Section on Corporation, Banking and Business Law, American Bar Association
International commercial arbitration has been the victim of its own success. Arbitration is often the only dispute resolution process acceptable in business contexts where parties from different countries have rejected recourse to each other's legal system at the outset of the contractual relationship. For example, when a Swedish shipyard contracts to build tankers for an agency of the Libyan government, the Swedes are unlikely to relish the prospect of appearing before Libyan courts, and the Libyans may view submission to the courts of Sweden (or of another industrialized Western nation) as an affront to Libyan national sovereignty. Neither the Swedish shipyard nor the Libyan government "chooses" arbitration. Rather, arbitration imposes itself for lack of an acceptable alternative. Hard tasks take a high toll, and arbitration thus may become a long and costly process.
Arbitration of International Contract Disputes
Available at: https://scholarship.law.bu.edu/faculty_scholarship/1616