International Arbitration is not Arbitration - SIAR 2008-2
Jan Paulsson heads the international arbitration practice of Freshfields Bruckhaus Deringer, Paris
Originally from: Stockholm International Arbitration Review
INTERNATIONAL ARBITRATION IS NOT ARBITRATION
What are you to make of the title of this lecture? It may well take me the better part of an hour to try to convince you I’m right - and you may still disagree.
But it will take me less than one minute to explain why the title is not at all preposterous - and you will be instantly persuaded.
You don’t think that international arbitration is arbitration because it has "arbitration" in its name, do you? Do you think a sea elephant is an elephant? International arbitration is no more a "type" of arbitration than a sea elephant is a type of elephant. True, one reminds us of the other. Yet the essential difference of their nature is so great that their similarities are largely illusory.
Sea elephants have no legs. They exist in an environment radically different from that of elephants. International arbitration is no less singular. This needs to be understood. The concept is as stark as the dichotomy between animals with legs and those without. Here is the difference: arbitration is an alternative to courts, but international arbitration is a monopoly - and that makes it a different creature.
Not so long ago, conference organisers were so enamoured of the topic "arbitration vs. litigation" that they seemed to treat it as a handy default solution. They seemed to say: "If we cannot think of anything original, let’s just trot out the question ‘Is arbitration better than litigation?’ and we’ll fill the hall." Amazingly, sometimes they did. But whatever the interest in the question in a purely national setting, it is nonsense as soon as one considers the most basic of international contexts; that is, a single table where two parties of different nationalities are facing each other. That is all you need to see to realise that the question is puerile because each party hearing ‘arbitration or courts?’ thinks "this arbitration as opposed to what - my court or their court?" We can be certain that lawyers’ cupboards across the globe are filled to bursting with myriad contracts referring to international arbitration even though each side actually preferred courts.