Drafting effective arbitration clauses


Smooth conduct of arbitration requires a well-drafted arbitration clause, which must not only be enforceable but also conducive to speedy dispute resolution and tailor-made to minimize procedural disputes.

K K Cheung
K K Cheung

Ad hoc arbitration gives the parties more flexibility and autonomy in the arbitration proceedings, whereas institutional arbitration is known for administrative convenience and the institutions’ supervisory functions. In choosing among arbitration institutions, factors such as language, reputation of the arbitration institutions and institutional arbitral rules should be considered.

Leading institutions provide model clauses for parties to consider. Depending on the case, parties are encouraged to follow the model clauses as closely as possible. If the parties opt for administered arbitration, the chosen institution will provide administrative support to the parties throughout the arbitration. On the other hand, the parties have to follow the procedures of the rules of the institution, which are more elaborated.

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K K CHEUNG is a partner at Deacons in Hong Kong