What is commercial arbitration?

Concept of Commercial Arbitration

Commercial arbitration according to Clause 1, Article 3 of the 2010 Commercial Arbitration Law, is defined as a method of dispute resolution agreed upon by the parties. Dispute resolution must comply with the provisions of the Commercial Arbitration Law 2010. The disputes here are disputes between the parties arising from commercial activities; Disputes arising between parties including at least one party engaged in commercial activities or other disputes between parties that are prescribed by law to be resolved by Arbitration.

Advantages of Commercial Arbitration

– Flexible and simple procedures, parties can be proactive in the time and place of dispute resolution.

– The arbitrator’s decision is objective and highly reliable because the parties have full freedom to choose their own arbitrator. Appointing an arbitrator helps the parties choose an arbitrator who is experienced, reputable, and has extensive knowledge of the dispute.

– The principle of non-public arbitration dispute resolution helps parties protect their reputation and business secrets.

– The arbitrator’s decision is final and enforceable for the parties. The parties have no right to appeal or protest. This is the difference and also the advantage of dispute resolution by arbitration compared to court.

Conditions for implementing the arbitration method

Dispute resolution by arbitration can be agreed upon by the parties before or after the dispute arises, depending on the case. The arbitration agreement is expressed in the form of a clause of the contract or in the form of a separate agreement, but it is required that the agreement be in writing. The following forms of agreement are also considered established in written form:

+ The agreement is established through communication between the parties by telegram, fax, telex, email and other forms as prescribed by law.

+ The agreement is established through information exchange between the parties.

+ The agreement is recorded in writing by a lawyer, notary or competent organization at the request of the parties.

+ In the transactions of the parties, there is a reference to a document showing the arbitration agreement such as contracts, evidence, company charter and other similar documents.

+ Through the exchange of the petition and self-defense statement, which shows the existence of an agreement made by one party and not denied by the other party.

Arbitration Agreement

The nature of the Arbitration agreement is expressed in the unanimity and free will of all disputing parties. An arbitration agreement will not have legal value if it is only the subjective will of one party or is imposed by any agency, organization or individual. The laws of countries often provide the most general legal framework within which the will of the parties is absolutely respected and is a prerequisite for establishing an Arbitration agreement.

An arbitration agreement is the result of a unity of will between free and equal parties. That unity of will is not bound by law or any organization or individual. When one of the parties is deceived, threatened, or coerced during the process of establishing an arbitration agreement, these are actions that go against the principle of freedom of agreement, and will be void.

Depending on when it is discovered that the arbitration agreement will be invalid, there will be legal consequences as in Article 6: “In cases where the disputing parties have an arbitration agreement and one party initiates a lawsuit in court, the Court shall The judge must refuse to accept the case, except in cases where the arbitration agreement is invalid or the arbitration agreement cannot be performed. Thus, the Court will have to accept the dispute when the arbitration agreement is invalid as clearly stated in Article 43.

Statute of limitations for initiating a lawsuit to resolve a dispute by Arbitration

Unless otherwise specified by specialized law, the statute of limitations for initiating a lawsuit under arbitration procedures is 02 years, from the time legitimate rights and interests are violated.