Building a picture of disputes in construction cases

Companies should treat with caution disputes arising from multinational construction projects. There are many international dispute resolution bodies providing parties with professional and diversified dispute resolution services, from which Beijing Arbitration Commission (BAC) stands out. As a result of the opening up of China’s market and the fast development of the overseas contracting business, the BAC has accumulated abundant experience in resolving disputes in international construction projects.

During the period from its establishment in 1995 to June 2013, the BAC has accepted a total of 4,074 cases regarding disputes in construction projects, with the total amount reaching almost RMB34 trillion (US$5.6 trillion), and an annual average amount of RMB1.8 trillion. There are 391 arbitrators in the BAC at present, 142 of whom are experts in the area of construction engineering. The conclusion rate of cases involving construction projects is 95.8%, and it takes an average of 98 days to conclude a case.

By analysing the practical cases handled by the BAC, we see the disputes in construction projects primarily focus on project funds, project quality and claims for extension of time, and involve highly professional issues, big amounts and complex legal relations. As a dispute resolution method with experts settling cases, a single and final award, strong confidentiality, flexible procedure and high efficiency, arbitration perfectly fits needs. Here we will provide suggestions to corporate counsel, other lawyers and related personnel on the procedural and process management of cases, in combination with the Arbitration Rules of Beijing Arbitration Commission.

The author, Guo Chao, is a case manager at the Beijing Arbitration Commission