The choice of the seat is always a key issue when parties decide to settle their dispute through arbitration.

The choice of seat is an important issue for three main reasons. First, it may have impact on which law will govern arbitration. Second, it may be necessary to request the assistance of the local legal system in which the local court will exercise its supervisory and supportive powers. Third, because the choice of seat will have implications on the enforcement of the award.

Therefore, it is essential to know, beforehand, if the local arbitration law is, for example, inspired by the provisions and principles of the UNCITRAL Model Law or if the local courts are supportive to arbitration and if the place of arbitration is in a state party to the New York Convention.

There are other conditions, notably related with practical and logistical issues, which must also be considered when parties draft the arbitration agreement and choose the seat of arbitration. It is the case of accommodation, telecommunications, transportation, use of related services, for example, translation services, or available facilities.

In any event, it is important to distinguish the seat of arbitration where all or most of the hearings may take place for practical reasons, for example, most of the witnesses live in the place of arbitration or it is easier the production of evidence in such place. While the seat of arbitration has important legal consequences, the same cannot be said for the place of arbitration, which is relevant for practical reasons.

Jan-Mar 2018 issue

Abreu Advogados