Why your tribunal selection is the single biggest predictor of arbitration success — and how TRW helps you get it right from Dhaka, London, and Dubai.
Executive Summary
Selecting the “right” arbitrator is the most consequential decision you will make in international arbitration. It shapes the entire case—from procedure and tone to cost, timeline, and, ultimately, enforceability of the award. A superb case can be lost to weak case management; an average case can be won through disciplined process, fair hearing, and a well-reasoned award. This article distills TRW Law Firm’s practical approach to arbitrator selection across commercial and investment disputes, drawing on our cross-border practice in Bangladesh, the UK, and the UAE. We translate the typical talking points—impartiality, expertise, availability—into concrete, board-ready criteria and a repeatable selection workflow your team can adopt immediately.
We cover: (i) what arbitrators actually do and why their day-to-day decisions matter; (ii) the core selection criteria and how to weigh them; (iii) how choices differ for sole arbitrators vs. three-member tribunals; (iv) the due diligence that in-house teams should insist upon; (v) how seat, rules, sector, language, culture, and digital practices (including AI and data security) influence your shortlist; (vi) the cost and timeline impact of different arbitrator profiles; and (vii) a step-by-step selection playbook with checklists, sample questions, and a structured summary table you can print and use in your next matter.
Key message: An arbitration is only as strong as its tribunal. Treat arbitrator selection like a critical corporate hire—because that is precisely what it is.
1) What an Arbitrator Really Does (and Why It Decides Your Case)
Arbitrators do far more than “decide at the end.” From day one, the tribunal sets the pace, frames the issues, and shapes the evidence record on which the award will stand. Small tactical choices snowball into major outcomes.
The arbitrator’s invisible architecture
▪️ Procedural design: Timetables, page limits, sequencing (documents → memorials → witnesses → hearings), and expedition options (bifurcation, partial awards). These choices influence cost, momentum, and settlement leverage.
▪️ Evidentiary gatekeeping: What comes in, when, and how. Approaches to late evidence, privilege disputes, expert hot-tubbing, and adverse inferences vary widely.
▪️ Case management tone: Is the tribunal firm, fair, and focused—or permissive and delay-tolerant? Tone determines counsel behavior, discovery burden, and your legal spend.
▪️ Legal analysis and drafting quality: Even “winning” parties can lose at enforcement if reasoning is thin or the award mishandles public-policy or due-process concerns.
▪️ Cybersecurity & AI hygiene: Increasingly central to protecting the record and the legitimacy of the outcome. Tribunals now shape what tools may be used and how.
Bottom line: The arbitrator is the architect of your dispute’s life cycle. Choose the architect who builds the process your case needs.
2) The Business Case for a Good Arbitrator
a) Enforceability and risk management
A well-reasoned award that addresses each pleaded head of claim and defense, maps to the governing law, and shows due process discipline is dramatically easier to enforce under the New York Convention or equivalent regimes. Weakly reasoned awards, jurisdictional shortcuts, or process irregularities give oxygen to set-aside or refusal arguments.
b) Cost and time compression
Disciplined case management (e.g., sensible limits on document production, focused issues lists, and strict adherence to timetables) can reduce your external fees by 20–40% and calendar time by several months. Conversely, an overburdened or laissez-faire arbitrator often doubles both.
c) Settlement leverage
A tribunal that clarifies issues early and signals procedural firmness often catalyzes productive settlement windows (after the first major procedural order, post-expert reports, or following a partial award on liability).
d) Reputation and stakeholder optics
In high-stakes disputes—especially those touching governments, regulated sectors, or public markets—the credibility of the tribunal matters to investors, regulators, and counterparties. A respected chair or sole arbitrator helps stabilize expectations, even when the case is hard-fought.
3) Core Criteria for Selecting the Right Arbitrator
Below we present the criteria that TRW uses in shortlisting and ranking candidates, with practical “what to look for” signals you can verify before you nominate.
3.1 Impartiality and independence
▪️ No conflicts; clean disclosures: Prior engagements with parties, affiliates, experts, or counsel must be disclosed and immaterial.
▪️ Temperament under challenge: How has the arbitrator handled previous challenges or disclosures? Calm, transparent responses correlate with stability during heavy litigation weather.
▪️ Nationality sensitivity: For presiding or sole arbitrators, divergent nationality from the parties is often preferable to avoid perceived bias and downstream enforcement friction.
How to evaluate: Study disclosures patterns in past cases (where available), review public writings for tone, and survey counsel who have appeared before the arbitrator.
3.2 Legal and sector expertise
▪️ Governing law fluency: For commercial cases, look for comfort with the governing law and the lex arbitri (seat law). For investor-State matters, experience with treaty interpretation, public international law, and damages frameworks.
▪️ Industry literacy: In sectors like construction, energy, banking/derivatives, telecom/IT, or shipping, domain familiarity shortens hearings and sharpens findings.
▪️ Remedial craftsmanship: Some arbitrators write elegant, enforceable awards; others struggle with interest, currency, tax gross-up, or costs. Ask about remedial frameworks in their prior awards.
How to evaluate: Publications, prior awards (when accessible), conference interventions, and peer feedback. In construction or M&A earn-out disputes, look for prior fact-heavy case experience.
3.3 Procedural philosophy and management style
▪️ Due-process balance: Not “paranoid” (that invites delay) but serious about equal arms and right to be heard.
▪️ Efficiency toolkit: Willing to use issues lists, chess-clock hearings, and sensible page/time limits; open to expert hot-tubbing; readiness to bifurcate where it truly saves time.
▪️ Writing discipline: Timely, clear procedural orders; ability to synthesize voluminous submissions into structured findings.
How to evaluate: Ask references how the arbitrator handled timetable slippage, late evidence, and oral advocacy. Look for consistent firmness—never theatrical severity.
3.4 Availability and caseload
▪️ Calendar realism: Confirm the arbitrator’s current pipeline and hearing windows.
▪️ Institutional expectations: Some rules now require availability declarations—press for specifics.
▪️ Secretarial support: Robust case-management support correlates with timely awards.
How to evaluate: Request projected award timeline for your case profile. Probe for recent award issuance intervals.
3.5 Language and cultural fluency
▪️ Working language proficiency: Eliminates translation fog and reduces post-hearing briefs spent correcting misunderstandings.
▪️ Cultural awareness: Especially where parties come from different legal traditions (common vs. civil law) or distinct business cultures (South Asia, Middle East, Europe).
How to evaluate: Check hearing experience with similar party profiles and comfort with non-native English advocacy.
3.6 Cybersecurity, confidentiality, and AI policy
▪️ Secure systems: Document handling, encrypted platforms, and clear instructions about witness data and export controls.
▪️ AI transparency: Tribunals should set boundaries on AI usage (by the tribunal and parties), address confidentiality, and ensure that any tool use does not substitute human judgment.
▪️ Sanctions and data-residency sensitivity: Especially in cross-border matters touching restricted jurisdictions.
How to evaluate: Ask how the arbitrator manages data security, what tools are used for virtual hearings, and whether the tribunal issues AI/cyber protocols at PO1.
3.7 Costs discipline and fee transparency
▪️ Predictable fee model: Rates, administrative fees, and expected hours by phase; realistic cost-to-complexity linkage.
▪️ Costs awards philosophy: How the tribunal allocates costs (costs-follow-the-event vs. apportionment; treatment of unreasonable conduct).
How to evaluate: References on costs orders; look for openness to awarding costs against dilatory tactics.
3.8 Diversity and fresh perspective
▪️ Avoid the “usual suspects only” trap: A repeat-player comfort zone reduces perspective diversity and can lower morale among stakeholders who expect modern, inclusive tribunals.
▪️ Rising arbitrators: Well-qualified mid-career arbitrators often bring speed, focus, and writing energy.
How to evaluate: Balanced slates—combine established gravitas (especially for chair) with dynamic, sector-fluent co-arbitrators.
4) Sole Arbitrator vs. Three-Member Tribunal: How Your Choice Changes
4.1 Sole arbitrator
When the contract or stipulation calls for a sole arbitrator, your selection leverage is concentrated. The arbitrator’s substantive worldview and procedural habits directly become your case reality.
For sole arbitrators, prioritize:
▪️ Cross-disciplinary fluency: Capable of synthesizing law, facts, and technical evidence unaided.
▪️ Drafting horsepower: A sole arbitrator writes alone—look for crisp, structured, citation-literate awards.
▪️ Time management: Single-person throughput must match case complexity and deadlines.
▪️ Perceived neutrality: Because there is no panel balance, neutrality optics matter even more for enforcement comfort.
4.2 Three-member tribunal
Here, you appoint one arbitrator, your opponent appoints one, and the two appoint a chair (or an institution does). You are optimizing panel dynamics as much as individual merit.
For three-member tribunals, prioritize:
▪️ Complementarity: Legal, sector, and cultural balance across the panel.
▪️ Chair leadership: A chair who builds consensus, writes well, and holds the timetable.
▪️ Interpersonal fit: Collegiality among arbitrators; mismatched temperaments cause drift and divided awards.
▪️ Strategic seat alignment: Choose arbitrators comfortable with the seat’s supervisory court posture and procedural expectations.
5) The TRW Selection Workflow (Step-by-Step)
Below is the 8-step playbook we run with clients. It is designed for repeatable use and board visibility.
▪️ Caseload reality check: Hearing windows, prior award issuance timelines.
▪️ Style references: Counsel and co-arbitrator interviews on tone and writing.
▪️ Digital hygiene: Cyber/AI protocols used in recent cases.
Step 5 — Shortlist (3–5 names)
▪️ Rank by weighted score; document rationale for governance.
▪️ Map complementary pairs if a three-member tribunal is anticipated.
Step 6 — Sounding and availability
▪️ Through permitted channels (typically via institutions), confirm availability and willingness.
▪️ Avoid substantive contact; preserve integrity of the appointment process.
Step 7 — Nomination strategy
▪️ For three-member tribunals: select your party-appointed arbitrator and propose principled profiles for chair to guide co-selection.
▪️ For sole arbitrators: prepare a reasoned nomination note that anticipates any neutrality objections.
Step 8 — Onboarding and PO1 strategy
▪️ Enter with a draft Procedural Order No. 1 proposal addressing timetable, issues lists, document production, expert process, hearing format, cybersecurity, and AI usage policy.
▪️ Start as you mean to continue: clarity and discipline in the first month pays dividends all year.
6) Sector-Specific Nuances That Change Your Shortlist
6.1 Construction & infrastructure
▪️ Evidence load: Expect large technical records; prefer arbitrators experienced with expert hot-tubbing and delay/quantum methodologies.
▪️ Remedies: Variations, prolongation, disruption, and liquidated damages—choose chairs who can parse schedule analyses and damages causation.
6.2 Energy & natural resources
▪️ Stabilization, price review, force majeure: These clauses require doctrinal nuance and commercial realism.
▪️ States and SOEs: Optics of neutrality and public-policy sensitivity loom larger; drafting needs careful proportionality analysis.
▪️ Confidentiality & cybersecurity: Heightened importance due to market sensitivity and regulatory overlay.
6.4 Technology, telecoms & data
▪️ IP and data issues: Comfort with technical evidence, software delivery metrics, licensing, and data-residency constraints.
▪️ AI-adjacent disputes: Tribunals must be conversant with algorithmic evidence and discovery limits.
6.5 M&A, JV & shareholder disputes
▪️ Earn-outs and warranties: Fact-heavy with accounting and valuation evidence; prefer arbitrators experienced with accountant experts and governance dynamics.
▪️ Interim measures: Chairs who act decisively on status quo protections can prevent irreversible harm.
7) Seat, Rules, and Their Impact on Your Choice
7.1 The seat (lex arbitri)
The supervisory court’s approach to due process, interim measures, confidentiality, and set-aside standards directly affects award resilience. Choose arbitrators who have worked comfortably under the chosen seat—and draft early procedural orders to align with that court’s expectations.
7.2 Institutional rules (ICC, SIAC, LCIA, etc.)
Institutions differ in case management tools (terms of reference, expedited tracks, emergency arbitration), costs regimes, and scrutiny of awards. An arbitrator who “knows the machinery” will avoid missteps and leverage the institution to keep the case on track.
8) Drafting, Costs, and the Science of a Good Award
8.1 Anatomy of an enforceable award
▪️ Jurisdictional clarity: Each objection addressed and resolved.
▪️ Issues list alignment: Findings organized by the parties’ pleaded issues.
▪️ Reasoning sufficiency: Transparent logic; no “black box” leaps.
Tribunals increasingly reward procedural discipline and punish obstruction. Your arbitrator’s philosophy here materially affects net outcome. We favor arbitrators who: (i) record procedural history tightly; (ii) link costs to conduct; and (iii) explain apportionment.
9) People Management: The Quiet Superpower
Great arbitrators manage people as well as law. They:
▪️ Keep advocates focused without humiliating them.
▪️ Create psychological safety so witnesses answer honestly.
▪️ Defuse brinkmanship before it derails the schedule.
▪️ Use plain, respectful language that multinational teams understand.
When interviewing references, ask specifically about hearing room dynamics. You are buying leadership as much as legal skill.
10) Digital-First Tribunals: Virtual Hearings, Evidence Platforms, and AI
10.1 Virtual and hybrid hearings
Your arbitrator should set rules for time-zones, witness integrity (no prompting), and backups for connectivity failures. The tech stack (transcription, exhibit handling) must be secure and simple.
10.2 AI guardrails
Arbitrators may use AI for admin tasks (e.g., timeline housekeeping) but should never outsource adjudicative judgment. Clear protocols reduce later challenges alleging over-reliance. Ask candidates how they approach AI and disclosure about tool usage.
10.3 Cybersecurity
Expect encryption, access controls, and instructions on handling personal data and export-controlled material. Tribunals should be ready to issue a dedicated Cybersecurity & Privacy Protocol as part of PO1.
11) Red Flags (and What to Do if You See Them)
▪️ Chronic award delays without credible justification.
▪️ Evasive disclosures or a pattern of late “supplementary” disclosures.
▪️ Over-accommodation of dilatory tactics in the name of “fairness.”
▪️ Unstructured hearings with minimal intervention on relevance or time-keeping.
▪️ Inflexible ideology (e.g., resolutely anti-bifurcation regardless of case fit).
▪️ Opaque drafting style that leaves stakeholders guessing at key findings.
Mitigations: Re-calibrate at PO1, request issues lists, propose chess-clock, seek partial awards where helpful, or (in extreme cases) consider challenge/ replacement under the governing rules.
12) How TRW Tailors Arbitrator Choice Across Jurisdictions
12.1 Bangladesh-anchored disputes
We blend local commercial realities with international enforcement needs. We look for arbitrators who handle document-heavy records, understand regional contracting practices, and maintain firm timetables that respect fiscal year ends and supply-chain clock speeds.
12.2 London-seated proceedings
Our London hub privileges chairs with award craftsmanship and comfort with English law’s remedial precision (interest, costs, mitigation). We also emphasize data security and sensitivity to English court supervisory expectations.
12.3 Dubai/MENA matters
We look for tribunals familiar with civil-law sensibilities, Arabic/English bilingual advocacy, and public-policy contours in energy, construction, and distribution disputes. We prize culturally fluent case management and robust virtual hearing capability.
13) FAQs We Hear From General Counsel
Q1: Should we always avoid arbitrators who have previously acted for our counterparty? Not automatically. The test is independence and disclosure, not unfamiliarity. Prior, remote work of limited scope is not disqualifying if fully disclosed and immaterial. What matters is whether a reasonable third party would see a real risk of bias.
Q2: Are ex-judges always the safest choice? Ex-judges bring gravitas and drafting quality. But some have limited comfort with private, party-driven procedure and global business evidence. For fact-dense, technical cases, a seasoned commercial arbitrator (or a chair plus a technical co-arbitrator) can outperform.
Q3: How many cases is “too many” for an arbitrator to handle? There is no magic number; it depends on case size and secretarial support. We look at hearing windows, award issuance cadence, and responsiveness. If award times stretch beyond institutional expectations without complexity justification, we exclude.
Q4: Can we influence the chair choice in a three-member tribunal? Indirectly, yes. By nominating a respected, collaborative party-appointed arbitrator and articulating a principled chair profile, you shape the peer selection.
Q5: Does diversity really affect outcomes? Diversity improves deliberation quality and stakeholder legitimacy. It reduces echo chambers and increases the chance that the tribunal hears your case in full color, not grayscale.
14) A Sample Case Study (Hypothetical, Names Generic)
Context: A Bangladeshi infrastructure company (“Delta Build Co.”) and a GCC developer (“Al-Nour Holdings”) dispute EOT, variations, and liquidated damages under a FIDIC-based EPC. Seat London, rules of a major institution, English governing law. Documentary record > 200,000 pages; delay and quantum experts on both sides.
TRW approach:
Profile definition: We weighted case management and construction literacy at 60% combined, with award craftsmanship at 25%, and availability at 15%.
Shortlist: Five candidates—two senior construction arbitrators (one civil-law, one common-law), one rising proceduralist with heavy hearing discipline, and two ex-judges with strong drafting pedigrees.
Outcome: We nominated a mid-career construction specialist as our party-appointed arbitrator (known for expert hot-tubbing and crisp PO1s). The co-arbitrators selected a seasoned English chair renowned for structured awards.
Process features: Early issues list, limited document production keyed to delay/causation, concurrent expert evidence, and firm post-hearing brief schedule.
Result: Timely final award with granular delay analysis and lucid damages reasoning—readily enforceable and respected by both sides.
15) The In-House “Quick Win” Toolkit
When time is short and stakes are high, use this condensed set of moves:
▪️ One-page case architecture (issues, law, seat, rules, evidence volume).
▪️ Weighted criteria (100-point matrix).
▪️ Five-name longlist spanning gravitas and fresh perspective.
▪️ Availability confirmation with hearing window and award timeline.
▪️ PO1 starter draft including AI/cyber protocols and issues list.
16) Why TRW (Tahmidur Remura Wahid) Is Asked to Do This Work
▪️ Cross-border coverage: Dhaka, London (High Holborn), Dubai—arbitration seats and enforcement perspectives that matter for South Asia–MENA–Europe deal flows.
▪️ Process obsession: We treat tribunal selection like executive search—criteria, diligence, references, and onboarding.
▪️ Award craftsmanship focus: We bias toward arbitrators who write well and on time—because enforceability is the final KPI.
If you’re scoping a dispute or redrafting arbitration clauses, the best time to think about the arbitrator is before the dispute arises. We regularly refresh clients’ clause banks to reflect the seats, rules, and appointment methods that suit their risk profiles.
▪️ Are we prepared with a reasoned nomination note that anticipates neutrality concerns?
Conclusion
Selecting the right arbitrator is not a formality; it is strategy in its purest form. The tribunal you craft determines the discipline of your process, the clarity of your hearing, the quality of your award, and the ease of enforcement. Treat selection with the rigor of executive recruitment—define the role, score the candidates, check references, confirm availability, and onboard with a robust PO1. Combine gravitas with energy, diversity with fit, and doctrinal mastery with managerial calm.
At TRW, we believe that good tribunals make good cases better—and bad tribunals make good cases longer, costlier, and riskier. If you are preparing for a dispute or re-tooling your arbitration clauses, our cross-border team in Dhaka, London, and Dubai can help you build tribunal strategies that travel well and enforce even better.
Summary Table: Choosing the Right Arbitrator (Board-Ready)
Criterion
Why It Matters
What to Look For
Red Flags
TRW’s Playbook Move
Impartiality & Independence
Enforceability and legitimacy of the process
Clean disclosures; calm handling of challenges; neutral nationality for chair/sole where advisable
Evasive or serial late disclosures; visible partisanship
Arbitration in Bosnia and Herzegovina — A TRW Law Practical Guide for Businesses and Counsel (2025)
By Tahmidur Remura Wahid (TRW) Law Firm — International Arbitration
Bosnia and Herzegovina (BiH) presents a distinctive arbitration landscape shaped by its post-Dayton constitutional structure, economy in transition, and a multi-layered court system. While the country recognizes and enforces foreign arbitral awards under the New York Convention and has working arbitral institutions, arbitration remains comparatively underused. For cross-border counterparties and investors, this means two things: (i) there is legal infrastructure to arbitrate effectively; and (ii) success turns on disciplined clause drafting, seat selection, and enforcement strategy.
This deep-dive guide explains how arbitration works in Bosnia and Herzegovina, what to watch out for, and how to structure and run an arbitration seated in BiH—or involving Bosnian counterparties—with the fewest surprises and the highest chance of a collectable outcome. It is written for general counsel, transaction leads, and disputes lawyers who need a single, practical reference.
For how our teams run complex cross-border arbitrations globally (ICC, LCIA, ICSID, SIAC, SCC, UNCITRAL, DIAC, HKIAC, SCCA, ICDR) see: International Arbitration at TRW.
1) Legal Architecture at a Glance
Bosnia and Herzegovina is a state composed of two entities—the Federation of Bosnia and Herzegovina (FBiH) and the Republika Srpska (RS)—plus the Brčko District (BD). Each has its own Civil Procedure Act (CPA) provisions on arbitration that broadly mirror the UNCITRAL Model Law approach:
Federation of BiH CPA (2003) — arbitration provisions typically found in Articles 434–453 Republika Srpska CPA (2003) — counterpart provisions, Articles 434–453 Brčko District CPA (2018) — Articles 427–446
Although titles and article numbers differ slightly by entity, the core mechanics are aligned: arbitration agreements must be in writing; tribunals derive competence from party consent; courts have supporting and supervisory roles; and awards are generally binding and enforceable.
Implication for practitioners: Drafting and strategy should assume Model-Law-style principles but must account for entity-specific procedures and local court practice when seeking interim measures, annulment, or enforcement.
2) Institutions and Rules You Will Encounter
Bosnia and Herzegovina has two principal arbitral forums for commercial disputes:
Arbitration Court at the Foreign Trade Chamber of Bosnia and Herzegovina (Sarajevo).
Foreign Trade Arbitration at the Chamber of Commerce of the Republika Srpska (Banja Luka).
Both administer domestic and international commercial disputes and provide sets of institutional rules, with case management that is familiar to parties versed in European arbitration practice. Parties remain free to choose ad hoc arbitration (e.g., under UNCITRAL Rules) or to designate foreign institutions (ICC, VIAC, Swiss Rules, LCIA, etc.) with seats inside or outside BiH.
Practical note: Because arbitration usage domestically remains moderate, tribunal selection is the single most important decision after seat and law. Whether you arbitrate under local institutional rules or international rules, ensure the arbitrator profile matches your dispute (EPC delay, valuation, M&A earn-out, commodities, etc.) and is conflict-resilient for enforcement.
3) Arbitration Agreements Under BiH Law
3.1 Formal Requirements
An arbitration agreement must be in writing and signed (or otherwise evidenced in writing), covering present or future disputes arising out of a defined legal relationship. This mirrors global norms, but practitioners should avoid pathological clauses (conflicting institutions, undefined seat, vague scope).
Drafting best practices for BiH counterparties:
Identify institution and rules unambiguously.
Specify seat (legal place) and language.
Clarify number of arbitrators (one vs. three) and the appointment method.
Include governing law for the contract and (optionally) allow ex aequo et bono only if truly intended.
3.2 Annulment-Like Interference at the Agreement Stage
Federation CPA provisions allow a party, in certain circumstances, to seek court intervention that can undermine an arbitration agreement—e.g., where a named arbitrator cannot or will not act, or where parties cannot agree on an arbitrator and decline to request a court appointment. Poor drafting that names an unavailable arbitrator without a fallback can create delay.
TRW drafting fix: Always specify a default appointment path (e.g., through the chosen institution or failing that the president of the local chamber’s arbitration court / another appointing authority). Avoid naming a single individual arbitrator in the clause; list an appointing mechanism instead.
4) Choice of Law, Seat, and Language
4.1 Substantive Law
Parties are free to choose the governing law for the substance. Bosnian tribunals will usually apply that choice, subject to mandatory rules and public policy.
4.2 Ex Aequo et Bono
Some BiH provisions allow decision ex aequo et bono (equity) if expressly agreed. This can aid settlement in relational contracts but complicates enforcement if reasoning seems detached from positive law. Use sparingly.
4.3 Seat and Language
There are no rigid statutory seat/language rules; party autonomy prevails. Failing agreement, the tribunal decides. If you need pro-arbitration court support, weigh Sarajevo, Banja Luka, or Brčko practices—or designate a foreign seat (e.g., Vienna, Zurich, Paris) with hearings in BiH.
Seat strategy:
BiH seat if you need proximity to evidence/witnesses, local interim measures, and localized cost.
Foreign seat if you expect set-aside litigation and want predictable pro-arbitration courts with global credibility (helpful at recognition abroad).
5) Recognition and Enforcement (Domestic & Foreign Awards)
Bosnia and Herzegovina is a party to the New York Convention, with commercial reservation and reciprocity reservation. In practice, this means:
BiH recognizes and enforces foreign awards from other Convention states;
Enforcement applies to disputes considered “commercial” under BiH law.
Procedure: Enforcement of foreign awards is governed by Conflict of Laws Act provisions (e.g., Chapter IV). Local courts will check standard grounds (invalid agreement, due process, excess of mandate, public policy, etc.).
Enforcement tips:
Front-load due process hygiene—service records, opportunity to be heard, translations.
Draft clear dispositive language in awards (sum certain, interest from date X at rate Y, costs allocation).
Map attachable assets early (state-owned or private), and consider parallel recognition in EU/EEA/UK where counterparties hold value.
6) Annulment (Set-Aside) of Awards
Annulment petitions (e.g., in FBiH CPA Articles 450–452) are typically limited to Model-Law-style grounds and must be brought promptly (often within 30 days of receipt). The competent court is the one that would have had jurisdiction at first instance had there been no arbitration.
Practice pointer: Draft procedural orders and the award to survive set-aside scrutiny. Tribunals should articulate jurisdiction, due process observance, scope of mandate, reasoning on each claim/defense, and a costs rationale tethered to submissions.
7) Investor-State and Public-Law Interfaces
Multiple investor-State arbitrations have involved Bosnia and Herzegovina, underscoring that:
Regulatory commitments and concession frameworks must be honoured;
Foreign investors can access treaty protections (FET, expropriation, FPS) depending on BIT/ECT coverage;
Annulment and enforcement strategy is decisive where public budgets and political economy are engaged.
If your counterparty is a public entity:
Examine separate legal personality and execution immunity questions up front;
Draft relief that is enforceable (monetary plus declaratory), and gather asset intelligence early.
8) Common Pain Points (and How to Neutralize Them)
Clause Pathologies — Conflicting institutions or missing seat. Fix: Clear institution/rules; seat; number of arbitrators; appointing authority fallback.
Named-Individual Arbitrator Unavailable — Clause deadlock. Fix: Use an appointing authority instead of a single named person.
Jurisdictional Ambiguity — Disputes carved out as “non-arbitrable” or under exclusive local court jurisdiction. Fix: Confirm commercial nature and scope; avoid public-law carve-outs unless intended.
Enforcement Shock — Award obtained, value not realized. Fix:Asset mapping from day one; recognition venues lined up; interest mechanics nailed down.
9) Choosing One vs. Three Arbitrators
One arbitrator: lower fees, quicker, but higher variance risk if the arbitrator’s sector fit is weak.
Three arbitrators: costlier, slower, but peer review inside tribunal reduces outlier reasoning and produces enforcement-ready awards.
TRW matrix: We model your quantum, complexity, novelty, and enforcement vectors. For high-impact infrastructure/EPC or investment-heavy disputes, three is often worth it.
10) Interim Measures and Emergency Relief
Bosnian courts and tribunals can grant interim measures (preservation, status quo, security). If seated in BiH, plan local counsel coordination for court-assisted measures (e.g., freezing accounts, securing evidence). If seated abroad, tribunals may still order interim measures enforceable via local courts—timing and translation are key.
Emergency arbitrator provisions depend on the chosen institutional rules. If you anticipate dissipation or plant shutdown risk, prepare emergency filings in parallel with your Notice.
11) Evidence, Language, and Translation Strategy
Bosnian/Croatian/Serbian (BCS) documents and testimony are common; English-language contracts are also frequent in cross-border deals. Poor translation is the silent killer of credibility.
Our controls:
Bilingual master index; uniform terminology; QC loop between legal and translation teams;
Targeted document production via Redfern schedules;
Short, document-anchored witness statements;
Early expert retention (delay, valuation, accounting) so quantum evolves with the facts.
12) Institutions vs. Ad Hoc: Which to Choose?
Local institutions (Sarajevo/Banja Luka): proximity, language, potentially lower cost, familiarity with local counsel and evidential practices.
Foreign institutions (ICC/VIAC/Swiss/London): brand credibility, predictable administration, deeper arbitrator pool, and award robustness for recognition abroad.
Ad hoc (UNCITRAL): flexible and cost-sensitive, but requires a disciplined procedural framework and a cooperative counterparty (or a strong chair).
Rule of thumb: If your counterparty’s assets lie outside BiH or you anticipate set-aside fights, an international institution with a foreign seat can improve enforceability optics. If speed and cost control near the project site matter most, a local seat with a carefully selected tribunal can work well.
13) Sector-Focused Notes
13.1 Energy & Infrastructure (EPC/FIDIC)
Expect critical path analysis, concurrency debates, change orders, and LDs. Draft claims from the schedule backwards. Use window analysis and contemporaneous logs.
13.2 Manufacturing & Heavy Industry
Warranty regimes, specifications, acceptance testing, and bonds are pivotal. Be precise on technical standards and remedial powers in both contract and pleadings.
13.3 M&A / Shareholder / JV
Earn-outs, warranty breaches, disclosure letters, and post-closing covenants drive value. Prepare forensic accounting and board-deck discovery early.
13.4 Trade & Logistics
Quality/quantity disputes, demurrage, sanctions overlays. Preserve sampling protocols and maintain clean chain of custody.
14) Costs, Timelines, and Budget Control
Arbitration in or involving BiH can be cost-efficient compared with major Western seats, but budget variance arises from tribunal formation, translation, and expert work.
TRW’s discipline:
Stage-gated plan (Notice/Answer; Document Production; Witness/Experts; Hearing; Post-Hearing).
Monthly dashboards: burn vs. plan, probabilistic outcomes, and enforcement readiness.
A mid-complexity, three-arbitrator case can often reach hearing in 10–14 months with disciplined case management; documents-only or expedited routes may be faster.
15) Model Clauses (Bosnia and Herzegovina Counterparties)
Institution + Seat (Local)
“Any dispute arising out of or in connection with this contract shall be finally settled by arbitration administered by the Arbitration Court at the Foreign Trade Chamber of Bosnia and Herzegovina in accordance with its Rules in force on the date of commencement. The seat of arbitration shall be Sarajevo, Bosnia and Herzegovina. The tribunal shall consist of three arbitrators. The language of the arbitration shall be English. This contract shall be governed by the law of [choose: FBiH / RS / BD or another system], excluding its conflict of laws rules.”
Institution Abroad + Local Hearings
“Any dispute… shall be finally settled under the [ICC/VIAC/Swiss Rules]. The seat shall be Vienna. The tribunal shall consist of three arbitrators. The language shall be English. Hearings and witness examinations may take place in Sarajevo/Banja Luka/Brčko. The governing law is [X].”
Ad Hoc (UNCITRAL) with Appointing Authority
“Any dispute… shall be settled by arbitration under the UNCITRAL Arbitration Rules. The appointing authority shall be the [VIAC/Swiss Arbitration Centre/President of the Chamber’s Arbitration Court]. The seat shall be Sarajevo. There shall be one/three arbitrator(s). The language shall be English. Governing law: [X].”
Do not name a single individual arbitrator in the clause. Always include an appointing authority fallback.
16) Running the Case: TRW’s Playbook for BiH Disputes
PO-1 discipline. Arrive with a complete draft (schedule, Redfern template, privilege/confidentiality ring, hearing protocol).
Evidence engineering. Build bilingual timeline, master index, and translation glossary; lock in expert scopes.
Mediation timing. Where appropriate, mediate post-disclosure or after expert exchanges, when risk is priceable.
Enforcement from day one. Identify attachable assets, immunity issues, and parallel recognition venues.
17) Frequently Asked Questions
Q1: Is arbitration “trusted” by BiH courts? Courts generally respect party autonomy and the New York Convention. As always, outcomes vary by judge and record quality. Due process hygiene and award clarity are pivotal.
Q2: Can I get interim measures before the tribunal forms? Yes—through courts at the seat (and in some cases before or alongside tribunal appointment). Draft narrow, evidence-backed requests with enforceable terms.
Q3: Should I seat the case in BiH or abroad? If enforcement abroad is your endgame and you expect set-aside skirmishes, a foreign pro-arbitration seat may help. If proximity, language, and cost matter, a BiH seat with a carefully chosen tribunal works well.
Q4: How do deposit and fee logistics work? Institutional rules govern deposits. If the respondent refuses to pay its share, you can advance to keep the case alive and seek cost shifting later.
Q5: Are public-law disputes arbitrable? Classic commercial disputes are; public-law/administrative matters may not be. Scrutinize scope and consider treaty arbitration for investor-State issues.
18) Case-Handling Scenarios (Illustrative)
A) EPC Delay & LDs on a Hydropower Project (FBiH entity)
Seat: Sarajevo; Rules: Local institutional
Issues: EOT entitlement, concurrency, LDs, force majeure
Strategy: Window analysis + scheduler expert; Redfern requests tied to monthly progress; bifurcate liability/quantum; early mediation after expert first round
Strategy: Forensic accounting; disclosure of board packs; precise damages model; focused cross on accounting assumptions
Outcome Goal: Earn-out tranche release + interest + costs; enforceable in EU
C) Supply Contract with Parallel Court Attachments (BD)
Seat: Brčko; Rules: UNCITRAL ad hoc with appointing authority
Issues: Non-conforming goods; bond draw; urgent status quo
Strategy: Court interim relief for bond restraint; emergency arbitrator (if available under agreed protocol); documents-only merits if narrow on liability
Confirm commercial nature and arbitrability of the dispute. Audit clause: institution, rules, seat, language, number, appointing authority. Decide seat strategy (BiH vs. foreign) based on set-aside and enforcement vectors. Draft Notice with persuasive but flexible narrative; annex key documents. Prepare emergency measures file (if needed). Build PO-1 and Redfern templates; propose pragmatic calendar. Run arbitrator intelligence; plan strikes/rankings for list method. Lock translation controls (glossary, bilingual index). Retain experts early (delay, valuation, accounting). Map assets; plan parallel recognition venues. Keep a mediation track alive; target timing by evidential maturity.
23) Conclusion
Arbitration in Bosnia and Herzegovina is viable, but it rewards precision. With three overlapping procedural regimes, developing institutional practice, and a judicial culture that is broadly respectful of arbitration yet still maturing, strategy and drafting decide outcomes as much as the merits. Choose the right seat, build the right tribunal, engineer procedure from PO-1, and design enforcement from day one. Done well, you can obtain timely, enforceable relief against Bosnian and international counterparties—without losing years to procedural detours.
If you are evaluating an arbitration clause for a Bosnia-linked contract, preparing to file, or facing a demand as respondent, our international arbitration team can move fast to stabilize the situation, frame the case, and protect value.
Contact TRW — International Arbitration
Tahmidur Remura Wahid (TRW) Law Firm International Arbitration — Bosnia and Herzegovina and Global
Global Offices Dhaka: House 410, Road 29, Mohakhali DOHS Dubai: Rolex Building, L-12 Sheikh Zayed Road London: 330 High Holborn, London WC1V 7QH, United Kingdom
TRW Recognized Among the World’s Leading International Arbitration Firms in the GAR 100 (2025)
Prepared by Tahmidur Remura Wahid (TRW) Law Firm — Dhaka • Dubai • London
TRW is delighted to announce its inclusion in the 2025 edition of the Global Arbitration Review (GAR) 100, the annual guide to the world’s top international arbitration practices. The recognition reflects TRW’s consistent results across complex, high-value disputes, its client-first culture, and a global practice that spans commercial and investor-state arbitration.
This milestone underscores our long-standing commitment to combining world-class advocacy with pragmatic strategy and cost discipline. It also reflects the trust of our clients across Asia, the Middle East, Europe, Africa, and North America who routinely turn to TRW for disputes that cross borders, industries, and legal systems.
If you’d like to discuss a live matter or request a conflict-free assessment within 24 hours, please visit International Arbitration or Contact TRW.
What the GAR 100 Recognition Signals
The GAR 100 is widely regarded as the definitive, data-driven survey of leading arbitration firms. Rankings reflect a rigorous appraisal of:
Track record: Outcomes in recent arbitrations under major rules (ICC, LCIA, SIAC, DIAC, HKIAC, SCC, ICSID, UNCITRAL, LMAA, among others).
Client feedback: Independent references from in-house teams and dispute resolution leads.
Team depth: Advocacy strength, sector fluency, and multilingual capability.
Global footprint: Ability to run cases seamlessly across seats, languages, and time zones.
TRW’s place in the 2025 GAR 100 validates our core proposition: elite advocacy with transparent economics, executed by a team that blends common- and civil-law experience with sector-specific know-how.
Why Clients Choose TRW for International Arbitration
1) Advocacy that moves the needle
We conduct our own advocacy from the outset. That means your strategy isn’t fragmented between case theory and courtroom execution. It also means tighter timelines, coherent messaging, and reduced cost.
2) Enforcement thinking from Day One
A good award is only valuable if it converts to cash or relief. We design cases with enforcement at the center—mapping counterparty assets, receivables, banking relationships, and execution paths across jurisdictions. See Enforcement of Arbitral Awards.
3) Sector fluency
From energy and infrastructure to financial services, TMT, healthcare, maritime, and consumer goods, TRW teams pair arbitration experience with genuine sector knowledge, ensuring that evidence, experts, and damages models are persuasive to tribunals.
4) Global, multilingual delivery
With Dhaka, Dubai, and London as anchors, TRW operates seamlessly across time zones. Our lawyers work in English and additional regional languages, and we’re used to mixed law backgrounds on tribunals and opposing counsel.
5) Transparent, value-driven fees
We align budgets with inflection points that decide cases—focused written advocacy, expert clarity, targeted document production, and efficient hearings—without wasteful process.
While specific client names are often confidential, the matters below illustrate the scale and diversity of disputes handled by TRW over the last cycle:
Construction & Energy (Middle East): Acting for a specialist subcontractor in an ICC arbitration seated in London concerning a major refinery project in Oman. Dispute centered on unpaid invoices, retention, delay and disruption, and economic duress arising from unilateral scope changes. The matter settled on favorable terms before the merits hearing following targeted document production and a tribunal-endorsed timetable. See Construction Arbitration.
Financial Services (Asia–US corridor): Defending multiple Asian respondents in an ICDR arbitration governed by New York law. The claimant pursued the extension of the arbitration clause to non-signatories through agency and alter-ego theories. TRW’s jurisdictional strategy and procedural posture resulted in no payment liability for the respondents.
Technology & Distribution (South Asia): SIAC arbitration involving termination rights, performance metrics, and price-review mechanics in a long-term distribution agreement. Achieved phased relief and a structured settlement that stabilized the client’s supply chain.
Shareholder & JV Disputes (EU–MENA): LCIA arbitration over earn-out mechanics, MAC clauses, and competing valuation models. The tribunal adopted TRW’s issue sequencing, streamlining expert work and reducing hearing time by half.
Investor-State Advisory: Treaty structuring and pre-dispute counseling for investors entering energy and telecom verticals in emerging markets, with emphasis on most-favoured nation (MFN) leverage and umbrella clause coverage.
Arbitrator intelligence: Shortlists tailored to the dispute’s legal and technical profile.
Evidence that persuades
Measured-mile and windows analysis for construction delay.
Valuation and damages aligned with tribunal expectations, not just academic models.
Document discipline: Clear evidentiary spines; targeted, material document production instead of sprawling discovery.
Hearing engineering
Chess-clock time management, expert hot-tubbing where appropriate, and hybrid hearings that respect time zones and budgets.
Post-hearing precision: Briefs that link transcript page/line to outcomes, paired with proportionate and well-evidenced costs submissions.
Settlement as a deliberate design
We build off-ramps into the timetable—neutral quantum sessions, without-prejudice windows, and staged security—so that clients can settle on advantageous terms without sacrificing momentum.
If you want us to pressure-test a live strategy, reach out via Contact TRW.
What Clients Say (Selected Themes)
“Clarity at speed”—TRW’s pleadings and expert briefs made it easy to make decisions internally.
“Leverage without theatrics”—pressure points were identified early; settlement followed a predictable path.
“Costs aligned with outcomes”—budgets tracked the issues that mattered and were revised only when the case geometry changed.
To discuss references with similar fact patterns, use Contact TRW.
Our Team
TRW’s arbitration group includes counsel qualified across multiple jurisdictions, with deep training in both common-law and civil-law systems. Team members have acted as advocates and tribunal secretaries, and some regularly sit as arbitrators, offering a 360° view of what convinces a tribunal.
We are grateful to our clients for their trust, to our co-counsel and experts for their partnership, and to the broader arbitration community for collegiality and critique—both sharpen our work. TRW’s place in the GAR 100 (2025) is, above all, a recognition of our clients’ boldness and our team’s daily commitment to clarity, precision, and results.
For press and speaking engagements, or to request a confidential consultation, please visit Contact TRW.
TRW Contact & Offices
Tahmidur Remura Wahid (TRW) Law Firm — International Arbitration & Enforcement Dhaka • Dubai • London
Arbitrators’ Discretion in Awarding Costs: Are There Any Limits?
A TRW Law Firm deep dive with London & Dubai perspectives—built for in-house counsel, deal teams, and arbitration users who want predictability
Why this matters: In most international arbitrations, the cost order is the last—and sometimes the most consequential—line of the award. It can transform a paper win into a net loss, or salvage a partial defeat. Yet the rules that govern costs are famously elastic: institutions grant tribunals wide latitude, seats differ, and the parties’ own conduct often tips the scale. This guide distils best practice from diverse seats and rules and translates it into actionable tactics you can deploy from day one. Who we are: TRW’s teams in Dhaka, London and Dubai build cost strategies into the case architecture from the first draft of Procedural Order No. 1 to the last page of the award. Explore our related services: International Arbitration & Dispute Resolution, Investment Disputes & ICSID, and Corporate & Commercial Contracts.
1) The lay of the land: costs in international arbitration are a policy choice masked as discretion
Unlike merits issues, costs are rarely dictated by hard law. Most modern rules empower tribunals to award arbitration costs (institutional and tribunal fees, hearing logistics) and decide party costs (legal fees, experts, witnesses, document management, translation, travel) with broad discretion, subject to any agreement of the parties and mandatory law at the seat. In practice, that discretion plays out along three axes:
Allocation model:
“Costs follow the event” (the net winner recovers a substantial share) — dominant in international practice and familiar to English and many civil-law lawyers.
“Each party bears its own” — more common in certain domestic systems, but still seen when tribunals aim to preserve access to justice or when both sides behaved poorly.
Calibration method:
Binary winner-takes-most (common-law instinct).
Issue-by-issue apportionment (civil-law instinct), adjusting to relative success.
Behaviour-based adjustments for efficiency, cooperation, proportionality, and bad faith.
Reasonableness filter:
Even under loser-pays, tribunals scrutinise rates, staffing, hours, duplication, and necessity.
They compare spend to stakes and complexity, and they police excess.
Implication for users: If you want predictability, don’t wait for closing submissions. Engineer the cost outcome before the first case management conference and keep nurturing it throughout the case.
2) The legal framework that actually constrains discretion (when it does)
2.1 Party autonomy sits at the top
What the parties agree to—in the arbitration clause, a later protocol, or a consent order—binds. You can contract for:
Loser pays as a default;
Proportional allocation by issue;
Exclusion or capping of success fees;
A cap or budget exchange regimen;
Recovery of in-house counsel time and pre-arbitration costs.
Empower tribunals to award costs of arbitration and reasonable legal and other costs;
Invite tribunals to weigh outcome, conduct, efficiency, and reasonableness;
Permit interim costs (e.g., on procedural skirmishes) and costs upon withdrawal.
While phrasing differs, the direction of travel is uniform: wide discretion, guided by fairness.
2.3 Lex arbitri and mandatory law can impose hard stops
Typical “hard stops” include:
Public policy limits (e.g., no punitive multipliers where considered penal);
VAT/GST treatment under local tax law;
Restrictions on contingency or uplift recovery;
Requirements to reason the costs order;
Seat-specific rules on interest and calculation periods.
2.4 Enforcement reality checks
A beautifully reasoned cost order that offends the enforcing court’s public policy or local tax rules can stall collection. Plan for recognition where the counterparty’s assets live. More on path-to-cash: International Arbitration & Dispute Resolution.
3) The five principles that reliably shape cost awards
Principle 1 — Outcome matters, but it’s not everything
Most tribunals start with who won overall. That yields a presumption in favour of the prevailing party recovering a significant share of reasonable costs. Yet the presumption bends when:
The winner lost big issues or inflated the claim;
The loser conceded early or offered a reasonable settlement the winner beat only marginally;
Both sides over-litigated.
Principle 2 — Reasonableness is a value, not a formula
Tribunals test reasonableness against:
Rates vs market (London, Dubai, Paris, Singapore benchmarks);
Team mix (partner leverage, duplication across offices);
Hours vs complexity (did the spend track the issues?);
Necessity (five experts for one quantum point?);
Proportionality (spending USD 300,000 to chase USD 30,000 invites trimming).
Tip: Convert your ledger into a story of necessity: tie hours and roles to issues lists and case milestones.
Principle 3 — Conduct counts (a lot)
Tribunals increasingly reward efficiency and penalise gamesmanship:
Late ambushes, serial extensions, obstruction in document production, needless jurisdictional punts, or frivolous applications can swing costs against even a nominal winner.
Cooperation, focused disclosure, timely narrowing of issues, and realistic timetables pay dividends.
Principle 4 — Transparency about funding and risk matters
Disclosure of third-party funding is now common to enable conflicts checks and fair case management. On recovery:
Funded legal costs are recoverable if they are the party’s obligation;
Funder premiums/uplifts are usually not (absent special circumstances or party agreement);
ATE premiums and similar may be non-recoverable unless rules/seat say otherwise.
Principle 5 — Reasons are the guardrail
A cost order needs reasons: how outcome, conduct, reasonableness, and proportionality were weighed; how numbers were derived; how tax and interest were handled. Reasons make cost awards defensible on set-aside and enforcement.
4) What “loser pays” really means today (and how to use it)
“Loser pays” is not a blank cheque. Expect calibrations:
Net winner recovers 50–100% of reasonable legal costs depending on conduct and relative success;
Issue apportionment trims recovery if the winner lost discrete major issues;
Offers to settle may affect costs from a certain date.
Playbook to maximise recovery:
Budget credibly and update; record variance reasons.
Keep time narratives linked to issues; suppress “administrative” noise.
Use a lean core team; explain any specialist spikes.
Preserve proof of offers and “beat the offer” logic.
Defensive playbook to limit exposure:
Table early, reasonable settlement proposals;
Keep your own spend proportionate;
Highlight opponent’s over-lawyering and duplication;
Seek staged costs orders on frivolous skirmishes to build a record.
5) The American Rule instincts in international practice—and when tribunals use them
Tribunals sometimes default to each side bears own costs where:
The case raised novel legal questions;
Both parties litigated honourably and efficiently;
The outcome was a mixed bag with no clear winner;
The contract or later protocol says so.
Reality check: Even “American Rule” instincts usually morph into split allocations rather than pure zero-recovery. If you want to preserve access to justice in a tough, uncertain case, negotiate a costs position early with the other side (or in PO1), rather than hoping for generosity at the end.
6) What counts as a “cost” (and what usually doesn’t)
Typically recoverable (if reasonable and necessary):
External counsel fees;
Tribunal/institutional fees;
Expert and consultant fees;
Hearing logistics, transcription, interpretation;
Document review/hosting, e-discovery vendors;
Reasonable witness travel and accommodation;
Pre-arbitration costs (sometimes) where clearly tied to the dispute and contract.
Often contentious or excluded:
Funder success fees or uplifts;
ATE premiums (seat-dependent);
In-house counsel time (recoverable in some seats with proof);
PR or media spend;
Duplicative vendor costs where one would do.
Tax/VAT/GST:
Address who bears VAT on legal fees; claim VAT on top of fee recovery where you incur it and can’t fully credit it back; show the tribunal jurisdictional VAT logic.
Calculate interest on the net or gross amount as appropriate under governing law/seat.
7) Interim costs orders: the quiet lever that shapes behaviour
Tribunals can and should use interim costs tools to deter tactics that waste time and money:
Costs in the application on losing discovery or procedural motions;
Security for costs where a claimant appears impecunious or asset-light;
Wasted costs for non-compliance with procedural orders;
Adverse costs on withdrawn claims or abandoned jurisdictional challenges.
Why this matters: A handful of smart interim costs orders early in the case can halve the noise for the next 12 months.
8) Third-party funding, success fees, and security for costs—how they really interact
Disclosure: Expect tribunals to require disclosure of the fact of funding and the identity of the funder for conflicts checks; terms are usually kept confidential unless directly relevant.
Recoverability: Legal fees paid with funding are party costs and recoverable (subject to reasonableness). Funder uplifts are ordinarily not.
Security for costs: Funding alone is not proof of impecuniosity, but when combined with thin balance sheets and asset-offshoring, it can justify security.
Adverse costs cover: Tribunals sometimes condition funding-related procedural indulgences (extensions, late amendments) on obtaining adverse costs cover.
9) The London and Dubai lenses: what users should expect—and demand
9.1 London (England & Wales)
Instinct: sophisticated loser pays, grounded in reasonableness.
Good practice: early costs management in complex cases; reasoned costs awards with worked calculations; sensitivity to offers and Part 36-style logic in spirit.
Tactics: seek issue-wise apportionment where appropriate; document efficiency moves; use freezing or interim cost orders strategically in parallel court interface when available.
9.2 Dubai (DIFC/UAE)
DIFC courts: common-law ethos; receptive to reasoned costs logic; fast recognition and supportive of arbitration outcomes.
Regional practice: high scrutiny on sanctions/AML and VAT; be explicit about tax treatment in submissions.
Tactics: lodge concise, tabulated cost schedules; pre-clear banking routes for collection; where enforcement may cross into onshore UAE, calibrate language and documentation to execution practice.
10) Procedural Order No. 1: bake in the rules you want applied to costs
Model PO1 “Costs & Conduct” provisions (adapt to seat/rules):
Costs Follow Success (Default). Absent party agreement otherwise, the Tribunal will apply a loser-pays presumption subject to adjustment for relative success, reasonableness, proportionality, and party conduct.
Reasonableness & Proportionality. The Tribunal may consider rates, staffing, hours, duplication, necessity, and case complexity, and may reduce any item accordingly.
Conduct & Efficiency. The Tribunal may take into account compliance with timelines, cooperative case management, focus in document production, and avoidance of frivolous applications.
Interim Costs. Costs of discrete applications shall be in the Tribunal’s discretion and may be awarded on an interim basis.
Funding Disclosure. Parties shall disclose the existence and identity of any third-party funder for conflicts purposes within 14 days of funding.
Schedules. Each party shall submit costs schedules with sufficient detail (workstream, role, hours, rate, amount) at milestones set below.
Tax & Interest. Parties shall address VAT/GST treatment and propose interest calculations (rate, compounding, period) applicable to any cost award.
Codifying this early saves surprises later and helps align expectations of mixed legal teams.
11) The documentation that wins cost orders (and avoids painful trims)
Issue-mapped time records: entries that say “review” or “admin” invite cuts; entries tied to Issue 1 – jurisdiction or Issue 3 – quantum win credibility.
Team discipline: avoid five senior lawyers on a routine call; explain any specialist spikes.
Expert scopes: keep reports within mandate; note cost-saving scoping decisions.
Ignoring offers.Fix: track and “beat the offer” logic; propose time-limited offers.
No tax/interest analysis.Fix: include VAT/GST and interest computations in your costs brief.
Funders’ uplifts in the ask.Fix: unless your clause allows it, don’t ask—save credibility for recoverable items.
Confidentiality missteps.Fix: if you need to refer to offers or funding terms, use sealed annexes.
Seat blind spots.Fix: align with mandatory norms on recoverability and reasons.
13) Security for costs: not a punishment—an insurance policy the tribunal can tailor
When appropriate: impecunious claimant, asset flight risk, history of non-payment of adverse costs, or deadlocked security in a cross-claim dynamic. Forms: bank guarantee, parent guarantee, escrow, ATE with tribunal-approved terms. Calibration: proportional to realistic adverse costs exposure, not everything the respondent ever spent. Safeguards: stage security (e.g., to the pleading milestone), revisit upon case narrowing or partial awards.
14) Costs in treaty and state-facing disputes—special sensitivities
Public interest arguments can mellow loser-pays instincts; tribunals still consider conduct and efficiency.
Sovereign immunities rarely affect costs orders but can complicate collection; target commercial assets and revenues.
Transparency rules may affect confidentiality of cost schedules; prepare public-law-compatible versions.
15) London & Dubai playbooks: how we run the costs phase for clients
The London playbook
Three-layer submission: (1) Outcome & conduct narrative; (2) Reasonableness analysis mapped to issues; (3) Numbers with VAT/interest workings.
Comparators: short note on market rates and case complexity; leverage cost-saving moves.
Offer logic: explain how you beat meaningful settlement offers.
The Dubai/DIFC playbook
Tabular schedule with role, hours, rate, subtotal, plus VAT logic under UAE/DIFC frameworks.
AML & banking ready: ensure the eventual cost payment can clear (licences, bank letters).
Conduit planning: if execution may move to onshore UAE, craft translation and formalities now.
16) Model language for contracts and ToR that clarifies costs (and reduces surprises)
Costs Default Rule. The Parties agree that, subject to the Tribunal’s discretion and mandatory law of the seat, costs shall follow the event, adjusted for relative success and party conduct.
Recoverable Items. Recoverable Party Costs include reasonable external legal fees, experts, witness costs, translations, transcripts, hearing logistics, and e-discovery vendors. Funder uplifts and PR costs are not recoverable unless agreed in writing.
In-House Time. Reasonable in-house counsel time is recoverable where particularised and evidenced.
Interest & Tax. Cost awards shall include interest from the due date at [X% over SONIA / relevant benchmark], compounded [monthly/quarterly], and address VAT/GST consistently with applicable tax law.
Offers to Settle. The Tribunal may take account of written settlement offers when determining costs, with submissions on offers to be filed in a sealed annex.
File a concise narrative + worked spreadsheet + VAT/interest note + sealed annex for offers.
Ask for reasons on allocation, reasonableness, tax, and interest.
Final award: Collection
Be ready with recognition paperwork in asset hubs; pre-clear banking and licences if needed.
18) Frequently Asked Questions (straight answers)
Q: We won—but the tribunal slashed our costs by half. Is that normal? A: It can be. If you over-resourced routine tasks, ran multiple speculative points, or spent disproportionately to the stakes, tribunals trim. Next case: issue-map time, avoid duplication, document efficiencies.
Q: Can we recover in-house counsel time? A: Sometimes. Seats differ. Provide detailed logs, roles, and show why using in-house was efficient compared to outside counsel.
Q: Are uplift/success fees recoverable? A: Typically no, unless the parties agreed or a rule/seat expressly permits. Ask for legal fees actually incurred.
Q: Does third-party funding hurt our costs recovery chances? A: Not per se. Funded cases recover reasonable legal spend. But be prepared for security for costs if your asset position looks weak.
Q: Should we split costs by issue or push loser-pays? A: Depends on your case profile. Where you are the clear net winner, push loser-pays with behaviour credits. In mixed outcomes, propose issue-based apportionment with maths.
19) The TRW advantage: from clause to closing—and cash in bank
Clause engineering: We hard-wire cost logic into contracts and Terms of Reference.
Case management: We script PO1 to reward cooperation and deter games.
Budgets & narratives: We align time entries to issues and milestones so you win the reasonableness battle.
Interim levers: We pursue interim costs and security where justified.
Final brief: We deliver a bulletproof costs package—narrative, numbers, tax, interest, offers—built to survive enforcement.
Enforcement choreography: London and DIFC pathways, with bank-ready documentation and licences where needed.
Arbitrators do enjoy wide discretion in awarding costs—but it’s not a black box. Direction comes from party agreement, institutional rules, seat law, and evolving expectations around efficiency, fairness, and proportionality. If you want predictability, design for it. Write it into your clause and PO1. Manage your team and vendors to tell a costs story of necessity. Use interim costs to police the process. And when you win, present a reasoned, tax-aware, interest-grounded ask that a tribunal can grant with confidence—and a court can enforce without hesitation.
That’s how you turn “discretion” into something very close to certainty.
Talk to TRW
Tahmidur Remura Wahid (TRW) Law Firm Dhaka (Headquarters): House 410, Road 29, Mohakhali DOHS Dubai: Rolex Building, L-12, Sheikh Zayed Road London: 330 High Holborn, London WC1V 7QH, United Kingdom
When Arbitrators Use AI: LaPaglia v. Valve and the Boundaries of Adjudication — A TRW Law Firm Guide (Dhaka • London • Dubai)
Executive takeaways
AI can help with logistics; it cannot replace judgment. Using AI to organise records, generate outlines, or check citations is very different from allowing a tool to shape factual findings or legal conclusions.
Transparency is the safety valve. Disclosing intended AI use (and its limits) early in the case—and inviting party comment—greatly reduces challenge risk.
The U.S. test is “exceeding powers” and due process. The argument in LaPaglia v. Valve frames heavy AI reliance as an arbitrator exceeding the parties’ agreement to receive a reasoned decision by a human neutral, and as a due-process problem if facts outside the record are introduced without party input.
Soft-law guidance is converging. Leading guidelines emphasise non-delegation of decision-making, source verification, and party consultation.
Plan now. Add a short “AI Protocol” to Procedural Order No. 1 (PO1) and to terms of appointment. This protects award integrity and enforceability.
For a wider overview of how we design efficient, enforceable procedures, see International Arbitration.
1) The case that sparked the debate: LaPaglia v. Valve—what’s at stake?
A consumer claimant petitioned a U.S. federal court to vacate an AAA award, alleging the sole arbitrator “outsourced his adjudicative role” to AI. The petition points to (i) alleged comments about using a chatbot in other contexts, (ii) a compressed award timeline, and (iii) purported “AI tells” in the text, along with uncited facts not in the record. The challenge proceeds under the Federal Arbitration Act (FAA) §10(a)(3) (misconduct) and §10(a)(4) (exceeding powers).
Why this matters beyond the U.S.: even though national vacatur standards differ, most modern arbitration regimes revolve around party consent, equality of arms, and the tribunal’s duty to deliberate and give reasons. If a party can plausibly show that a non-human system substituted for deliberation—or that unvetted, extra-record material crept into an award—the award’s legitimacy is at risk anywhere.
2) Where AI adds value in arbitration (and where it doesn’t)
Helpful, low-risk uses (with human control):
Organising the record: deduplication, exhibit indexing, chronology building.
Language support: drafting scaffolds, translation aids, plain-language rewrites for non-decisional text (e.g., procedural summaries) subject to counsel review.
Template hygiene: tables of contents, citation formatting, defined terms lists.
High-risk uses (or outright no-go without disclosure and party input):
Evidence synthesis and credibility findings. AI should not determine what the record “proves” or who is credible.
Legal reasoning and holdings. Tools may help outline, but the tribunal’s own analysis must drive the outcome.
Fact material from outside the record. Any third-party retrieval or inference must be disclosed and opened to comment.
Undisclosed reliance on systems that hallucinate sources or mischaracterise authorities.
3) The emerging consensus principles
Across the most-cited guidance documents, the core principles align:
Non-delegation: Arbitrators must not delegate their adjudicative role to AI.
Verification: Any AI-assisted output used in the process must be checked against the record and reliable sources.
Transparency & party consultation: If AI tools will be used beyond purely administrative tasks, tell the parties and give them a chance to be heard.
No extra-record surprises: If a tool surfaces facts or authorities outside the record, flag them and invite comment before they influence the award.
Responsibility: Arbitrators remain entirely responsible for the award—style, substance, and accuracy.
4) How LaPaglia maps onto challenge grounds
(a) Exceeding powers (FAA §10(a)(4) and analogues)
Parties typically agree to a human neutral who will deliberate and issue a reasoned decision. If AI is used such that it replaces deliberation or authorship on substantive issues, a challenger may argue the arbitrator exceeded the mandate. The closer AI use gets to decisional outsourcing, the stronger the challenge.
(b) Misconduct / due process (FAA §10(a)(3) and international analogues)
If an award contains facts not in the record (or drawn from undisclosed AI outputs) without giving parties a chance to respond, a court could find fundamental unfairness. Internationally, similar concerns arise under “unable to present one’s case” and “public policy” refusal grounds at the enforcement stage.
(c) Evidentiary hurdles for challengers
Proving AI reliance can be difficult. “AI-detector” opinions are notoriously unreliable. Stronger indicators include process evidence (disclosures, emails, tool usage logs), textual anomalies coupled with extra-record content, or internal inconsistencies that cannot be reconciled with the record. Ultimately, courts ask: did the arbitrator decide, or did a tool?
5) Practical playbook for tribunals: an “AI Protocol” for PO1
Clause 1 — Purpose & scope “The Tribunal may use digital tools to manage logistics and drafting. The Tribunal shall not delegate any part of its decision-making to any AI system.”
Clause 2 — Transparency “The Tribunal will inform Parties if it intends to use AI tools beyond administrative functions (e.g., drafting scaffolds, translation aids). Any such use shall be explained in general terms.”
Clause 3 — Record integrity “The Tribunal will not rely on AI-generated information outside the evidentiary record without first disclosing the material and allowing Parties to comment.”
Clause 4 — Verification “The Tribunal will independently verify any AI-assisted text included in orders or awards against the record and authoritative sources. References must be accurate and checkable.”
Clause 5 — Confidentiality & security “Any AI tool used by the Tribunal shall be operated in a manner that does not upload case data to public or third-party training sets. Use is restricted to secure environments with no model training on case content.”
Clause 6 — Party use of AI “Parties shall disclose if AI systems materially assist in drafting evidentiary submissions (e.g., expert analytics). They must verify accuracy, cite sources, and certify no confidential data was exposed to public models.”
Clause 7 — Responsibility “The Tribunal assumes full responsibility for all procedural rulings and the reasoning and conclusions of any award.”
6) Counsel strategy: safeguarding the record (and the award)
Ask early. At the first case management conference, request that the tribunal state on the record how (if at all) it intends to use AI.
Lock in the protocol. Propose the PO1 language above, plus data-security and confidentiality terms for any tool usage.
Police the record. If an order or draft award references uncited facts or non-existent sources, promptly request clarification and an opportunity to be heard.
For party submissions:
Use closed/enterprise tools only; ban uploads to public models.
Human-verify all outputs; keep a source log.
Disclose tool assistance where it touches substantive analytics (e.g., expert modelling).
If challenging an award: build proof around process defects (lack of disclosure, extra-record reliance), not around AI-detector screenshots.
7) What arbitral institutions and appointing authorities can do now
Issue standing guidance that reaffirms non-delegation and verification.
Update terms of appointment to include basic AI and data-security undertakings.
Provide safe toolkits (secure drafting and evidence environments) so tribunals need not improvise with public systems.
Encourage simple disclosure templates—e.g., “The tribunal used tool X for formatting only; no external sources were consulted beyond the record.”
8) Ethics, confidentiality, and data protection
Even where AI use is procedurally acceptable, arbitrators and parties must honour confidentiality and data-protection obligations. That means:
No ingestion of confidential case data into public or retrainable models.
Prefer on-premise or enterprise AI with no training on user inputs.
Redact personal data and special category data where possible; maintain transfer logs when cases span Dhaka–London–Dubai infrastructures.
If in doubt, don’t upload—run tools locally or within a vetted hosting environment.
Soft law hardens into practice. Disclosure/verification norms will become standard in PO1 and terms of appointment.
Tooling bifurcates. Tribunals and institutions move to private, auditable AI for admin tasks; public chatbots fade from professional use.
Challenge jurisprudence evolves. Courts will focus on process integrity (non-delegation, party participation, accuracy), not on per se bans of technology.
Training and accreditation. Expect arbitrator rosters to require AI-competency and data-security modules as table stakes.
10) A concise checklist you can adopt tomorrow
For tribunals
Add an AI paragraph to your terms of appointment.
Disclose intended use; invite comment.
Keep AI away from fact-finding and legal conclusions.
Verify every proposition against the record before it hits the award.
Use secure, no-training environments only.
For parties
Propose an AI Protocol in PO1.
Human-verify any AI-assisted text; keep source logs.
Monitor for extra-record references; object early.
If challenging, focus on non-delegation and due process, not detectors.
How TRW Law Firm can help (Dhaka • London • Dubai)
We design technology-aware arbitration procedures that preserve fairness and enforceability:
Drafting PO1 AI Protocols and updating terms of appointment.
Advising tribunals and parties on defensible AI use and data security.
Stress-testing awards for process vulnerabilities before issuance.
Handling set-aside/recognition strategies where AI use is alleged.
Explore our broader approach at International Arbitration and speak with our cross-office team about building an AI-resilient procedure for your next case.
