Types of ArbitrationSeptember 18, 2021
When compared to the typical technique of a legal procedure, which often occurs in a Court and must go through a protracted process, and which frequently leaves one or both parties financially drained. An arbitration procedure is not official and does not include a court action, which can save the parties a significant amount of time. A dispute is presented to the ‘arbitral tribunal’ rather than a regular civil court or elsewhere in arbitration. The arbitral tribunal must make a judgment on the dispute, and that decision is binding on the parties because they do not have grounds to appeal.
In this article, I will be writing down briefly about 5 different types of arbitration which are domestic arbitration, institutional arbitration, ad-hoc arbitration, statutory arbitration and fast track arbitration. All these 5 types of arbitration are for different situations.
1. Domestic arbitration
We can expect how it should be just from the name itself which is domestic arbitration. It is when both parties are from the same country. Domestic arbitration is a form of arbitration that takes place in India, in which both parties must be Indians and the dispute must be resolved in line with Indian substantive law. The Arbitration and Conciliation Act of 1996 does not define the phrase “domestic arbitration.” However, when Section 2 (2) (7) of the Act 1996 is read together, it is implied that ‘domestic arbitration’ means an arbitration in which the arbitration proceedings must necessarily be held in India and according to Indian substantive and procedural law, and the cause of action for the dispute has completely arisen in India, or the parties are subject to Indian jurisdiction.
2. Institutional arbitration
An institutional arbitration is one in which a specialized institution is selected to oversee the arbitration process/case administration. Each institution has its own set of regulations that give a framework (such as deadlines for filing papers or processes for making requests, etc.) for the arbitration, as well as its own form of management to help with the process. The Hong Kong International Arbitration Centre (HKIAC) and the International Chamber of Commerce are two common entities (ICC).
3. Ad-hoc arbitration
In this case, the parties to the dispute accept and make arrangements for the arbitral proceedings without the participation of an arbitration panel. If the parties are unable to agree on who will be the arbitrator in ad hoc arbitration, the arbitral award will be selected by the chief justice of a High Court or the Supreme Court (in matters of international arbitration) or their designate, according to section 11 of the Arbitration and Conciliation Act of 1996.
4. Statutory arbitration
Arbitration may be initiated by an agreement entered into by both parties or when a legislation expressly provides for arbitration to be utilized for settlement of specific problems. Statutory arbitration occurs when a legislation of Parliament or a state legislature allows for arbitration. Statutory arbitration differs from other types of arbitration in that the parties’ permission is not required.