Dubai: In a significant boost in its status as a major hub for international business, Dubai has been ranked among the top 10 cities in the world for international arbitration, according to a recent report.
According to the 12th version of the International Arbitration Survey titled ‘Adapting arbitration to a changing world’, Dubai was the only jurisdiction from the Middle East which was on the list of the top ten ranked arbitral seats, alongside the most preferred seats of London, Singapore, Hong Kong and Paris. In this year's survey Dubai surpassed well-known seats such as Vienna and Washington.
The survey was conducted by the School of International Arbitration (SIA) at Queen Mary University of London (QMUL), in partnership with White & Case (LLP), about the rankings of arbitral seats and institutions, which is a key reference for decision makers to identify and analyse the needs, expectations, and trends of international arbitration stakeholders. This edition saw the widest-ever pool of respondents since its first edition in 2006, with more than 1,200 questionnaire responses received and 198 interviews conducted with specialists in 53 cities worldwide over five months.
Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, hailed the rankings. "Congratulations to the UAE on Dubai's achievement of being the only jurisdiction from the Middle East on the top 10 ranked International arbitral seats globally," Sheikh Maktoum tweeted.
The survey results showed Dubai has the opportunity to climb the ranks with right kind use of benchmarking and pioneering experiences to reach a better position among the top ranked arbitral seats by coping with the expectations and global evolving needs of disputing parties.
Analysts said Dubai definitely has the potential to climb the ranks. However, this requires the activation of a dynamic arbitration ecosystem led by the government and framed by targets and key performance indicators so as to ‘attract international arbitration cases.’ This ecosystem should also partner with stakeholders representing the Dubai Judiciary, arbitral institutions, arbitrators, law firms, and schools of law, united towards a common goal of achieving a leading position amongst international arbitration seats.
This year’s survey saw the widest-ever pool of respondents since its first edition in 2006, with more than 1200 questionnaire responses received and 198 interviews conducted with specialists in 53 cities worldwide over 5 months.
The study showed international arbitration is the preferred method of resolving cross-border disputes for 90 per cent of respondents.
While the acceptance of arbitration is growing, new centers are emerging as preferred destinations. Until 2010, Singapore was not listed amongst the top ten most preferred arbitral seats. Within ten years, it has risen to be the most preferred arbitral seat, having tied with London. Meanwhile, the Singapore International Arbitration Centre (SIAC) ranks second after the International Chamber of Commerce (ICC) International Court of Arbitration, Paris.
In this year’s survey majority of the respondents chose London and Singapore as the most preferred seats and ICC as the most preferred institution, reflecting similar choices from previous surveys.
Shift of focus to Asia
The 2021 survey also shows a drop in the percentage of respondents who preferred London as a seat from 64 per cent in 2018 to 54 per cent in 2021, and ICC as an institution from 77 per cent in 2018 to 57 per cent in 2021.
This clearly shows a decline in traditionally dominant European seats and institutions, and an increase in Asian seats and institutions such as Singapore and Hong Kong, and SIAC and Hong Kong International Arbitration Centre (HKIAC).
The 2021 survey showed that the most import five adaptations that would make arbitral seats more attractive are ‘he greater support for arbitration by local courts and judiciary; increased neutrality and impartiality of the local legal system; better track record in enforcing agreements to arbitrate and arbitral awards; ability to enforce decisions of emergency arbitrators or interim measures ordered by the arbitral tribunals, and ability for local courts to deal remotely with arbitration-related matters.
The five most preferred seats for arbitration are London, Singapore, Hong Kong, Paris and Geneva.
‘Greater support for arbitration by local courts and judiciary’, ‘increased neutrality and impartiality of the local legal system’ and ‘better track record in enforcing agreements to arbitrate and arbitral awards’ are the key adaptations that would make other arbitral seats more attractive.
The United Nations Commission On International Trade Law (UNCITRAL) Arbitration Rules are the most popular regime for ad hoc arbitration.
The five most preferred arbitral institutions are the ICC, SIAC, HKIAC, LCIA and CIETAC.
Respondents chose ‘administrative/logistical support for virtual hearings’ as their top choice adaptation that would make other sets of arbitration rules or arbitral institutions more attractive, followed by ‘commitment to a more diverse pool of arbitrators’. Arbitration users would be most willing to do without ‘unlimited length of written submissions’, ‘oral hearings on procedural issues’ and ‘document production’, if this would make their arbitrations cheaper or faster.