Dispute resolution through arbitration: advantages over traditional court systems in the region

In Law Alliance - By recognizing arbitration as an effective mechanism for resolving disputes outside the state courts, Ibero-American countries have modernized their arbitration laws and acceded to international treaties on the subject, in order to maintain it as a real and complementary alternative to ordinary justice, given the deficiencies of the latter, due to the congestion of cases, procedural slowness and the clear signs of judicial corruption.
In this context, it has been recurrent to identify the positive differentiating elements of arbitration compared to the performance of ordinary justice, such as: speed, confidentiality, flexibility, specialization of arbitrators, impartiality of the forum and transparency, and international recognition of awards. 

1. Speed and efficiency
Speed is one of the comparative advantages of arbitration, since, as a matter of principle, it takes less time than an ordinary judicial process, and if this is not the case, the strength of the arbitral institutionality is diminished, and the bastion of speed, without procedural delays, and having a final arbitral award that is not subject to appeal instances, is lost. The latter, in practice, is exposed to the questionable actions of the parties and their lawyers, who establish unethical delaying mechanisms, according to their convenience. 
The delay of the controversies known by the ordinary justice system has led the States to improve the regulations, promoting agility, (in the Ecuadorian case there are ordinary processes that last 100 days). This, in turn, has caused a clash with the arbitration practice, which has seen the need to expedite the processes, with procedural efficiency, within a healthy competition.  
To this must be added the cost savings, since a shorter and more concentrated arbitration procedure tends to reduce legal expenses and the costs associated with litigation (arbitrators’ and administrative fees, expert opinions, fees), which are controllable by the tribunal and the parties, to the benefit of the parties and of the arbitration itself.   

2. Confidentiality and privacy of the process
Confidentiality provides peace of mind to the parties, when they know that what is being discussed is restricted to the knowledge of the parties, their representatives, the arbitral tribunal and the administering institution, and no one else who is not authorized; and, thus, public exposure of the dispute is avoided, in which the parties’ desire to protect THEIR sensitive information, whether for commercial or reputational interest, prevails.  
The discreet treatment of sensitive disputes, in practice, makes companies prefer arbitration, which has no more publicity than desired, and allows them to take care of their public image and avoid unnecessary exposure.

3.  Procedural flexibility and party autonomy
The autonomy of the parties is evidenced by the possibility they have to administer the process with a procedural flexibility not seen in the judicial procedure, and to which the arbitrators adhere; and thus, the parties are the ones who choose the composition of the tribunal, the venue and language to which the procedure will be submitted, the basic rules, the time it will take for the resolution and the rules that will govern the process.   
For their part, the arbitrators will adhere to the general principles of public order and sound criticism, but not to the procedural strictness imposed by the codes of the matter, providing, however, trust and ethical certainty. They will also adapt to the demands of the times, such as the use of technology in the admission of electronic documentary evidence, virtual hearings and online processing, giving the user the feeling of adaptability and resilience of arbitration.  

4.  Specialization and technical quality of the arbitrators
The parties to a dispute would like to have arbitrators specialized in the matter to resolve it. This may be difficult in practice. However, the likelihood that the arbitrator will be knowledgeable in the subject matter or have a sound experience is much higher than in the ordinary justice system. This arbitration specialty becomes a positive differentiating element by guaranteeing the quality of the resolution, its content and scope.  
It is also important to highlight that arbitrators usually have more time available to study the case in depth, with the intrinsic commitment to deepen the review of the pleadings, the performance of technical expert evidence and to elucidate the complex legal issues involved. This has been achieved to the extent that the administering institutions, as a rule in Ibero-America, have been careful to choose and add to their lists of arbitrators, academics, former judges, senior lawyers and people with expertise and experience.  

5. Impartiality and transparency of the arbitration forum
In societies such as those of Latin America, it is regrettable to admit the common denominator represented by the lack of ethical suitability and impartiality of the judges, whose actions allow the suspicion of political or nationalistic influences, or of any other kind; and, in this sense, arbitration shows its impartiality and neutrality, given that any action to the contrary is considered an attack on the ethical strength of arbitration and subject to strict moral judgment, beyond the legal.  
Foreign investors know that Latin American judicial systems represent partiality or inefficiency, and therefore turn to arbitration as a mechanism to "delocalize" the resolution of the conflict, seeking neutrality. This type of legal tranquility is what the region promotes, especially to generate foreign investment as an adequate mechanism for orderly and equitable economic and social growth. 

6. International recognition and enforcement of awards
The 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, and the 1975 Inter-American Convention of Panama for the Inter-American sphere, have greatly contributed to the consolidation and acceptance of arbitration as an expeditious way to settle disputes, since, on the one hand, practically all Latin American countries have ratified the New York Convention, and most of them are also parties to the Panama Convention; and on the other hand, the procedures have been regulated internally so that this facility to enforce internationally the resulting decision provides the necessary security to public and private contracts. In this sense, arbitral awards enjoy a regime of recognition and enforcement at the global level that is much more favorable than that of national court judgments. The New York Convention obliges national courts to recognize foreign awards as binding and to enforce them, with few formal exceptions, which provides "cross-border legal certainty" by recognizing them as a local judgment with equal value, even prohibiting the review of the merits of the award during the exequatur (only formal control is allowed), respecting the principle of res judicata.  

Este esfuerzo práctico y normativo de la región, ha visto sus frutos a través del crecimiento del número de casos sometidos a arbitraje, de cuantías importantes, y de complejidad muy relevante. De esta manera, el arbitraje cuenta con muchos más adeptos y cultores, que velan por su permanencia, eficacia y aceptación.
 
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