Empirical research reveals that users of international arbitration view undue time and cost as international arbitration’s worst attributes. This article offers some potential solutions to combat this increasing dissatisfaction, focusing on a prophylactic approach in which parties are encouraged to negotiate and incorporate cost- and time-saving measures directly into the arbitration clause of their underlying contract.
In the early stages of a commercial relationship, parties operate behind a ‘veil of ignorance’, a concept derived from modern social philosophy in which members of a nascent society are prevented from knowing what position they will occupy in that society. Without the knowledge of how the future society’s rules and policies might affect them personally, each participant will be naturally inclined to promote, agree to, and implement rules and policies that are fair and advantageous to all. Likewise, if parties to a nascent commercial relationship address cost- and time-saving techniques during the earliest stages of that relationship, they will be incentivized to agree to a dispute resolution framework that reduces time and costs more effectively than if they sought to implement those measures after a dispute has arisen.
This article discusses several suggested measures designed to increase the economy and efficiency of international arbitration, along with a discussion of the respective tradeoffs and practical limitations of including those measures in the parties’ arbitration agreement.Journal of International Arbitration