Overview of Arbitration

  1. What is arbitration?

    Arbitration is a private dispute resolution process that parties may choose as an alternative to going to court. The arbitration process is consensual in that the parties must agree to refer their dispute to arbitration. In arbitration proceedings, the dispute is decided either by a single arbitrator or a panel of arbitrators (usually three in number). An arbitrator performs a similar role to that of a judge and is responsible for managing the proceedings. A key function of the arbitrator is to ensure that the parties to the dispute have a reasonable opportunity of presenting their case. At the conclusion of the arbitration, the arbitrator will deliver an award which is final and binding on the parties.

  2. How is arbitration different from mediation?

    While mediation is also a consensual process, mediation only results in a resolution of the dispute if the parties agree to terms of settlement. In a mediation, it is the mediator’s role to bring the parties together and explore areas of compromise with a view to agreeing final terms of settlement. However, it is the parties who are in control of the outcome. If the mediation is unsuccessful, then the parties will ordinarily have to resort to arbitration or court litigation to resolve their dispute.

  3. How is arbitration different from court litigation?

    In arbitration proceedings the dispute is decided by an arbitrator as opposed to a judge. One of the main differences between arbitration and court litigation is that the parties have the ability to choose the arbitrator who will decide their dispute, unlike in court litigation where the court will allocate a judge to the case. Arbitration is conducted in private as opposed to court litigation which is conducted in open court. Arbitration is generally less formal and has the potential to provide for a more flexible procedural framework than court litigation.

  4. What are the main advantages of arbitration?

    The main advantages of arbitration are:
    • Flexibility: Due to its consensual nature, parties are able to agree on procedures for the arbitration that are tailor-made for their dispute.
    • Choosing the arbitrator: In arbitration, parties have the ability to choose the arbitrator who will decide their dispute.
    • Neutrality: For international parties, arbitration offers parties a neutral forum to have their dispute determined.
    • Confidentiality: Arbitration hearings are held in private and parties can agree that the arbitration will remain confidential as between themselves.
    • Finality: An arbitration award is final and can normally only be challenged on narrow and discrete grounds.
    • Enforceability: Arbitration awards can be more easily enforced internationally than court judgments.

  5. What are the potential disadvantages of arbitration?

    Because an arbitral tribunal gets its power from the agreement of the parties, a tribunal generally has no powers against non-parties to the arbitration agreement. Therefore, unlike court litigation, it is generally not possible to join any third parties to the arbitration without the agreement of the parties concerned. It is also generally not possible to compel the attendance of witnesses or require third parties to produce evidence without assistance from the court.

  6. What is “institutional” arbitration?

    An institutional arbitration is administered by a specialised arbitral institution. An arbitral institution has its own set of rules which provides a procedural framework for the arbitration. It also has its own form of administration to assist with the arbitral process (although the precise services that are on offer can differ from institution to institution).

  7. What is ”ad hoc” arbitration?

    An ad hoc arbitration is not administered by a specailaised institution. Rather, all arrangements for the arbitration need to be carried out between the arbitral tribunal and the parties.

  8. What are the advantages of institutional arbitration?

    The main advantage of an institutional arbitration is that the parties benefit from an established format for the arbitration from an institution with a proven track record which specialises in assisting parties with the arbitral process.

  9. What are the advantages of ad hoc arbitration?

    Because an ad hoc arbitration is not administered by a specailaised institution, the parties do not incur the added administrative costs associated with an institutional arbitration. An ad hoc arbitration has the potential to be more flexible, faster and less expensive than an institutional arbitration, however much depends on the cooperation of the parties and the case management of the arbitration by the arbitral tribunal for its effectiveness

  10. Is arbitration cheaper than litigation?

    Due to its flexible nature, arbitration has the potential to be cheaper than court litigation. However, much will depend on the cooperation of the parties in adopting procedures that are efficient and cost effective. Moreover, if the arbitral process largely mirrors the court litigation process, there are unlikely to be any significant cost savings and, in fact, the arbitration may be more expensive due to arbitrator and institutional fees and expenses.

  11. Is arbitration quicker than litigation?

    Due to its flexible nature, arbitration has the potential to be quicker than court litigation. In this respect, much will depend on the conduct of the parties and the case management of the arbitral tribunal. One area where arbitration is likely to be quicker than court litigation (particularly in an international context) is at the enforcement stage due to the narrower grounds on which a party can ordinarily challenge and resist enforcement of an award.

Arbitration in ADGM

  1. Why arbitrate in ADGM?

    ADGM is a leader in the arbitration community with its modern pro-arbitration framework that has been modelled on the UNCITRAL Model Law. This framework is superbly complimented by the ADGM Arbitration Centre (ADGMAC) which is equipped with state-of-the-art technology and hearing facilities and supported by outstanding infrastructure. Together, they provide the ideal forum for parties to resolve their arbitral disputes. See link here for further information in why parties should arbitrate in ADGM.

  2. What is ADGMAC?

    ADGMAC is a hearing facility that is equipped with state-of-the art technology. ADGMAC is open to all who wish to book the hearing rooms and other facilities for arbitration cases. ADGMAC is not an institution itself, which means that the facilities can be used by parties regardless of which institution they choose to administer their arbitration. In addition, the parties can, and are encouraged to, make use of ADGMAC’s facilities and services even where the legal place of the arbitration is outside of ADGM.

  3. Neither ADGMAC or its staff provide legal advice. If a party requires legal advice, they should seek this from an independent legal advisor.

  4. Does ADGMAC administer arbitration proceedings?

    No. As noted above, this provides parties with the flexibility to choose the institution to administer their arbitration and is one of the advantages of selecting ADGMAC as the place for their arbitration hearing.

  5. Does ADGMAC have its own arbitration rules?

    No. Again, this provides parties with the flexibility to choose the arbitration rules which will apply to their arbitration and is one of the advantages of selecting ADGMAC as the place for their arbitration hearing.

  6. What is Smart Arbitration?

    Smart Arbitration employs the use of technology to assist parties with the conduct of their arbitration and is geared towards enhancing efficiency and ease of working. For further information on how ADGMAC provides for Smart Arbitration, please click here.

  7. What are the Arbitration Regulations 2015?

    The Arbitration Regulations 2015 provide the basic legal framework for arbitrations conducted in ADGM and comprises the arbitration law that the ADGM Courts will apply if it is called upon in its supervisory role over the arbitration, or at the enforcement stage.

  8. When do the Arbitration Regulations 2015 apply?

    Section 8 of the Arbitration Regulations 2015 provides that, unless stated otherwise, Part 3 of the Regulations shall apply to arbitrations where the seat of the arbitration is the Abu Dhabi Global Market, or where an arbitration agreement applies the Regulations. Part 4 of the Regulations shall apply to the recognition and enforcement of arbitral awards in the Abu Dhabi Global Market, irrespective of the state or jurisdiction in which they are made.

  9. What role do ADGM Courts have in arbitration proceedings?

    ADGM Courts have a supervisory role over arbitration proceedings conducted in ADGM. Pursuant to the Arbitration Regulations 2015, the Court may be called upon to assist with the arbitral process in relation to such matters as the appointment or removal of an arbitrator, making an order for (or enforcing an order in relation to) interim measures, the taking of evidence and determining a preliminary point of jurisdiction. ADGM Courts are also the competent court to hear any application to set aside an award made in ADGM or to recognise and enforce an award (regardless of where the award was made) in ADGM.

  10. Can parties use foreign counsel for an ADGM arbitration?

    Yes, parties can use foreign counsel in an ADGM arbitration (including in relation to an arbitration hearing conducted in ADGMAC).

  11. Are ADGM arbitration proceedings confidential?

    Arbitration proceedings conducted in ADGM are confidential as provided for by Article 40 of the ADGM Regulations.

  12. Are ADGM awards enforceable outside ADGM?

    ADGM arbitral awards are enforceable under: the New York Convention in more than 150 countries; multi-lateral and bilateral treaties with certain countries; and memoranda of understanding with leading international common law jurisdictions.