Court proceedings abroad are slow and costly. Alternative methods often offer a faster and more confidential path to a solution.
Disagreements over quality, delays or payment are part of commercial life. When the parties are in different countries, going to court can be slow, expensive and uncertain. Traders have several alternatives.
Negotiation
Direct discussion remains the quickest and least expensive route. Prepare your file carefully: the contract, invoices, shipping documents, inspection reports and correspondence. Propose concrete solutions, and confirm any agreement in writing.
Mediation
In mediation, a neutral mediator helps the parties reach their own settlement. The process is voluntary, confidential and usually much faster than litigation. The United Nations Convention on International Settlement Agreements Resulting from Mediation (the Singapore Convention on Mediation, 2019) helps make international settlement agreements enforceable in the states that have joined it.
Arbitration
In arbitration, the parties submit their dispute to one or more arbitrators, whose decision, the award, is binding. Arbitration is the most widely used method for international commercial disputes, because awards can be recognised and enforced in more than 170 countries under the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
Plan ahead
The best time to agree on how disputes will be resolved is before they arise. Include a dispute resolution clause in your contracts that specifies the method, the institution or rules, the seat and the language of the proceedings.
The Council works to help traders resolve disputes fairly and practically. Traders facing a cross-border dispute can contact the Council for guidance.
This article provides general information only and does not constitute legal advice.