Dispute resolution has traditionally been court of
law oriented in Finland. However, arbitration has recently
become increasingly popular especially among legal persons,
i.e. business entities, as an alternative to court of
law procedure. Consequently so-called business-to-business
disputes are more often submitted to arbitration.
 Arbitration
is considered to hold certain advantages in comparison
with dispute resolution in courts of law. Arbitration
provides for speedy resolutions in contrast to generally
lengthy proceedings in courts of law. Arbitral proceedings
and arbitral awards are generally private, whereas proceedings
and judgments in courts of law are public. Furthermore,
in arbitration the disputing parties may utilize the
best experts as arbitrators on a case-by-case basis,
which is not possible in courts of law. Hence, in arbitration
the probability of objectively correct resolutions is
considered to be greater than in courts of law.
Arbitration
is based on the principle of freedom of contract. There
are two basic forms or types of arbitration: ad hoc
and institutional. Both of these forms are based on
the parties’ agreement. In Ad hoc arbitration
the parties agree on the particular arbitration mechanism
on a case by case basis. The arbitration will be ad
hoc, unless the parties have explicitly opted for institutional
arbitration. In the latter kind of arbitration the parties
submit their disputes to arbitration conducted under
the auspices of, or administered or directed by an existing
institution. Arbitration proceedings are however not
considered institutional if the arbitration institute
in question only is competent to appoint the arbitrators,
without applying the rules of the institute to the actual
arbitral proceedings.
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