What, in your opinion, is the main advantage and the main disadvantage of litigating international commercial disputes?

Litigation

Pakistan Small Flag Pakistan

The main advantage of litigating an international commercial dispute in Pakistan is that it is relatively cheaper to do that here than in an established jurisdiction like London, Dubai or Singapore, particularly for projects or contracts that are based in Pakistan.

The main disadvantage however is time. Litigating in a court in Pakistan can take a lot of time as compared to other jurisdictions.

Malta Small Flag Malta

Whilst litigating international commercial disputes in Malta may take long due to court delays, costs are very limited when compared to other jurisdictions.

Singapore Small Flag Singapore

Singapore’s litigation scene enjoys great benefit from the efficient case management system in place, for the just, expeditious and economical disposal of proceedings. The Integrated Electronic Litigation System (“e-Litigation”) integrates technology in the litigation process, enhancing the efficiency of both the Court officers and staff, as well as of legal practitioners. The practice of holding regular pre-trial conferences also enables the Court to take on a proactive role in monitoring the progress of cases.

However, as is the case with litigation in other jurisdictions, litigation in Singapore can be costly, especially due to its unpredictable nature. Commercial disputes of an international nature often involve complex issues of law and fact-finding, racking up hefty legal fees. The Supreme Court is mindful of the foregoing and has introduced several initiatives to manage litigation costs.

Russia Small Flag Russia

Compared to other jurisdictions, Russian commercial litigation is rather fast and allows to get an enforceable judgement within 6 months (the time for consideration in both first and appellate instance courts). Also, over the recent years Russian courts have developed electronic systems of filings and databases for monitoring of cases, which significantly simplifies the process.

The main disadvantage is the high workload of the judges and, as a consequence, more complex cases may not be given a required attention. Also, Russian commercial ligation still remains to be predominantly based on documentary evidence, paying less attention to the parties’ witnesses and experts. For many years Russian judges have been known for rather formalistic approach in application of law, however now the situation is changing due to the approaches and guidance of the Supreme Court.

Spain Small Flag Spain

The main disadvantage of commercial litigation in Spain might be the strictness of the procedural rules governing court litigation (eg the general obligation to submit all the evidence with the claim or the statement of defence). Complex causes have recently highlighted the need to simplify the procedural rules and the latest amendments of the Spanish Civil Procedure Act already went in that direction, although yet far from having a proper case management. In any event, this can easily be solved by resorting to alternative dispute resolution methods, namely mediation and arbitration.

The most remarkable advantage is the average high quality of the resolutions issued by Spanish First Instance and Commercial judges and magistrates as well as their efficiency and speed in resolving cases.

Indonesia Small Flag Indonesia

As a signatory to the New York Conventions, it is beneficial to pursue litigation through arbitration in Indonesia for its universal enforceability. By pursuing international commercial disputes before Indonesian arbitration, the rendered awards can be enforced in multiple jurisdictions. On the other hand, there are a few disadvantages to resolve international commercial disputes in Indonesia. The disadvantages involve: non-execution of a foreign judgment through Indonesian courts as aforesaid and non-enforceability of a foreign arbitral award if the award contradicts with Indonesian public policies.

One of the arguments that many use to challenge the enforceability of a foreign arbitral award is that the underlying contract from which the dispute arises from is written in foreign languages while one of the contracting parties is an Indonesian entity. Many international commercial contracts involving Indonesian party used foreign language as the language of the contract (English/Chinese/etc). However, under Indonesia Law Number 24 of 2009 on Flag, Language, State Symbol and National Anthem (Language Law), it is mandatory to use Indonesian language in a memorandum, agreement or contract which involves Indonesian government institutions, Indonesian private entities or Indonesian citizens. The absence of Indonesian language may open the possibility for the opposing party to nullify the contract on the ground that the contract is violating Indonesian Language Law.

Germany Small Flag Germany

German courts and legal practitioners have continuously demonstrated pronounced legal expertise and have, therefore, built up a strong reputation in the international legal community. German courts are neutral and independent and, in almost all cases, administer the proceedings highly efficiently, in particular in comparison with certain other European and non-European legal systems. Moreover, the litigation costs are predictable due to the caps provided for by the respective statutes on court and attorney fees.

From an international perspective, the main disadvantage is probably that the official language of court proceedings is German, although there have been attempts in several federal states to establish specialised English-speaking chambers for commercial matters (cf. Question 3).

Mexico Small Flag Mexico

In our opinion, the main advantage in litigating international commercial disputes in Mexico is the fact that there are no fixed court costs or taxes, so no matter the amount of the controversy, the Courts are compelled to hear the claim, provided that they are competent.

On the other hand, a disadvantage might be that legal proceedings in Mexico take a substantial amount of time to be resolved in whole (20-24 months), basically due to the overload of work of the Courts.

Greece Small Flag Greece

Litigating commercial disputes in Greek jurisdiction is less costly in relation to most jurisdictions. On the other hand, the duration of proceedings may end up to be rather relatively extensive in some cases; however the legislator has succeeded in accelerating the procedure before the courts of first instance with its latest reform of the GCCP.

Monaco Small Flag Monaco

Comparatively to other jurisdictions, the time frame to obtain a Court decision is rather short.

It can also be seen as an advantage/disadvantage that the winning party’s lawyer fees are not to be systematically and integrally supported by the losing party.

Security is not commonly required from the applicant to obtain interim measures such as bank account attachments.

Also, depending from the standpoint, the lack of full disclosure requirements may be an advantage or a disadvantage.

Hong Kong Small Flag Hong Kong

The main advantages of litigating international commercial disputes under the Hong Kong court system are the wealth of its jurisprudence combined with an independent judiciary and sophisticated legal infrastructure which upholds the rule of law. Perceived disadvantages for commercial parties may include the lack of confidentiality of the proceedings as well as inflexibility in terms of selecting an adjudicator for the relevant dispute, compared to alternative forms of dispute resolution such as arbitration. Costs of litigation in Hong Kong may be perceived to be relatively high compared to other local jurisdictions.

Italy Small Flag Italy

Surely the greatest disadvantage of an international trade dispute in Italy is the time it takes to get a judgement. In fact, about 800 days are required to obtain a first instance ruling , about 1000 days for a second degree judgement and about 1300 days for a decision of the Corte di Cassazione. This problem is so overwhelming that the regulation 44/2001 has been recasted in order to avoid unfair procedural practices (one of which was to start cases in Italy in advance, the ill reputed “Italian Torpedo”). A further problem lies in the chronic lack of material resources for judges (whose number is, however, adequate).

The main advantage, however, could be found in the cost of commercial proceedings, significantly lower than the European average.

Ireland Small Flag Ireland

The main advantage of litigating international disputes in Ireland is the availability of swift, judicially managed disposal of disputes. Since its introduction in 2004, the Commercial Court transformed the landscape for commercial litigants, and it is now recognised internationally as an efficient platform for the determination of disputes. In addition, for commercial parties with no pre-existing links to the jurisdiction, with its streamlined system, Ireland appeals as a neutral venue, easily accessible from the EU and US.

An unavoidable corollary of any court proceedings, the principal disadvantage is the inevitable cost and business disruption which may occur. In recognition of this, however, the Irish courts have, as outlined above, introduced a number of measures aimed at encouraging parties towards alternative and (it is hoped) more cost effective and efficient methods of dispute resolution.

Switzerland Small Flag Switzerland

A major advantage of the Swiss system is certainly the high competence of the judges and the other court staff, especially at the commercial courts, and the high standard and compliance with procedural guarantees and due process. As a disadvantage might qualify the advance on court costs, which the claimant party must pay. Such payment can be a barrier to invoke to the court. However, legislative efforts are underway to reduce such barrier.

Chile Small Flag Chile

The main advantage is having the possibility to submit international commercial disputes to arbitration. There has been a great development of international commercial arbitration in Chile since the enactment of Law 19,971 that follows the UNCITRAL model arbitration law. The CAM has made available arbitration and mediation at the resolution of disputes. The arbitrators of CAM have the skills to deal with complex disputes and they are prepared to render their decisions according to the modern trends, providing legal certainty and efficient solutions in an affordable way.

One the other hand, a disadvantage might be that there are still some remnants of the Chilean civil procedure in the proof taking stage, such as the way in which expert witnesses’ reports are conducted, the opportunity given to submit evidence, or the value assigned to the evidence of witnesses. Likewise, in complex arbitration the role played for an expert witness may be prevailing, even replacing in some cases the reasoning of the arbitrator (when this one lies blindly in the expert witness´s opinion).

Sweden Small Flag Sweden

Court litigation in Sweden is safe, predictable and ensures a high level of compliance with Swedish substantive law. The judges maintain high integrity and, at least in the district courts of Sweden’s largest cities and in the courts of appeal, possess the competence to deal with large and complex commercial disputes. In addition, in medium-sized disputes, court litigation is a viable alternative in terms of how fast they are adjudicated. In addition, enforcement actions based on an award are usually quick and efficient. The main disadvantages are that the proceedings can be slow in larger disputes and that Swedish judges are typically generalists; the adjudication of very complex commercial disputes sometimes suffers from a lack of specialisation, especially in terms of business acumen.

Portugal Small Flag Portugal

In Portugal, commercial disputes can be adjudicated upon in Judicial Courts or Arbitrational Courts.

There are Arbitration laws with the basic rules that must be followed by the parties and the Court. Arbitration Courts are faster than their judicial counterparts when it comes to analysing and ruling on the matter, but the case can become more expensive since parties have to pay not only the Court fees but also the arbitrators (that are usually well known attorneys or Professors at Law Faculties), in addition to lawyers.

For more than 10 years, the Portuguese judicial system has operated via an online platform – CITIUS – where judicial files are accessible: papers have to be submitted trough this platform and judges’ decisions are also registered here. As a result, parties are able to understand what is happening in their proceedings at any time and print whatever they need to.

If the amount requested in the file does not exceed € 250.000,00, court fees will not be as expensive as with arbitration proceedings. In a realistic scenario, if the case is not too complex and no extraordinary circumstances arise, it can be ruled on approximately in one and a half years in the first instance Court.

UAE Small Flag UAE

The main disadvantage in my opinion is that litigation can be quite lengthy. There are no strict time tables and there are many delay tactics which parties can adopt to prolong the life span of a dispute.

Cost can be also viewed as a disadvantage especially if compared to neighbouring countries. However, it could be deemed as an advantage if compared to other methods of dispute resolution such as arbitration.

As for the advantages, there are many. The main advantages in my opinion is that there is always a strive to develop the judicial system.

In addition, the judicial system is quite independent and there is no political or governmental interference which would influence the courts findings.

Saudi Arabia Small Flag Saudi Arabia

A major disadvantage for claimants is that the judges of the Commercial Court do not award damages for loss of anticipated profit or business interruption, although this may be an advantage for defendants. On the plus side is the judges’ impartiality, with no preference for local parties over non-Saudis.

Norway Small Flag Norway

The main advantage is that Norway has a well-functioning court system that has broad experience in commercial dispute resolution. The major drawback is the processing time. This is particularly the case in some of the courts of appeal. Thus, arbitration may be an option. The Nordic Offshore and Maritime Arbitration Institute (NOMA) has recently established a new framework for professional and cost effective commercial arbitrations, which is specifically adapted to international dispute resolution, and this framework may be used as basis for arbitration in Norway.

United States Small Flag United States

The main advantage is that the United States has a sophisticated judiciary with experience resolving a broad range of commercial disputes and expertise on commercial matters. The main disadvantage is that there are potentially many jurisdictions from which litigants can choose—each with their own laws and procedures. Therefore, potential litigants must think carefully about which U.S. jurisdiction would be best suited to resolve their disputes, including how various claims are defined and when the statute of limitations period will run in a given jurisdiction.

Austria Small Flag Austria

The Austrian state courts rank amongst the most efficient in the European Union. The average duration of first instance proceedings with cross-border implications at the district court level is 6 -12 months. This, combined with relatively moderate court fees (calculated by reference to the amount in dispute and capped at 1.2% where the amount in dispute is exceptionally high), makes litigation an accessible dispute resolution tool. On the negative side, there is only limited flexibility on the part of the Austrian state courts as regards the use of foreign languages, in particular English. While there are of course judges who have an excellent command of foreign languages, the Code of Civil Procedure requires that the proceedings are conducted exclusively in German. The resulting need to involve professional translation/interpretation service providers regularly contributes to elevated procedural costs in litigation proceedings involving a foreign party.

Japan Small Flag Japan

One advantage of litigating international commercial disputes in Japan is the relatively low court filing fees. For example, if the amount being claimed is JPY 100 million, the filing fee is only JPY 320,000, and if the amount being claimed is JPY 1 billion, the filing fee is only JPY 3,020,000. Another advantage is that, in general, throughout Japan, the quality of judges is relatively high and judges are free from corruption. This is due to the rotation system in which judges are transferred to different courts on a three- to four-year basis.

On the other hand, one disadvantage is that foreign documents must be translated into Japanese for submission in court, which costs both time and money. Also, it takes a relatively long time to effect service in a foreign country because of the procedure described in #8.

Also, as described in #14, the limited form of document disclosure is an aspect that should be considered before commencing litigation in Japan. This can be either an advantage or a disadvantage, depending on the type of material evidence in question.

United Kingdom Small Flag United Kingdom

One of the main advantages of the English court’s is their global reach. London’s status as a global commercial centre means that defendants face a heavy price if they do not obey the court’s orders as significant commercial actors can rarely afford to be unable to come to London or have assets in the jurisdiction. This makes London a popular forum for fraud cases, where the power to compel worldwide asset preservation and disclosure is key. Costs are the main disadvantage, although London is not alone in this and clients can mitigate the high costs of litigation by having up front conversations with their legal advisors about the economies of litigation and what other alternatives (such as mediation or settlement discussions, or litigating efficiently, such as through the Shorter Trials Scheme) are available.

Denmark Small Flag Denmark

The main advantage will be costs as compared to US/UK jurisdiction. The courts are independent and well functioning and the Maritime and Commercial Court offers a very professional team of judges who has intimate knowledge of the different industries. The disadvantage is that the courts often take a long time in very complicated matters.

France Small Flag France

The main advantages of litigating international commercial disputes in France can be summarized as follows:

  • an international chamber has recently been created within the Paris Commercial Court and the Paris Court of Appeal. The English language can be used during the proceedings. Even if pleadings are still drafted in French, documents in English may be filed without translation and judgments are translated under the responsibility of the court's registrar. In addition, if the proceedings are to be held in French, simultaneous translation by a translator appointed by the court may be arranged. Parties appearing before the court may speak English if they so wish;
  • there is no disclosure process under French law, thereby avoiding a burdensome procedure;
  • before the Commercial Court, the procedure is oral; this offers a certain flexibility;
  • the hearings are quite short (they rarely exceed a couple of hours at most).

Disadvantages can be found in that there is usually no hearing of expert witnesses and no witness cross-examination.

India Small Flag India

A structured approach in terms of procedure is one of the many advantages of litigating international commercial disputes in India. The Code of Civil Procedure, 1908 and the Evidence Act, 1872 are two of the primary statutes for this purpose and proceedings largely take place in accordance with the provisions of these acts. Further, Indian courts are increasingly rendering investor-friendly decisions and also respecting the choice of parties in choosing a foreign law to resolve their disputes in international commercial litigations. A transparent, independent and the recent investor-friendly approach of the Indian judiciary augurs well for the dispute settlement mechanism in the country.

In so far as disadvantages are concerned, time taken to resolve disputes in courts due to the huge backlog of pending cases remains a major cause of concern.

Updated: August 30, 2018