With the advent of globalisation, cross-border business transactions and partnerships are becoming a widespread trend. Although this has helped foster many business relationships, there have been several conflicts that have occurred among business entities from different parts of the world. In this regard, international arbitration has proven itself to be one of the most effective ways of settling disputes.
If your business operates within the jurisdiction of the UAE laws, then knowing how arbitration works would be necessary. As either a large multinational corporation or an investor, you must seek legal counsel by consulting a Dubai lawyer to effectively handle arbitration cases. Charter Legal can provide you with efficient legal services for your business needs.
What Is International Arbitration?
International arbitration is a form of dispute resolution where parties agree to arbitrate their dispute before one or more arbitrators as opposed to taking their case to court within their national boundaries. An arbitral award is a ruling made by the arbitrator after a hearing which is generally legally binding in several countries.
International arbitration is commonly used in commercial contracts, construction contracts, commercial trade, joint ventures, and investments for various reasons.
Why International Arbitration Is Important
Some of the benefits of arbitration include:
- Neutral and independent arbiters
- Increased confidentiality
- Rapid solution compared to court proceedings
- Flexibility in procedures
- Global recognition of arbitration awards
- Minimised jurisdiction disputes
The United Arab Emirates has laws that support arbitration and make the country an ideal arbitration centre due to its advanced legal system.
Arbitration Agreement
Step 1: Creating an Agreement for International Arbitration
The first and foremost thing that needs to be done in international arbitration is an agreement for arbitration.
An arbitration agreement usually forms part of a business agreement which includes:
- Scope of disputes to be arbitrated
- Institution of arbitration
- Seat of arbitration
- Governing law
- Language of procedure
A properly written agreement can help prevent future problems concerning procedures and jurisdiction. Seeking professional legal advice can help you create an arbitration agreement that suits your needs.
Step 2: Notifying Party of an Arbitration Claim
To start an arbitration claim when there is a dispute, the claimant sends a Notice of Arbitration.
This notice includes:
- Identification of the parties involved
- Description of the dispute
- Provisions of the agreement relevant to the dispute
- Relief or remedy desired
- Nomination of an arbitrator if required
This formal notice begins the arbitration process and informs the opposing party about the claim being made.
Step 3: Appointment of Arbitrators
One of the key elements of arbitration is the option to appoint arbitrators based on their knowledge of the particular issue.
The composition of the arbitral tribunal depends on the arbitration agreement which provides for the following options:
- A sole arbitrator
- Three arbitrators
- An arbitration panel appointed via an arbitration organization
Choosing arbitrators is important as it is directly related to the quality of the award as their experience and neutrality can significantly impact the outcome of the case.
The experienced Dubai attorney can help you choose the best arbitrators in cases of cross-border disputes.
Step 4: Initial Pre-Procedural Hearing
Once the arbitral tribunal is appointed, a pre-procedural hearing will take place.
At this stage, the tribunal and the parties discuss:
- Scheduling issues
- Deadlines
- Production of documents
- Hearing schedule
- Confidentiality agreements
This step establishes the framework for the arbitration and helps ensure an efficient process.
Step 5: Exchange of Written Submissions
At this stage, the parties will exchange in-depth written briefs that set out their respective positions. These briefs generally consist of the following:
Statement of Claim
In the statement of claim, the claimant will include the following:
- Facts of the dispute
- Arguments in law
- Evidence
- Remedies sought
- Statement of Defense
In the statement of defence, the respondent will state:
- Response to the claims against them
- Counterarguments
- Evidence
- Counterclaim, if applicable
Good legal preparation during this phase will play an important part in the result of the case.
Step 6: Evidence and Document Production
Evidence is an extremely important aspect of international arbitration. Parties can present the following types of evidence:
- Contracts or agreements
- Financial information
- Correspondence
- Technical data
- Expert testimony
- Witness statements
The tribunal may also order the production of additional documents when necessary.
Professional legal services UAE businesses depend on often include evidence management, document review, and strategic case preparation to strengthen arbitration claims.
Step 7: Arbitration Hearings
When the writing process is completed, the hearings can follow.
During hearings:
- Witnesses can be questioned
- Experts can give their testimonies
- Legal arguments will be made
- Questions can be asked by the arbitrators
Virtual hearings are now part of many international arbitrations, making the process easier and cheaper when the parties are from various countries.
Step 8: Decision-making and Award
After considering all the documentation and listening to the arguments made by the parties, the arbitration tribunal can start its decision-making procedure.
The matters that the tribunal must consider include:
- The contractual agreements
- The law applicable to the dispute
- Evidences and testimonies
- Reports of experts
An arbitral award will finally be issued after these considerations.
The arbitral award normally contains:
- Findings of facts
- Conclusions of law
- Damages awarded
- Costs
UAE law provides mechanisms for recognising and enforcing arbitral awards, which gives businesses peace of mind.
Step 9: Enforcement of the Arbitral Award
Getting an award does not always mean the process ends there. The other party must comply if they refuse to do so, then action must be taken.
The awards made under international arbitration can be enforceable in different jurisdictions because of various treaties and laws that exist at the domestic and international level.
If you need help enforcing the awards given by the arbitral tribunal, then a qualified Dubai attorney will ensure that you receive the award.
How Charter Legal Can Help
To handle cases of international arbitration, one needs to plan properly, have a good knowledge of domestic and international laws, and use sound legal strategies. Charter Legal has been providing UAE residents with reliable legal assistance for years.
We provide all kinds of legal advice and assistance that you might need from drafting an agreement to enforcing the awarded award.
Conclusion
International arbitration has proved to be quite an effective method in resolving such conflicts. It would be beneficial for one to get acquainted with all stages of arbitration procedures starting from the signing of a contract and initiating the arbitration proceedings, and further on.
Due to their practical experience in UAE laws, companies will be able to easily handle any arbitration procedures. In case you require professional lawyers in Dubai or any other legal assistance related to any disputes, we highly recommend Charter Legal.