‘’A court, outside a court’; Arbitration is the supreme reflection of ‘Alternative

Dispute Resolution’’

Alternative dispute resolution is a term that refers to several different methods of resolving
business-related disputes, family disputes etc outside traditional legal and administrative forums.
It is generally classified into at least four types: arbitration, mediation, collaborative law and
negotiation. Among those methodologies, arbitration has surged in popularity in recent years
because companies and courts became extremely frustrated over the expense, time, and
emotional toll involved in resolving disputes through the usual avenues of litigation. Today, legal
and corporate acceptance of alternative dispute resolution as a legitimate remedy for addressing
business disagreements is reflected in the language of business contracts. Alternative dispute
resolution contingencies have become a standard element in many contracts between companies
and their employees, partners, customers, and suppliers.

Alternative Dispute Resolution in Bangladesh:

Bangladesh has recently enacted the Arbitration Act 2001. It came into force on 10 April 2001,
repealing the Arbitration (Protocol and Convention) Act 1937 and the Arbitration Act 1940,
legacies of the British Raj in India. The new Act was again amended in 2004 in certain respects.
Such legislative steps were urgent in the face of increasing foreign investment in Bangladesh in
various sectors, especially in natural gas and power, and the ever-growing export trade with the
rest of the world. The Act, consolidates the law relating to both domestic and international
commercial arbitration. It thus creates a single and unified legal regime for arbitration in
Bangladesh. This modernization gives Bangladesh a facelift as an attractive place for dispute
resolution in the field of international trade, commerce and investment.

Some features of Arbitration:

Arbitration is a process in which a dispute is submitted to an impartial outsider who makes a

decision which is usually binding on both the parties. Arbitration is a less formal process. The
features are:

(a) In commercial dispute one of the parties to the dispute must be either a firm registered abroad
or a foreign national.

(b) The dispute in question must arise out of a legal relationship, whether contractual or not, but
considered as a commercial dispute under the law in force in Bangladesh.

(c) The parties are free to determine the number of arbitrators of any nationality. If the parties
fail to fix the number of arbitrators, the tribunal is to consist of three arbitrators.
(d) The courts can intervene in regard to appointments of the arbitrators on behalf of the parties
as well as of the chairman of the arbitral tribunal within sixty days from the receipt of a party’s
application, to facilitate the arbitral process.

(e) The court shall respect the parties’ agreement to arbitrate and refer any party to such
agreement to arbitration and stay any legal proceedings that may have been commenced against
the other party.

(f) The parties are free to agree on the venue, failing which the arbitral tribunal, having regard to
the circumstances of the case, including the convenience of the parties, shall determine it.

(g) No appeal lies against the tribunal’s order of interim measure of protection. The tribunal can
summon any persons to appear before it.

(h) The tribunal has no power to act in respect of consolidation of arbitral proceedings and
concurrent hearings, unless it is given by the parties on agreed terms.

(i) The tribunal must deal with any dispute submitted to it as quickly as possible and act fairly
and impartially by giving each party ‘reasonable opportunity’ to participate in the proceedings.

(j) The tribunal may continue the proceedings in the absence of a party and make an award on
the basis of the evidence before it.

(k) The tribunal must give its award without undue delay and the award will have the same force
of law as if it were a decree of a court.

(l) An award shall be made by the majority of the arbitrators and shall be in writing and signed at
least by the majority where the tribunal consists of more than one arbitrator.

Alternative dispute resolution procedures also offer several advantages:

 A single procedure: Through Alternative Dispute Resolution, the parties can agree to
resolve in a single procedure a dispute involving intellectual property that is protected in
a number of different countries

 Party autonomy: Because of its private nature, Alternative Dispute Resolution affords
parties the opportunity to exercise greater control over the way their dispute is resolved
than would be the case in court litigation.

 Neutrality: Alternative Dispute Resolution can be neutral to the law, language and
institutional culture of the parties, thereby avoiding any home court advantage that one of
the parties may enjoy in court-based litigation.

 Finality of Awards: Unlike court decisions, which can generally be contested through
one or more rounds of litigation, arbitral awards are not normally subject to appeal.
Reasons behind Arbitration wide acceptance:

 Cost: One of the largest reasons parties choose to resolve their disputes outside of the
courts is cost. Alternative dispute resolution usually costs much less than litigation.

 Speed: Alternative Dispute Resolution can be scheduled by the parties and the panelist as
soon as they are able to meet. Compared to the court process, where waits of 2-3 years
are normal, dispute resolution is as fast as the parties want it to be.

 Control: The parties control some of the process; selecting what method of Alternative
Dispute Resolution they want to follow, selecting the panelist for their dispute resolution;
the length of the process; and, in a mediations case, even the outcome.

 Confidentiality: Disputes resolved in court are public and any judgments awarded are
also public. Arbitration and mini trials are all conducted in private and in strict
confidentiality.

 Experienced Neutral Panelists: Our panelists are professional arbitrators with training
and expertise in dispute resolution and insurance. Disputing parties are able to select their
panelist from a list of qualified individuals who are specialized in specific aspects of
insurance.

Arbitration has been proved a cheapest and simple means to resolve disputes amicably. It is a
unique and significant process by which very easily solution can be obtained. Bangladesh’s new
legislative step in the field of commercial arbitration is very timely. Now on the wake of
economic globalization and liberalization of the private justice system in many countries, such a
step was inevitable in the competitive global marketplace in order to attract foreign investment
and international business operations to Bangladesh for its sustainable economic growth and
development for year to come.

The government is required to bring necessary alterations and changes in the existing laws of the
land and also adopts alternatives various methods for resolving disputes and conflicts of family
matters, traders and commercial associations, labor and industrial disputes and compensation
matters.