Traditional arbitration centres hold strong, but South East Asia emerges as new challenger

September 24, 2014

London, Paris, Singapore, Stockholm, Vienna and Zurich have received the highest ratings as a possible venue for international arbitration, while Beijing, Johannesburg, Moscow and Mumbai received the lowest rating.

These are the findings from a global report from international law firm Berwin Leighton Paisner, which surveyed lawyers and corporate counsels across 34 different jurisdictions.

While the European cities maintain their appeal, six in ten people (60%) believe that South East Asia will be one of the most popular choices for international arbitration in the future, with Malaysia, Indonesia and South Korea being obvious candidates as emerging new destinations.

When asked about the most important factors when choosing an arbitration seat, three quarters of businesses (75%) believe having a ‘personal connection’ with a city is an important factor when choosing an arbitration seat.

This is in contrast with just 18% who say that being party to the New York Convention is important, while only 37% say that access to good local lawyers is a key factor.

Access to a pool of good and experienced arbitrators was also rated highly, with 74% of respondents saying this was an important factor.

In looking at why commercial parties regretted choosing a particular city, local court involvement emerged as one of the most common causes.  Over one quarter (28%) of people said that they regretted their choice because of too much court intervention, while 20% said they felt the local courts had not given them the support they needed.

The survey also revealed the logistical considerations that contribute to the value of a city as an arbitration venue, the most important being the cost of local lawyers, good transport links and arbitration facilities.

Carol Mulcahy, partner in the Commercial Dispute Resolution practice, said: “The choice of seat or ‘legal home’ of arbitration clearly comes down to a whole range of factors, but it’s interesting to see that personal connections play an important part, particularly among those in Europe and North America.

Looking ahead – particularly as we see new regional arbitration hubs emerging in South East Asia - the quality of the support of local courts, arbitrators and lawyers is likely to creep further up the list of priorities.”

BLP currently has 16 partners who specialise in International Arbitration, working out of London, Moscow, Singapore and Abu Dhabi.

Additional findings

  • 37% felt the presence of good local lawyers at the seat of arbitration was an important factor in choosing a seat.
  • 60% believed arbitration venues in South East Asia would become more popular
  • 74% felt access to a pool of good international arbitrators at the seat of arbitration was important, while local lawyers fared less well
  • 65% said they would be more likely to choose a particular seat if local law did not contain a right of appeal against an award