“Expedited Arbitration as a Speedy Means of Dispute Resolution”: International Arbitration and International Litigation Team

Expedited Arbitration as a Speedy Means of Dispute Resolution

Arbitration is widely used, particularly by companies operating internationally, as a means of resolving disputes with business counterparties. This is likely because, compared with court litigation, arbitration offers greater international enforceability of awards and a higher degree of confidentiality in the proceedings.

Under the arbitration rules of major arbitral institutions with which Japanese companies are familiar — including the Japan Commercial Arbitration Association (the “JCAA”) — where the amount in dispute is below a certain threshold, the default rule, absent a separate agreement between the parties, is that Expedited Arbitration Procedures apply rather than ordinary arbitration procedures. In other words, once the parties to a contract have agreed to resolve future disputes by arbitration under the rules of a particular arbitral institution (an “arbitration agreement”), any future dispute that meets the relevant requirements will automatically become subject to Expedited Arbitration Procedures. It is therefore very important to understand how Expedited Arbitration Procedures work.

While Expedited Arbitration Procedures offer the advantage of resolving disputes within a short period, they also carry the risk that, depending on the nature of the case, the parties may not have sufficient time to fully present their arguments and evidence. Accordingly, when selecting arbitration as the dispute resolution mechanism in a dispute resolution clause, it is important to consider in advance — based on the types of disputes that may arise in the future — whether to proceed on the assumption that Expedited Arbitration Procedures will apply.

On the other hand, if a party sees business value in achieving a speedy resolution within a short period, resorting to Expedited Arbitration Procedures can be an attractive option. Japan’s newly established “Statutory Trial Period Litigation Proceedings” (Hōtei Shinri Kikan Soshō Tetsuzuki) — a civil litigation procedure designed to achieve adjudication and judgment within a fixed, short period — has drawn some skepticism as to its practical effectiveness. Against that backdrop, we expect Expedited Arbitration Procedures to attract even greater attention as a means of speedy dispute resolution, regardless of whether the dispute is international in nature.

This newsletter provides an overview of Expedited Arbitration Procedures under the JCAA’s Commercial Arbitration Rules (2021) (the “JCAA Rules”) and of the Statutory Trial Period Litigation Proceedings introduced for civil litigation in Japan, and then discusses practical points to consider when using Expedited Arbitration Procedures.

Please click here for the full article.

[Contents]

1.    Differences Between Arbitration and Court Litigation

2.    Features of Expedited Arbitration Procedures

3.    Flow of Expedited Arbitration Procedures

4.    Comparison of Trial Period and Cost with Civil Litigation

5.    Comparison with Statutory Trial Period Litigation Proceedings

6.    Types of Disputes Suited — and Not Suited — to Expedited Arbitration

7.    Conclusion

[Related Link]

Japanese: 「スピーディーな紛争解決手段としての迅速仲裁」：国際仲裁･国際訴訟プラクティスチーム

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