International Commercial Arbitration in the USA: How Proceedings Are Conducted, From Choosing Arbitrators to Winning an Award

Oct 1

7 min read

Updated: Oct 7

This post is based on Chapter 10, “A General Overview of the Conduct of International Arbitration Proceedings in the United States”, by Edna Sussman, in the book *International Arbitration in the United States*, edited by Laurence Shore, Tai-Heng Cheng, Jenella E. La Chuisa, Lawrence Schaner and Mara V.J. Senn, with Liang-Ying Tan as Associate Editor (Kluwer Law International, 2018).

The United States has enforced arbitration agreements and awards firmly since the Federal Arbitration Act of 1925. For anyone drafting an arbitration clause or appearing in a US-seated arbitration, the practical questions are how the process runs and how it differs from US court litigation and from other seats. This post walks through the chapter’s answers in the order a case unfolds.

Why the USA Is a Popular Seat

Edna Sussman notes that US courts have repeatedly backed arbitration and its reach. They have even enforced interim measures and emergency arbitrator decisions that some countries would not treat as final awards.

New York law is the most common governing law in corporate contracts after English law, and that helps make New York the leading US seat. The chapter cites ICDR and ICC caseload figures showing New York far ahead of Miami, Los Angeles and San Francisco.

Other draws include:

Arbitrators and counsel from many legal and cultural backgrounds, with expertise in almost every business sector.
A deep support industry of translators, court reporters and litigation support.
Dedicated arbitration venues.
Arbitrators used to issuing awards quickly. The American Arbitration Association’s domestic rules have long required an award within thirty days of the close of hearing, while the International Centre for Dispute Resolution rules allow sixty days.

Constituting the Tribunal: Choosing Arbitrators

The contract decides how arbitrators are chosen. Party-appointed arbitrators are common in international cases, but some US institutions also offer the list method, where the institution proposes names based on the parties’ stated preferences.

The chapter stresses that a party-appointed arbitrator must still be independent and impartial. US practice has moved away from non-neutral party-appointed arbitrators since the ABA-AAA Code of Ethics for Arbitrators was revised in 2004, and today they survive only in a few industry sectors.

Disclosure and challenges. Arbitrators also consult the International Bar Association Guidelines on Conflicts of Interest, including the red, orange and green application lists. In a US court, those lists are not decisive. Section 10 of the Federal Arbitration Act allows an award to be vacated for “evident partiality”. Under the Second Circuit’s standard, a reasonable person would have to conclude the arbitrator was partial. Other circuits vary, and the Ninth Circuit asks whether there is a reasonable impression of partiality.

AAA and ICDR arbitrators are trained to disclose anything a party might see as a connection. This resolves the “too much information” debate in favour of more disclosure, in line with the global trend towards transparency.

The Prehearing Phase

The preliminary hearing. The tribunal usually opens with a preliminary or case management conference, in person or by phone. It uses the conference to identify the real issues in dispute, set the timetable for jurisdictional objections, consider bifurcation or early dispositive motions, and discuss counsel’s different ethical duties, sometimes by adopting the IBA Guidelines on Party Representation. International arbitration statements of claim and defence are usually far more detailed than US litigation pleadings.

Document disclosure. Parties expect to exchange the documents they rely on, and targeted document requests under the IBA Rules on the Taking of Evidence are now common. US-style depositions, interrogatories and requests to admit are generally not used in US-seated international arbitrations. The ICDR Rules say so expressly. Depositions may be allowed only in exceptional cases, such as preserving testimony that might otherwise be lost.

Written submissions. Tribunals follow a harmonised international pattern. The claimant’s memorial, with witness statements, exhibits and expert reports, comes first. Then come the respondent’s counter-memorial and, often, a reply and a rejoinder. These filings do the work US discovery would otherwise do and shorten the hearing.

Confidentiality. The chapter warns that, unless institutional rules say otherwise, US arbitration is generally confidential only for the institution and the arbitrators, not for the parties. Counsel should seek a confidentiality order drafted more broadly than a typical litigation protective order, so that it covers the whole proceeding, subject only to presenting the award to a court for enforcement or vacatur.

Before the hearing. Between the preliminary hearing and the hearing, tribunals decide authorised motions, often hearing jurisdictional issues first. They resolve document disputes, often through a Redfern schedule, and may issue subpoenas. A status call is usually held a few weeks before the hearing to settle timekeeping, such as a chess clock, witness arrangements including remote testimony, logistics such as court reporters and translators, and when demonstrative exhibits will be exchanged.

The Hearing

In US courts and domestic arbitrations, direct examination is usually live. In international arbitration, the written witness statement stands as the direct testimony. A short warm-up before cross-examination lets the witness address new developments. Key features the chapter highlights:

Cross-examination is generally not limited in scope, and tribunals watch that redirect does not become a second direct examination.
The party offering a witness statement must make the witness available for cross-examination, or the tribunal may disregard the statement under the IBA Evidence Rules.
Cross-examination styles of lawyers from different traditions have converged, but counsel should still consider the arbitrators’ background before being aggressive.
Cultural differences can shape how witnesses testify, so arbitrators adapt their style to ensure every party feels fully heard.
Where the agreement is silent on language, the tribunal seeks agreement or looks to institutional rules and practicality, and translation arrangements are set clearly.
Videoconferencing is increasingly used to save travel cost and time.
Party-appointed experts owe a duty to the tribunal. “Hot tubbing” is often used, with experts questioned together to find agreement and isolate the real disagreements.
Differences between civil law and common law arbitrators in how actively they question witnesses have narrowed.

Because expectations differ, the chapter says tribunals should end by asking whether parties have had a full and fair opportunity to present their case. Closing arguments or post-hearing submissions follow.

The Award

Tribunals try to deliberate immediately after the final submissions. The chair usually prepares the first draft of the award, and the goal is a sound, enforceable decision that explains why the losing side’s positions failed. The chapter cites a survey of arbitrators in which 63 per cent favoured sharing views early and discussing reactions throughout the case.

Standard of proof. Common law systems typically use a preponderance of the evidence for ordinary civil claims and clear and convincing evidence for serious allegations such as fraud. Civil law systems apply free assessment of evidence. There is no consensus on which law governs the standard, so who bears the burden can matter in deliberations.

Unreasoned awards. Most international awards are reasoned, but US-seated tribunals can issue an award without reasons where the rules allow it, and US courts enforce such awards, unlike some other countries. Parties may choose this to protect trade secrets, avoid collateral estoppel arguments or save cost. Because courts in the US rarely seal filings, this can be a real advantage. Tribunals still check that counsel have considered the law where the award may be enforced.

Key Takeaways

A US seat offers pro-arbitration courts, a deep pool of arbitrators and experts, and a procedure that largely follows international norms.
US litigation tools such as depositions are generally left out, and the exchange of full written case submissions replaces much of discovery.
Disclosure by arbitrators leans towards more, and “evident partiality” is the key ground to vacate an award for bias.
Draft confidentiality terms deliberately, because the default protection is narrower than many parties assume.
As the chapter concludes, no two arbitrations are alike, so the process must be tailored to the dispute.

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Frequently Asked Questions

1. Why is New York the most popular seat for international arbitration in the USA?

New York law is widely chosen in commercial contracts and has a long tradition of enforcing contracts as written, which gives business predictability. The choice of governing law also influences the choice of seat.

2. Is US-style discovery available in international arbitration seated in the USA?

Generally no. Depositions, interrogatories and requests to admit are usually not allowed. Parties exchange documents they rely on, and targeted document requests under the IBA Evidence Rules are common.

3. Can a US court set aside an award for arbitrator bias?

Yes. Section 10 of the Federal Arbitration Act permits vacating an award for evident partiality. Many courts, including the Second Circuit, ask whether a reasonable person would have to conclude the arbitrator was partial.

4. Are US arbitration proceedings automatically confidential?

Not between the parties. Under the default position described in the chapter, confidentiality binds the institution and arbitrators, so parties should agree a broad confidentiality order.

5. Can a US-seated tribunal issue an award without reasons?

Yes, if the institutional rules permit it. US courts enforce unreasoned awards, and parties sometimes prefer them to protect confidential information or avoid collateral estoppel arguments.

Keywords

International commercial arbitration in USA, arbitration in United States, Federal Arbitration Act, New York seat arbitration, ICDR arbitration rules, AAA arbitration, evident partiality Section 10 FAA, IBA Rules on the Taking of Evidence, IBA Guidelines on Conflicts of Interest, unreasoned arbitral award, arbitration hearing procedure, witness statements in arbitration, Edna Sussman arbitration

Credits and Source

This post is an original summary and commentary prepared for educational purposes. All credit for the ideas and analysis goes to:

Author of the chapter: Edna Sussman
Book: International Arbitration in the United States
Editors: Laurence Shore, Tai-Heng Cheng, Jenella E. La Chuisa, Lawrence Schaner and Mara V.J. Senn
Associate Editor: Liang-Ying Tan
Publisher: Kluwer Law International, 2018 (ISBN 978-90-411-5016-5)