Originally from Alternatives to the High Cost of Litigation

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While international commercial arbitration is frequently touted as the preferred method of resolving multinational business disputes, the process is not universally beloved. Instead, certain segments of the bench, bar, and academia believe that all legal disputes–including those in the cross-border commercial context–should be decided in court rather than in arbitration.

Over the years, philosophical concerns have typically given way to practical considerations, since international litigation has not been as effective or attractive as international commercial arbitration. Not only has the procedural flexibility of arbitration allowed parties to appoint neutral, expert decision-makers and adopt uniquely cross-cultural procedures that would be unavailable in national courts, but the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, June 10, 1958, 21 U.S.T. 2518, 330 U.N.T.S. 3, best known as the New York Convention (see www.newyorkconvention.org/english), has made enforcement of cross-border arbitration agreements and arbitral awards cheaper, easier, and more predictable than enforcement of foreign judgments.

Rather than cede to arbitral hegemony, proponents of judicial dispute resolution have recently decided that the best way to compete with arbitration is to bring various attributes of arbitration into the litigation context. Two different techniques have been used.