Conglomerates Also Turn to Arbitration Center

Confidentiality, Speed, and Cost-Effectiveness: Key Advantages

Major conglomerates are turning to the International Arbitration Center of the Korean Commercial Arbitration Board (KCAB) to resolve international disputes. Arbitration is seen as a more attractive option because it tends to resolve disputes more quickly than litigation, maintains confidentiality, and significantly reduces costs.

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Currently, international arbitration cases handled by the KCAB International Arbitration Center involve major companies, including Company A and Company B, as parties to the disputes. Company A is reportedly engaged in a dispute arising from a contract between its affiliates. Industry insiders believe that it is common for disputes between affiliates to be brought to KCAB in order to take advantage of the confidentiality of the arbitration process.

There have been criticisms that, until now, Korean conglomerates have entrusted major international disputes to overseas arbitration institutions such as the Singapore International Arbitration Centre (SIAC) or the International Chamber of Commerce (ICC), while largely overlooking the KCAB International Arbitration Center.

In response, the KCAB International Arbitration Center has embarked on a sweeping innovation initiative. It has launched an International Arbitration Tribunal, revamped the expedited and simplified procedures, and streamlined and diversified the process for appointing and composing arbitrators. The center has also introduced an Early Determination procedure and refined rules for multi-party and multi-contract disputes, as well as adjusted cost and electronic procedure regulations.

Lee Sangyeob, a foreign attorney at OhKims Law & Company who spent about eight years at the KCAB International Arbitration Center, said, "It is desirable to begin by attracting cases from domestic companies. Based on this, the center can expand its presence globally."

Kim Jisoo, The Law Times Reporter

※This article is based on content supplied by Law Times.

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