HomeFWJ TakeawayInternational arbitrationArbitration explainedWhat should an arbitration clause include?

The importance of a well drafted Arbitration clause cannot be underestimated.  It can help save considerable time and costs, as it ensures fewer areas of dispute with how it is to be interpreted. Our brilliant team is here to help.

Arbitration clauses should always try and cover the following points:

  • There is a dispute. And that future and/or existing disputes are covered. The New York Convention provides clarity and confirmation for this to parties – “all or any differences which have arisen or which may arise between them” (emphasis added)
  • It is arbitrable i.e. that it is capable of being settled by arbitration. It is vital that the dispute is covered by the clause. If not, any award will not be enforceable. Generally issues of patents, antitrust and competition laws, securities, insolvency, bribery and corruption, fraud, natural resources, and corporate governance need to be looked at closely to ensure that they are arbitrable in the jurisdiction the dispute is taking place at.
  • There is a mechanism to commence the arbitration. This differs from ad hoc arbitrations to institutional arbitrations, but usually will take the form of a formal notice.
  • This mechanism should also include the method by which the arbitrators are chosen, and the number of arbitrators. 
  • What the rules of the arbitration should be – is it ad hoc, or institutional?
  • What the seat of the arbitration should be?
  • The law of the contract.
  • The language of the arbitration.

Many arbitral institutions such as the LCIA or the ICC have model clauses which parties are encouraged to follow. For example the ICC rules suggest the following

All disputes arising out of or in connection with the present contract shall be submitted to the International Court of Arbitration of the International Chamber of Commerce and shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by one or more arbitrators appointed in accordance with the said Rules.”

Whatever your Arbitration enquiry – our team has the expertise to help you. FWJ are experienced in helping clients domestically and internationally deal with Arbitration clauses and help resolve disputes as quickly and commercially as possible. No matter what your issues – call our team of experts today and we can help.

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