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International Construction Law Review

INTERNATIONAL ARBITRATION INSTITUTIONS SHOULD PROVIDE FOR THE PROMPT ENFORCEMENT OF DISPUTE BOARD DECISIONS: A SOLUTION EXISTS

Christopher R Seppälä1

Independent arbitrator and counsel
Over the last 30 years, the dispute board (“DB(s)”) has come to be recognised as the most effective and widely used pre-arbitral procedure for the settlement of issues and disputes under major international construction projects. The DB may address more construction disputes than international arbitration as recourse to a DB generally precedes – often as a condition precedent – arbitration and, in the majority of cases, makes subsequent proceedings unnecessary.2 While there are different types of DB, the form of DB that will be addressed here is the Dispute Adjudication Board (“DAB”) or Dispute Avoidance and Adjudication Board (“DAAB”), that is, the kind that makes decisions that are binding on the parties, at least on an interim basis, and which is to be found in, among others, the 1999 and 2017/2022 editions of FIDIC’s standard forms of construction contract.
While DBs that make decisions have proved a great success, they have a well-known “Achilles heel”, namely, that if a decision is not complied with voluntarily, it can be enforced only by an international arbitration which normally takes many months or years. There exists no prompt mechanism for enforcing a decision internationally. This article will argue, however, that this need not be the case if use is made of a system of “Compliance arbitration” adapted from a model arbitration clause published by UNCITRAL in 2024. Accordingly, in the absence of any better method, international arbitral institutions should consider modifying their rules to incorporate such a system, as described below.

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