ARB-MED-ARB MODEL: INTERNATIONAL PRACTICE AND APPLICABILITY IN VIETNAM

Viết thuê luận á, luận văn thạc sĩ, chuyên đề ,khóa luận, báo cáo thực tập
Sdt/zalo 0967538 624/ 0886 091 915 lamluanvan.net
MINISTRY OF EDUCATION AND TRAINING
FOREIGN TRADE UNIVERSITY
ARB-MED-ARB MODEL: INTERNATIONAL PRACTICE AND
APPLICABILITY IN VIETNAM
Major: Economics
Specialization: International Trade Policy and Law
Code: 8310106
Full Name: Le Hong Nhung
Supervisor: Assoc. Prof, Dr. Nguyen Minh Hang,
Ha Noi, 2019

STATEMENT OF ORGINAL AUTHORSHIP
The master thesis “Arbitration-Med-Arb model: international practice
and applicability in Viet Nam”, which was completed as a result of the course
named Master of International Trade policy and Law, is the author’s sole work with
the best devotion, endeavor and hard-working period given. The author guarantee
that the master thesis have been carried out in conformity with the thesis writing
regulation and process issued by the Foreign Trade University

ACKNOWLEDGEMENT
This thesis is the result of six months of researching. It is an interesting and
learning experience. In completing this thesis, the author would like to give my
special thanks to many people for their significant help, contribution, and
recommendations during my writing process.
Foremost, special mentions and the most sincere thanks should belong to
Associate Prof. Dr. Nguyen Minh Hang, my supervisor at Foreign Trade University.
With her master knowledge and experiences, she helped me in writing this thesis. I
could not complete this thesis without her positive suggestions and guidance.
Secondly, I would also like to give my thanks to the authors who provided me
with valuable books for my thesis.
My last appreciation is to the Faculty of Graduate Studies of Foreign Trade
University for organizing such a meaningful master course and all the support, my
family and my friends for their supports and encouragements.
Hanoi, 15th
January 2019
Le Hong Nhung

TABLE OF CONTENTS
STATEMENT OF ORGINAL AUTHORSHIP
ACKNOWLEDGEMENT
LIST OF FIGURES & TABLES
LIST OF ABBREVIATION
SUMMARY OF THESIS RESEARCH RESULT
INTRODUCTION.....................................................................................................1
1. Rationale .........................................................................................................1
2. Literature review............................................................................................2
3. Research questions.........................................................................................4
4. Research’s objective.......................................................................................5
5. Scope of study.................................................................................................6
6. Methodologies.................................................................................................7
7. Research disposition ......................................................................................8
CHAPTER 1: THEORETICAL FRAMEWORK .................................................9
1.1. Alternative dispute resolutions .....................................................................9
1.1.1. Background............................................................................................9
1.1.2. Definition..............................................................................................11
1.1.3. Methods and forms of ADR.................................................................13
1.1.4. ADR and litigation ...............................................................................13
1.2. Mediation ......................................................................................................16
1.2.1. Rationale of mediation.........................................................................17
1.2.2. Definition and process .........................................................................18
1.2.3. Stages of commercial mediation..........................................................20
1.2.4. Types of commercial mediation...........................................................23
1.2.5. International organization’s activities for commercial mediation ....24
1.2.6. Advantages and disadvantages of commercial mediation..................27
1.3. Arbitration....................................................................................................28
1.3.1. Rationale of arbitration .......................................................................28
1.3.2. Definition and process .........................................................................29

1.3.3. Stages of commercial arbitration ........................................................31
1.3.4. Arbitration agreement........................................................................33
1.3.5. Forms of commercial arbitration........................................................34
1.3.6. Benefits and drawbacks of commercial arbitration ...........................35
1.4. The key differences between mediation and arbitration..........................36
1.5. The understanding of arb-med-arb model ................................................39
CHAPTER 2: INTERNATIONAL EXPERIENCE ON APPLYING ARB-
MED-ARB MODEL: STUDY OF SINGAPORE ................................................42
2.1. Singapore’s development in mediation and arbitration ..........................42
2.1.1. Singapore’s development in mediation ...............................................42
2.1.2. Singapore’s development in arbitration..............................................45
2.2. Singapore's Arb-Med-Arb model...............................................................50
2.2.1. SIAC-SIMC Arb-Med-Arb Protocol ...................................................50
2.2.2. Procedure of Singapore’s Arb - Med - Arb model..............................52
2.2.3. Advantages of Arb - Med – Arb...........................................................55
CHAPTER 3: APPLICABILITY OF AMA MODEL IN VIET NAM AND
RECOMMENDATIONS........................................................................................60
3.1. Vietnam’s approach on applying Arb – Med - Arb model ......................60
3.1.1. Vietnam economy review.....................................................................60
3.1.2. Vietnam development in commercial mediation and arbitration ......63
3.1.3. Arb-Med-Arb applicability in Viet Nam and issues...........................74
3.2. Recommendations for Viet Nam.................................................................79
3.2.1. For Government...................................................................................79
3.2.2. For associations and enterprises.........................................................89
CONCLUSION........................................................................................................91
1. Conclusions...................................................................................................91
2. Limitation of research .................................................................................92
REFERENCES........................................................................................................93

LIST OF FIGURES & TABLES
Table 1.1: Comparing ADR and Court Procedure..............................................16
Figure 1.1: Commercial mediation process ..........................................................20
Table 2.1: Circumstances to use commercial mediation .....................................27
Figure 2.1: Commercial arbitration process ........................................................31
Table 2.2: Comparison Between Arbitration & Mediation ................................38
Figure 3.1: Total Number of New Cases Handled by SIAC (2006-2016) ..........46
Firgue 3.2: Procedure of Singapore Arb-Med-Arb model..................................52
Table 3.1: Advantages of Mediation versus Arbitration.....................................55
Figure 3.3: Advantages of Arb-Med-Arb .............................................................57
Figure 3.4: Newly established enterprises of May from 2014 – 2018.................61
Figure 4.1: Viet Nam’s Arb-Med-Arb model (expected).....................................75

LIST OF ABBREVIATION
ADR Alternative Dispute Resolution
AMA Arbitration-Mediation-Arbitration
ARB-MED-ARB Arbitration-Mediation-Arbitration
CMC Community Mediation Centres
FDI Foreign Direct Investment
HKMAAL Hong Kong Mediation Accreditation Association Limited
ICC International Chamber of Commerce
PD Practice Direction on Mediation
PDRC Primary Dispute Resolution Centre
SMC Singapore Mediation Center
SIAC Singapore International Arbitration Center
SICC Singapore International Commercial Court
SIMC Singapore International Mediation Center
SIMI Singapore International Mediation Institute
TRACENT Ho Chi Minh City Commercial Arbitration Center
UN United Nations
UNCITRAL United Nations Commission on International Trade Law
VIAC Vietnam International Arbitration Center

VMC Vietnam Mediation Center
WB World Bank
WTO World Trade Organization

SUMMARY OF THESIS RESEARCH RESULT
The thesis “Arb-Med-Arb model: international practice and applicability in
Vietnam” focuses on giving recommendation on how Vietnam can apply the
experiences of developed jurisdiction around the world, which in this study are
Hong Kong, US, especialy Singapore in order to improve the country’s commercial
dispute resolution context. In general, Vietnam’s alternative dispute resolutions on
commercial dispute in general is still limited. In addition, the commercial mediation
activities is scattered between arbitration center national wide without a uniform
Mediation and Arbitration Act until the recent Decree No. 22/ND-CP about
commercial mediation that have been issued in April 2018 and Law on commercial
arbitration issued in June 2010. Despite a remarkable movement, Vietnam
regulation still possessed many drawback regarding the code of conduct for
mediators and arbitrators. The solutions which have been found in the study of the
three developed dispute settlement hubs of the world shall help to attract the interest
of Vietnam enterprises on using multitiered-clause Arbitration - Mediation -
Arbitration to sellte disputes, improving the standard and conduct of mediator and
arbitrator, fortify the enforceability of the mediation settled agreement and
arbitration award.

1
INTRODUCTION
1. Rationale
An era of connection and cooperation is the way people usually call the
21st century. An outburst of a smartphone or high-tech computer for instance
would imply that its parts are collected and produced in different countries. These
components are then assembled into the final product and distributed over the
world. That is international trade at its absolute finest.
Powering such international trade are complex technologies which have
reduced the obstacles for global advertising, near-instant global communication,
prompt product and services delivery. In conclusion, the term “globalism” has been
reconceptualized by technology.
There are however features of globalism where technology cannot assist (at
least not yet). Since the characteristics of international businesses, the contracts
signed between the sides are generally quite sophisticated, consisting of a expansive
heavily negotiated clauses regarding to each party’s commercial requirements. In
addition to trade terms, parties’ awareness of the need to have a well-written dispute
settlement clause are increasing .
Go along with the development of technology, the mechanisms for resolving
dispute have not stayed immovable and have gradual developed to dedicate to
globalism as much as achievable. In this field, arbitration has been found an ideal
substitute to the traditional court procedures. Generally, arbitrations are supposed
more efficient and flexible than courts, while the parties are offered confidentiality.
The enforcement is another enormous advantage of arbitration. In particular, an
arbitration awards are more readily enforceable than judgment from foreign court.
The question that people are finding the key is: are we on the top of the
progression for dispute settlement clauses? Can arbitration clauses (or any
substitute dispute resolution clauses) still be refined? The Singapore International
Arbitration Centre (SIAC) and Singapore International Mediation Centre (SIMC)
assuredly realize that fact. Altogether, the SIAC and SIMC have requested to bring

2
up a nontraditional dispute settlement model compositing the advantages of
arbitration and mediation clauses, whose name is the Singapore Arb-Med-Arb
Protocol (“ AMA Protocol”).
The AMA Clause allows parties to choose to settle disputes by method of
arbitration to deal with their differences or by mediation before reaching arbitration.
A multi-tiered clause is considered as a form of arbitration clause which combines
mediation and arbitration proceedings in order to increase the chance of settling
disputes between the parties via goodwill and positive discussions and to inspire
constructive negotiations before a fully-completed arbitration procedure.
In this thesis, the author would like to look into this new approach to settle disputes
and see what advantages AMA could have for the parties. Moreover, the author also
want to show the key points for question: “Can Vietnam be able to apply this model
to resolve the disputes in the future?”. Consequently, being a Master student
majoring in International Trade Policy and Law, for the desire to devote my
knowledge to the better Vietnam’s dispute settlement, so as to keep pace with the
global standards, the author selected the topic: “Arb-Med-Arb model:
international practice and applicability in Vietnam”.
2. Literature review
Although commercial mediation and arbitration have long developing journey
all over the world, Vietnam’s mediation and arbitration is still inexperienced and
the term is new to some extent. Especially, Arbitration - Mediation - Arbitration
model has ever been researched thoroughly as well as applied in Viet Nam. As a
result, the study’s subject is quite new and there has not been any same or
analogous topic up to the moment that the author has finished the paper. The author
would like to review some experiential researches from both Vietnamese and
foreign sources as follows:
- Nguyen Trung Nam, Trinh Nguyen (2017) – “Mediation – arbitration in
commercial and construction disputes” is a research about the issues in the
circumtances of construction dispute settlement under Viet Nam’s laws and

3
point out some recommendations, composing mediation’s applying methods,
in the context of Viet Nam, combining the other ADR procedures so as to
require a multi-tiered dispute settlement mechanism, or in the unique form of
Arb-Med-Arb innovated in Singapore, in order to promote the efficiency and
enforceability of the dispute settlement way in construction conflict via the
improvements of commercial mediation, from the past to recent situation.
The major acknowledgement of this paper is the information about the issues
relating to construction disputes in Viet Nam.
- Financier Worldwide Magazine (2018) – “Arb-med-arb in cross-border
disputes”: in this study, the authors pointed out the simple idea behind
multi-tiered dispute resolution is to provide several possible avenues to
dispute settlement within one dispute resolution procedure. The result is a
mechanism that combines various dispute resolution methods, such as
mediation and arbitration, in different ways. In addition, the researcher also
stated some advantages and limitations of the AMA Protocol.
- Bryan Cave Leighton Paisner team (2015) – “Singapore’s new “Arb-
Med-Arb” protocol: a positive development?” is a sientific article that study
how the SIMC - SIAC protocol works and consider the benefits and
downsides of attaching one of Singapore’s newest dispute settlement
methods to commercial contracts.
- Anindya Basarkod and Dr. Markus Altenkirch (2018) – “Arb-Med-Arb:
what is it and how can it help the parties to solve their disputes
efficiently?” is a paper looking into Arbitration - Mediation - Arbitration as
a new approach to resolve disputes and show what advantages Arbitration -
Mediation - Arbitration could have for the conflict sides.
- Daniel Chong, Sharon Lin, (2018) - “Arb-Med-Arb: Connecting the
Dots between Arbitration and Mediation”: in this study, the authors
pointed out some key aspects of “Arb-Med-Arb”, the differences between
arbitration and mediation. In addition, the reason why people should use

4
Arb-Med-Arb to solve the dispute and a sample of Arb-Med-Arb clause are
also mentioned in this research.
My review will not explore all aspects of disputes resolution but focus on the
which main points have been mentioned in the above articles or studies. Most of the
above research define the Arb-Med-Arb model and show some main advantages but
does not mention the method used to apply AMA in Asian country such as Viet
Nam. Although the study named “Mediation – arbitration in commercial and
construction disputes”by Nguyen Trung Nam, Trinh Nguyen (2017) showed the
issues in the circumtances of construction dispute settlement under Viet Nam’s laws
and point out some recommendations, the definition, characteristics and important
advantages of Arb-Med-Arb are not mentioned here.
In short, up to now, there has not been any comprehensive study researched on
all-sided Arb-Med-Arb model and the method that used to apply this multi-tiered
dispute settlement mechanism in Viet Nam. My contribution will highlight the
advantages of this dispute resolution method in general (not focus on any specific
field) and answer the question: “How can we apply Arb-Med-Arb in Viet Nam?”.
3. Research questions
There are some key questions of this study including: “What is Arb – Med - Arb
protocol?”, “What are the countries applied this clause in the world?” and “What
should Viet Nam act to apply this model in the future”. In order to find out the
answers for such research questions, we need to focus on these sub questions:
- What are the basic principles of arbitration and mediation?
- What are the differences between arbitration and mediation?
- How can Arb-Med-Arb help the parties to solve their disputes in
Singapore?
- What are the benefits of Arb-Med-Arb model?
- How can Viet Nam apply Arb-Med-Arb model?
- What are implications for Viet Nam?

5
4. Research’s objective
Arbitration and mediation are applied increasingly in the world to settle the
disputes instead of court. That are very useful alternative dispute resolution,
however, the combination of arbitration and mediation bring the surprising benefit.
International economic integration is one of the main tasks of Viet Nam in
the near future. Therefore, “Economic integration is central in which the integration
in other areas has to facilitate economic integration and contribute positively to
economic development, defense consolidation, national security and preservation;
and promote cultural identity and promote cultural and social development.
Integration in the different fields must be implemented in a coordinated global
integration strategy with a roadmap and steps in line with the actual conditions and
capabilities of the country" (Resolution No. 22-NQ / TW dated 10 April 2013 on
international integration). Up to 2018, Vietnam has negotiated and signed more than
ten regional free trade agreements (FTA), including commitments on technical
barriers to trade and will sign some next new FTAs such as: EVFTA, RCEP, ….
The roadmap for tariff reductions in free trade agreements is committed for a period
of ten years for each phase and is specified for each agreement. That is the reason
why the amount of international trade transactions and import-export turnover are
increasing drammatically.
It is clear that at this moment, clear that Viet Nam should act now for the
unexpected disputes in businesses and to protect Vietnamese enterprises in
international market. Meanwhile there is not legal framework as well as any clause
refer to Abitration – Mediation – Arbitration model. Therefore, the content of the
thesis will highlight the objectives:
- Systematize the basic principles of two alternation dispute resolution
method: arbitration and mediation and the key differences between these
approaches.
- Understanding how Arbitration - Mediation – Arbitration model works ;

6
- Get deeper understanding on the way Singapore apply this protocol to
resolve conflict in business and the advantages of this model.
- Forecasting the difficulties that Vietnam has to face with when applying
this model, giving suggestion and proposal for Vietnam Government, arbitration
and mediation service providers to facilitate the development of dispute settlement
mechanism
5. Scope of study
There are a number of trade disputes cbalternative dispute settlement, such as
negotiation, arbitration, mediation, or med-arb can be used in various dispute
categories ranging from civil, family, commerce. From many studies, it is found
that, alternative dispute settlement methods give the best answer regarding
commercial disputes where the key economic development of the nation rests. This
research focuses on the use of arbitration and mediation, arbitration - mediation -
arbitration model to resolve commercial disputes.
The study specifies the research content on Arb-Med-Arb model of
Singapore. In fact, Arb-Med-Arb model has many advantages, however, this is
really new model in dispute resolution, so Singapore is the only country create and
allow apply this model. In addition, the thesis also analyzes Vietnam’s recent
development on commercial mediation and arbitration such as: legislation,
awareness... In short, the study would do research on the current Vietnam’s
arbitration and commercial mediation situation, which can be enhanced and
introduce some implications on how to how to apply Arb-Med-Arb model in
Vietnam according to international standard and experiences.
The research time shall cover the period in the early twenty centuries until
now because Singapore and Viet Nam have a later phase of mediation in
comparison with other developed countries in the world. Moreover, several legal
documents on commercial mediation and arbitration of international bodies from
the late nineteen to early twenty centuries shall also be included.

7
6. Methodologies
This thesis is completed based on the application of theory research method
and practical research method. Theory research method includes analytical method,
synthesis method and reference to the laws and regulations in order to achieve the
requirements set for a research project. Practical research method mostly includes
interview method with experts in the fields of international arbitration and
mediation (as described in the Appendix 1).
Data which is used in the analysis of the thesis is mostly secondary one. The
data is collected, quoted from reports, researches of experiential researchers and
organizations in the field of arbitration and mediation. Primary data for such study
is hard to conduct since arbitration - mediation - arbitration model is quite new in
Vietnam going along with the limitation of capital and time of the author.
Theory research method: About analytical and synthesis method, in Chapter 2.
Theoretical framework, theoretic and fact, the legal framework related mediation
and arbitration, in general and internal coordination related to arbitration -
mediation - arbitration model, in particular are deeply analyzed in order to find out
international and domestic practices and show the opportunities to apply arbitration
- mediation - arbitration clause in Viet Nam. Some arbitration - mediation -
arbitration applied cases to settle disputes in Singapore are introduced and analyzed
as experiences for Viet Nam to learn in future if Viet Nam involves in same cases.
In Chapter 1. International experience on applying arbitration - mediation -
arbitration model: study of Singapore, the author use synthesis method and
reference to the laws and regulations to show the experiences and find the
implications for Viet Nam ...
In Chapter 2. Applicability of arbitration - mediation - arbitration model in
Viet Nam and recommendations, the method of reference to the laws and
regulations is also used so as to figure out some unsuitable points regarding to laws
and regulations of Viet Nam. Synthesis method will be also used in this chapter to
conclude the thesis and suggest opening the new issues.

8
Interviews are carried out with some experts and associations to show the
applying method and give recommendations for Chapter 3.
7. Research disposition
Beside the table, chart lists, reference and appendix, the main content of the
thesis includes the followings:
- Introduction.
- Chapter 1: Theoretical framework
- Chapter 2: International experience on applying arb-med-arb model:
study of Singapore
- Chapter 3: Recommendations
- Conclustion

9
CHAPTER 1: THEORETICAL FRAMEWORK
In this chapter, it is supposed to be helpful to briefly set out the principles on
arbitration and mediation before analyze the others deeper knowledge of the multi-
tiered arbitration - mediation - arbitration clause and model.
1.1. Alternative dispute resolutions
1.1.1. Background
According to the report of the World Bank Group, the idea of using ADR
as a method of resolving disputes by consensus rather than confrontation has come
from traditional practices of many countries. In other words, ADR has originated
from the history of many cultures, especially one in Asia where harmonization is
always a major criteria (World Bank Group, 2011).
However, the origin of modern ADR is often accepted is the United States
by many studies, the thesis recounts the ADR platform of the USA. Earlier, ADR
was first used to resolve civil rights by using mediation and considering action
against overworked and delayed courts. Since then, ADR has developed rapidly, not
only practical but also institutional with the encouragement of the Government,
legal organizations, academics. For example, in 1990, all federal district courts were
required to have a plan to reduce costs and delay in litigation process. Therefore,
each federal district court developed some form of ADR process. Due to
innovations in ADR, mandatory ADR development in courts, states and federal
systems, the growing interest in ADR has made the United States the largest source
of knowledge in the court connected ADR (USAID, 1998).
Later in the 1980s, the demand for commercial ADR in the United States
began to increase because of the desire for a more effective alternative to litigation.
Therefore, ADR models such as negotiation, mediation and litigation have
developed significantly. The institutionalization of ADR has changed the rules and
legal practices. US regulations, public consultation and administrative dispute
resolution have been added to the use of ADR.
The United States is always leading in many areas and ADR is not an
exception. Many countries copy US processes, others try to blend American style

10
with their own dispute settlement traditions. This process is being used to solve
various problems not only commerce, social, civil, politics. Developing countries
are involved in the implementation of ADR, including Vietnam.
China or Hong Kong in particular are also affected by ADR trend from the
United States. The fire spark of disappointment in litigation and arbitration has
spread from the United States to other jurisdictions followed by China (Zheng
Rungao, 2003). The dispute parties began to criticize the limitations of traditional
dispute resolution that subsequently gave rise to ADR. Besides, China ADR’s
development can be explained by its special cultural background. The Chinese
prefer a consensus, non-adversarial ways of dispute settlement follow philosophies
suchas “better bend than break”, “willows are weak yet they bind others wood”.
The reason is that in China, reservation of face and business relationship private is
very important. Such platform has contributed to promote the growth of ADR,
especially in the field of trade. While the USA model affects most of the world, the
China’s one in general are powerful for Asia or Southeast Asia in particular.
Singapore is also affected by ADR trends from the US and is considered a
pioneer in Southeast Asia's ADR. The reason for the need of ADR here is also due
to the limitation of the litigation. In the early 1990s, Singapore courts were full of
case files. More than 2000 cases are awaiting resolution in the Supreme Court.
More than 10000 cases are inactive, many of which have been more than 10 years.
The process of starting treatment takes 5-10 years for about 44% of cases. On the
other hand, appeals take 2-3 years to be heard. Latency can be calculated as part of
the life expectancy of the person and the processing time of the judgment has not
been mentioned. Therefore, ADR was implemented by the Singapore judiciary to
reduce the burden of the court and help desperate claimants (Judith Prakash, 2009).
The thesis summarized the background of ADR, from the country of origin -
the United States, to countries in the same region and has much influence on
Vietnam such as China and Singapore have the same reasons for developing ADR
due to the limitation of litigation and court’s proceed. Now the thesis will continue
and define ADR.

11
1.1.2. Definition
According to Yona Shamir, ADR is defined as:
“Alternative Dispute Resolution (ADR, sometimes also called
“Appropriate Dispute Resolution”) is a general term, used to define a
set of approaches and techniques aimed at resolving disputes in a
non-confrontational way. It covers a broad spectrum of approaches,
from party-to-party engagement in negotiations as the most direct
way to reach a mutually accepted resolution, to arbitration and
adjudication at the other end, where an external party imposes a
solution. Somewhere along the axis of ADR approaches between these
two extremes lies “mediation,” a process by which a third party aids
the disputants to reach a mutually agreed solution.”
Source: (Yona Shamir, 2003)
Alternative dispute resolution is a more common term, however many
empirical studies and even the author finds the words Dispute Settlement more
appropriate to nature. The purpose of dispute resolution is to make social life better
(Park and Burger, 2009). That process will attempt to resolve and consider conflicts
that help people and entrepreneurs keep relationships. The Latin word refers to this
process for the sinner through the unimportant person of the social life and
important to the social order. Lack of dispute resolution will make it difficult for
people to go together.
Or even the Great Gandhi once said:
“I realized that the true function of a lawyer was to unite parties...
The lesson was so indelibly burnt into me that a large part of my time
during the twenty years of my practice as a lawyer was occupied in
bringing about private compromise of hundreds of cases. I lost
nothing thereby not even money; certainly not my soul”.
Source: (Azquotes, 2018)

12
What the thesis tries to say, all are in the words of the former US Chief
Justice, Warren Burger:
“The obligation of our profession is… to serve as healers of human
conflict. To fulfill our traditional obligation means that we should
provide mechanisms that can produce an acceptable result in the
shortest possible time, with the least possible expense and with
minimum of stress on the participants. This is what justice all about.”
Source: (Chief Justice Warren Burder, 1997)
In conclusion, ADR can be defined as a concept used to refer to different
methods of resolving legal disputes. It stems from court delays in handling cases
timely and reasonably. On the other hand, different regimes can help disputing
parties resolve conflicts in a timely and cheap way. However, in essence, ADR is
still complementary to the courts. Nationally and internationally, ADR is
increasingly used in the field of law and commerce. ADR can be used in different
types of disputes, from civil, family and commercial. From many studies, it has
been found that ADR methods provide the best answer regarding trade disputes in
which the important economic development of the country lies (Shodhganga, 2018).
Obviously, ADR is not a new concept, but novelty lies in the proliferation of
its model:
“Dispute resolution outside of courts is not new; societies world-over
have long used non-judicial, indigenous methods to resolve conflicts.
What is new is the extensive promotion and proliferation of ADR
models, wider use of court-connected ADR, and the increasing use of
ADR as a tool to realize goals broader than the settlement of specific
disputes.”
Source: (USAID, 1998)

13
1.1.3. Methods and forms of ADR
ADR systems can often be categorized into negotiation, mediation or
mediation systems and arbitration. According to the USAID study in 1998, the
thesis summarized the following categories:
The negotiation process creates a platform to facilitate the face of negotiations
between the disputing parties, without the presence of a third party. On the other
hand, the mediation and reconciliation systems are similar in that they invite a third
party between the parties, or to reconcile a specific conflict or to reconcile their
relationship. Mediators and mediators can facilitate communication, or can help
direct and structure a settlement, but they do not have the right to resolve. Finally,
the arbitrator authorizes a third party to decide how to resolve the dispute.
In addition, it is important to differ between ADR binding and non-binding
forms. The negotiation, mediation and reconciliation systems belong to the non-
binding group, they recognize the willingness of the disputing parties to reach
consensus. The arbitration process can be binding or non-binding. Binding one
creates a third-party decision that the parties will follow even if they disagree with
the conclusion, like a judicial decision. Non-binding one creates a third party
decision that the disputant may not follow.
Mandatory processes and voluntary processes also need to be distinguished.
Many legal systems order parties to make negotiations, mediation, mediation or
arbitration before going to court. The ADR method may also be required as part of a
previous contractual agreement between the parties. For a voluntary one, using the
ADR process completely depends on the needs of the dispute parties.
1.1.4. ADR and litigation
This section examines the advantages and disadvantages of the ADR process
and compares with litigation. The following knowledge is drawn from the Dispute
Resolution - Master of Policy and International Trade Law course of Prof. Dr.
Wolfgang Wurmnest, LL.M. (Berkeley).

14
By negotiation, this process means that the parties try to resolve their dispute
by mutual agreement without trial. The skills needed are at a lower level of legal
nature, rather a question of negotiation tactics and experience. Inexpensive and
amicable agreement allows the parties to continue their business relationships, the
parties may try to include solutions that require cooperation and will not normally
be available in court proceedings. However, negotiation has no coercive power, so
the parties must both agree to negotiate and resolve their dispute, no agreement has
no results.
On the other hand, arbitration means that a dispute between the parties is filed
under an agreement with a private third party chosen by the parties (arbitrators or
arbitrators) to resolve it in a judicial manner (eg: a third party has the right to make
binding decisions. Arbitration is an opportunity for parties to present evidence or
submit to support their request. This method has many advantages:
- Permitting party autonomy
- Less intrusions by state courts.
- Special expertise of arbitration can be selected by the parties.
- Confidentiality proceedings are not open to the public.
- Faster and cheaper than court.
- Almost globally recognized arbitration awards through the United Nations
Convention on the Recognition and Enforcement of Foreign Arbitral Rulings (New
York, June 10, 1958).
On the contrary, there are some disadvantages such as the weak enforcement
power of the arbitral tribunal over the parties. In some cases, the support of the
courts may be necessary to obtain evidence for temporary or constitutional
measures of a court. Moreover, there is uncertainty about procedural issues plus the
application of legal rules and issues with third party involvement unless contracted.
Last but not least, mediation is the process by which the parties engage a
neutral third party support to act as a mediator - a facilitating intermediary - without

15
giving any binding decision but using a variety of different procedures, techniques
and skills to help the parties resolve their disputes by negotiation agreement without
adjudication. Some notable characteristics are that negotiations are basically
supported by a neutral third party, sometimes mediators have knowledge of
psychology (business psychology). Mediation has the same advantages as
negotiation, plus it looks at “interests”, not merely “rights”. In addition, mediation
is a bit more expensive than negotiation without mediators, but there may be a
better chance of success. The disadvantage of mediation is the advance agreement
on such amicable dispute settlement and the need of good will during mediation or
it will be a waste of time.
The results of the empirical survey indicate that litigation is preferred by
disputant on not many criteria. The criteria are to minimize costs, speed of the
resolution process, privacy, keep relationships, neutral views and precedents setting.
Litigation or adjudication only has a greater advantage than other ADRs is setting
precedent. Arbitration is favored by many people of their ability to get neutral
opinions. The strength of Mediation lies in reasonable prices, the ability to connect
issues, keep business relationships between parties to cooperate in the future and
relate to constituencies in the process. In this table, number 3 means highly likely to
satisfy goal, number 2 means being likely to satisfy the goal, number 1 means being
unable to satisfy the goal and zero equals to highly unlikely to satisfy goals. Now
we can see that for what reason ADR is favored by disputant rather than
adjudication at the courts.

16
Table 1.1: Comparing ADR and Court Procedure
How are they likely to achieve disputants’ goals?
Disputant’s goal ADR’s procedure
Court’s
procedure
Mediation Arbitration Adjudication
Minimize costs 3 1 0
Resolve quickly 2 3 0
Maintain privacy 2 2 0
Maintain
relationships
3 1 0
Get neutral opinion 0 3 3
Set precedent 0 1 3
Source: (USAID, 1998)
1.2. Mediation
The most comprehensive and modern definition of mediation is offered by
the International Mediation Institution as follows: “Mediation is negotiation
facilitated by a trusted neutral person. The role of the neutral - the mediator – is to
help those involved sort out their issues and arrive at a consensus. That might
involve helping parties to finalize an agreement, resolve a dispute, develop effective
communications, build or improve relationships, or all of these things.” Two other
important features of mediation are described below:
- Confidentiality: mediation is a confidential process where what was
discussed or agreed in private is not disclosed to others without everyone’s
agreement. In addition, what is discussed in private session with each party shall not

17
be disclosed to the other party without its prior agreement. However, in such private
session, the mediator, throug hhis/her neutral questions may assist a party in
assessing its situation based on which the party may come up with more realistic
proposal that will bring the parties closer to the agreed settlement.
- Voluntary: prior to the mediation process, the parties must reach a
mediation agreement in writing which shall be used as the legal basis for mediation
process. During the process, the mediator does not have the authority to impose
upon the parties a solution to the dispute. And if the mediation does not result in an
agreement, either party can still submit the dispute to the court or arbitration
(whichever applicable). In such case, details of the mediation will not be disclosed
or used at the court/arbitration hearing.
1.2.1. Rationale of mediation
Among ADRs’ methods, arbitration has long been the favored one in settling
international commercial dispute (GaryB.Born, 2009). Although international
community has begun to detach from such process because of the questions
regarding the time, cost and procedure of arbitration (William W. Park, 2012).
Therefore, disputants are looking for another proper commercial dispute resolution
mechanism and mediation is currently a more favorable substitution (Jacqueline
Nolan-Haley, 2012).
Recent development may make international commercial mediation sounds
like a new term, however, the mechanism of using such process in resolving cross
border commercial dispute is rather familiar (Harold I. Abramson, 1998). It has
been proved that commercial mediation was widely used before arbitration, only
after the WWII, commercial arbitration has come in as a new player in the field of
settling transnational trade disputes (Eric A. Schwartz, 1995).
For Asia region, China in particular possess a long history of mediation (Wang
Wenying, 2005). Back to the time of the Qing dynasty, the judge often ordered
parties to mediate to resolve a dispute before resorting to litigation. In addition, the
Confucius philosophy also has had a remarkable influence over the South East Asia,

18
including Vietnam, Singapore and Thailand... The philosophy highly valued the
harmony and yielding to others, and avoid conflict and argument. The idea of using
consensus-based dispute resolution mechanism in China is still popular until today
(Danny McFadden, 2011). Actually, it is popular throughout the South East Asia, as
a study has stated that lower use of arbitration to mediation in this region is due to
the fact that arbitration and litigation aim to identify the loser and winner of the
dispute, this could cause the loss of business relationships.
Not only in the Eastern area, commercial mediation is also a rising trend in the
Western region as well. The potential increasing in the commits of commercial
businessmen in using consensus-based dispute resolution mechanism is signaling
worth noting changes (John Lande, 2000). The process is happening in every areas:
spreading from private, public to international. Regarding international bodies, The
World Bank and International Finance Corporation has united in trying to facilitate
international commercial mediation. For countries, there are many jurisdiction
nowadays require dispute parties to mediate before going to court. Representing the
group of private area, infamous international corporations such as General Electric
and Siemens have encouraged advance mediation as a dispute settlement process
(S.I.Strong, 2014). As a result, the empirical studies have concluded that
commercial mediation are becoming increasingly institutionalized.
1.2.2. Definition and process
Having gone through the background, reasons to use and general mediation
definition, the thesis shall define commercial mediation. According to the Decree
22/2018/ND-CP of Vietnam government, the definition of commercial mediation is
very general:
“Commercial mediation is a commercial dispute settlement method
which is agreed by parties and supported by the neutral third party,
the commercial mediator who according to the regulation of such
Decree.”
Source: (Chinh Phu, 2018)

19
Problems with such definition is that it is not specific, viewers and even
disputants might feel very confused and do not know what will be considered
commercial disputes in this case. The answer can be found in another regulation
which is the Commercial Act 2005, Commercial Arbitration Act 2010.
While looking at the definition of a country in the region – Singapore, the
dispute parties can know right away what type of dispute is considered having
commercial characteristic:
“…commercial disputes … include banking, construction, healthcare,
employment, information technology, insurance, partnership,
shipping and tenancy disagreements…”
Source: (SMC, 2018)
To sum up, it can be understood that commercial mediation is a dispute
settlement process that help parties to settle conflict or dispute relating to
commercial matter, which might include but not limited to banking, construction,
healthcare, employment, information technology, insurance, partnership, shipping
and tenancy disagreements…, without refereeing to court’s action. Commercial
mediation facilitate the communication between parties and assist them in creating
their resolution considering the later phases, together with the support of a fair-
minded mediator. In addition, commercial mediation is a mechanism with
characteristics such as exclusive and secrecy. This ADR also makes disputants feel
complacent and free to speak about the critical of the disputes and its impact on
them. With commercial mediation, the parties have the chance to pass on their
viewpoints relating to the circumstance which has happened, plus the knowledge
that they think is related and the other parties need to know. Further, the disputant
can raise question at will concerning their cases and receive the comments and
thinking of the other party on the situation. Commercial mediation is a unique
process that offers parties the opportunity to communicate face to face and explain
to the other in detail how the dispute should be done. The success chance of
commercial mediation is also astonishing high. Studies have shown that more than

20
two third of the parties that mediate come to a conclusion (Bilal Farooq, 2010).
Despite commercial mediation’s uncertainty in guarantee a 100% agreement, the
process still open the door for parties in later negotiations with a much better
circumstance and chances of success. In summary, the thesis draws the mediation
process as follow.
Figure 1.1: Commercial mediation process
1.2.3. Stages of commercial mediation
Mediation is a flexible process, and each nation has its own culture of doing
mediation (Lewicki, Barry and Saunders, 2009). USA mediator will focus more on
win-lose scenario, term, going straight to closing and implementing and less focus
on relationship building. On the contrary, Asian mediator will try to build the
connection between parties more than focus on others process (Feehilly, 2008).
However despite the differences, there are three major stages of a mediation session
(Street, 2005):
- Canalizing the communication channel
- Building the understanding connection
- Informed negotiation.
Agreement to mediate
Contact with mediator
Mediation scheduled
Mediation conducted
Parties reach agreement
Case Closed
Parties do not reach
agreement
Arbitration or
Court Referred

21
2.2.3.1. Canalizing the communication channel
In general disputes, the communication between parties is often detained.
Because the lawyers shall be the representative spokesman, especially in case of
commercial dispute, the disputant has always been warned to not speak on the own
in order to avoid any disadvantages caused by slippery words. However, a
successful mediation shall partly be achieved by an indispensable element which is
opening up the channel of communication (Street, 2005).
When the stream of information between parties is canalized, each side can
understand the objectives and real needs of the other which shall be the ground to
develop a proper solution to meet the desire of the parties. Indeed, study has proved
that failure to connect information to find suitable solution links directly to the
failure of the negotiation process. For the process to reach its goal, mediators ought
to facilitate the communication, make parties to open up, discover their needs with
the ultimate goals of creating a free, productive and positive discussion atmosphere
(J Butler, 1999).
In addition, although a clear flow of information is very important, the path to
reach there requires factors such as trust and honesty. Each person under the
mediator's support must share details information about themselves, what they need
and what they want. However, not every situation has perfect conditions for all
ideas to happen. In some cases, the feeling may be so negative that the
communication flow is stuck or even blocked. That is when the mediator will return
in a messenger, a communication channel between the parties. Other events that one
side is overpowered by the other or we can call it the "the big fish and the small
fish" scenario. In such cases, the mediator will have to play the role of the equalizer
to ensure that they have the opportunity to speak up (Street, 2005).
2.2.3.2. Building the understanding connection
Having opened up the flow of communication, the dispute parties also need to
know that if they can exploit the chance to get to know the other party, there are
better chances for them to reach an effective negotiation and it is also better for the

22
mediator in helping parties getting mutual agreement.
The hinge for the bridge of understanding to stand on is trust. In normal
context, this term required time to be developed. In commercial dispute such
element shall be harder to acquire, therefore a great effort from both parties and
even the mediator are needed. Trust is established once it happens between the two
sides and also the mediator.
Let imagine if there is no trust, the most two prominent question shall linger
all the time in the head of the parties: how much should a party reveal to the other
and how much should a party believe in the other. Can a negotiation be succeed
with such lack of trust, the thesis doubt that.
Despite the fact that no guarantee of a successful negotiation with trust,
mistrust even more harmful to the negotiation. Lack of trust, normal human mind
shall tend to act defensively, doubtful which shall lead to bargaining, even threats
and finally the jeopardy of the mediation process.
2.2.3.3. Informed negotiation
After the stream of information has been canalized and trust has been formed
between the parties and the mediator, the next step is to determine the negotiation
with the support of the mediation (Street, 2005).
However, the parties needs to address the situation, whether it is a win-lose
one where one party shall prevail or a win-win one where both parties can have the
target and requirements satisfied (Lewicki, Barry and Saunders, 2009). In order to
address such situation, the interdependence of parties’ target shall need to be
analyzed. If the strategy of the parties is win-lose, the goals of the mediation is
value claiming, frankly saying is to achieve the result no matter what. On the other
hand, if the strategy of the parties is win – win, the target of the mediation is value
creating. In reality, it has been proved that most of the cases required the mutual
conduct of both types. However, parties need to actively look at whether one or
more process is needed. For instance, claiming value is suitable if the conditions are
limited and there are no promise of a cooperation between parties. In addition,

23
parties tend to think of the problem toward the claiming value situation, therefore it
is critical to recognize the interdependence of the parties’ goal in order to avoid the
wasting of creating value chance.
Based on the reality that commercial mediation does not possess a unified
process, several forms have been given birth. In commercial cases, there are two
popular forms of mediation: facilitative or evaluative, however, nowadays more
forms have been developed in general (Boulle, 2005). The next section will
consider the appropriateness and applicability of each of these types of mediation to
the specific issue of dispute in commercial transactions.
1.2.4. Types of commercial mediation
1.2.4.1. Facilitative commercial mediation
This type is known as the first form of mediation which has been appeared
since the later part of the 19th
century. The main idea of facilitative commercial
mediation is to form a favorable environment for the dispute parties. This would
require questions making, viewpoint corroboration and ensure the bridge of
understanding between parties of the mediators. In addition, the mediators shall try
to discover the right meaning of the dispute and support parties in order to find the
decision, but the mediators shall not give their owns resolution, suggestions and
forecast the possible decision of the court. Facilitative one is solely about making a
mutual meeting of mind resulting in the exchange of knowledge and information.
Having such characteristic, this type of commercial mediation is pretty fit for
settling cross border commercial conflict, particularly the medium and small cases.
Despite focusing on the ending, the process aims for the preservation of the parties’
business relationship (Alexandra, 2016).
1.2.4.2. Evaluative commercial mediation
On the contrary of facilitative mediation, evaluative one support the disputants
by stating the pros and cons of the conflict, making prediction about the possible
decision of the court to the case. With such features, evaluative mediation is often
compared to settlement meeting by the judges. The target of such process is the

24
legal rights of the disputants, as a result, the mediator also has his eyes on what’s
right and what’s wrong rather than the real desires of the dispute parties. In
addition, this type of mediation is conducted one party at a time, with the support of
the legal representatives of the parties to assess the pros and cons of the situation.
The role of the lawyers in this type of commercial mediation is more significant
than the facilitative one as they can represent the parties’ presence if needed. The
reason lies in the origin of evaluative commercial mediation which comes from the
mandatory principle or reference of the court. Such characteristics make evaluative
commercial mediation widely used in big, complex international commercial
transaction since the parties here concern more about the legal result rather than
keeping the business relationship between each other. In addition, the mediators in
this case are often lawyers who possess profound knowledge of commercial matters
and international trade law (Alexandra, 2016).
1.2.4.3. Transformative commercial mediation
Empirical study has stated that the newest kind of commercial mediation is
transformative one (Boulle, 2005). The idea of this type is providing almost full
authority to the hands of the parties. Consequently, the process shall force parties to
look closely and realize the other party’s needs, desire, viewpoints. The name has
said it all, transformative mediation facilitates the transform of the connection
between the parties. Such mechanism shall give the party the power to lead the way
that mediation goes and focus on the business relationship. The role of the
mediation in this type is not much regarding the time during and at the end of the
mediation as the role of the mediator here is to follow the direction made by dispute
parties. Despite being new to the international commercial dispute community,
transformative mediation still have much room to develop and may be soon it shall
join the line with the other two methods.
1.2.5. International organization’s activities for commercial mediation
Despite the arguments on mediation, as stated earlier, there is an undeniable
support for the use of mediation on an international level.

25
2.2.5.1. UNCITRAL
The United Nations Commission on International Trade Law (UNCITRAL)
can be consider one of the leading organizations that is facilitating international
commercial mediation. Established in 12/1966, the basic function of UNCITRAL is
promoting the harmonization and consensus of the international commercial law
(Europa, 2007). It all began in the year 2014, resulting from a cross borders
commercial mediation case, UNCITRAL found the need to consider a possible
resolution agreement with enforceability (UN, 2015). From that point forward,
UNCITRAL has continuously promoted the use of mediation and agreed that such
type of conflict settlement shall result in circumstances which most of the cases can
save the business relationships, support the management of world commercial
activities and worth noting saving of expenses (UN, 2003). In the effort of ensuring
the promotion of using commercial mediation and forming a harmonization method
of resolving global disputes, The Conciliation Rules (1980) and Model Law on
International Commercial Conciliation (2002) has been issued with the idea of
promoting a quick and accessible application of resolution agreements
(UNCITRAL, 2002). In recent years, UNCITRAL has some quite bold moves on
the matter. The Convention on Enforcement of Settlement Agreements Resulting
from International Commercial Mediation has been held in 2014. The convention
can be seen as an additional efforts that UNCITRAL has made for the widely use of
international commercial mediation. The key points that has been stated in the
convention about the advantages of commercial are: decreasing the disputes that
resulted in trade relationships destroyed; better governance of international
business; reducing expenses for governments.
2.2.5.2. Others organizations
Another organization that also shows support and aids to the use of
international commercial mediation is The International Chamber of Commerce
(ICC). The ICC’s actions are quite comprehensive for dispute parties, for the
consolidation of the right model of using commercial mediation, ICC has issued a
head to toe instruction including how to draft a mediation clause in contract writing

26
(ICC, 2018), a throughout list of principals and advantages of commercial
mediation. Lately, The National Committee of ICC in the Czech Republic has a
new idea. This organization desire to create a mediation facility where dispute
parties in commercial business can connect for knowledge and suggestions
concerning mediation. As the plan, the organization will support parties in Europe
then expand to other parts of the world if it is success (Martin Svatos, 2015).
Another worth noting international bodies is the United Nations (UN), UN
mostly uses mediation in dispute between countries as they praised the use of
mediation as the rightful settlement which capable of resolving disputes, protect the
next generations from the brink of war (Lars Kirchhoff, 2008). The promotion of
mediation at a world level can be considered as a foundation for the UN to facilitate
the use of international commercial mediation. As a result, in 2012, UN has issued a
guidelines that stated the UN’s aids to the use of international commercial
mediation.
Speaking of the support for international commercial mediation, it will be a
mistake not mentioning the World Bank. In 2011, the World Bank has released the
ADR Centre Manual: A guide for Practitioners on Establishing and Managing
Centres that provide instruction on making correct mediation and promoting the
advantages of commercial mediation (WB, 2011). On a recent move, The World
Bank and International Finance Corporation have also united in trying to facilitate
international commercial mediation.
Last but not least, the World Trade Organization (WTO) also possess a
significant place in the proliferation of commercial mediation on an international
level. WTO strongly trust that the main target of a multilateral commercial process
ought to be the dispute resolution, without such system there is high probability that
the relationships shall not be well. Consequently, WTO is also a supporter for the
promotion of commercial mediation. (WTO, 2018).

27
1.2.6. Advantages and disadvantages of commercial mediation
Mediation is not almighty and it is important for the parties to decide whether
commercial mediation is fit for their circumstances or not.
Table 1.2: Circumstances to use commercial mediation
Appropriate to use mediation Not appropriate to use mediation
End the dispute quickly. Not willing to join mediation.
Save legal costs. Mediation’s intention is not good. For
example, party solely uses mediation to
collect more information for later court.
Preserve or maintain business
relationship.
Drawn public attention to the case.
Avoid publicity or to maintain secrecy.
The law does not provide a suitable
solution for the parties’ needs.
Source: Mediation (State Courts of Singapore, 2014)
A clear advantages can be seen in the use of commercial mediation are speed,
reasonable expenses, easy and time saving. In general, mediation is a better option
regarding the ability to adjust the outcome to the demands of the parties while the
jurisdiction shall not change follow the need of the parties. In addition, mediation is
held in an intimate place where the privacy of the parties can be ensured. The list of
advantages is quite long, however, there are statements that the advantages of
commercial mediation only available if the parties reach the agreement (Lord
Neuberger, 2015).
The arguments depend on the viewpoint. Some believes that various
advantages follow a fail mediations such as more expenses and time, jeopardy of

28
business relationship. In addition, mediation might be unfair in a circumstance
between big and medium, small enterprises. The big size can use their comparative
advantages in order to put pressure on the others side and get a favorable outcomes
for them. In addition, there is worries about a weak jurisdiction if parties use too
much mediation. This comes from the strength of mediation which often resulted in
a successful agreement between parties. Especially in the common law countries or
general speaking judge made law. The less cases the less legal aspect to be
developed. This disadvantages result from the fail thinking of many people that
mediation is a better option that litigation. In fact, mediation should be considered a
critical step before litigation. If mediation is good, the parties are happy and courts
save time for others case; if mediation is not good, the parties might have to go to
court. It is crucial to separate the ideas between these two concepts (Alexandra,
2016).
Lastly, one of the major problem is the lack of information which litigation
can ensure, or we can call it the problem regarding human characteristics (Paul
Randolph, 2010). Sometimes, parties just do not want to mediate, it is the matter of
credibility. Maybe because they do not want a win-win situation when they feel that
they have a better grounds. Or maybe it is a situation which the party does not trust
that the other parties will act in a good manner. Such subjective thoughts could
result in a lot of time and money.
1.3. Arbitration
1.3.1. Rationale of arbitration
Arbitration is the most formal alternative to litigation. In this process, the
disputing parties present their case to a neutral third party, who renders a decision.
Arbitration is widely used to resolve disputes in both the private and public sector.
Moreover, arbitration is generally considered a more efficient process than
litigation because it is quicker, less expensive, and provides greater flexibility of
process and procedure. The parties often select the arbitrator and exercise control
over certain aspects of the arbitration procedure. Arbitrators typically have more

29
expertise in the specific subject matter of the dispute than do judges. They may also
have greater flexibility in decision-making. (“Using Arbitration to Resolve Legal
Disputes”)
Arbitration is the process of bringing a business dispute before a
disinterested third party for resolution. The third party, an arbitrator, hears the
evidence brought by both sides and makes a decision. Sometimes that decision is
binding on the parties. To arbitrate a matter is to bring it before an arbitrator. An
arbitrator is a spectator, witness, or hearer.
Arbitration is a form of alternative dispute resolution (ADR), used in place
of litigationin the hope of settling a dispute without the cost and time of going to
court. Litigation is a court-based process that involves a decision that is binding on
both parties and a process of appealing the decision. The differences
between arbitration and litigation involve the processes themselves and the result of
decisions on the disputes.
Arbitration is often confused with mediation, which is an informal process of
bringing in a third party who goes between the disputing parties to help them settle
a dispute. The mediation process is not binding on the parties, and the mediator
does not hear evidence. The mediator meets with the parties for discussion. The
mediator tries to bring the parties together by discussion and caucusing (a separate
discussion). Litigation, arbitration, and mediation are all involved in settling
business disputes (Jean Murray, 2019)
1.3.2. Definition and process
In legal science, the arbitration was studied under many different levels and
there are many definitions of arbitration:
According to the American Arbitration Association/ICDR (AAA):
"Arbitration is a dispute resolution method by submitting the dispute to a number of
objective consideration and settlement and they will make the final decision,
valuable required the claimants to enforce ".

30
In Vietnam, according to Article 3 (1) of the Law on Commercial Arbitration
2010: "Commercial arbitration means a dispute resolution method agreed by the
parties and conducted in accordance with the provisions of this Law.”
Besides, according to Martin Domke, commercial arbitration is defined as:
“…a means of settling disputes by referring them to a neutral person,
an arbitrator, selected by the parties for a decision based on the evidence and
arguments presented to the arbitration tribunal. The parties agree in advance that the
decision will be accepted as final and binding.”
Source: (Britanica, 2003)
In short, commercial arbitration can be understood as a form of alternative
dispute resolution (ADR) and is a way to resolve commercial disputes outside
the courts. The dispute will be decided by one or more persons (the "arbitrators",
"arbiters" or "arbitral tribunal"), which renders the "arbitration award". An
arbitration award is legally binding on both sides and enforceable in the
courts. (O'Sullivan, Arthur; Sheffrin, Steven M., 2003)
According to the American Arbitration Association (AAA), here is the general
process for arbitration.

31
Figure 1.2: Commercial arbitration process
1.3.3. Stages of commercial arbitration
While each case is different and may have unique circumstances that can
change the usual procedures, according to American arbitration association
arbitrations, arbitrations usually proceed through the following general stages:
1.3.3.1. The Case Initiation
The arbitration center/asscociation sends out a letter or email notifying the
parties that the case has been filed. This communication will also provide
information regarding the arbitration process. Dates for when the respondent should
file an answer to the claimant’s Demand for Arbitration and for all parties to
provide any other needed information will be set at this time as well. Further, if
there are any fees required from any party at this time, the AAA will also request
said fees.
1.3.3.2. Arbitrator Invitation
Depending on what process is set forth in the Rules that govern your
arbitration, the arbitration center/asscociation invites an arbitrator or arbitrators to
Dispute occurs
Arbitration
agreement is
invoked
Arbitrator is
selected
Discovery
conducted
Position
Statements
submitted to
arbitrator
Hearing
Decision
Award and
enforcement

32
serve on the case. As part of this process, the arbitrator reviews case information,
checks for conflicts and returns a signed oath document, along with any relevant
disclosures, if applicable.
1.3.3.3. Arbitrator Appointment
Parties are notified of the appointed arbitrator and provided the opportunity
to object to this arbitrator serving on the case. A due date for any objections is set
and if any objections are received, the arbitration center/asscociation will conduct a
process to decide if the arbitrator should be kept on or removed from the case. If the
AAA decides to remove the arbitrator, the case returns to the arbitrator invitation
stage, as previously described. If the Arbitrator is kept on the case, the case
continues to the next stage.
1.3.3.4. Preliminary Hearing and Information Exchange
After appointment and confirmation of the Arbitrator, the preliminary
hearing conference call with the parties and the arbitrator will be scheduled and
held. During this call, preliminary issues are addressed, the exchange of information
between the parties is scheduled and a hearing date is set. After the call is held, the
Arbitrator will issue a written document called a “scheduling order”, which
confirms all important dates and specifics discussed on the call.
1.3.3.5. Hearing Stage
During this stage, the parties present their case to the arbitrator. This process
can take place in person, over the telephone, or by the parties submitting written
documents. The parties’ arbitration agreement and the applicable Rules that govern
the case will dictate the process. Sometimes, parties will also submit written
arguments after the hearing at the direction of the arbitrator.
1.3.3.6. Award
After the hearing is completed and the arbitrator determines no more
evidence will be presented, the hearing(s) is closed and a date for the issuance of the
award is set. The arbitrator renders a written award which decides the outcome of

33
the case and is sent to the parties. At this point, the case is over and the arbitration
center/ association closes its file.
Again, these are the general stages of most arbitration cases. As the
arbitration progresses through these stages, the arbitration center will communicate
specific directions and information about each. It is important to read this
information carefully, and respond and participate appropriately throughout the
process.
1.3.4. Arbitration agreement
To submit the dispute for settlement before the arbitral tribunal, there should
be an arbitration agreement entered into by disputing parties. Arbitration agreement
represents the will of the parties that they agree to bring any legal claims arising out
of a business relationship to be settled by arbitration. Arbitration agreement is
usually found in the form of a clause/term in the contracts concluded by the parties,
or it can be a separate agreement (an agreement to arbitrate). Arbitration agreement
may be formed before or after the dispute arises.
In the UNCITRAL Model Law, Article 7 (1) provides the meaning as
follows:
“Arbitration agreement is an agreement by the parties to submit to arbitration
all or certain disputes which have arisen or which may arise between them in
respect of a defined legal relationship, whether contractual or not. An arbitration
agreement may be in the form of an arbitration clause in a contract or in the form of
a separate agreement.”
According to the New York Convention 1958, the arbitration agreement will
be treated as an independent agreement, even if the arbitration agreement was
expressed as a clause in the contract of the parties.
Arbitration agreement plays a fundamental role in determining the
jurisdiction of the arbitral tribunal, while reflecting the freedom of the parties'
agreement to arbitration. The arbitration agreement may exclude the jurisdiction of
the Court over the case.

34
1.3.5. Forms of commercial arbitration
Commercial arbitration exists in two basic forms is ad hoc arbitration and
administered arbitration.
1.3.5.1. Ad-hoc arbitration
Ad-hoc arbitration is a type of arbitration that is agreed by parties to
establish in order to solve the case and will cease to exist when the incident is
resolved. The nature of ad-hoc arbitration express through the following basic
features:
- Established when disputes arise and terminated when the dispute is
resolved.
- There is no arbitration institution, no permanent system, no list of
arbitrators. Arbitrators selected by the parties or appointed by other arbitrators may
be the person named in or outside the list of arbitrators from any arbitration centers.
- Rules of the arbitration proceedings to resolve the dispute may be agreed
by the parties to build or choose from any of the procedural rules of any arbitration
centers.
Although arbitration is prescribed in the Vietnamese Commercial Arbitration
Act 2010, it is not developed in practice of Vietnam. The reasons, among others, are
ad-hoc arbitration requires the parties themselves to be proactive and skillful in
participating in the arbitration proceedings without having any support from a
professional arbitration secretariat; and not only the arbitral tribunal but the parties
would need to have considerable good experience in arbitration procedure for an
efficent outcome of the proceeding.
1.3.5.2. Administered arbitration / Insitutional arbitration
Administered/Insitutional arbitration is a type of arbitration which is well-
formed, with arbitration institution, and also list of arbitrators. Arbitrators within the
list will operate under the institution’s charter and procedural rules. Most of the
major arbitration institutions reputed worldwide are established under such models

35
named arbitration centre, arbitration panel, arbitration institute, national and
international arbitral tribunal ... but most arbitration institution is established in the
form of arbitration centers.
VIAC is an institutional arbitration centre, having its operations and
functions similar to other arbitration institutions in the world such as International
Court of Arbitration ICC, Singapore International Arbitration Centre (SIAC), Hong
Kong International Arbitration Centre (HKIAC), ....
According to VIAC, insitutional arbitration type has some features as follow:
- Structure of an arbitration institution will includes an executive board,
secretariat board and arbitrators of the institution. Co-operation and management of
the arbitration institution are generally simple. The Executive Board, normally, are
composed of the president, one or more vice presidents and secretary-general.
Besides Executive Board, there will be a list of arbitrators who are likely to be
available to be appointed to serve as arbitrators resolving cases. Normally, this list
has a feature of a recommendations.
- Arbitration institution decide their own activities and procedural rules.
Within its operating, the institution also has the right to expand and narrow the
scope of operation, but must register with the state authority. This feature allows the
arbitration institution to hold and operate with specialized arbitration nature (only
solve these kinds of certain commercial disputes).
1.3.6. Benefits and drawbacks of commercial arbitration
Arbitration is a less formal process than court litigation, and it is conducted
in private, away from the glare of the media and the public. Parties to the
arbitration, as well as arbitrators, are generally obliged to maintain the
confidentiality of all matters relating to the arbitration proceedings and the
arbitration award. Moreover, parties are free to appoint their own arbitrators, engage
their preferred counsel and choose the procedures and rules for the conduct of an
arbitration. Parties are generally assured of finality once the arbitration award is

36
issued as there are limited avenues for appeal against an arbitration award. Finally,
the arbitration process can be more cost-effective and efficient than court litigation.
There are, however, also some disadvantages to arbitration as a method of
resolving a dispute. Arbitrations can be expensive. In a legal action, the costs
incurred by the Judge are not borne by the parties to the dispute. In arbitrations
however, the arbitrators costs have to be paid by one or both of the parties. Whilst
costs in an arbitration will generally (like a court case) follow the event, before each
party signs up to an Arbitration they will have to sign an agreement in which it is
usual that the parties are jointly liable for same. This means that if the arbitrator
directs your opposing party to pay his costs and he/she defaults, you may well have
to ‘carry the can’. Furthermore, while the finality of an arbitrator’s decision may
well appeal to some, others may consider it to be a disadvantage if they do not feel
that the arbitrator’s decision is the right one. Finally, under the rules of court,
Judges have various powers they may exercise in the course of a legal action. For
example, on the defendants application, a Judge may strike out the plaintiff’s case
for want of prosecution. Powers such as this are not enjoyed by an arbitrator.
1.4. The key differences between mediation and arbitration
Although mediation and arbitration have the same goal in mind, a fair
resolution of the issues at hand, there are some major differences which both parties
must understand beforehand.
The main difference between arbitration and mediation is that in arbitration
the arbitrator hears evidence and makes a decision. Arbitration is like the court
process as parties still provide testimony and give evidence similar to a trial but it is
usually less formal. In mediation, the process is a negotiation with the assistance of
a neutral third party. The parties do not reach a resolution unless all sides agree.
Mediators do not issue orders, find fault, or make determinations. Instead,
mediators help parties to reach a settlement by assisting with communications,
obtaining relevant information, and developing options. Although mediation
procedures may vary, the parties usually first meet together with the mediator

37
informally to explain their views of the dispute. Often the mediator will then meet
with each party separately. The mediator discusses the dispute with them, and
explores with each party possible ways to resolve it. It is common for the mediator
to go back and forth between sides a number of times. The main focus remains on
the parties as they work towards a mutually beneficial solution. Most disputes are
successfully resolved and often the parties will then enter into a written settlement
agreement. Many people report a higher degree of satisfaction with mediation than
with arbitration or other court processes because they can control the result and be
part of the resolution.
Arbitration, on the other hand, is generally a more formal process than
mediation. An arbitrator could be a retired judge, a senior lawyer or a professional
such as an accountant or engineer. During arbitration, both parties are given an
opportunity to present their cases to the arbitrator. Much like a regular court
proceeding, lawyers can also question witnesses from both sides. During arbitration,
there are usually little if any out-of-court negotiations between parties. The
arbitrator has the power to render a legally binding decision which both parties must
honour and the award is enforceable in our courts and the courts of 142 countries.

38
Table 1.3: Comparison Between Arbitration & Mediation
Arbitration Mediation
Adjudication Expedited negotiation
Arbitrators control the outcome. Parties control the outcome.
Arbitrator is given power to
decide.
Final and binding decision.
Mediator has no power to decide.
Settlement only with party approval.
Often extensive discovery is
required.
Exchange of information is voluntary and is
often limited. Parties exchange information
that will assist in reaching a resolution.
Arbitrator listens to facts and
evidence and renders an award.
Mediator helps the parties define and
understand the issues and each side's interests.
Parties present case, testify under
oath.
Parties vent feelings, tell story, engage in
creative problem-solving.
Process is formal. Attorneys
control party participation.
Process is informal.
Parties are active participants.
Evidentiary hearings.
No private communication with
Joint and private meetings between individual
parties and their counsel.

39
the arbitrator.
Decision based on facts,
evidence, and law.
Outcome based on needs of parties.
Result is win/lose award—
Relationships are often lost.
Result is mutually satisfactory—A relationship
may be maintained or created.
More expensive than mediation,
but less expensive than
traditional litigation.
Low cost.
Private and confidential. Private and confidential.
(Financial Industry Regulatory Authority-FINRA, 2018)
1.5. The understanding of arb-med-arb model
To satisfy the needs of an increasingly diverse set of legal cultures meeting
in the global marketplace today, dispute resolution mechanisms must continually
evolve. One of the recent solutions to arise out of the blending of legal cultures is
evolutionary rather than revolutionary, because it is in fact not new at all: multi-
tiered dispute resolution.
In the recent years, the “Arb-Med-Arb” process has gained traction as a
dispute resolution mechanism. The process of “Arb-Med-Arb” (the short form for
Arbitration-Mediation-Arbitration) entails exactly what its name suggests: the
commencement of arbitration proceedings, followed by mediation to attempt an
amicable resolution, followed by continuation of arbitration proceedings if
mediation was unsuccessful.

40
The simple idea behind multi-tiered dispute resolution is to provide several
possible avenues to dispute settlement within one dispute resolution procedure. The
result is a mechanism that combines various dispute resolution methods, such as
mediation and arbitration, in different ways. Clauses incorporating multi-tiered
dispute resolution are a recent development in commercial and cross-border
contexts.
Yet in some parts of the world, such as mainland China and other civil law
countries, it is standard for judges and arbitrators to attempt to facilitate settlement
in the course of trial and arbitration.
Multi-tiered dispute resolution provides a dynamic solution for cross-border
disputes. It combines the flexibility of negotiation and mediation with the promise
of finality and expedited enforcement through arbitration under the UN Convention
for the Recognition and Enforcement of Foreign Arbitral Awards. It also presents a
unique set of considerations for parties to navigate.
The common question about “Arb-Med-Arb” is whether the initial
arbitration is even necessary, and whether a simpler “Med-Arb” process is more
effective to help parties to save time and costs. However, any practitioner with
sufficient experience in mediation will explain that it is unwise to attempt mediation
before each party has sufficient understanding of its own and its opponent's case.
This is even more so where the dispute is multifaceted or acrimonious.
For this reason, the “Arb-Med-Arb” process stays the initial arbitration
proceeding only after the arbitration pleadings have been exchanged. The principle
behind this is that by having parties formulate and state their case in the arbitration
pleadings, the scope of the dispute will be sufficiently outlined to allow them to
adequately prepare for the mediation, on both the merits of their case as well as
their readiness to negotiate in good faith. This discourages parties from using the
mediation session as a fishing expedition to supplement their case in the litigation
or arbitration. It is also noted that under the Arb-Med-Arb model, the case file and
all documents are also forwarded from arbitration center to mediation center for the

41
mediation. This not only ensures that the necessary information will be available to
all parties (including the mediator) at the mediation, but also saves the time and
costs of having to reproduce or recreate the same materials. This unique partnership
between the arbitration center and mediation in Singapore is laudable as it further
streamlines the entire process. While the simpler “Med-Arb” is not ineffective in
itself, the growing traction of “Arb-Med-Arb” shows the recognition that the more
comprehensive “Arb-Med-Arb” may well be the way forward for alternative dispute
resolution mechanisms.
The specific procedure of Arb-Med-Arb will be described in the next
Chapter.

42
CHAPTER 2: INTERNATIONAL EXPERIENCE ON APPLYING ARB-
MED-ARB MODEL: STUDY OF SINGAPORE
2.1. Singapore’s development in mediation and arbitration
Singapore is the country considered as one of the most favored destination
for international ADR solutions. “Over the years, Singapore has become one of the
leading alternative dispute settlement.”1
Furthermore, Singapore is the creator as
well as the only country that apply arbitration - mediation - arbitration model up to
now. That is the reason why this research choose to analyze the structure of this
nation. How did the country complete the road so as to become such outstanding
hub for global commercial mediation and arbitration? The study would look at the
road in forming institution and structure of the Singapore’s mediation and
arbitration proceedings.
2.1.1. Singapore’s development in mediation
In the ending years of twentieth century (1990s), Singapore’s mediation is
revived when this country‘s court is full of enormous cases load. Moreover, they
started considering mediation as a more viable dispute settlement regarding to the
length of procedure and harmonization. In this country, mediation was also found as
a method to relief the adjudication’s responsibility on backlogged cases. Based on
such encouragement, the first three mediation institutions were formed in the effort
of realization such goals (Sundaresh Menon, 2015).
The first one is the Primary Dispute Resolution Centre. This centre focuses on
the civil cases which were being handled by the State Courts of Singapore, the limit
for those cases is approximately 200,000 US dollar. Consequently, the mediators of
the Primary Dispute Resolution Centre is mostly judges and have received advance
courses in the mediation for conducting such process, of course. The mediator is
one of the most impressive about the Primary Dispute Resolution Centre in
Singapore, because the cases load is enormous while the judges are limited, they
had to look for more mediators who have required legal background and pass the
1 ADR in Asia Pacific

43
accreditation. After that, the position of Primary Dispute Resolution Centre has
been enhanced by the State Courts Practice Directions in Singapore that stated
conflict parties are automatically consulted to the most suitable method of
alternative dispute settlement , mediation is one of which and no circumstance
happens when they decide not to do so.
The second mediation institutions is the Singapore Mediation Center,
established in 1997 and aim mostly at the commercial cases. Similar to the Primary
Dispute Resolution Centre, the Singapore Mediation Center is active side-by-side
with the Supreme Court of Singapore. Dispute parties in such court are strongly
recommended to resort the choice of mediation to settle the dispute.
Notwithstanding, the court still has the power to place the court at the hand of
mediation if they find it proper. One of the most noticeable move is the
collaboration between the Singapore Mediation Center and the business firms and
areas in Singapore. Such partnership shall help the SMC to establish a mediation
program that is suitable to the demand of the economic zone. The production are the
Council for Estate Agencies Mediation Sub-Scheme and the Court for Private
Mediation Education.
The final one is the Community Mediation Centres (CMC). All the things
stated in that name, this center focus on the matters relating to people and home.
Since the common life conflict are diverse, this institution has to handle many cases
in many aspects, so they need many mediators who comes from various social life’s
sides. The mentioned institution has its own Mediator Framework to administer the
standards for its mediators, training programs and qualification to recruit volunteer
mediators.
By classifying mediation institutions, the result was noticeable. As reported in
2015, the PDRC has handled more than 7.000 cases and it has been raising in the
years after. Solving rate is irrational high: 9/10. The SMC has solved nearly 2.500
cases with the successful ratio of nearly 80 percent. Finally, the CMC has solved
about 7000 community disputes and the solving rate is also great, about 70 percent
(Sundaresh Menon, 2015).

44
At that time, Singapore also aware of the demand of the international
commercial community for quality dispute settlement resolution as the increasing of
FDI and cross border trade activities in the region (UN, 2013). Based on such
situation, the country has developed itself to a place for dispute resolution of
international commercial activities conflict and is regarded as one of the most
popular arbitration and mediation institution of the world (White & Cases, 2012).
The Singapore International Mediation Center ( The Singapore International
Mediation Center) was formed by the Working Group in 2013, stemmed from a
mediation circumstances survey. The Working Group also recommended to create
an accreditation system to professionally qualify mediators and a strong legal
framework for mediation in Singapore. Consequently, the Singapore International
Mediation Center is an option that full of international quality and various
mediators as well as specialists. The international commercial mediation services
are provided follow the Singapore International Mediation Center mediation
principles. Moreover, the mediators can find many supports from logistic to
documents available to be their best. The SIMI or the Singapore International
Mediation Institute is the supporter of the Singapore International Mediation. The
Singapore International Mediation Institute is responsible for the validation of
mediators in the the Singapore International Mediation Center which shall be later
discussed in the Mediator section of the thesis.
The last piece of the Singapore’s ADR pictures is the Singapore International
Commercial Court (SICC). The SICC is a body of the Singapore High Court that is
responsible for receiving international trade disputes that usually do not related to
the country. This institution can be considered as the combination of the court and
arbitration, so utilized both the advantaged features of the two kinds. Besides the
SIMC and the SIAC, Singapore has become an impressive ADR hub in the region
or even all over the world. In this country, parties can vouluntarily choose the
resolution they desire to select or can anytime resort to mediation by themselves or
referred by the court and do not have to be anxious because the mechanism is
perfect.

45
Furthermore, the Asian Mediation Association was formed in Singapore on
17th
August 2007 with the signing of the MOU between five mediation centers to
enhance the mediation ecosystem in the region. The five pioneers’ mutual interest is
the improvement of mediation in resolving business and commercial conflicts. Arb-
Med-Arb model is the only in a way that it is able to assemble the mediation centers
across Asia which has a various cultures and jurisdiction. The organization pay
attention mostly on resolving dispute in Asia or with parties who have trading
activities in Asia with a wide range of dispute settlement and services such as:
facilitation of mediation in a neutral jurisdiction or neutral mediator, mediator
selection and training, establishing and implementing of mediation systems. At the
present time, the quantity of members has increased to twelve, including: Bahrain
Chamber for Dispute Resolution, CCPIT/CCOIC Mediation Center, Delhi
Mediation Centre, Fiji Mediation Services, Hong Kong Mediation Centre, Indian
Institute of Arbitration and Mediation, Indonesian Mediation Center, Japan
Commercial Arbitration Association (JCAA), Malaysian Mediation Centre,
Philippine Mediation Center, Singapore Mediation Centre, Thai Mediation Center
(AMA, 2018).
2.1.2. Singapore’s development in arbitration
Twenty-five years ago, international arbitration in Singapore was almost non-
existent. Today it is recognized as a leader in international arbitration in Asia, and
as a growing hub for international arbitration globally. This is demonstrated, not
only by the fact that SIAC has been recognized as one of the fastest growing arbitral
institutions in the world (in 2016 it had 343 new cases) (SIAC, Singapore, 2018)
but also by the fact that over 80 percent of these cases are international (Alvin Yeo
& Chou Sean Yu, Singapore, 2015) Singapore has achieved this by fully engaging
in regulatory competition. Remarks by Minister of Law K. Shanmugam at an
Arbitration Dialogue organized by the Ministry of Law in 2011 support this
assertion. He stated that Singapore intends to be at the “leading edge of thinking in
international arbitration,” (Shaun Lee, 2013) and he went on to explain the
government’s unequivocal approach to arbitration:

46
“As I tell the arbitration practitioners we meet, our approach in Singapore is:
we see a problem, and where it can be solved legislatively, we are in a position to
do that within three to six months. For example, in almost every jurisdiction, you
might get cases which sometimes are not consistent with how we want arbitration to
be supported. We came across such a case from the High Court and the situation
was sorted out legislatively within four months. That is the approach we take when
we have a court system and judicial philosophy now which is extremely supportive
of arbitration as well. They intervene in appropriate cases; they do not take a
completely hands-off approach, but totally supportive and in line with international
thinking.” (Shaun Lee, 2013)
Singapore is challenging established centers for arbitration such as London,
Paris and Stockholm. Case filings at the Singapore International Arbitration Centre
(SIAC) have increased by more than 300 per cent in the past 15 years. In 2000,
Singapore handled 58 cases but numbers rose dramatically after the financial crisis.
In 2015 there were 271 filings. This was a 22 per cent increase on 2014’s total. By
contrast, the London Court of Arbitration had 326 arbitrations referred to it in 2015,
up 10 per cent on 2014. Singapore is fast catching up. (Jane Croft, Singapore, 2016)
Figure 2.1: Total Number of New Cases Handled by SIAC (2006-2016)
(SIAC, Singapore, 2018)

47
2016 was a record breaking year for Singapore's main arbitral institution, the
Singapore International Arbitration Centre (SIAC), and the ICC (Lim Tat,
Singapore, 2017):
- SIAC administered 343 new cases from 56 jurisdictions, representing
almost a 400% rise from a decade ago and a 27% increase from 2015.
- SIAC handled a total amount in dispute of US$11.85 billion), nearly
three and half times the amount in 2014.
- The ICC Court recorded 966 new cases filed in 2016, with the average
monetary value in dispute rising from US$63 million in 2014 to US$84
million in 2015.
- Singapore was also named the number one seat of ICC arbitration in Asia
for five years running and the fourth most preferred seat globally for ICC
arbitration.
Over 84% of all new Singapore seated SIAC arbitrations and 71% of all new
Singapore seated ICC arbitrations filed in 2015 were international in nature,
involving one or more nonSingaporean parties.
The attraction of arbitration in international business transactions in Singapore
is attributable to its:
- Strong rule of law.
- Arbitration legislation based on the UNCITRAL Model Law on
International Commercial Arbitration 1985 (UNCITRAL Model
Arbitration Law).
- Supportive judiciary.
- Confidentiality of arbitration proceedings
- Cutting-edge arbitration facilities at Singapore's Maxwell Chambers
Singapore’s strong commitment to being at the “leading edge” of international
arbitration provides insight into how states can successfully engage in regulatory
competition and market themselves as attractive arbitration destinations. Shortly
after attaining internal self-governance in 1960, Singapore had a gross domestic

48
product (“GDP”) per capita of USD428 and faced an uncertain future.(Tan Cheng-
Han, Dan W Puchniak, & Umakanth Varottil, Singapore, 2015). Today Singapore
has an estimated GDP per capita of USD55,252.40, making it one of the richest
countries in the world. (Global Finance, “Singapore GDP and Economic Data”,
2017). With few natural resources, much of the city-state’s development has been
credited to effective and firm governance. (Cheung-Han, Puchniak, & Varottil,
Singapore, 2017) Singapore’s government practices a form of state-capitalism,
which essentially ties the ruling People’s Action Party’s legitimacy to remain in
power with competent economic management and the ability to deliver sustained
economic growth. As Singapore scholars have observed, “the link between
economic legitimacy and political power in Singapore cannot be understated.”
Consequently, the government has worked hard to ensure that Singapore maintains
a regulatory climate hospitable to business. It has been rewarded for its efforts:
“For the past eight years, the World Bank has recognized Singapore as having
the best regulatory and economic environment in the world for doing business [in
June 2016, however, it slipped to second place, behind New Zealand]. Transparency
International consistently ranks Singapore in the top five countries in the world for
having the lowest level of corruption. The Wall Street Journal and The Heritage
Foundation consistently rank Singapore in the top few countries in the world with
respect to economic freedom. The Asian Corporate Governance Association has
repeatedly ranked Singapore as having the best corporate governance in Asia.”
(Cheung-Han, Puchniak, & Varottil, Singapore, 2017)
In light of Singapore’s commitment to economic growth, it is unsurprising
that it would seek to market itself as an arbitration-friendly jurisdiction. In addition
to generating revenue from the fees associated with arbitration, it has been argued
that non-Western and developing states must “opt in” to the Western system of
arbitration “in order to maintain and grow business relationships with Western
partners.”( Edward Leahy & Carlos Bianchi, Singapore, 2000). In other words, the
benefits of adopting arbitration-friendly laws go beyond attracting arbitrations, and
include attracting business in general. Developing a robust system of private

ARB-MED-ARB MODEL: INTERNATIONAL PRACTICE AND APPLICABILITY IN VIETNAM

ARB-MED-ARB MODEL: INTERNATIONAL PRACTICE AND APPLICABILITY IN VIETNAM

Recommended

Recommended

More Related Content

Similar to ARB-MED-ARB MODEL: INTERNATIONAL PRACTICE AND APPLICABILITY IN VIETNAM

Similar to ARB-MED-ARB MODEL: INTERNATIONAL PRACTICE AND APPLICABILITY IN VIETNAM (20)

More from lamluanvan.net Viết thuê luận văn

More from lamluanvan.net Viết thuê luận văn (20)

Recently uploaded

Recently uploaded (20)

ARB-MED-ARB MODEL: INTERNATIONAL PRACTICE AND APPLICABILITY IN VIETNAM