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Abstract

The thesis of this Article is that arbitration should become the default mode of resolution of international commercial disputes. In Part I, I first address the critical issue of the legitimacy of international arbitrators. In the traditional model of voluntary arbitration, the legitimacy of arbitrators flows from the agreement of the parties. By agreeing to have their dispute settled by way of arbitration, the parties have not only empowered the arbitrators, but also abided by the power that they have conferred on them. In the model that I propose, however, arbitration loses its contractual foundation. Would arbitrators also lose all legitimacy? In the absence of any acceptance of the parties, can adjudicatory power be conferred on private individuals? In Part II, I discuss the comparative legitimacy of courts and of arbitrators to settle international commercial disputes, and find that the legitimacy of arbitrators is not lower than the legitimacy of courts. I then turn to the more traditional critiques of arbitration. Legal scholars have long debated the desirability of private adjudication. Many of them have concluded that its costs outweigh its benefits, and that it is thus undesirable. In Part III, I argue that this critique assumes features of the arbitral process which are peculiar to U.S. domestic arbitration, and which are thus not necessary. I present recent developments in specialized fields of international arbitration and argue that they indeed show that the costs of private adjudication have been overstated. Finally, in Part IV, I build on the conclusions reached in the previous parts and frame the details of the proposed model accordingly. Before discussing the theoretical foundation of the proposed model, however, I begin this Article by sketching the advantages of arbitration over litigation. I show that, in an international context, arbitration is a more suitable mode of dispute resolution, and that extending its scope would actually improve the settlement of international commercial disputes.

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