Manama: Bahrain has become the first country in the world to establish an arbitration free-zone and introduce the concept of statutory arbitration after it formally launched the Bahrain Chamber of Dispute Resolution (BCDR).
The Chamber, an initiative of Bahrain's Ministry of Justice and delivered in partnership with the American Arbitration Association, a provider of conflict management and dispute resolution services, will be known formally as the BCDR-AAA.
The BCDR-AAA will provide the region with an international centre of excellence, but with the distinct added advantage of operating an arbitration free-zone under Bahrain's new legislation.
As a result, where international disputes are heard at the BCDR, where the parties involved agree to be bound by the outcome, the award will be guaranteed and not subject to challenge in Bahrain.
This resolves an issue that has been a significant problem in many parts of the world, despite existing international conventions. Bahrain's arbitration free-zone will offer jurisdictional and legal certainty to the recognition of arbitration awards, an essential component of modern day commercial transactions.
In another global first, Bahrain has also introduced the concept of statutory arbitration for commercial and financial disputes. Cases that would previously have come before Bahrain's domestic courts, where the claim is over 500,000 Bahraini dinars (Dh4.86 million) and involves an international party or a party licensed by the Central Bank of Bahrain, will now be directed to the BCDR-AAA for final and binding resolution.
The move is aimed at providing additional benefit to Bahrain's commercial, banking and financial services sectors, which form a long-established hub within the region.
"In establishing the BCDR-AAA, Bahrain has sought to bring the very latest in global ADR solutions to the region. BCDR has partnered with the world's leading provider — the AAA — to ensure the highest standards of international best practice are consistently delivered. And have also enacted cutting-edge legislation that guarantees the independence of the Chamber itself and, vitally, the interests of its users," Shaikh Khalid Bin Ali Al Khalifa, the justice minister, said.
"The BCDR-AAA will provide these users, including Bahrain's legal community, international legal firms, multi-nationals and governments contracting in the Gulf and beyond, with a purpose-built solution for the rapid, effective and certain resolution of commercial disputes.."
