I had the privilege of participating in a seminar on this topic two weeks ago, where experts from the U.S. and the Dominican Republic provided a wealth of information on how non-traditional means are used to achieve fair resolution of a wide variety of legal disputes. In the field of international business, one method of avoiding expensive litigation has been the use of binding arbitration clauses in contracts. By agreeing in advance what rules will govern settlement of the dispute, including the jurisdiction whose laws will be applied, the parties can proceed to do business in confidence that there will not be unpleasant surprises if the relationship breaks down. International arbitration is carried out by a disinterested third party. The effectiveness of an arbitration clause depends on the support of the legal systems in the home jurisdictions of both parties and the places where they do business together.
Local courts play a critical role.
They must enforce the agreement to arbitrate so that no party can circumvent the contractual commitments he has made. Once an award is made, the local court must recognize and enforce that decision. Foreign investors will hesitate before establishing themselves in a country if there are no guarantees that arbitration clauses will be respected. Unfortunately, we are aware of instances where Dominican courts have failed to respect such arbitration clauses. This is but one example of why it is so important that the Dominican Republic have a strong, independent judiciary that merits the respect and support of the Dominican people.