FINLAND Law and Practice Contributed by: Tuuli Timonen, Annika Lampela and Tony Chokairy, Dottir Attorneys
3.5 Arbitral Institutions The Arbitration Institute of the Finland Chamber of Commerce (FAI) is the leading arbitral institution in Finland. The FAI Rules are widely used, especially in domestic but also in international disputes seated in Finland. In cross-border contracts, parties also fre- quently refer disputes to other institutions, such as – and primarily – the Arbitration Institute of the Stock- holm Chamber of Commerce (SCC) or the Interna- tional Chamber of Commerce (ICC). Other institutional rules tend to be less frequently used, although contracts with counterparties based in the United States of America occasionally refer to the International Centre for Dispute Resolution of the American Arbitration Association (ICDR), and con- tracts with Asian counterparties may refer to the Sin- gapore International Arbitration Centre (SIAC) or the Hong Kong International Arbitration Centre (HKIAC). 3.6 Length of Proceedings The duration of arbitration proceedings depends on the complexity and scale of the dispute. In practice, the duration of standard commercial arbitrations may vary significantly depending on factors such as the volume of evidence, the complexity of the dispute and the procedural timetable adopted by the tribunal. Recent data from the FAI and SCC suggests that pro- ceedings are often resolved relatively efficiently. The data indicates median durations of approximately nine months under standard rules. Expedited procedures are available under institutional rules and are designed to ensure faster resolution of disputes. For example, both the FAI and SCC expe- dited rules provide that the final award will typically be rendered within approximately three months from the referral of the case to the arbitrator, subject to possi- ble extensions in exceptional circumstances. In prac- tice, expedited proceedings are typically concluded within a few months. Data from the FAI indicates a median duration of approximately three months, while SCC statistics show that a clear majority of expedited cases are resolved within six months.
strong public interest or mandatory statutory protec- tions – in other words, matters that cannot be settled by an agreement of the parties. In commercial practice, restrictions on arbitrability rarely present obstacles, as most business disputes are considered arbitrable. 3.3 Advantages of Arbitration Arbitration is perceived as offering several advantages in Finland. Arbitration’s (relative) speed and confidenti- ality are often decisive factors, particularly in disputes involving trade secrets, sensitive financial information or reputational concerns. Other commonly cited advantages include: • the ability to appoint arbitrators with specific indus- try expertise; • flexible, efficient and tailor-made procedures; • the finality of awards, with limited grounds for chal- lenge; and • ease of international enforcement under the New York Convention on the Recognition and Enforce- ment of Foreign Arbitral Awards (the “New York Convention”). 3.4 Disadvantages of Arbitration The main perceived disadvantage of arbitration is cost. Arbitrators’ fees and institutional costs can be significant, particularly in high-value disputes involv- ing three-member tribunals, whereas litigation in pub- lic courts is more cost-efficient if the matter is resolved in the first instance (albeit it may take a long time). Limited appeal possibilities may also be viewed as a drawback. While finality is often considered an advan- tage, parties have only narrow grounds to challenge an award, even if they disagree with the tribunal’s legal or factual assessment. In addition, arbitration lacks the same direct coercive powers as courts in certain procedural matters, which may require court assistance. For smaller disputes, litigation before state courts may therefore be a more cost-effective option.
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