The pre-arb negotiation agreement: Glue or sticking point?

By Xie Wei, CIETAC South China Sub-Commission
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The pre-arb negotiation agreement- Glue or sticking point_ , 仲裁条款中的协商前置约定:粘合剂还是绊脚石?
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The parties usually agree in commercial contracts to negotiate with good faith before the commencement of arbitration or litigation. The pre-arbitration agreement contributes to the efficiency of dispute resolution, to save the time and cost of all parties and avoid further damage to the ongoing business relationship during legal proceedings.

However, it is often difficult for the parties to communicate effectively after disputes arise. An agreement to make negotiation or mediation a condition precedent to the right to pursue arbitration may sometimes be considered as a burden on the non-defaulting party, and become an obstacle to the resolution of disputes through formal legal procedures. In the process of case filing, arbitration institutions will focus on those unconventional wordings of the arbitration agreement, one of which is the pre-arbitration negotiation agreement.

In practice, there are generally two types of pre-arbitration negotiation agreement.

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