LIECHTENSTEIN Law and Practice Contributed by: Christoph Bruckschweiger, Benedikt König, Philipp Benda and Magdalena Marxer-Friedrich, paragraph 7
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In contrast, there are no official statistics regarding the frequency of arbitration cases due to the inher- ent privacy of these proceedings. Nevertheless, legal practitioners observe a strong and continuous affinity for arbitration within the Liechtenstein market. State court litigation can be a practical choice when the defending party has its registered office or assets within Liechtenstein. It is also effective for disputes involving parties located in Austria or Switzerland as bilateral treaties exist between Liechtenstein and these neighbouring countries which facilitate the straightforward cross-border enforcement of court judgments. Without such treaties being in place, enforcing a Liechtenstein court ruling internationally can be chal- lenging. A crucial factor driving the preference for arbitration is global enforceability. Liechtenstein has ratified the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. This makes arbitration attractive for cross-border cases, as it ensures that foreign arbitral awards can be success- fully enforced against Liechtenstein parties, and vice versa. Another major reason for choosing arbitration pro- ceedings is confidentiality, as parties frequently want to exclude the public from sensitive matters. Compared to state court litigation, arbitration offers a swifter resolution to disputes and provides parties with greater procedural flexibility.
1. Dispute Resolution Methods 1.1 Main Dispute Resolution Methods Regarding the main dispute resolution methods in Liechtenstein, a distinction can be made between state court litigation and alternative dispute resolution methods. The most common mechanisms include: • contentious proceedings before state courts, gov- erned by the Code of Civil Procedure; • non-contentious proceedings also before state courts, governed by the Code on Non-Contentious Matters; • arbitration proceedings; and • mediation, which is regulated under the Mediation Act. 1.2 Choice of Dispute Resolution Method Traditional litigation remains a highly utilised method for resolving disputes in Liechtenstein. State courts publish annual statistics demonstrating this reliance, with a current ratio of roughly three to two regard- ing contentious proceedings versus non-contentious proceedings. The allocation of a case to either contentious or non- contentious proceedings is strictly prescribed by law. Classic civil and commercial disputes, such as claims for damages or contractual disagreements, must be conducted through contentious proceedings. Con- versely, non-contentious proceedings are not legally permitted for these standard disputes. Instead, they are frequently utilised to resolve specific matters under the Persons and Companies Law, with a strong focus on foundation and trust issues.
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