International arbitration is a method of resolving disputes between parties, typically businesses or countries, where those parties agree to use a neutral third party, called an arbitrator, instead of a traditional court. This method is often used in international trade and investment disputes. International Arbitration is defined under section 2(1) (f) of the Arbitration and Conciliation Act, 1996.
International Commercial Arbitration is one of the several forms of dispute resolution for international commercial agreements. The use of Arbitration has increased along with the growth of International Trade and Commerce and the accompanying disputes springing from these pursuits. In a broader sense, arbitration is a vehicle of dispute resolution in which parties to a contract select a neutral arbitrator (s) to present their dispute for a legally binding ruling. Arbitration is often selected for the reasons of confidentiality, and to eliminate the uncertainties in the choice of arbitrator and forum. Parties from different national origins may also be reluctant to accept National Court litigation with the potential for National bias. Arbitration offers the parties more control over how proceedings will be conducted.
International commercial arbitration is similar, in important respects, to domestic arbitration. As in domestic matters, international arbitration is a consensual means of dispute resolution, by a non-governmental decision maker that produces a legally binding and enforceable ruling. In addition, however, international arbitration has several features that distinguish it from domestic arbitration. Most importantly, international arbitration is often designed and 4 accepted particularly to assure parties from different jurisdiction that their disputes will be resolved neutrally. Among other things, the parties seek a neutral decision maker. In addition, international arbitration is frequently regarded as a means of mitigating the peculiar uncertainties of transitional litigation, by designating a single, exclusive dispute resolution mechanism for the party’s disagreements. Moreover, international arbitration is often seen as a means of obtaining an award that is enforceable in diverse jurisdiction.
The expression “International Commercial Arbitration: has been defined to mean, in short, an arbitration relating to a commercial dispute which has at least one of the parties belonging to a foreign country. Such party may be an individual, firm or a company. It has been noticed that Public Sector Undertakings (PSUs) i.e. state-owned corporations in India and other business entities normally do not object to the arbitration in an International Contract to take place outside India. Corporations such as Oil & Natural Gas Commission (ONGC), the National Hydro Power Corporation (NHPC), Steel Authority of India Ltd. (SAIL), Food Corporation of India (FCI) in their international contracts agree to arbitration being held outside India as Government of India and/or state-owned corporations are amenable to subscribing to an arbitration clause making arbitration 6 subject to the rules of an internationally recognized Arbitral Organization.
The International of Commercial Arbitration may result in the application of a different set of rules. Several legal systems have special rules international arbitration while other systems opt for a unified regulation. There are three ways of establishing the international character of arbitration.
Arbitration may be international because:
- Its subject matter or its procedure or its organization is international;
- The parties involved are connected with different jurisdictions;
- There is a combination of both.
The objective criterion focuses on the subject matter of the dispute and the international or national character of the underlying transaction. Hence, the international commercial interest, or the cross border element of the underlying contract, or the fact the dispute is referred to a genuinely international arbitral institution, such as the International Court of Arbitration (ICC), the International Commercial Law Alliance (ICLA) or International Centre for Settlement of Investment Disputes (ICSID), would be sufficient for the arbitration to qualify as international. To the subjective criterion, the focus is on the different nationality or domicile or place of business of the parties to the arbitration agreement. It follows that parties, individuals or companies, should come from different jurisdiction. The modern combined criterion, a third approach combines both the subjective and objective criteria.
International Commercial Arbitration has proved to be a very effective mechanism for resolving disputes but it faces certain obstacles which can be overcome by adopting certain measures such as reducing costs, avoiding delay, setting up a separate monitoring institution and making separate laws for Domestic and International matters. By adopting the aforesaid measures, International Commercial Arbitration will not only enlarge its scope but also promote arbitration for small claims. Especially, in Developing countries like India, where the economy is developing at a very high rate and also with the advent of globalization, the economy has expanded a few notches. A dispute resolving mechanism such as International Commercial arbitration can help in fostering the growth of the economy. On the other hand, most of the time countries, such as Singapore have opted for arbitration as they have separate laws for domestic and international matters and the courts interference is minimal. India can also become the arbitration hub of the world, if proper arbitration mechanisms are developed International Commercial Arbitration in India should be made much easier and 13 accessible or else the main purpose of its existence will be deprived. It should also be less technical and more responsive to the canons of justice and fair play and make the arbitrator adhere to such process and norms which will create confidence not only by doing justice between the parties, but by creating the sense that justice appears to have been done.
Our Firm has separate team for Arbitration Practice including domestic arbitration & International Arbitration, under the leadership of Mr A K Singh is internationally renowned Arbitration lawyer in India. The Aegis Legal is the pioneer in the Arbitration practice in India and known as one of the best arbitration lawyers in Delhi India. The Aegis Legal has been engaged in various top-notch arbitration cases across the country.
Our firms stand as one of the leading law firms nationwide. We provide comprehensive legal services in the both domestic and international arbitration matters. Our proficiency extends across different sectors making us one of the trustworthy for businesses engaged in complex disputes. We offer specialized services in various arbitration processes, including commercial and institutional arbitration, delivering strategic legal solutions tailored to the unique needs of our clients. Our team of skilled arbitration lawyers in India has successfully represented clients in high-stakes cases involving contractual disputes, cross-border litigation, and enforcement of arbitration awards.
