With the beginning of a new calendar year, the 20th anniversary in 2005 of the adoption of the UNCITRAL (United Nations Commission on International Trade Law) Model Law on International Commercial Arbitration, and the approaching (two years from now) 50th anniversary of the 1958 United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, it seems an opportune time to share with our readers some observations concerning changes that we perceive have taken place in international arbitration and for us to hazard guesses as to future trends in international arbitration.

International Arbitration Hike

There has always been a strong case for the use of international arbitration as a means of resolving transnational commercial disputes. Contracting parties see international arbitration as a means to avoid giving the other side a “home court” advantage, and because of the involvement of experienced commercial arbitrators, international arbitration is regarded as offering greater predictability of dispute resolution. Other perceived benefits include the greater amounts of time generally available to arbitrators, and, of course, the vaunted increased speed and lower costs. Thus, even though arbitrators have to be compensated by the parties and judges do not, a greater number of international commercial disputes – particularly those involving large amounts of money – have come to be resolved through arbitration rather than in the courts.

The greater use of international arbitration can be seen in published statistics. There has been steady growth in number of cases heard by the International Chamber of Commerce and the International Centre for Dispute Resolution of the American Arbitration Association, as well as a burgeoning of the number of disputes heard in China. Many arbitration centers have grown up around the world, some with more hopes than business, but enough to give rise to an active association of arbitration institutions.