attractive features of international arbitration. The word ‘flexibility’ seems to be used in a relative sense, meaning more flexible than court proceedings. Users simultaneously point out lack of speed and lack of effective sanctions as being among the least attractive features of the arbitral process. This would presumably be in comparison to user expectations.
The flexibility of arbitration is due to its consensual basis. The parties may choose their arbitrators, the place and the language of the proceedings. The procedural rules are considerably less comprehensive than the ones in the rule book that the courts have to follow. This gives the parties wide opportunities to agree on the procedural design, including the scope of the proceedings, the rules for taking of evidence and the use of interlocutory and partial awards. In principle, the freedom to agree on the procedure extends to the point where the agreement violates the requirements of fair and equal treatment, the right to be heard and the right to be represented by an attorney or to the point where the agreed procedure does not qualify as ‘arbitration’ at all, in which case the outcome of the procedure may not be recognized and enforced as an arbitral award (although the agreement and its outcome may have other legal effects). Standard ad hoc arbitration agreements have little to say about the proceedings as such; the agreement basically says that the parties shall settle their dispute by way of arbitration, also perhaps specifying the place and the language of the proceedings.