RECOURSE TO INTERNATIONAL COMMERCIAL ARBITRATION IN SOUTHEAST ASIA

Apr 28, 2026

Una panel de Arbitraje Mercantil Internacional en una moderna sala de conferencias con vistas al horizonte de Singapur. Un mazo, una balanza de justicia y un cartel que dice 'INTERNATIONAL COMMERCIAL ARBITRATION PANEL' sobre la mesa junto a las siglas 'SIAC' y 'AIAC'. Un mapa en la pared muestra ciudades conectadas en el sudeste asiático.

1. The corporate internationalization process

The corporate internationalization process is often long and complex; a process that sometimes stems from offensive factors to gain market share or leverage economies of scale, and other times from defensive factors to reactivate demand or neutralize competition. Currently threatened by geoeconomic difficulties —barriers, tariffs, and trade restrictions—, regulatory volatilities —normative fragmentation, state protectionism, unpredictable enforcement—, technological contingencies —cyber threats, critical infrastructure, uncontrolled artificial intelligence—, environmental hazards —extreme weather events, scarcity of natural resources, disorderly transitions— and geopolitical instabilities —active and latent armed conflicts, global corporate threats, China-West rivalry—, it demands, as recommended by the Global Risks Report 2026 from the World Economic Forum, a high degree of resilience and sustainability. And above all, risk management.

 

2. Dispute resolution mechanisms

One of the most important issues in the international commercial sphere is, indeed, risk management, particularly regarding disputes arising from the interpretation or execution of contractual clauses, where International Commercial Arbitration allows for anticipating, as far as possible through corresponding provisions, their resolution in the fastest and most effective manner.

Among these provisions are various types of mechanisms, whether judicial or arbitral, the choice of which can —and must— be made at the appropriate time, taking into account the concurrent circumstances of each case, such as the identity and nationality of the parties, the legal nature of the relationship, the specialization of the adjudicator, the confidentiality of the process, or the enforceability of the ruling. A choice that, as Faustino Cordón points out, frequently leans in favor of the arbitral route as a result, on one hand, of a certain mindset favoring this path; and, on the other, the absence of a supra-state jurisdiction for private law.

This pro-arbitration mindset is explained by several reasons, among which is neutrality, meaning the possibility of choosing a neutral forum, a neutral arbitrator, and a neutral law, thereby reducing the danger of the “Home Court Advantage”. But it is not the only one, of course, as there are others, such as the specialization of the arbitrator compared to an ordinary judge; confidentiality, given that arbitral proceedings and awards are private; speed, which means the duration of an arbitration usually does not exceed 12 months; and enforceability, which requires the signatory countries of the New York Convention of June 10, 1958, to recognize these awards and execute them just like national judgments.

 

3. International commercial arbitration in Southeast Asia

If recourse to arbitration almost always seems advisable in all types of international commercial operations, it is even more so in those carried out in lesser-known markets. One of the latter has been Southeast Asia until now, although today we are fortunately facing a market to which, both for the economic, commercial, or strategic potential it represents, and for the explicit recognition of this potential by the Spanish Strategy for Asia Pacific 2026-2029, increasing attention is being paid.

It is worth highlighting the institutional, economic, operational, and, above all, legal safeguards linked to the numerous arbitration centers existing in the region: SIAC, VIAC, AIAC, BANI, PDRCI, or THAC.

While the Singapore International Arbitration Center (SIAC) is undoubtedly the best known (about 886 cases in 2025), the Vietnam International Arbitration Center (VIAC) is the fastest-growing in the area after SIAC. For its part, the Asian International Arbitration Center (AIAC) in Kuala Lumpur and the Indonesia National Board of Arbitration (BANI) in Jakarta maintain significant activity focused on construction. Finally, the Philippine Dispute Resolution Center Inc. (PDRCI) and the Thailand Arbitration Center (THAC) likewise contribute to regional legal certainty.

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