How important is the role of maritime arbitration in the Shipping industry?
Maritime arbitration is the most popular method of disputes resolution in shipping industry. It has been used for centuries, even millennia. With its variety and range, maritime arbitration is the epitome of international commercial arbitration. It falls within the
definitions of ‘international’ and ‘commercial’ in Article 1 of the UNCITRAL Model Law and it
is found all over the world, in institutions as well as in its traditional ad hoc form. In London, maritime outnumber non-maritime commercial arbitrations. The numbers of ad hoc arbitrations conducted under the Terms and Procedures of the London Maritime Arbitrators Association (LMAA) consistently exceed the caseloads of international arbitral institutions. So, London remains the most popular seat for international commercial arbitration in shipping disputes. Its large number of cases creates a virtuous circle of expertise, certainty, and cost effectiveness.
Characteristics of the maritime arbitration refer to a fast, cost-effective procedure. It is also confidential as far as the parties, witnesses, documents, maritime know-how and sensitive information is concerned. It is a flexible process and parties can consider the procedure based on documents only or oral hearing as well.
The shipping companies must prepare on the case itself as necessary. Assistance to the legal team in gathering information and documents is required. Timetables must be met, so organizing the case and documents with the lawyers is imperative. The use of specialized and qualified lawyers is essential.
Appointment of arbitrators is equally important based on knowledge, experience and expertise who are going to consider the case in neutral and fair grounds for the parties. Arbitrators work to ensure the law develops in accordance with common sense and business ethics. This ap- plies in shipping as arbitrators are mostly commercial people who genuinely care about serving the industry. Diversity of profession is likewise valuable on arbitral tribunals.
Maritime arbitration is the preferred process of disputes resolution in shipping industry and London is the chosen seat in most of the shipping contracts.
* International Arbitrator, FCIArb Mediator, Trainer of Mediators Vilmar International S.A.
The answer was provided for NAFS magazine issue 143 in its special report “WOMEN in SHEPPING”