International Arbitration - Drafting International Arbitration Clauses

Drafting International Arbitration Clauses

Most arbitral institutions have promulgated model clauses for parties to use to authorize the institution to oversee the arbitration. A number of specialized publications regarding the drafting of international arbitration clauses are available.

A number of essential elements should be included in almost all international arbitration agreements. These include the agreement to arbitrate, a definition of the scope of disputes subject to arbitration, means for selecting the arbitrator(s), a choice of the arbitral seat and the adoption of institutional or ad hoc arbitration rules. A number of other provisions can also be included in international arbitration clauses, including the language for the conduct of the arbitration, choice of applicable law, arbitrator qualifications, interim relief, costs, procedural matters and the like.

In order to bridge the gap when parties to an international agreement have difficulty in agreeing upon an arbitral institution, some international arbitration specialists recommend using an arbitration clause that authorizes two arbitral institutions in the same city. Those clauses generally empower the party commencing the arbitration to select the arbitral institution.

Writing in the Business Law Today of the American Bar Association, Eric Sherby (Israel) suggested a mnemonic device – “BLINC LLC” – designed to enable the draftsman to remember a checklist for quickly drafting an international arbitration clause: Broad, Law, Institutional, Number, Costs, Location Language, and Carve-out.