Arbitration and international commercial disputes relationship has been growing in popularity with the passing of time. Many believe that this has been down to the implementation of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards in 1958. This Convention attempted to make arbitration quicker and more attractive to commercial parties. The founding basis of arbitration was to furnish parties with a trouble-free, quick and relatively cheaper method (without the added stress of court room formality) for resolving commercial disputes. The lure of arbitration for international commercial disputes was mainly motivated by the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (also known as the New York Convention) which has provided arbitration awards (unlike court judgments) almost global enforceability. Unfortunately, as arbitration became more popular and more commonly referred to in commercial disputes, so it became slower and became criticised for its eventually high cost. Not only was the time and cost condemned but it was felt that the process was actually very complicated.
Therefore, there is a need to consider the following questions – Where does arbitration sit now in the current climate in terms of its role and its niche? Is it effective as a method of alternative dispute resolution? If yes, why? If no, why not?
Not only is it now commonly understood that the process of arbitration can be as time-consuming and document heavy as a trial but moreover, many of the supposed advantages of international arbitration are lost once a challenge is brought before the competent court at the seat of an arbitration, or once enforcement proceedings are contested. Once contested, the dispute becomes public and played out in front of domestic judges of varying capacity and competence instead of in front of neutral, specialist arbitrators in a private setting. Furthermore, when enforcement proceedings are dealt with by national courts, as they must be, there is a not inconsiderable risk that the conclusion of the case will be held in front of a biased national court, thereby destabilizing one of the main advantages of international arbitration. As we will see as we get further into this dissertation, judicial supervision is necessary for international commercial arbitration to continue to produce just results but does this negate the effectiveness of arbitration? The idea that judicial supervision is necessary for arbitration to function properly is crucial to the discussion of whether arbitration fulfills its role as providing an effective, alternative to litigation.
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