Originally from Arbitration Clauses for International Contracts - Second Edition

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EXPERT DETERMINATION AND DISPUTE BOARDS

Many international contracts provide for submission of disputes to a third party, an expert, who is chosen for his or her expertise in the area.

The advantages of expert determination as a method of dispute resolution, as compared to arbitration or litigation, are speed, low cost and simplicity, on the assumption that the expert determination will be a fairly simple, informal procedure.

Where the contract provides for final and binding decisions by the expert, expert determination is similar to arbitration, but expert determination can be distinguished from arbitration in three principal ways. First, while an arbitrator is chosen to exercise a judicial function and to resolve a dispute based upon submissions by the parties, an expert is chosen for his or her expertise in a certain subject matter and often does his or her own investigation or appreciation of the issue, with or without submissions by the parties. Second, while arbitrators are invariably individuals, an expert can be a company or an organization. Third, while arbitral awards can be enforced on the basis of the New York Convention and are subject to challenge on the grounds laid out in the Convention, an expert determination, unless re-qualified as an arbitration, is not governed by the New York Convention.