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International arbitration can be an efficient and neutral means of resolving cross-border disputes, but its costs are a constant concern for parties. Even when the amount in dispute is high, parties understandably wish to avoid unnecessary expenses and to have a clear picture, from the outset, of what an arbitration is likely to cost.
While each case is different, the primary culprit in most arbitrations is not the arbitral institution itself, but legal and expert fees. Understanding how these fit into the overall cost structure of an arbitration can help parties budget realistically and make informed decisions throughout the proceedings.
In broad terms, the costs of an international arbitration typically fall into four main categories:
- Institutional Fees (Including Arbitrators'
Fees)
These are the administrative fees charged by the arbitral institution, together with the fees and expenses of the arbitral tribunal. Many institutions calculate their fees based on the amount in dispute, sometimes subject to a schedule or sliding scale. While institutional and arbitrators' fees can be significant, they are often modest compared to the total costs of legal representation. - Legal Fees (Typically the Largest
Expense)
Legal fees almost always represent the largest portion of the overall costs. They cover case assessment, written submissions, document production, witness preparation, hearings and post-hearing work. The complexity of the dispute, the legal team and the procedural choices made by the parties and the tribunal all have a strong impact on the total legal bill. - Expert Fees (If Needed)
Many cases require quantum experts, technical experts, or other specialist evidence. Expert fees may include time spent on analysis, preparing reports, responding to the opposing expert and giving oral testimony at the hearing. In highly technical or quantum-heavy disputes, expert costs can be substantial. - Hearing Costs
Hearing costs include venue hire (if not conducted remotely), transcription services, interpreters, travel and accommodation for counsel, witnesses and arbitrators, as well as the costs of virtual hearing platforms where relevant. These are usually far smaller than overall legal and expert fees, but they can still add up, especially for long hearings.
Clients often face an information asymmetry when it comes to arbitration. They must decide how to proceed without having a clear sense of what the entire process is likely to cost. To offer greater transparency, Aceris Law has prepared brief guides to the total costs of arbitration in a number of leading institutions, including:
These guides provide indications of institutional and arbitrators' fees, as well as typical ranges for the total cost of arbitration under each set of rules, including legal fees and other expenses, based on publicly available data where possible.
They are intended to assist parties in budgeting, comparing institutions, and making informed decisions about where and how to arbitrate their disputes.
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.
