The resolution of disputes arising from international commercial transactions through international litigation are difficult due to the reluctance to litigate in a foreign court due to unfamiliarity or potential bias; time involved in deciding the dispute and issues of enforcement of a foreign judgment, apart from the issue of conflict of laws. Hence, to overcome these difficulties, international commercial arbitration is the best method of resolving international commercial disputes.
The Agreement entered into between the parties govern the venue, laws, mode of appointment of arbitrator, etc in the Arbitration. The arbitrator(s) or Arbitral Tribunal, is a neutral person who acts as a judge and derives its authority and jurisdiction from the commercial agreement. The judgment (known as the “award”) of the Arbitrator is final and binding on the parties. Many countries are Arbitration friendly nations and execution of award is easier if the State is a party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards.