Moving Beyond Borders: Critical Role Of Institutions In Providing Business Solutions

Alternative Dispute Resolution (ADR) is an important aspect of legal process that is invoked in every dispute. The need for institutional arbitration to ameliorate the issues that are faced by the parties to an arbitration is necessary. Cross border sharing of ideas and best practices is imperative to ensure a holistic growth of ADR in India.

Former Prime Minister Pandit Jawaharlal Nehru envisioned a borderless world which can be used to provide best business solutions. In facilitating borderless business solutions we can transform the legal system into a seamless sector. Arbitration should move beyond borders and must solve real business problems. In the last 30 years, ADR has become a part of every contract. ADR prevents disputes and handles them in a better environment so that business relationships are not broken.

Justice S. Ravindra Bhat, judge of the Supreme Court of India, speaking at the APCAM international ADR Summit, said that, "After we entered UNCITRAL and enacted the Arbitration and Conciliation Act, an international perspective was initially lacking. We used to see Arbitration as an alternative route and not as the larger picture as we it today. It got resolved a decade ago. We had many statutory developments like the overhaul of the Act. The Courts provided impetus to the Act. Arbitration institutions provide access to speedier justice. The natural growth would be by setting up more institutions. We need to foster a culture of domestic Arbitration." 

Arbitration requires empowerment at the government level so that institutions of repute can be built to serve parties in the best possible way.

Athita Komindr, Head of the UNCITRAL Regional Centre Asia and the Pacific said that, "UNCITRAL brings predictability in the arbitration landscape. There are commentaries internationally endorsed. There is a range of instruments for all stakeholders to adopt. The countries following UNCITRAL instruments provide solutions as these instruments are already followed by many countries."

ADR must be party centric and must aim to provide best legal solution to the parties at dispute.

Justice Madan B. Lokur,  pointed out that, "When the Mediation and Conciliation Project Committee (MCPC) was conceptualised, the idea was two fold. Firstly, that we encourage mediation so that burden on courts reduces. Secondly, many litigants who are waiting for justice, their cases could be resolved through mediation. The next step was to popularise mediation so that lawyers who have been trained could set up their practice of mediation. Large numbers of lawyers were trained as mediators. That's how mediation picked up in many parts of the country. The idea is to establish mediation through training and reduce burden on the Courts and ameliorate the problems of litigants. The lawyers who enter into private practice of mediation have to be paid as it's a profession. Community mediation is one such model which can be adopted wherein the fee is nominal and it encourages mediation."

Jeff Leong, Sr. Partner, M/s Jeff Leong, Poon and Wong, said that, "ADR Institutions play a critical role. However, there is a need for reform on a global level. As lawyers, structuring transactions is a necessary part of dispute resolution. There is a need for reputable, efficient and unbiased ADR institutions or Arbitration centres. The ADR institution must be impeccable and free from any allegation of wrongdoing. It must be independent because they are rule of law institutions."

The ADR institutions must be beyond reproach and they must have rules of procedure of international standard.

Tejas Karia, Partner, Shardul Amarchand Mangaldas, said that, "We don't have one prominent Arbitration because of which we are unable to settle India as the seat of arbitration. We need to focus on developing cities as Arbitration centres and build an ecosystem around it. The Courts should be proactive and must support Arbitration. It's a work in progress but it will take some time to see complete change in the Arbitration landscape. Firms like ours have separate section of Arbitration specialists and we give precedence to Arbitration practice. There should be a specialist arbitration bar. Some more steps have to be taken and we are moving in the right direction."

There is a huge need for building a specialised bar which serves the particular needs of ADR disputes.

Dr. Rajendra Lade, General Manager-Legal, Hindustan Petroleum Corporation Ltd, said that, "The overall gamut of dispute resolution has several components. We are still moving on to conciliation. The system is evolving and progressive development is taking place. Arbitration is cost effective and it is time consuming and when in the end if the arbitration award is set aside, time and money is wasted. Settlement is our approach but when it comes to international arbitration, there must be experts who understand the sectors. Arbitration is understood as an alternative and therefore everything becomes ad-hoc and part time. There should be a standalone Arbitration bar and a separate forum of judges who are only arbitrating so that convenience can be provided."

The parties to arbitration invoke the jurisdiction of the Courts which needlessly protract the arbitration proceedings and therefore there must be specialised Courts to deal specifically with matters related to ADR to ensure quick disposal of applications.

Anil Xavier, President of Indian Institute of Arbitration and Chairman of APCAM pointed out that Arbitration must be swift and effective and the problem of a lot of time wasted in Section 36 and 34 applications should be analysed and resolved.

There is a lot of scope for improvement for India to become the hub of Arbitration. There should be an effort and support by the Government to enhance ADR mechanism in India.