What Is an Arbitration Clause?

The arbitration clause, also known as an arbitration agreement, is an expression of the intention of both parties to submit their dispute to a third party for arbitration. Arbitration is the most commonly used method in the settlement of disputes in international trade, and it is premised that both parties have an arbitration agreement. ^[1]

Arbitration clause

Right!

The arbitration clause, also known as an arbitration agreement, is an expression of the willingness of both parties to submit their dispute to a third party for decision. Arbitration is the most commonly used method in the settlement of disputes in international trade, and it is premised that both parties have an arbitration agreement. ^[1]

The so-called arbitration, also known as arbitration, refers to a way for buyers and sellers to sign a written agreement before or after a dispute occurs, and voluntarily submit the dispute to a third party agreed by the two parties to award it in order to resolve the dispute. Because the arbitration determines the dispute in accordance with the degree of arbitration allowed by law, it promotes the award to be legally binding, and both parties must comply with it.

At present, the content of arbitration clauses in China's import and export contracts are diverse and generally include the following aspects:

Where to conduct arbitration is a key point for buyers and sellers when negotiating arbitration.

This is mainly because the place of arbitration and

Arbitration in international trade may be conducted by the parties in a permanent arbitration institution as stipulated in the arbitration association, or the parties may jointly designate an arbitrator to form an ad hoc arbitration tribunal. Which country (region) the arbitration institution selected by the parties to hear the dispute shall specify in the contract.

3. Application of the Arbitral Procedural Law

In the arbitration clause of the sales contract, the arbitration rules of which country (region) and which arbitration institution should be used for arbitration.

4. Effect of arbitral award

The validity of an arbitral award mainly refers to whether the award made by the arbitral tribunal is binding on the parties and whether it is decisive.

5. Burden of arbitration costs

It is usually specified in the arbitration clause who will bear the cost of arbitration. The general provisions are borne by the complaining party, and some are determined by the arbitral tribunal at its discretion.