Arbitration is a flexible and reliable method of dispute resolution, completely adjusted to the parties’ needs. Speed, expertise of the arbitrators, moderate costs and enforceability of arbitration awards in over 150 countries are some of the reasons why such a large number of business disputes are resolved by arbitration.
The parties may agree upon jurisdiction of the Permanent Arbitration regardless of their nationality or membership at the Chamber of Commerce and Industry of Serbia. As an independent and non-governmental institution, the Permanent Arbitration guarantees neutrality and administer arbitration disputes in the most efficient manner. The Secretariat of the Permanent Arbitration is at the disposal to all participants in the dispute before the initiation of the arbitration, throughout the entire proceeding, and even during the enforcement stage.
- DURATION OF ARBITRAL PROCEEDINGS
Duration of arbitral proceeding before the Permanent Arbitration is limited to 6 months from the date of constitution of the arbitral tribunal, or the appointment of the sole arbitrator. At the same time, according to the Supreme Court of Cassation statistics for 2015, there are over 36000 unresolved cases before the Commercial Courts of Serbia, of which over 50% have entered their fourth year, and in 25% between 5 to 10 years have passed since the date on which the initial act has been submitted.
A novelty, whose purpose is to significantly shorten proceedings, are the rules for the expedited arbitration, which apply when the amount in dispute does not exceed EUR 50 000, and are decided by a sole arbitrator. However, since the monetary value of a dispute does not always equal its complexity, parties are free to agree on application of these rules to the disputes of a greater value, being also allowed to exclude their application in the disputes where the amount in dispute does not exceed EUR 50 000.
- THE PARTIES ARE FREE TO CHOOSE ARBITRATORS
As opposed to court proceedings, in arbitration the parties are free to choose arbitrators. The parties are given the opportunity to choose the arbitrator according to experience, familiarity with certain issues of law and other qualifications the parties deem relevant for the proceeding.
Permanent arbitration does not have a roster of arbitrators. Any natural person having contractual capacity may act as an arbitrator, unless the parties have agreed upon additional conditions with respect to the qualifications of the arbitrator. The arbitrators may be domestic or foreign nationals. In order to assist parties in choice of arbitrators, the Permanent Arbitration provides and publishes a list of persons qualified to serve as arbitrators. This list is not to be considered a recommendation, nor shall it bind in any way the parties or the Permanent Arbitration.
- ARBITRATION COSTS
Arbitration costs before the Permanent Arbitration are moderate, predictable and depend on the amount in dispute. In the case of domestic arbitration before the Permanent Arbitration, the costs are in a great number of cases lower than the costs of the proceedings before the national courts. Costs of international arbitration at the Permanent Arbitration are usually lower than the arbitration costs before other arbitration institutions in the region and the world.
At the time of submitting a request for arbitration, a statement of claim, a counterclaim, or a set-off claim, the party shall deposit with the Secretariat of the Permanent Arbitration a sum of EUR 200.00 as a registration fee. Also, the claimant deposits an advance for costs with the Secretariat of the Permanent Arbitration. The advance of cost includes both the administrative costs and the arbitrators’ fees. Upon completion of arbitration, the costs are distributed between the parties, proportionally to their success in the dispute. You can calculate arbitration costs HERE.
- FLEXIBILITY AND NEUTRALITY
Unlike court proceedings, arbitration is flexible and parties can adapt it to the particularities of the case. This is especially important in international arbitration, where the parties are free to agree upon the governing law, the language and the place of arbitration.
Arbitral proceedings are not public. The identity of the parties may not be revealed without their approval, and only the parties and the persons authorized by the parties may attend the hearings. Arbitral award may be published in its entirety only with the approval of the parties involved. As a result, the parties’ confidential business information is kept from the public. This way, arbitral proceedings do not harm business reputation of the parties involved, and also contributes to the preservation of the business relationship between the parties, both during and after the proceedings.
- SINGLE-INSTANCE PROCEDURE
Arbitration is a single-instance procedure. The award is final and not subject to appeal, minimizing the possibility of impediment of proceedings and delay of the enforcement. However, that does not mean that arbitral proceedings are not susceptible to scrutiny. For the purposes of securing legal security, the proceedings are regulated by laws and other legal instruments. In case of violation of the rules of the procedure, the arbitration decision can be annulled.
- ENFORCEABILITY OF ARBITRATION AWARD
The arbitration award becomes final at the moment of its enactment. In Serbia, awards made before the Permanent Arbitration have the force of a final judgment of a court of law.
The enforcement of arbitration awards abroad is significantly facilitated due to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, to which Serbia is, along with 157 other countries, signatory. For that reason, an arbitration award made before the Permanent Arbitration is enforceable in over 150 countries around the world. At the same time, enforcement of court decisions abroad is often associated to various obstacles. Even close commercial, historical and geographic relations with a country do not guarantee that a domestic court decision will be enforced in that country. In certain cases the enforcement abroad is only possible on the grounds of an arbitral award, or it may prove burdensome due to disproportionate expenses and delay.