INTERNATIONAL COMMERCIAL ARBITRATION
The Hon. JOHN HATZISTERGOS:
The Hon. HELEN WESTWOOD: My question without notice is to the Attorney General. What is the latest information on international commercial arbitration?
International arbitration is a dispute resolution system selected by many of the world's leading international companies. In 2008 a PricewaterhouseCoopers survey "International Arbitration: Corporate attitudes and practices" revealed that 73 per cent of corporations prefer to use arbitration to resolve their cross-border disputes rather than transnational litigation and that they saw arbitration as a means to successfully preserve business relationships. Arbitration agreements and arbitral awards are enforceable worldwide under an international law known as the New York Convention. International arbitration is emerging as the preferred choice for resolving commercial disputes. It is not uncommon to hear of businesses choosing international arbitration to resolve disputes that involve substantial amounts, which can be hundreds of millions of dollars or even billions of dollars.
The arbitration centre in Singapore lists a number of cases in which the amount in dispute was substantial, including a $US230 million dispute between a Malaysian company and Singaporean company and a $US427 million dispute between a Chinese company and a Canadian company. These disputes bring with them substantial boosts to the local economy where they are held. Australia is well placed to capitalise on this booming global market. I am able to advise the House that Sydney is set to share in the booming market in commercial dispute resolution with Australia's first dedicated international dispute resolution centre. Last week on 3 March 2010 I was pleased to make an announcement about the centre, together with the Commonwealth Attorney General, a representative of the Australian Centre for International Commercial Arbitration and the New South Wales Chief Justice. Without their involvement, guidance and support, this centre would not have been possible.
The $600,000 facility at 1 Castlereagh Street, Sydney, will feature world-class communication, audiovisual and video-conferencing facilities, tribunal facilities, conference rooms and access to translation and transcription services. Work on the fit-out is due to start in March 2010. The Australian Centre for International Commercial Arbitration [ACICA] and the Australian Commercial Disputes Centre, jointly funded by the Commonwealth and New South Wales governments, will strengthen capacity for corporations to resolve disputes without the need for court action. According to the Director of the Australian Centre for International Commercial Arbitration, Professor Doug Jones, it is estimated that the direct and indirect economic benefits of the centre are:
likely to run into tens of millions of dollars each year. As well as the legal fees flowing to the centre and the legal services sector, there will be enormous flow-on for the professional services, hospitality, tourism and support sectors.
International investors want to avoid the uncertainty of litigation in a foreign court system with the associated lack of familiarity over processes. That is why ongoing reforms to arbitration laws at both State and Federal levels will create an international best practice legal framework for arbitration in Australia. In November 2009 the Federal Government introduced the International Arbitration Amendment Bill to increase the effectiveness, efficiency and affordability in international commercial arbitration. The Australian Government is also working with State and Territory Governments to draft a new model commercial arbitration bill based on the UNCITRAL Model Law on International Commercial Arbitration. These reforms provide the local framework for our highly skilled and internationally experienced Australian arbitrators to resolve disputes on Australian territory under Australian arbitration law.
It is becoming increasingly clear that people doing business in the Asia-Pacific are embracing arbitration as the forum to resolve disputes. This presents us with an opportunity to host international arbitration and to become a destination of choice in the Asia-Pacific region, especially given that Australia operates under a Western legal system that is proudly independent from government and is easily accessible, especially for English speakers. Sydney will be the place to go when businesses want their problems fixed in a fashion that is swift and fair.