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ARTICLE · 23 APRIL 2018

Is arbitration innately unfair?

Any imbalance in power between the parties weighs against arbitration clauses when offered on a standard form basis.

AustraliaCorporate/Commercial Law

It is increasingly common for large enterprises, particularly those who work internationally, to rely on compulsory arbitration clauses to settle disputes arising from their contracts. The reasons for this are many, but from an international perspective the most tangible benefit is the ability to remove the peculiarities of individual jurisdictions and place disputes into a central framework that suits the requirements (and understanding) of the business. The online marketplace only exacerbates this issue, with products and services offered to a wide variety of persons and corporations, with whom each contract may be subject to a different jurisdiction and different applicable law. Commercial arbitration promises enterprises certainty, but in removing protections put in place by the local jurisdiction, it may contradict applicable Australian law.

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