Analyzing the Lack of International Commercial Arbitration Centers in Pakistan: A Comparative Study with Deployment Countries

Abstract

The study investigated what stop Pakistan from establishing an internationally respected commercial arbitration center, despite being part of the 1958 New York Convention. The study looked at Pakistan’s arbitration system next to mature arbitration systems in Asia, trying to understand legal, institutional and procedure issues, monitor court involvement trends and find out about the numbers of specialized arbitrators and how foreign investors view the Pakistani system. Questionnaires were used to survey 50 legal professionals (30 judges and 20 lawyers) in Pakistan’s legal centers to study their views on the arbitration system, its obstacles and possible reforms. All participants agreed that Pakistan’s arbitration system is not up to international standards because of courts interfering excessively (mentioned by 83.3% of judges and 75% of lawyers). The respondents strongly believed in the benefits of institutional reforms such as setting up arbitration centers (100%), offering specialized judicial training (100%) and working with well-known bodies such as the ICC and LCIA (100%). Lack of disagreement in the meetings revealed that systemic change was resisted. Many pointed out that Pakistan has old and weak laws, with few enforcements and said it could benefit economically from becoming an arbitration hub that brings in more foreign capital and eases the burden on courts. It was recommended that to establish the international commercial arbitration center in Pakistan. Foremost in the study’s conclusions was the reason that legal updates and improved capacity are needed at the national level for Pakistan to become a major place for arbitration.