WHAT ROLE DOES THE CHOICE OF ARBITRAL INSTITUTION PLAY IN INFLUENCING THE ENFORCEABILITY OF ARBITRAL AWARDS IN INTERNATIONAL COMMERCIAL ARBITRATION?

Abstract

Globalization has made international commerce the norm, leading to the prominence of international commercial arbitration as a vital mechanism for resolving disputes between parties from diverse legal and cultural backgrounds. However, the academic and professional domains have understudied the pivotal role of the choice of commercial arbitral institution in arbitral awards’ enforceability. This research addresses this gap by thoroughly examining how the selection or choice of arbitral institutions influences enforceability. The study focuses on three prominent commercial arbitration institutions, namely, JAMS, ICC, and CIETAC. The central research question is, “What role does the choice of arbitral institution play in influencing the international commercial arbitral awards’ enforceability?” The study, a desk-based inquiry, adopts a qualitative and exploratory research design to comprehensively explore the intricate aspects of arbitral institutions’ influence on the enforceability of arbitral awards, hence the choice of an arbitrating organization. A systematic review of relevant literature is conducted, focusing on keywords related to the research question. Qualitative content analysis is applied to the collected data. Findings reveal that enforceability hinges on the organizations’ procedural rules, practices, and administrative support, aligned with the New York Convention of 1958. However, procedural changes at the institutional level are also paramount. ICC’s institutional oversight and flexibility foster enforceability but face concerns regarding party autonomy limitations. JAMS prioritizes party involvement, transparency, and due process, enhancing the likelihood of enforceable awards. CIETAC’s dual system caters to international and domestic disputes, emphasizing efficient case management, yet challenges persist in enforcing awards in China due to uneven New York Convention application. Court decisions further demonstrate nuances, with ICC’s, JAMS’, and CIETAC’s awards facing challenges based on issues such as public policy, transparency, impartiality, and adherence to local legal norms. Reputation also influences enforceability, but JAMS seems to excel on this ground. This study offers a set of recommendations. International commercial arbitration institutions should adopt rules for efficiency, fairness, and party autonomy. They should also maintain transparency and impartiality in arbitrator selection and proceedings to enhance institution's reputation and enforceability. Besides, they must ensure compliance with local legal norms and public policy where enforcement is sought to reduce refusal risks. Institutions facing issues, for example, CIETAC, should work on objectivity, rectify problems, and improve efficiency in enforcement. When dealing with contracts in China, it is essential to consider arbitration clauses and risk management to mitigate disputes and navigate unique legal aspects.