International arbitration is a private procedure in which parties from different countries have their dispute decided by arbitrators instead of a national court, and the award can be enforced in more than 170 countries under the New York Convention of 1958. The main limitation: arbitration only works if both parties agreed to it in writing, and an award can be challenged only on a few narrow grounds, so there is usually no appeal on the merits.
For businesses trading across borders, the choice between arbitration, a state court and the Netherlands Commercial Court is best made when the contract is drafted. This article explains how arbitration works, what Dutch law adds when the seat is in the Netherlands, and how to choose.
What is international arbitration?
International arbitration is binding dispute resolution by one or three arbitrators chosen by, or for, the parties. The award has the same effect between the parties as a court judgment.
The parties decide the essentials: the number of arbitrators, the seat (the legal home of the proceedings), the procedural rules, the applicable lagh susbainteach and the language. That freedom, called party autonomy, is the main difference from court litigation, where the court’s own procedural rules apply.
Most cases are commercial disputes between companies in different countries, often about supply, distribution, construction, M&A or licensing contracts. Investor-state arbitration is a separate field, discussed below.
How do you agree on arbitration?
You agree on arbitration through a clause in your contract or, after a dispute arises, through a separate submission agreement. Without a written agreement there is no arbitration, because the process rests entirely on consent.
A good clause names at least:
- an suidheachan, which determines which national arbitration law applies and which courts can set the award aside;
- na riaghailtean, such as those of the Netherlands Arbitration Institute (NAI) or the International Chamber of Commerce (ICC), or ad hoc arbitration under the UNCITRAL Rules;
- the number of arbitrators, usually one or three;
- a' chànan of the proceedings;
- the governing law den chùmhnant.
A vague or contradictory clause leads to a preliminary fight about jurisdiction before the real dispute is even discussed. Our article on cùisean uachdranas agus cur an gnìomh a’ mìneachadh nan cunnartan.
How do arbitration proceedings work?
Proceedings start with a request or notice of arbitration to the institution and the other party. The tribunal is then formed, sets a timetable and decides the case on written submissions, evidence and usually an oral hearing.
With a three-member tribunal, each party appoints one arbitrator and those two choose the chair. If a party does not appoint in time, the institution or, in ad hoc cases, the court at the seat appoints instead. Arbitrators must disclose any possible conflict of interest.
A typical procedure includes a statement of claim and defence, a limited exchange of documents, written witness statements, a hearing at which witnesses and experts are questioned, and final submissions. The tribunal can order interim measures, and many institutional rules provide for an emergency arbitrator before the tribunal is formed. Complex cases often take one to two years.
What does Dutch law add when the seat is in the Netherlands?
With a Dutch seat, Book Four of the Dutch Code of Civil Procedure (Wetboek van Burgerlijke Rechtsvordering, Rv), Articles 1020 to 1076, applies, whatever law governs the contract. The regime was modernised on 1 January 2015 and leaves the parties a great deal of freedom.
Three points decide most practical questions:
- The arbitration agreement must be proven in writing, but an exchange of emails or a reference to standard terms that contain a clause usually suffices.
- A Dutch award is enforced with leave from the preliminary relief judge (còir-taice) of the district court under Article 1062 Rv.
- An award can only be set aside on the closed list of grounds in Article 1065 Rv: no valid arbitration agreement, an irregularly composed tribunal, a tribunal that exceeded its mandate, a missing signature or reasons, or a conflict with public policy. Since 2015 the claim goes directly to the court of appeal (Article 1064a Rv), with cassation to the Supreme Court.
For institutional arbitration in the Netherlands, the NAI in Rotterdam handles cases in English as well as Dutch. The Permanent Court of Arbitration in The Hague mainly administers state and investor-state cases.
How is an arbitral award enforced abroad?
Under the New York Convention, a court in a contracting state must recognise and enforce a foreign award unless one of the limited refusal grounds in Article V applies. You apply with the award and the arbitration agreement, with translations where required.
Refusal grounds include an invalid arbitration agreement, a party that could not present its case, a tribunal that exceeded its mandate, and a conflict with the public policy of the enforcing state. In the Netherlands, Articles 1075 and 1076 Rv govern foreign awards, and the application is made to the court of appeal. Our article on enforcing an annulled arbitral award in the Netherlands discusses a difficult variant.
This is the practical advantage over a foreign court judgment, for which no worldwide enforcement treaty of comparable reach exists. See also our article on the aithneachadh agus cur an gnìomh bhreitheanas cèin.
Is investor-state arbitration still available within the EU?
Largely not. In Achmea (C-284/16, 2018) the EU Court of Justice held that arbitration clauses in investment treaties between Member States are incompatible with EU law, and in Komstroy (C-741/19, 2021) it applied the same reasoning to intra-EU claims under the Energy Charter Treaty.
The Member States terminated their intra-EU bilateral investment treaties by an agreement signed in 2020, and both the Netherlands and the EU have withdrawn from the Energy Charter Treaty. An EU investor with a complaint against another EU Member State must now turn to that state’s courts and to EU law. For investors from outside the EU, treaty arbitration against a host state remains possible where a treaty provides for it.
Should you choose arbitration, a state court or the Netherlands Commercial Court?
Arbitration offers confidentiality, expert arbitrators and worldwide enforcement; a state court offers lower costs, an appeal and public precedent. The Netherlands Commercial Court (NCC) sits in between.
| Arbitration | Dutch state court | Netherlands Commercial Court | |
|---|---|---|---|
| cànain | Chosen by the parties | Dutch | Beurla |
| dìomhair | Mar as trice | No, hearings are public | No, hearings are public |
| Appeal on the merits | No, only setting aside on limited grounds | Tha | Yes, to the NCC Court of Appeal |
| Cur an gnìomh thall thairis | New York Convention, more than 170 states | Within the EU without exequatur; elsewhere by treaty or national law | As a Dutch state court |
| cosgaisean | Arbitrators’ fees and administrative costs | Cìsean cùirte | Higher court fees than ordinary Dutch courts |
The NCC is a chamber of the Amsterdam District Court and Court of Appeal. It hears international commercial cases in English if the parties have expressly agreed to it in writing. Where precedent and appeal matter more than confidentiality, an NCC clause is often the better choice. For smaller disputes, meadhanachadh can be a cheaper first step, and many contracts combine mediation with arbitration in a multi-tier clause.
What should you check when drafting a cross-border contract?
- Whether the clause names one forum clearly: arbitration, a state court or the NCC, not a mix.
- Which seat you choose, because its courts can set the award aside.
- Whether the other party’s assets are in a New York Convention state.
- Whether the value at stake justifies three arbitrators, or one is enough.
- Whether confidentiality matters more to you than a right of appeal.
What should you check when a dispute has arisen?
- Which clause applies and whether it covers this dispute and all parties involved.
- Whether the contract requires negotiation or mediation before arbitration, and the deadlines for it.
- Whether you need interim measures, such as an attachment of assets, before the tribunal is formed.
- Where the other party has assets against which an award could be enforced.
- Which limitation periods apply under the governing law.
What can we do for you with international arbitration?
Tha ar n- luchd-lagha eadar-nàiseanta agus luchd-lagha cùmhnant advise companies before and during cross-border disputes; see also our page on Cùis-lagha Duitseach.
- We draft or review the dispute resolution clause in your international contracts.
- We assess whether arbitration, a state court or the NCC fits your contract and your counterparty.
- We prepare and conduct NAI and ICC arbitrations with a Dutch seat.
- We request leave to enforce a Dutch award or recognition of a foreign award in the Netherlands.
- We bring or defend setting-aside proceedings before the court of appeal.
- We arrange prejudgment attachment of assets in the Netherlands to secure your claim.
Geàrr-chunntas
- Arbitration requires a written agreement and gives a binding award without appeal on the merits.
- Awards can be enforced in more than 170 states under the New York Convention.
- With a Dutch seat, Articles 1020-1076 Rv apply; setting aside is possible only on the grounds of Article 1065 Rv, before the court of appeal.
- Intra-EU investor-state arbitration is largely closed after Achmea and Komstroy.
- The Netherlands Commercial Court is an English-language alternative with a right of appeal.
Ceistean Àbhaisteach
Dè na prìomh eadar-dhealachaidhean eadar rèiteachadh eadar-nàiseanta agus cùis-lagha?
Arbitration is based on agreement, usually confidential and decided by arbitrators the parties choose, with no appeal on the merits. Litigation before a state court is public, follows the court’s procedural rules and allows an appeal. Arbitral awards are easier to enforce abroad under the New York Convention.
How is an arbitral award enforced in another country?
You apply to the competent court in the country where the debtor has assets, with the award and the arbitration agreement. Under the New York Convention that court may refuse only on limited grounds, such as an invalid agreement, a breach of due process or a conflict with public policy.
Can an arbitral award made in the Netherlands be appealed?
Not on the merits, unless the parties agreed on arbitral appeal. An award can be set aside only on the grounds listed in Article 1065 Rv, in proceedings before the court of appeal.
Which arbitration institution should we choose?
For a Dutch seat, the Netherlands Arbitration Institute (NAI) is the usual choice. For large international contracts, the ICC is common. Ad hoc arbitration under the UNCITRAL Rules is possible without an institution, but then the court at the seat may have to step in for appointments.
