Arbitration

We assist in arbitration proceedings

Arbitration is one of the alternative dispute resolution methods, meaning a way of resolving disputes outside the general courts. One of the key advantages of arbitration is that a resolution is typically reached more quickly than through court proceedings. Arbitration is particularly common in disputes between businesses, but it can also be used in disputes between private parties where settlement is legally permitted.

What is arbitration?

Arbitration refers to a procedure agreed upon by the parties for resolving a dispute through arbitrator(s) instead of a court. Arbitration proceedings are confidential, and, as a rule, the arbitral award rendered by the arbitrator or arbitral tribunal cannot be appealed.

Arbitration is a form of alternative dispute resolution (ADR). Other ADR methods include, for example, mediation. The term “alternative” refers to dispute resolution methods that serve as an alternative to court litigation. The English abbreviation ADR (Alternative Dispute Resolution) is also commonly used. Arbitration proceedings in Finland are governed by the Finnish Arbitration Act.

If a matter is resolved through arbitration, the same dispute cannot subsequently be heard by the general courts. The arbitral award therefore constitutes the final resolution of the dispute.

Advantages of arbitration

Compared to court proceedings, the main advantages of arbitration are its speed, flexibility and confidentiality. Since arbitral awards are not subject to appeal, the process does not extend over several years. An arbitral award is immediately enforceable in the same manner as a final and binding judgment of a general court.

All written materials submitted in arbitration, as well as the decisions and arbitral award issued by the arbitral tribunal, are confidential. Under the Arbitration Rules of the Finland Chamber of Commerce, even the parties themselves are not entitled to disclose such information, subject to certain exceptions, unless otherwise agreed. This confidentiality is often particularly important for businesses, as judgments of the general courts are, as a rule, public and may be obtained by anyone upon request.

If the arbitration agreement does not specify the arbitrators or the method for their appointment, each party is entitled to appoint an equal number of arbitrators. Arbitrators are typically selected based on their specific expertise in the subject matter of the dispute and in dispute resolution.

Costs of arbitration

Arbitration is generally best suited for disputes between businesses where the financial interests involved are significant. The monetary value of the dispute determines the amount of the administrative fees and the arbitrators’ remuneration.

An application fee is payable when initiating arbitration. Under the standard arbitration rules, the application fee is EUR 3,000, and in expedited arbitration EUR 2,500. It should be noted that the application fee is non-refundable, even if the applicant withdraws the application or the arbitration otherwise ends prematurely. The Finland Chamber of Commerce (FAI) also requires an advance on costs at the early stages of the proceedings. A fee of EUR 3,000 is charged for the appointment of arbitrator(s) in ad hoc proceedings. Unless otherwise agreed or ordered, the parties are jointly and severally liable for the fees payable to the arbitrator(s). An arbitrator may also require the parties to provide an advance payment or security for the fees payable to them.