Duhaime's Law Dictionary


Commercial Arbitration Definition:

Arbitration of a dispute as to a trade transaction for the supply or exchange of goods or services.

A form of arbitration which is designed for use within commercial relationship and not personal, family law or labor law relationships.

Arbitration has traditionally been limited to commercial, business or trade relationships but with the increasing public malaise with the civil court system, arbitration has grown dramatically as an alternative dispute resolution measure. To stop the resolution of disputes to areas such as family law, the adjective of commercial has been added to arbitration. Some jurisdictions continue to name their arbitration statutes by the older name of, simply, arbitration act, and to then, just as with most commercial arbitration agreements, exclude family law disputes from the application of the statute, and to enact separate legislation in regards to labour or labor disputes.

Jurisdictions also distinguish between commercial arbitration and international commercial arbitration, the former for disputes which are exclusively domestic in nature, and the latter in regards to commercial disputes with an element of international commerce (eg. foreign trade). For example, Nova Scotia has a Commercial Arbitration Act and an International Commercial Arbitration Act.

For example, the UNCITRAL Model Law on Commercial Arbitration defines commercial arbitration:

"... to cover matters arising from all relationships of a commercial nature, whether contractual or not.

"Relationships of a commercial nature include, but are not limited to, the following transactions: any trade transaction for the supply or exchange of goods or services; distribution agreement; commercial representation or agency; factoring; leasing; construction of works; consulting; engineering; licensing; investment; financing; banking; insurance; exploitation agreement or concession; joint venture and other forms of industrial or business cooperation; carriage of goods or passengers by air, sea, rail or road."

As a sample of domestic legislation, the Commercial Arbitration Act of British Columbia defines commercial arbitration in a circuitous fashion to cover arbitration agreements which deal with:

"... a trade transaction for the supply or exchange of goods or services; a distribution agreement; a commercial representation or agency; factoring;leasing;construction of works; consulting; engineering; licensing; financing; banking; insurance; an exploitation agreement or concession; joint venture and other related forms of industrial or business cooperation; carriage of goods or passengers by air, sea, rail or road; (and) investing."

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