International Arbitration: A Study into Corporate Attitudes and Practices

PricewaterhouseCoopers in association with the School of International Arbitration, Queen Mary, University of London, has published a unique study looking into corporate attitudes and practices surrounding international arbitration.

With the growth and complexity of international trade and investment, the resolution of cross border disputes is becoming more and more sophisticated. Increasingly, parties are opting for international arbitration to resolve disputes as opposed to litigation through the national courts. International arbitration can provide distinct advantages over litigation through its more flexible processes and the wide enforceability of awards; yet there are disadvantages, particularly for the unwary.

This study into the views of in-house counsel at leading corporations around the world tests twelve perceptions around international arbitration and uses the empirical evidence from the research to either confirm or challenge these perceptions. The results provide valuable insights for any business that trades or invests abroad.

Key findings:

  • A significant majority of corporations prefer international arbitration to resolve their cross border disputes
  • The advantages of international arbitration clearly outweigh the disadvantages
  • Corporations overwhelmingly favour the finality of arbitration awards
  • The tactical significance of some features of international arbitration, e.g. the choice of seat of arbitration may not be fully appreciated
  • A clear dispute resolution policy provides an important strategic advantage when negotiating dispute resolution clauses for cross border contracts
  • There is widespread support for regional arbitration institutions
  • Corporations are looking for arbitrators with an established reputation in the international arbitration community
  • Although international arbitration can sometimes be at least as expensive as transnational litigation, it may represent better value for money
  • With increasing awareness of international arbitration as a dispute resolution process, there is growing demand from corporations for more education on the tools and tactics of international arbitration
  • The outlook for international arbitration is extremely positive - 95% of corporations expect to continue using international arbitration