The Importance of International Commercial Arbitration

Introduction

International commercial arbitration is one of the most important legal institutions in international private law. This conclusion follows from the fact that the nature of arbitration depends largely on autonomy of the parties, who choose arbitration procedure as the procedure in which the dispute will be settled; place where the arbitration is to be held; arbitral tribunal etc. Probably the most important and considerable expression of the autonomy is the right to choose the law, which is to be applied to merits of the dispute. The chosen applicable law guarantees in large measure predictability of the outcome of the case and allows parties to control the scope of interpretation and application of the international commercial contract. As regards the law which is applicable to the arbitration agreement, this law can differ from the law applicable to the merits of the dispute and in the absence of a choice of law by the parties an arbitral tribunal has to determine this applicable law.

The paper will deal with different approaches to determination of law applicable to an arbitration agreement and to merits of the dispute. The main approach comes down to the application of the law chosen by the parties themselves. The choice concerning the merits of the dispute can be express or implied, nevertheless, the intention of the parties exists and arbitrators should decide the dispute according to the norms of such law. However, the situation when the parties made no choice of law is also possible. In that case the obligation of determination of the law is vested on arbitrators. As for the law applicable to the arbitration agreement, in the absence of any choice an arbitral tribunal also has to determine the proper law to dec...

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...if it does not follow directly from the agreement between them. This approach follows from the essence of arbitration which is inseparably connected with private interests and party autonomy.

Works Cited

1. Gaillard, E., Savage, J (1999). Fouchard Gaillard Goldman on International Commercial Arbitration. 1244 p., Kluwer Law International;

2. Jacquet, J-M. 5.5 Law Governing the Merits of the Dispute (United Nations Conference on Trade and Development. Dispute Settlement. International Commercial Arbitration). 35 p.;

3. Kröll, S (2005-06). Selected Problems Concerning the CISG’s Scope of Application. Journal of Law and Commerce, pp.39-57;

4. Schmidt-Ahrendts, N. CISG and Arbitration (2011). Belgrade Law Review, no. 3, pp. 211-223;

5. Lew, J.D.M., Mistelis, L.A., Kröll, S.M (2003). Comparative International Commercial Arbitration. 904 p., Kluwer Law International;