At its simplest, arbitration is an alternative to national court litigation as a means of resolving disputes; in choosing arbitration parties are opting to have their dispute resolved privately instead of going to a national court.

Key features of international arbitration which make it an attractive alternative to the procedure of regular litigation are :
  1. Arbitration is consensual in nature. In various situations, national courts may ascertain their own jurisdiction even in cases where-in the contract between the parties does not explicitly mention any resolution of dispute arising amid them to be dealt with by that respective court. However, an arbitral tribunal can only indulge in dispute resolution when it has been expressly mentioned in the relevant contract.
  2. It is neutral. Arbitral hearings can take place in countries that may belong to a neutral stand and shall possess an unbiased point of view regarding the subject matter at hand.  Usually, they choose the procedural rules of one of the well-known international arbitral institutions such as the ICC, LCIA or SIAC. They can also choose the language that the arbitration will be conducted in, rather than being bound to use the language of the national court.
  3. The process is comparatively more casual in nature than that of a national court hearing. The level of comfort allows both parties to amicably resolve disputes arising amidst them.
  4. In place of a court-appointed judge, the dispute is heard by an arbitrator or a panel of arbitrators.
  5. Decisions of an arbitral tribunal – the arbitration award – are usually final and subject to limited rights of challenge, unlike the judgments of national courts which typically can be appealed through several further rounds of litigation.[1]

Current Situation of Arbitration in Financial Institutions

Most of the financial institutions and organizations are tilting in favor of the method of arbitration as a solution for any and all disputes arising regarding the relevant contract between both parties. Arbitration in this aspect has many positive features and advantages which makes it a relatively better alternative than the tedious and lengthy procedure of national court litigation. Some being:
  1. Confidentiality: Confidentiality is a major aspect that has to be taken into consideration when undergoing the procedure of dispute resolution between two parties regarding any delicate financial situation like Mergers and Acquisitions. Such information affects international markets worldwide and if discussed in open court may easily lead to leakage of any sensitive information. Arbitration acts as a subsequent safeguard for the same.
  2. Expertise: Most of the national courts are not knowledgeably equipped regarding the expertise required to deal with such matters of importance, however specific arbitral tribunals include arbitrators with respective knowledge pertaining to the subject matter at hand, which makes it easier to adjudge in such situations.
  3. Flexibility: Arbitral proceedings can be tailor-made to suit the requirements of both parties so that there is a level of convenience maintained.
  4. Enforceability: Enforceability of an arbitral award is much easier as compared to the order or judgment of any national court.
In totality, Arbitration is much more desired as a mode of dispute resolutions due to the aforementioned features however this doesn’t mean that such method is devoid of any problems in its own right.
The major problem of arbitration between financial organizations may arise in a situation of disputes between parties indulging in cross border dealings and partnerships. Two of the main attractions of the process of Arbitration were that they were cost-effective and less time-consuming. However, due to the dealings of financial institutions across international boundaries both these features have become a sort of discrepancy to the same. The cost has become a factor as both parties may not belong to the same country and thus may involve high costs regarding the expenditure of procedure and transportation. Time consumption is considered a negative factor as both parties and arbitrators may belong from different countries which may lead to delay in coordination between the parties and the arbitrators which may lead to slow remedies.
Opinion on the solution: Cost and time are two major factors which every person considers when undergoing the procedure of dispute resolution. Major Multinational organizations may be able to bear costs regarding such procedure but smaller organizations might not be able to do so. Also according to me, there should be a unilateral body, which should govern such procedures. Taking the International Court of Justice as an example, such a body should be present which shall act as a governing body or act as an International Arbitral tribunal, which may hear such cases between the two aggrieved parties in a cross border dispute arising between two financial organizations. If not so, there should be an establishment of a regulatory authority, which shall act as a price-determining, or controlling body that can help in the determination of a certain amount, which shall act as a core price upon which further adjustments can be made to suit both the parties.
In my personal opinion, I believe that the aforementioned methods may also help in reducing the time period of the whole procedure and remove the hindrance of delays in the procedure so that the procedure of arbitration can become a perfect solution for both parties indulging in such method of dispute resolution. If both of these problems are solved and dealt with accordingly, then the process of arbitration amidst financial organizations may become much smoother. 
Essentially, in conclusion, it can be said that Arbitration is creating its own position in the field of financial institutions even though there are certain hurdles and disadvantages that need to be overcome. It is being recognized as a more convenient, secure and private form of dispute resolution pertaining to financial topics. The advantages are subsequently much more superseding to the disadvantages of the procedure. If the minor hindrances, which have been mentioned above, are dealt with accordingly, then it may become the perfect solution regarding any financial dispute. Anyhow there is a lot of potential in the procedure of arbitration and thus the preference of such arbitration is increasing manifold. 

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