ARTICLE
1 December 2010

Dispute resolution in London

TheCityUK* has produced an analysis of the dispute resolution market in London, with a particular focus on arbitration and ADR. Its report – "Dispute Resolution in London & the UK 2010" – provides a detailed assessment of the city’s dispute resolution capabilities, statistics on referrals to London-based dispute resolution centres, and the market’s future prospects.
Australia Litigation, Mediation & Arbitration

December 2010

By Matthew Buckle and Salah Mattoo

TheCityUK* has produced an analysis of the dispute resolution market in London, with a particular focus on arbitration and ADR. Its report – " Dispute Resolution in London & the UK 2010" – provides a detailed assessment of the city's dispute resolution capabilities, statistics on referrals to London-based dispute resolution centres, and the market's future prospects.

The London attraction

The report paints a positive picture of the dispute resolution market in London, with significant growth seen across all institutions. The long-term growth in international dispute resolution is linked to an increase in cross-border transactions from which disputes originate, with more recent growth attributed to the difficult economic climate. The Commercial Court saw the highest number of claim forms issued since the Woolf reforms to civil procedure in 1999. The international nature of London dispute resolution is evident from the fact that 75 per cent of those actions involved at least one foreign party. In roughly one-half of cases, the only link to the UK is the parties' choice of London for dispute resolution.

What is the attraction of London? The report points to a number of key factors, including the arbitration friendly framework provided by the Arbitration Act 1996 and the courts' freedom from political influence, supported by an impartial judiciary. A depth of expertise in relation to complex cases was also cited, from specialist institutions to individual arbitrators, mediators and experts, together with international law firms and barristers able to provide specialist advice and advocacy. London is also seen as a venue offering flexibility in procedures offered by different institutions, as well as party autonomy in language and law. Confidentiality in arbitration proceedings is implied by law.

The statistics

The London Court of International Arbitration (LCIA) has seen a rapid increase in the number of disputes referred to it in recent years, doubling from 137 in 2007 to 285 in 2009. Over 90 per cent of these disputes are international, even though most are seated in London.

The IC International Court of Arbitration (IC) also saw a significant increase in cases filed, rising from 599 in 2007 to 817 in 2009. The largest number of IC arbitrations was conducted in Paris where the institution is based (113), but London was the second most popular venue (73). The quality of London arbitrators was confirmed in the appointment statistics for IC arbitrations – Swiss and English arbitrators topped the list, each with 22 per cent of all IC appointments. Germany, the USA and France followed, with 8 per cent each of appointed arbitrators.

A significant growth in referrals to arbitration was reported by the London Maritime Arbitrators Association (LMAA). Individual appointments rose by 38 per cent – from 2,673 in 2007 to 4,326 in 2009.

The International Centre for the Settlement of Disputes (ICSID) has seen a four-fold increase in disputes between states and investors since 2000. London is a key venue for tribunals, holding the highest number of merits hearings after Paris and Washington in 2009.

As we reported in our last issue (September 2010), mediations are also on the rise, with the Centre for Effective Dispute Resolution (CEDR) reporting that approximately 6,000 civil and commercial mediations a year are now conducted in the UK. This is almost double the number reported for 2007.

The competition

There is much for London to celebrate in this report, but competition from both established and emerging international arbitration centres remains fierce.

* TheCityUK is an independent body established with the support of the City of London Corporation (in consultation with government and industry) for promoting the UK-based financial and professional services industry.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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