Cultural Differences in Arbitration
When we talk about cultural differences in arbitration usually, we refer to the clash of legal cultural differences meaning different procedures used in civil law and common law countries. However social culture also impacts substantive matters in international arbitration.
In 1976 Edward Hall introduced the Iceberg Culture Model. This model is a metaphorical representation of culture, likening it to an iceberg where only a small portion is visible above the waterline while the vast majority remains hidden beneath the surface. The visible aspects of culture representing the 10% of the iceberg are what people directly experience through their senses. For instance, food, dress code, and language. Then there is the ‘deep culture’, everything that is not visible at first inspection, such as behavior, values, beliefs, and traditions. [1]
“An iceberg is a good illustration of what parties to dispute perceive. Only about 10% of the iceberg is above the water and the 90% that is underwater sank the Titanic”
How can cultural factors influence the arbitration process and outcomes?
Different cultures have distinct characteristics that can affect the process. Different communication styles on how they present their arguments and evidence, the conflict resolution styles that the parties adopt (avoidance, confrontational…), the traditions and customs of the parties, the difference in time orientation (present-oriented cultures might focus on more immediate concerns while future-oriented cultures may prioritize planning and gradually progression towards the solution) and even the cultural context of the dispute itself can influence the parties attitude. Cultural factors can affect the effective communication, the credibility and integrity of the parties, and lastly the fairness and the perceived legitimacy of the arbitration outcomes. [2]
Key Cultural Considerations in the International Arbitral Process
· Communication (verbal and non-verbal): The problems of communication are present when communication takes place across cultures. This can be from the basic problem of translation or to the difficulties for non-native speakers. Words spoken can often acquire a different connotation when translated. Non-verbal cues such as body language facial expressions and gestures often convey emotions attitudes and intentions that can vary across cultures and can be easily misinterpreted
· Cultural Biases and Stereotypes: Cultural biases consciously or unconsciously are present among individuals from different ethnic, national, or racial backgrounds. Biases can influence how parties and arbitrators assess each other credibility during the process. Cultural stereotyping can lead to misunderstandings, negative prejudgments about the participants, wrong assumptions arising mutual mistrust, and not fostering a nice place to start to seek a solution [3]
· Perception of Fairness and Justice: Different cultures have different perspectives of what constitutes fairness and justice. Each culture has its own set of norms and values that define these concepts within that specific cultural context. For example, in some cultures, fairness can be closely linked to principles such as quality and impartiality while others prioritize communal harmony or relational considerations. They usually say that “Justice must not only be done but must also be seen to be done”. In practical terms, this implies that parties should be heard and understood in what that matches their cultural context to the extent that this is feasible and compatible with the fairness/equity of arms. [4]
Practices to overcome Cultural Considerations
· Arbitrators should be self-critical regarding their limited understanding of other cultures and they should be self-aware regarding their own rotted culture and beliefs in order to keep a neutral position during the arbitration process. By acknowledging their biases and limitations arbitrators should approach each case with open-mind, cultural sensitivity and commitment to impartiality [5]
· Develop guidelines that will outline best practices for recognizing, acknowledging, and classifying cultural differences that may arise during arbitration proceedings. In that way, arbitrators could easier identify and therefore address the cultural issues and give emphasis on the advancement of quality fairness and efficiency of the process [6]
· Arbitrators should be given special legal cross-cultural training including cross-border practice in order to familiarize themselves with different legal cultures. By undertaking this training arbitrators not only will understand the differences in the legal systems but also encompass the idea that cultural factors play a major role in the arbitration process helping them to navigate the cultural complexities [7]
The potential of international arbitration to convey a perfect forum for the resolution of disputes between parties from different cultures is quite promising. However, the cultural disparities that the parties will bring to bear in the process are unavoidable. Cultural considerations have a huge impact on the process and the ultimate outcomes of the international arbitration process. Identifying, understanding, and navigating the different elements of the culture will make the process easier and more pleasant for all the parties involved and most importantly more successful in delivering fair and satisfactory solutions. Thus, the participants should embrace diversity in order for international arbitration to reach its full potential.
[1] Howard M, ‘Impacts of cultural differences on international arbitration based on the example of Iran’ (PHD thesis, Robert Gordon University 2018)
[2] Michael Edward, ‘Cultural considerations and their impact on international arbitration proceedings’ Spencer-West Limited < https://michaeledwards.uk/cultural-considerations-and-their-impact-on-international-arbitration-proceedings/ > accessed 10 May 2024
[3] Philip F. Shinn, ‘Harmonizing Cultural Differences in International Dispute Resolution” National Asian Pacific American Bar Association 2021 National Conference
[4] Khawar Qureshi, ‘Cultural sensitivity and International Arbitration’ [2008] MCNAIR International < https://www.mcnairinternational.com/client/publications/2008/English-Cultural_sensitivity_and_International_Arbitration.pdf > accessed 10 May 2024
[5] Ibid
[6] Khawar Qureshi, ‘Cultural sensitivity and International Arbitration’ [2008] MCNAIR International < https://www.mcnairinternational.com/client/publications/2008/English-Cultural_sensitivity_and_International_Arbitration.pdf > accessed 10 May 2024
[7] Kai Lucke Aloys Rigaut, ‘Cultural Issus in International Mediation’ [2002] < https://www.nottingham.ac.uk/research/groups/ctccs/projects/translating-cultures/documents/journals/cultural-issues-mediation.pdf > accessed 11 May 2024