Research On Third Party System In International Arbitration

Arbitration has taken on an increasingly important role in international commercial transactions and has become the preferred dispute resolution mechanism in many types of transaction contracts. It has long been called a creature of contract, a dispute resolution mechanism that has no form or validity outside the four corners of the parties' arbitration agreement. As international transaction become more complex, certain procedural problems are becoming more common. One of the most troubling issues in this area of law concerns intervention of third parties into an existing arbitration. The question raised by this article is whether the intervention of third parties as of right in an arbitration proceeding is wise, necessary, and legally possible under current laws.The structure of this article is straightforward. Part I define the terms of third party in arbitration. Besides Part I also outline consolidation, an important measure that has been used up this time to facilitate multi-partyarbitration. In some ways, the theoretical debate on propriety of consolidation illuminates the issue of intervention of third parties as of right and provides a helpful backdrop to the current discussion. Because many of the rationales in consolidation can also be used to justify intervention of third parties as of right, and its pros and cons is useful. In addition, recent reforms in the area of consolidation may suggest ways in which the law might change.Part II of this article discusses arbitration's contractual roots and analyzes the character of arbitration. Besides, this part also analyzes the privity of the arbitration agreement and the expansibility of the effect of arbitration agreement. Thereby obtaining the theoretical bases of constructing third parties system in arbitration proceeding.Parts III discuss the differences between arbitration and civil litigation in their procedural value. A brief discussion of some of the more interesting nexus points between arbitration and litigation will not only show why advocates of intervention of third parties can rely partly on analogies to civil procedure, but will also highlight some of the theoretical problems of intervention of third parties in arbitration.Part IV outlines the relevant provisions of a variety of national laws on arbitration as well as the rules promulgated by several arbitral institutions and United Nations bodies. This survey is not meant to be comprehensive, but will discuss a number of provisions from popular arbitral institutions and forum states as well as some of the more innovative agencies and states. The study is indented to be primarily a statutory analysis since the goal is to see if existing laws will support argument in favor ofintervention of third parties. However, case law will be introduced to the extent it is relevant and available.Parts V outline the construction of the third parties system in international commercial arbitration from the theory of law analysis and the practice operation angle.In short, it is urgent to set up a perfect theoretical framework of third party system in international commercial arbitration and a perfect practical flow of the institution of third party system in international commercial arbitration, in order to benefit the healthy development of international commercial arbitration. And also it is important to focus on whether and to what extent the third partiers should be allowed to participate in international arbitrations, since traditional notions of what an arbitration should be based as they are on the classic two-party paradigm-are quickly being undermined by the realities of global multi-party transactions. As this will increase in the coming years, the international community, including courts and commentators, practitioners and politicians, should try to identify a fair and workable approach to the issue of third parties in arbitration proceeding.