By Reagan Powers

Over the past few years, regional arbitration centers have grown in popularity, rivaling the historical dominance of the International Chamber of Commerce and the London Court of International Arbitration. The regional arbitration centers aim to provide cost-effective, localized, and efficient dispute resolution.

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Advantages of Regional Arbitration Centers

As markets continue to become more globalized, stakeholders desire a greater say in the resolution of their disputes when it comes to where a case is heard, what rules govern, and how arbitrators are selected. Regional arbitration centers can grant them that say. One of the most significant advantages regional centers offer is accessibility as they decrease the costs of transporting witnesses and documents to the venue. Countries which generate a large number of disputes participate on a low scale in the resolution. The countries generating these disputes may participate on a low scale due to enforcement issues, concerns over bias, high costs, and a desire to maintain political control over important issues. As interested parties, the importance of resolving disputes that concern their region or are in or near their region is imperative. When backed by arbitration-friendly judiciaries, regional centers can build investor confidence and facilitate smoother dispute resolution for businesses operating in the region.

Regional arbitration centers offer services tailored to that particular jurisdiction, aligning with local legal systems, business customs, and cultural expectations. This localization benefits the bargaining power of local parties who may opt for relations with regional institutions. Tailored services, such as rules in the local language and panels of arbitrators familiar with local laws and practices, can increase stakeholder confidence. Additionally, these centers offer cost-effective services compared to larger, more established international centers.

These centers also benefit the local market by providing infrastructure, resources, and capacity building. Local practitioners who might have otherwise taken their services elsewhere now have platforms in their regions to practice. The growth of regional arbitration centers contributes to the development of local legal and arbitration communities by training professionals, encouraging knowledge exchange, and expanding the pool of qualified arbitrators.

The Singapore International Arbitration Centre and the Hong Kong International Arbitration Centre

Two regional arbitration centers– Singapore International Arbitration Centre (SIAC) and the Hong Kong International Arbitration Centre (HKIAC)– exemplify these advantages.

Both centers have seen growing use, with the SIAC handling 625 new cases in 2024 and the HKIAC handling 503 new cases in 2024. The SIAC has grown in popularity due to its business-friendly environment, reputation for impartiality and integrity, and its connectivity to countries in Southeast Asia and the Asia-Pacific region. The HKIAC has grown in popularity in part because Hong Kong remains the only seat outside of Mainland China where parties may obtain interim relief directly from Mainland courts. The HKIAC has become well equipped to handle complex and urgent disputes, including those with a Mainland China nexus.

Both the SIAC and the HKIAC have distinguished themselves as leaders due to a combination of legal, infrastructural, and reputational factors. Because both cities serve as global financial and trade hubs, they are attractive venues for cross-border disputes. Additionally, their governments have made deliberate efforts to promote arbitration, investing in facilities and promoting their jurisdictions as arbitration-friendly.

Factors For Success of Regional Arbitration Centers

While the SIAC and the HKIAC are the posterchildren of growing regional arbitration centers, other centers have not seen the same level of popularity.   

For regional arbitration centers to be successful, there are several factors to consider, including  openness of the region’s government and judiciary to arbitration, attractive geological location to parties, and growing international credibility.

In some jurisdictions, national laws are either not aligned with international arbitration standards or allow for excessive judicial interference, undermining party confidence in the arbitration process. Additionally, some centers struggle with limited administrative capacity, outdated procedural rules, and a lack of experienced practitioners.

Geopolitical instability can diminish trust in certain regional arbitration centers and limit investment in infrastructure and marketing. Further, international engagement is crucial for lesser-known arbitration centers seeking to build the visibility and reputation necessary to attract cross-border disputes.

Without consistent reforms, transparency, and strategic development, many regional arbitration centers struggle to compete with the credibility, accessibility, and innovation offered by leading institutions.

“Although other regional arbitration centers are slower to gain popularity, when regional centers tailor their services to local needs while adhering to international standards, these centers enhance access to justice, help decentralize the global arbitration landscape and foster greater confidence in arbitration across diverse jurisdictions.”
^{Reagan Powers}

Conclusion

Regional arbitration centers play a vital role in the global dispute resolution landscape by offering accessible, cost-effective, and culturally attuned alternatives to large, traditional arbitration centers. Their success depends on factors including strong legal frameworks, institutional credibility, and strategic location. Leading centers like SIAC and HKIAC have set a high standard through innovation, transparency, and international engagement, while others lag due to legal uncertainty, limited resources, or lack of global recognition.

Although other regional arbitration centers are slower to gain popularity, when regional centers tailor their services to local needs while adhering to international standards, these centers enhance access to justice, help decentralize the global arbitration landscape and foster greater confidence in arbitration across diverse jurisdictions.