Settlement of Disputes by Way of Arbitration in Pakistan

Abstract

Arbitration is a method, through which, parties resolve their disputes; outside the court of law; by avoiding all types of technicalities of procedural law. It is one of the modes of Alternate Dispute Resolution. The Arbitration Act 1940 is the only statute in Pakistan, which deals with all types of arbitration processes in Pakistan, but it does not deal with the recognition and enforcement process of International Arbitral Awards in Pakistan. The New York Convention 1958 is enforced in Pakistan, through the Recognition and Enforcement Act 2011 and it deals with the recognition and enforcement process of International Arbitral Awards in Pakistan. The problem in Pakistan is that the majority arbitration processes are not conducted, in accordance with the provisions of the prescribed laws of arbitration, they are usually conducted, in accordance with the customs and usages of the society, which are not prescribed in the current Arbitration Act 1940. There are private Jirga and Punchayat systems; in rural areas; throughout Pakistan, to resolve disputes of the poor people of the locality and the decision of that proceeding usually are not submitted in the court of law, for the implementation, which is the requirement under the Arbitration Act 1940, for the smooth implementation of the decision; through the executive wing of the state. Many countries of the world have amended their arbitration laws, as per the customs and usages of the society and under the light of the relevant International Conventions and Treaties. Similarly, in Pakistan, the Arbitration Act 1940 needs a lot of changes, as per the customs and usages of the society, relevant principles laid down in the Holy Quran and Sunnah of Prophet Muhammad and in accordance with the related International Conventions and Treaties. The UNCITRAL Model Law 1985 is not applicable in Pakistan, thus it is also a requirement and need of the time to be implemented in Pakistan, through the act of the Parliament.