The ICC International Court of Arbitration at the International Chamber of Commerce in Paris-the largest and best-known arbitration institution in the world-recently released its statistical data for 2003. It took on 580 new cases for consideration. The disputes concerned all sorts of business matters, commercial transactions, investments, new technologies and industrial property. The parties involved ranged from major governmental institutions to small businesses. A third of the cases involved claims in excess of $10 million, with another one-third in the $1-10 million bracket. Values below that are viewed by the court as small claims.

Polish firms were a party to proceedings on nine occasions, which is minor league in comparison with the 127 French firms referenced, for example. The 988 arbitrators appointed came from a record 69 countries, including-for the first time-Albania, Bermuda, Bolivia, Malta and El Salvador, with Switzerland, the United States, Great Britain and France heading the popularity stakes. Hearings were held in 47 countries worldwide, including-for the first time-Mauritius, Morocco and Slovakia, and the most frequently selected cities were Paris, followed by London, Geneva, New York, Zurich, Rome, Singapore and Mexico City. Warsaw did not feature.

Regarding Poland, arbitration is gaining popularity. Polish enterprises, both state-owned and private, have attracted strategic partners from abroad, with the upshot being that Polish arbitration is dovetailing in with international practice. Proceedings have been conducted in languages other than Polish at the Court of Arbitration at the Polish Chamber of Commerce, and the list of arbitrators also features foreign attorneys. This is very much in keeping with many other European countries. The ICC (International Court of Arbitration) in Paris, on the other hand, is a truly international institution. There, an entrepreneur from Venezuela is litigating a dispute with a supplier from Australia, and a contracting party from the Maldives is going after a partner from Madagascar. The globe is literally spinning in front of one's eyes. It has happened in the past that Warsaw was a seat of arbitration and Polish was the language of arbitration.

Arbitration helps to discreetly settle disputes, rather than decide on them. That leaves far greater latitude for an amicable solution or for an award in line with the principles of equity ex equo et bono. A dispute may involve renowned firms, which are very mindful of their reputation and are connected by numerous business interests, of which perhaps only one might be in dispute. If they appeared in a common court, the parties would probably face each other at a public hearing, in a courtroom jam packed with journalists. Under such circumstances, there is always the fear that business secrets might be disclosed. The competition has a field day, and it is difficult to make concessions and get on with doing business in such an atmosphere.

The ICC, on the other hand, enjoys a great deal of trust. Among international institutions, it is second only to the United Nations in terms of the number of member states. Disputants seek neutrality. A common court, irrespective of the country, is a court for only one of the parties. Even if it is impeccably impartial, it shares the same cultural, historic and linguistic background, and often also religion, membership in a political system or a military alliance with one of the parties. The other party may feel uncomfortable about this home team advantage-hence the popularity of ICC arbitration. Arbitrators are frequently talented mediators who understand the ins and outs of business better than judges. Being the International Chamber of Commerce, the ICC does a great deal to resolve commercial disputes. It offers the services of independent experts who may provide the parties with an opinion explaining who is right even before a request for arbitration is filed. The ICC has issued special guidelines on resolving small claims-i.e. minor cases (up to $1 million)-and has its own rules for alternative dispute resolution (ADR).

The fact that disputes are heard only in first instance is an advantage. This is an immediately obvious benefit to those of us who have been exposed to the manner in which common courts administer justice. Almost the world over, the judiciary is composed of two and frequently even three instances. At the same time, there are infinite possibilities for filing complaints against procedural decisions, to mention just release from court costs. If one of the parties stalls for time, it may prevent the court from issuing a judgment for years. In arbitration, things proceed faster. One dispute worth several hundred million dollars was resolved by the ICC within two months. On average, proceedings should not go beyond one year-a result unparalleled by common courts anywhere in the world.

Piotr Nowaczyk
The author is a partner at SALANS law firm and Polish Member of the ICC International Court of Arbitration in Paris.