Describes arbitration as the means of dispute settlement which has a confidentiality as one of its advantage. Arbitration agreement has been described as well with the relevant arbitral source of law and its institutions.

1. ARBITRATION OF DISPUTES
IN INTERNATIONAL BUSINESS
TRANSACTION
MARISKE MYEKE TAMPI

2. Stay informed!
• www.iccwbo.org/index_court.asp - ICC International Court of
Arbitration
• www.asil.org – American Society of International Law’s Guide to
Electronic Resources for International Law
• www.adr.org – American Arbitration Association
• www.mediate.com – Mediation Information and Resource Center
• www.adrr.com – ADR and Mediation Resource

3. Purpose of Arbitration in International
Transaction
• Private system of adjudication
• Parties who arbitrate have decided to resolve their dispute outside
of any judicial system
• Involves a final and binding decision
• Producing an award that is enforceable in national court

4. Parts of Arbitration
Arbitrators
• One or three
• Chosen by
the parties
Institution • Chosen by
the parties
whether
international
arbitral
institution or
ad hoc
Rules
• Chosen by
the parties
whether the
rules of
arbitral
institution of
the another
rules
PlaceandLanguages
• Chosen by
the parties

5. Characteristics of Arbitration in International
Transaction
• Consent
• Non-governmental decision makers
• A final and binding award

6. Characteristics of Arbitration in International
Transaction: Consent
• Consent provides an underpinning for
the power of the arbitrators to decide a
dispute
• Arbitrator can only decide issues within
the scope of the parties’ agreement
• Submission agreement is allowed
*submission agreement: if the parties do not have an
arbitration clause in their contract, they can still
enter into an agreement after the dispute has
arisen.
Rules Procedures
Law
Another
part of
Parties’
Agreement
POWER OF ARBITRATION

7. Characteristics of Arbitration in International
Transaction: Non-governmental decision makers
Arbitrators are private citizen
Chosen by the parties
Weigh less heavily any questions of public policy or public interest
Perceived as even-tempered, thoughtful, fair-minded and reasonable

8. Characteristics of Arbitration in International
Transaction: A Final and Binding Award
Final
and
Binding
Arbitration results are…
• Although there are occasional
opportunities to appeal in some
jurisdictions
• How about Indonesia’s jurisdiction?

9. Advantages of Arbitration of Arbitration in
International Transaction
• The neutrality of the forum
• The likelihoodof obtaining enforcement
• Under New York Convention, courts are required to enforce the
award unless there are serious procedural irregularities, or
problem that go to the integrity of the process
• The ability to keep the procedure and the resulting award
confidential

10. Disadvantages of Arbitration of Arbitration in
International Transaction
• If an arbitrator has rendered a decision that is clearly wrong on
the law or the facts, the lack of ability to bring an appeal can be
frustrating to a party
• Arbitrators have no coercive powers
• If the arbitration agreement is not valid then the framework
becomes irrelevant, because there is no legal basis for arbitration

11. The Regulatory Framework
• The framework expands in terms of scope and applicability beyond
immediate parties
• UNCITRAL Model Law on International Commercial Arbitration has
been adopted by many countries as their arbitration law
• Substantive law are likely to be different, depends on the chosen
law

12. Arbitral Convention
• New York Convention
• Inter-American Convention on International Commercial
Arbitration (the Panama Convention)
• The European Convention on International Commercial Arbitration
• The Convention on the Settlement of Investment Disputes
between States and Nationals of other States (the “Washington
Convention” or the “ICSID Convention”)

13. Arbitral Institutions
• The International Chamber of Commerce (ICC) International Court
of Arbitration
• The American Arbitration Association’s (AA) International Centre
for Dispute Regulation (ICDR)
• The London Court of International Arbitration (LCIA)
• Other Arbitral Institutions: SCC, CIETAC, WIPO Arbitration and
Mediation, GAFTA, LMAA, LMAA, FOSFA

14. Other Disputes Resolution Methods
• Mediation
• Consiliation
• Neutral Evaluation
• Expert Determination
• Mini-Trials

15. The Arbitration Agreement
International Treaties
International Arbitration
Practice
National Laws
Arbitration
Rules
Arbitration Agreement

16. Arbitration Agreement
Article II of New York Convention
(1) Each Contracting State shall recognize an agreement in writing under which the
parties undertake to submit to arbitration all or any differences which have arisen
or which may arise between them in respect of a defined legal relationship,
whether contractual or not, concerning a subject matter capable of settlement by
arbitration
(2) The term “agreement in writing” shall include an arbitral clause in a contract or an
arbitration agreement, signed by the parties or contained in an exchange of letters
or telegrams
(3) The courts of a Contracting State, when seized of an action in a matter in respect
of which the parties have made an agreement within the meaning of this article,
shall at the request of one of the parties, refer the parties to arbitration, unless it
finds that the said agreement is null and void, inoperative or incapable of being
performed

17. Drafting the Arbitration Agreement:
Essential Requirements
• Choice of Arbitrators
• Place of Arbitration
• Language of Arbitration
• Substantive Law

18. Drafting the Arbitration Agreement:
Additional Provisions
• International Bar Association Rules on Taking Evidence
• Preliminary Relief
• Technical Expertise
• Multistep Dispute Resolution Clauses
• Disposiitive Motions
• Legal Fees and Costs
• Confidentiality
• Expanded Judicial Review
• Waiver of State Immunity
• Multiparty Agreements

19. References
Ashford, Peter. Handbook on international Commercial Arbitration. 2009.
New York: Juris Publishing
Dimatteo, Larry A. The Law of International Business Transactions. 2003.
Ohio: Thomson – South Western
Moses, Margaret L. The Principles and Practice of International
Commercial Arbitration. 2008. New York: Cambridge
Newman, Laurence W. and Richard D. Hill. The Leading Arbitrators’ Guide
To International Arbitration. 2008. New York: Juris Publishing
Onyema, Emilia. International Commercial Arbitration and the
Arbitrator’s Contract. 2010. New York: Routledge
Thacher, Simpson and Barlett LLP. Comparison International Arbitrarion
Rules. 2008. New York: Juris Publishing