Arbitration International Law
Claire Hunkin

One of the first questions that you need to determine, after reaching the conclusion that your dispute is subject to arbitration, is what law will control the procedural elements of the arbitration. Which direction the determination takes is largely dependent on how carefully the contract was drafted. The world that we are living in is nothing compared to what it was 20 years ago. With all the new technologies and innovations mankind is discovering our world is never and will never stay the same. The same mind set applies to law, rather its statewide, nationwide or internationally. Arbitration can be used in just about anything, for example, a lawyer use it for their client agreement, employers use it in contracts with employees, land lords use arbitration for tenant-landlord agreements and companies obtain arbitration clause when they’re planning on expanding or merging with a different company.
Unlike a judicial process, arbitration is conducted outside the court system by impartial arbitrators who are selected by the parties based on criteria that best fits the nature of the contract. There are advantages of having arbitration over litigation. Some of the few advantages are impartiality of decision makers, confidentiality, and expense. In arbitration, the disputing parties have the option to choose its panel members as opposed to litigation. Arbitration proceedings and awards are normally made private, where litigation proceedings are made available to the public and the most popular reason is because arbitration is much more affordable than litigation.
Arbitration agreements are formed at one of two points in time: during the negotiation of a contract, or after a legal dispute arises. The importance of international arbitration law has grown significantly over the years. Arbitration is widely used as a means of resolving transnational disputes involving different nations. This paper on the law applicable to arbitration agreements will start with examining the differences between the Law of arbitration in Russia and the United States of America. It will provide an overview of the law governing international arbitration in the United States and Russia. This paper will also reflect a brief history as to how arbitration came about. Problems may arise due to incompatibility between nations based on an idea or event. Finally, this paper will disclose my opinion on what I think Monarch Associate and Vladir Unlimited should consider if they want they’re venture to be a successful merger of companies.
Arbitration has been defined as “a process by which parties voluntarily refer their disputes to an impartial third person, an arbitrator, selected by them for a decision based on the evidence and arguments to be presented before arbitration tribunal. The United States of American is governed under the FAA. The FAA (Federal Arbitration Act) is the controlling body arbitration law at both state and federal level in the United States. According to (Elkins, 1993), the modern development of international arbitration is traced back to the Jay Treaty (1794) between Great Britain and the United State, which established three arbitral commissions to settle questions and claims arising out of the American Revolution.
International arbitration has long been recognized in Russia as a means of settling commercial disputes. Russia’s Law on International Commercial Arbitration of 1993 is based on the UNICITRAL Model Law on international commercial arbitration. This law governs arbitrations that arise out of foreign trade or economic contracts between parties, at least one of which has its place of business abroad, or is an international organization or a company with foreign investments in Russia (Russian Arbitration Association, 2013). This law governs arbitrations that arise out of foreign trade or economic contracts, between parties, at least one of which has its place of business abroad or is an international organization or a company with foreign investments in Russia. According to Russia’s International Commercial arbitration, any disputes of commercial nature involving a foreign party, as well as commercial disputes where at least one party is a Russian company with foreign investments, is governed under the International Arbitration Law (Russian Arbitration Association, 2013). The Law clearly sets out mandatory provisions as to the written form of the arbitration agreement. Exchange of letters, faxes, emails and other means also qualify as evidence of a written arbitration agreement.
In my opinion, the dispute is best handled in Russia, however, since this a merger of companies between two different nations, I believe it’s only fair that the United States government choose arbitrators from a panel maintained by both the Russian and United States Arbitration Institution. If I were an in house counsel, I would advise Monarch Associates to take a closer look at its foundations. Take the time to evaluate and reestablish their laws and before entering into a contract with foreign companies, seek out a company within the United States. Since we have established that an arbitration clause is either formed during drafting a contract or after a legal dispute, both companies have to work together in creating the contract. They have to find mutual grounds and make sure whatever decision they come up with will benefit the company. Some things I strongly suggest these companies or any other companies who is looking to merge with another foreign company, is to do their research. It’s better to be forewarned and arm themselves with knowledge of a potential business partner.

References
(n.d.). Retrieved from http://www.ruscham.com/en/rossinfo/db/9.html
Elkins, S. a. (1993). The Age of Federalism. New York: Oxford University Press. Retrieved from http://www.loc.gov/rr/program/bib/ourdocs/jay.html
Kesikli, O. O. (2014, April 24). Retrieved from Mondaq: April 24 2014
Russian Arbitration Association. (2013). Retrieved from http://www.arbitrations.ru/en/dispute-resolution/arbitration-in-russia.php