Types Of Arbitration

Types Of Arbitration

Arbitration is distinct from litigation primarily because the parties to the dispute have the right to choose the arbitrator depending on the type of arbitration they opt eg: ad hoc or institutional.

India is a signatory to the New York convention, which facilitates the enforcement of international arbitral awards.

There are different categories of arbitrations namely:

Domestic Arbitration

The term “Domestic Arbitration” denotes arbitration which takes place in India, when the subject matter of the contract, the merits of the dispute and the procedure for arbitration are all governed by Indian law or when the cause of action for the dispute has arisen wholly in India or where the parties are otherwise subject to Indian jurisdiction.

International Arbitration

International Arbitration” has a foreign ingredient. Arbitration becomes “International” when at least one of the parties involved is resident or domiciled, outside India or the subject matter of the dispute is abroad. The law applicable to an arbitration proceedings may be the Indian law or a foreign law, depending on the terms of the contract in this regard and the rules of conflict of laws.

Foreign Arbitration

“Foreign arbitration” is an arbitration conducted in a place outside India, where the resulting award is sought to be enforced as a "foreign award".

Ad hoc Arbitration

Ad hoc arbitration” is arbitration agreed to and arranged by the parties themselves without recourse to an Institution. The proceedings are conducted by the arbitrator(s) as per the agreement between the 'parties' or with concurrence of the parties. It can be domestic, international or foreign arbitration.

Institutional Arbitration

Institutional arbitration” is arbitration conducted under the Rules laid down by an established arbitral organization. Such Rules are meant to supplement provisions of the Arbitration and Conciliation Act in matters of procedure and other matters the Act permits. The rules may provide for domestic arbitration or for international arbitration or for both and the disputes dealt with may be either general in character or specific.

Specialized Arbitration

"Specialized arbitration" is arbitration conducted under the auspices of arbitral institutions which might have framed special rules to meet the specific requirements for the conduct of arbitration in respect of disputes of particular types, such as, disputes as to commodities, construction or specific areas of technology. Some trade associations concerned with specific commodities or Chambers of Commerce also specify that arbitration under their rules will be conducted only between members of that organisation.

Statutory Arbitration

“Statutory Arbitrations” are arbitrations conducted in accordance with the provisions of certain special Acts which provide for arbitration in respect of disputes arising on matters covered by those Acts. There are about 24 such Central Acts. Among them are the Cantonments Act, 1924, the Indian Electricity Act, 1910, the Land Acquisition Act, 1894, the Railways Act, 1890 and the Forward Contracts Regulation Act, 1956. Many State Acts also provide for arbitration in respect of disputes covered by those Acts, including Acts relating to co-operative societies. The provisions of the Arbitration Act, 1940 generally apply to those arbitrations unless they are inconsistent with the particular provisions of those Acts, in which case the provisions of those Acts will apply (Sections 46 and 47, Arbitration Act, 1940).