Businesses face a dilemma when disputes arise: they would like the certainty of a judicial decision, but often find courts to be slow, inefficient and/or inflexible. Commercial arbitration has developed as the leading solution to this dilemma, providing a private, flexible and user-controlled process, while also delivering a binding decision that will be enforced by courts. But commercial arbitration creates a dilemma for States: support of arbitration assists the business community and allows courts to redirect their limited resources to other areas, but the private and confidential nature of arbitration effectively allows businesses to operate an autonomous legal process, supported by the State but ultimately outside State control.
Commercial arbitration has a central place in contemporary dispute resolution, being used to resolve large numbers of disputes of both large and small value. In 2013, the ICC International Court of Arbitration received 767 requests for commencement of an arbitration, the London Court of International Arbitration received 301, the Stockholm Chamber of Commerce received 203 and the German Institution of Arbitration received 121. These were often disputes of considerable importance: 540 of the cases the ICC received in 2013 involved a dispute worth more than US$1m, 277 more than US$10m, and 63 more than US$100m. Yet these numbers represent only a fraction of the arbitrations occurring each year, with many more arbitral institutions operating in Europe, and a large number of arbitrations occurring without the involvement of an institution.
Yet despite commercial arbitration’s prominent role in the delivery of civil justice, the actual practices of arbitrators, the mechanisms for career development in the field, and the character of the justice arbitration provides remain sealed inside what has been called a “black box”. This is because research on arbitration suffers from the confidentiality of most arbitration proceedings and awards, and from the difficulty of collecting robust empirical data on a professional community that is heterogeneous, porous, multinational, and notoriously difficult to penetrate.
Through an innovative triangulation of methodologies, this project will open that “box”. Commercial arbitration relies on an institutional structure that rests on three pillars: regulative (rules and norms), normative (training, compliance, internal rules), and cultural-cognitive (social capital, informal networks, symbolic orders). Now that arbitration has reached a level of maturity as a dispute resolution system these pillars are sufficiently marked out to be the focus of empirical research. This project will clarify how social norms and social connections impact on standards of practice and career development in arbitration, and thereby on the functioning of arbitration as a mechanism for the delivery of civil justice. In so doing it will achieve three things. Firstly, by developing an enhanced understanding of the processes through which commercial arbitration functions as a field of professional practice, it will make possible more effective approaches to the integration of commercial arbitration into civil justice systems. Secondly, it will contribute to a greater understanding of the impact of informal social norms and social connections on career development and standards of practice in professional fields. Finally, it will contribute significantly to methodological development in qualitative social science research.
Commercial arbitration is an ongoing area of concern for both governments and civil society across Europe, but remains poorly understood because of the confidentiality that dominates the field. This project will take advantage of the Principal Investigator’s recognition amongst arbitration practitioners, and of the range of expertises of an interdisciplinary research team, to gain a clear understanding of this important, but controversial, area of civil justice.
This four-year, multi-disciplinary project will be conducted by a worldwide team of researchers. The objectives of the project can be classified as Empirical, Sociological, Practical and Developmental.
- To develop clear information on the structures of the social networks upon which European arbitration relies, generating the first empirical mapping and descriptive analysis of the social networks underlying arbitration in Europe.
- To develop clear information on how norms relating to arbitration differ amongst Europe’s diverse arbitration communities.
- To develop clear information on the reasoning styles and case management practices of arbitrators across Europe.
- To develop an understanding of how arbitration functions as a socially-regulated field of professional practice, and the impacts this structure has on its role in the delivery of civil justice across Europe.
- To develop an enhanced understanding of the role of social connections and adherence to social norms in unregulated or lightly regulated professional communities.
- To produce an empirically-based account of European arbitration that will provide States with the information they need to incorporate arbitration more effectively into the civil justice system.
- To clarify the social structures that underlie arbitration in Europe, and thereby assist the U.K.’s large arbitration community to continue to operate successfully across Europe after Brexit.
- To create a comprehensive integrated dataset on the social and psychological foundations of European arbitration that will facilitate further empirically-based research in this field.
- To produce a fact-based, sociologically-informed understanding of arbitration which can be used to guide both government action and professional development.