Abstract
Current mechanisms for resolving cross-border disputes through national court litigation pose substantial risks to business engaged in international trade, including the risk of conflicting national laws, biased, inefficient, inexperienced, or otherwise unsuitable decision-makers, inconsistent and duplicative national court proceedings, and severe obstacles to the enforcement of judgments. These shortcomings inhibit cross-border trade and investment, in some instances denying parties effective access to justice. The impact of these deficiencies is felt more by developing small States that are traditionally disadvantaged market participants. This paper discusses the role that international arbitration can play in alleviating these obstacles to trade for small States. In particular, through the use of international arbitration, including the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the UNCITRAL Model Law on International Commercial Arbitration and bilateral arbitration treaties (BATs), small States will be able to mitigate the risks and uncertainties posed by the existing mechanisms for international dispute resolution, thereby promoting international trade and investment.
Gary Born is the Chair of the International Arbitration Group at Wilmer Cutler Pickering Hale and Dorr LLP, President of the Singapore International Arbitration Centre (SIAC) Court of Arbitration and Honorary Professor of Law at the University of St. Gallen Law School and Tsinghua Law School. He is the author of International Commercial Arbitration (2nd ed., 2014), International Arbitration: Law and Practice (2nd ed., 2015), and numerous other works on international dispute resolution. The author would like to thank Jonathan Lim, Dharshini Prasad and Payel Mazumdar for their valuable contributions to this chapter.
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Notes
- 1.
The Draft Model Bilateral Arbitration Treaty and commentary was released for public comment on March 13, 2015 in the Kluwer Arbitration Blog and on Wilmer Cutler Pickering Hale and Dorr LLP’s website. See The Draft Model BAT https://www.wilmerhale.com/uploadedFiles/Shared_Content/Editorial/News/Documents/Draft-Model-BAT.pdf (accessed on 26 July 2017). Also see The Draft Commentary on BATs available at https://www.wilmerhale.com/uploadedFiles/Shared_Content/Editorial/News/Documents/Explanatory-Note-Draft-Model-Bilateral-Arbitration-Treaty.pdf (last visited on 26 July 2017).
- 2.
It is not an easy task to define a small State. See Maass (2009), at p. 65. Criteria for smallness include quantitative measures such as GDP, income per capita and population as well as qualitative measures rooted in geography, economics and politics—these are often relational, i.e. measured not in isolation but by a context-dependent reference frame and by how a state fits into the global system. See also Chap. 2.
- 3.
See Report of the Commonwealth Secretariat/World Bank Joint Task Force on Small States, Small States – Meeting Challenges in the Global Economy (2000), at p. 5.
- 4.
Born (2014b), p. 102.
- 5.
Born (2014b), p. 100.
- 6.
- 7.
Scherk v Alberto-Culver Co. (1974) 417 U.S. 506, 502 n.15.
- 8.
Article II(1) of the New York Convention.
- 9.
Article I(1) of the New York Convention.
- 10.
See Table 10.1 for the list of all small States that have adopted the New York Convention.
- 11.
See Table 10.1 for the list of all small States that have not adopted New York Convention.
- 12.
Born (2014b), p. 134.
- 13.
Born (2014b), p. 135.
- 14.
- 15.
Article 8 of the Model Law.
- 16.
Under most national arbitration laws and arbitration rules, the agreement to arbitrate is Stated to be “separable” from the contract containing it. Pursuant to this doctrine if, for instance, the contract containing the arbitration agreement is ineffective, invalid or unenforceable, the arbitration agreement is not automatically invalid: the agreement to arbitrate can be separated from the underlying agreement (Article 16 of the Model Law). See Finizio and Speller (2010).
- 17.
Article 16 of the Model Law.
- 18.
See Table 10.2 for the list of all small states that have adopted the Model Law.
- 19.
See Table 10.2 for the list of all small states that have not adopted the Model Law.
- 20.
Born (2014a), p. 7.
- 21.
Born (2014a), p. 7.
- 22.
World Investment Report 101 (2016).
- 23.
Born (2014a), p. 8.
- 24.
Born (2014a), p. 9 and See ALI/UNIDROIT Principles of Transnational Civil Procedure (2004), available at http://www.unidroit.org/english/principles/civilprocedure/ali-unidroitprinciples-e.pdf.
- 25.
Born (2014a), p. 9 and See UN Convention on Contracts for the International Sale of Goods (Vienna 1980). Available at http://www.uncitral.org/uncitral/en/uncitral_texts/sale_goods.html.
- 26.
Ibid and Article 6 of the CISG.
- 27.
Ibid.
- 28.
Born (2014a), p. 7.
- 29.
Ibid.
- 30.
The Draft Model Bilateral Arbitration Treaty was released for public comment on March 13, 2015 in the Kluwer Arbitration Blog; See above fn 2.
- 31.
- 32.
ECtHR, Bellet v France, Application no. 23805/94, 4 December 1995, at para. 36; compare also Äärelä and Näkkäläjärivi v Finland (24 Oct 2001) CommNo 779/1997 (Human Rights Committee) in regard to Art 2 ICCPR.
References
ALI/UNIDROIT Principles of Transnational Civil Procedure (2004) Available at http://www.unidroit.org/english/principles/civilprocedure/ali-unidroitprinciples-e.pdf
Born G (2014a) BITs, BATs and Buts: reflections on international dispute resolution. YAR: Young Arbitration Review, 13th edn
Born G (2014b) International commercial arbitration, 2nd edn
Finizio SP, Speller D (2010) A practical guide to international commercial arbitration: assessment, planning and strategy 41, 1st edn
Maass M (2009) The elusive definition of the small state. Int Polit 46:65–83
UN Convention on Contracts for the International Sale of Goods (Vienna 1980). Available at http://www.uncitral.org/uncitral/en/uncitral_texts/sale_goods.html
UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958) (the “New York Convention”). Available at http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention.html
UNCITRAL Model Law on International Commercial Arbitration (1985) Available at http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/1985Model_arbitration.html
World Investment Report 101 (2016) United Nations Conference on Trade and Development (UNCTAD)
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Born, G. (2018). Integration and Dispute Resolution in Small States. In: Butler, P., Lein, E., Salim, R. (eds) Integration and International Dispute Resolution in Small States. The World of Small States, vol 3. Springer, Cham. https://doi.org/10.1007/978-3-319-74573-2_10
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