[This the abstract for my judicial training lecture organised by the Legal Training and Research Institute, kindly invited by the Supreme Court of Japan, delivered on 5 March 2025 at the Tokyo Facilities for Arbitration Hearings. Powerpoints are available in English and translated into Japanese. An edited, updated and footnoted version of the transcript is forthcoming in the Japan Commercial Arbitration Journal (2025).]
Survey and other evidence typically identify many advantages of international commercial arbitration (ICA) over cross-border litigation. This explains why ICA is overwhelmingly the most preferred dispute resolution mechanism included in international commercial contracts (and even investment treaties). Yet ICA faces growing problems.
Enforceability of arbitration agreements and awards is challenged by new Hague Conventions for enforcement of judgments, and by the 2018 Singapore Convention for enforcing mediated settlements, although these instruments still have few ratifications. Neutrality and related expertise of arbitrators encounter rising challenges to arbitrators and the emergence of international commercial courts, notably in Singapore. Confidentiality in arbitration is not uniform and anyway can increase unpredictability, as well as making it harder for users to assess if arbitrators and lawyers provide good value for their services. Limited discovery of documentary evidence and other flexibility in arbitration procedures is offset by the proliferation and hardening of “soft law” instruments and standardised practices. The lack of appeal for error of law promises finality in awards but arbitration overall is not much quicker, cheaper or more amicable than litigation of commercial disputes.
This lecture elaborates such promises and pitfalls of ICA nowadays. It considers what could be done to improve the environment for ICA generally, enhancing traditional advantages while reducing costs and delays, in the context of countries like Australia and Japan that have struggled to attract ICA cases.
Related reading:
- “The Vicissitudes of Transnational Commercial Arbitration and the Lex Mercatoria: A View from the Periphery”(2000) 16 Arbitration International 53-78
- (with a much shorter and earlier version published as) “Kokusai Shoji Chusai to Lex Mercatoria no Hensen [The Vicissitudes of Transnational Commercial Arbitration and the Lex Mercatoria]” 113 Ho no Shihai 100-111 (Noboru Kashiwagi, trans; April 1999)
- Updated as chapter 2 of Luke Nottage, International Commercial and Investor-State Arbitration: Australia and Japan in Regional and Global Contexts (Elgar, 2021)
- “Cross-Fertilisation in International Commercial Arbitration, Investor-State Arbitration and Mediation: The Good, the Bad and the Ugly?” 50(3) Monash University Law Review 2025 (longer version at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4872129)
- Based on 6th ADR Address of the Supreme Court of New South Wales: https://disputescentre.com.au/supreme-court-of-new-south-wales-adr-address-2023/
