Arbitration as an alternative for solving disputes in Mexico
By Rodolfo Sanchez Arellano, New Corporate Approach
Legal disputes in Mexico may be resolved by Iitigation or through alternative dispute resolution mechanisms, such as negotiation, mediation, conciliation and arbitration. Over the past few years, arbitration has been increasingly used in Mexico to settle commercial disputes.
The Mexican legislation on arbitration is set out in the Code of Commerce, which incorporates most of the provisions established in the United Nations Commission on International Trade Law (UNCITRAL) and applies to domestic and international arbitration. Mexico has ratified the New York Con-ention and the Panama Convention.
In the case of national arbitration, the fact that local courts normally have an excessive workload makes the dispute process very lengthy and costly. In contrast, an arbitral tribunal has greater time availability, representing an important advantage.
Regarding international arbitration, the principal advantages are generally considered to be that in arbitration, both parties have the possibility of solving their dispute in a neutral forum and that the dispute will be solved by a specialist tribunal with expertise in determining such cases.
There are two main forms of arbitration. Institutional arbitration is entrusted to an arbitration institution, which administers the dispute resolution process according to its set of rules; whereas ad hoc arbitration is conducted independently according to rules specified by the parties. Arbitral resolutions are definitive and not subject to appeal.
In case of public controversies, arbitration cannot be used to resolve disputes relating to territorial resources and territorial waters within Mexican territory and, among others, resources within the exclusive maritime economic zone. Nor can it be used to resolve private disputes relating to family and civil status, agrarian issues, criminal offences, bankruptcy or employment.
Rodolfo Sánchez Arellano, Patner
New Corporate Approach, S.C., Mexico, Mexico
T: +52 55 5574 49 33
Rodolfo Sánchez Arellano is a tax partner at New Corporate Approach, S.C., a firm located in Mexico City. He has more than 20 years of experience in advising clients on corporate taxation, international taxation and cross border transactions as well as real estate and infrastructure matters.
published: January 2014