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Presented at an LL.M seminar at Cornell Law School on November 12, 2004.


The national statutes on international commercial arbitration, the leges arbitri, do, as a rule, not contain provisions on costs. In the final award, an arbitrator has to determine the costs of the arbitration (the fees of the arbitral tribunals, of expert witnesses mandated by the arbitral tribunal etc.), which cost incurred by the parties during the arbitration are recoverable and which party has to bear what share of the costs. A decision on these issues forms part of the ordinary course of an arbitration. Further cost-related issues may arise due to the peculiarities of the case, such as a refusal of one of the parties to contribute to the financing of the arbitration. Resorting to agreements may provide a satisfactory means for certain decisions on costs in arbitration proceedings; this is by making use of the contractual nature of these agreements; by asking whether these agreements can be interpreted in a way that gives an answer to the issue at stake or - as in the case of security for costs - whether the contract may be amended to grant a motion for security for costs. It is submitted that the reasoning so achieved is at least as convincing and consistent as other approaches solicited by doctrine. Therefore, it is further submitted that this approach should be considered when an issue arises that is not addressed in the lex arbitri or the institutional arbitration rules .

Date of Authorship for this Version

November 2004


Arbitration costs

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Contracts Commons