On 3 August 2010, the Australian International Disputes Centre (AIDC) opened in Sydney. Its opening is a milestone achievement and an important step in Australia’s growing reputation as a destination for the resolution of disputes through arbitration. In particular, it provides corporations with a viable alternative to the arbitration centres in Hong Kong and Singapore for the resolution of international disputes. The centre is located in the heart of the legal and financial services district in Sydney.

The AIDC features world-class communication, audiovisual and video-conferencing facilities, tribunal facilities, conference rooms and access to translation and transcription services. It is home to the Australian Centre for International Commercial Arbitration, the Chartered Institute of Arbitrators and the Australia Commercial Disputes Centre. From its opening day, it has hosted a number of international arbitrations. Its opening was attended by the Honourable Chief Justice Patrick Keane, the Chief Justice of the Federal Court of Australia, and the Honourable Chief Justice James Spigelman AC, the Chief Justice of the Supreme Court of New South Wales.

Parties to an arbitration agreement have considerable choice over the way a dispute can are arbitrated. They can choose the country, city and even building in which they wish to hold their arbitration. They are also free to select the arbitrator. It is expected that, following the AIDC’s opening, Sydney will increasingly be a nominated venue for the arbitration of disputes.

The opening of the centre coincides with ongoing reforms to Australia's arbitration laws at both a State and Federal level. International arbitrations in Australia are governed by the International Arbitration Act 1974 (Cth) which is based on, and gives parties the option to use, the UNCITRAL Model Law on International Commercial Arbitration. There have been recent amendments to the International Arbitration Act to bring it up to date with 2006 amendments to the Model Law. Those amendments:

  • confer on arbitrators the power to order security for costs
  • enhance the recognition of arbitration agreements concluded in almost any form (including those reached orally and electronically)
  • confer on arbitrators the power to order that property be inspected and experiments be conducted by experts and the parties
  • enhance the enforcement of foreign arbitral awards in Federal Court.

At a state level, the NSW Parliament on 22 June 2010 passed the Commercial Arbitration Act 2010 (NSW), which governs domestic arbitrations in NSW and is consistent with the Commonwealth legislation so that Australia has uniform laws applying to both domestic and international arbitrations. It is up to the parties to decide whether the arbitration will be governed by the Model Law or by a different set of arbitration rules.

Increasingly, parties are submitting disputes arising out of international contracts to arbitration. While this is true across the board, it is a particularly marked trend in the construction, transport, energy and financial sectors. Particular industries, such as oil and gas, shipping and insurance use international arbitration as a default dispute resolution mechanism. The enforceability of arbitral awards and the

flexibility, speed and reduced cost of the procedure (as opposed to international litigation) are seen as the major advantages of international arbitration.