The U.S. is a leading jurisdiction for the resolution of disputes via arbitration and strongly favors arbitration.

1.1 Advantages

Major advantages of arbitration in the U.S. include the presence of leading arbitration institutions and facilities, a deep pool of well-qualified arbitrators and counsel, and pro-arbitration courts.

1.2 Disadvantages and common pitfalls

One potential disadvantage is that an otherwise confidential award can become public if a judicial action is brought to confirm or vacate the award.

1.3 Distinctive features

Unlike many jurisdictions, the U.S. has not adopted the UNCITRAL Model Law.

2.1 Legal framework

International arbitration in the U.S. is governed principally by the Federal Arbitration Act (FAA) (9 U.S.C. §§ 1–16, 201–208, 301–307). The FAA addresses the validity of arbitration agreements, provides for courts to give effect to arbitration agreements, governs court intervention in arbitration and the confirmation and vacatur of awards, and implements the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”) and the Inter-American Convention of International Commercial Arbitration (“Panama Convention”).

2.2 What qualifies under domestic law as “international arbitration”? Is there a specific statute?

Under sections 202 and 302 of the FAA, an international arbitration is an arbitration that involves at least one non-U.S. party, involves property located abroad, envisages performance or enforcement abroad, or has some other reasonable relation with one or more foreign states.

2.3 Ratification of the New York Convention

The U.S. acceded to the New York Convention on 30 September 1970 and implemented it via 9 U.S.C. §§ 201 et seq.

2.4 Ratification of the ICSID Convention

The U.S. ratified the ICSID Convention on 10 June 1966 and implemented it via 22 U.S.C. § 1650a.

2.5 Other treaties relating to arbitration

The U.S. ratified the Panama Convention on 10 November 1986 and implemented it via 9 U.S.C. §§ 301 et seq.

2.6 Choice of forum for intra-EU dispute settlement

While there is no authoritative merits ruling on the topic, a recent decision of the U.S. Court of Appeals for the District of Columbia Circuit in NextEra Global Energy Holdings B.V. v. Kingdom of Spain indicates that U.S. courts will exercise jurisdiction to enforce an intra-EU award against an EU Member State.

2.7 Is the municipal law governing arbitration based on UNCITRAL Model Law?

The FAA is not based on the UNCITRAL Model Law. Some U.S. states have adopted the UNCITRAL Model Law, such as Florida and Texas. California adopted the 1985 UNCITRAL Model Law in 1988 and, in 2024, amended its law to conform to the 2006 UNCITRAL Model Law.

2.8 Recent amendments or reforms in arbitration laws

There have been no notable recent legislative amendments or reforms.

3.1 Presence of local arbitration institutions

There are many local arbitration institutions. Prominent institutions include the American Arbitration Association (AAA), the International Centre for Dispute Resolution (ICDR), JAMS and the CPR Institute for Conflict Prevention and Resolution (CPR).

3.2 Does the London Court of International Arbitration (LCIA) have a local office?

No.

3.3 Does the Permanent Court of Arbitration (PCA) have a local office?

No.

3.4 Does the ICC International Court of Arbitration have a local office?

Yes, in New York.

3.5 Does the International Centre for Dispute Resolution (ICDR) have a local office?

Yes.

3.6 Agreement entered into with local offices of international arbitration institutions

International arbitration institutions are free to operate in the United States.

4.1 Requirements as to content and form

The FAA does not prescribe the content and form of the arbitration agreement. Courts have held that there is no requirement that the arbitration agreement be signed.

4.2 Validity of arbitration agreements

The FAA provides that an arbitration agreement or clause in any commercial contract is “valid, irrevocable and enforceable.” An arbitration agreement will be invalid or unenforceable for the same reasons a contract would be invalid or unenforceable under the law governing the arbitration agreement.

A 2022 amendment to the FAA also renders invalid and unenforceable, at the claimant’s option, mandatory pre-dispute arbitration agreements and joint-action waivers in cases regarding sexual assault and sexual harassment disputes (9 U.S.C. §§ 401, 402).

4.3 Special formalities

There are no special formalities for the formation of arbitration agreements.

4.4 Governing law

As a result of the principle of severability, the law applicable to the underlying contract will not necessarily apply to the arbitration clause. While parties may agree to a choice-of-law clause that expressly applies both to the contract and to the arbitration clause, if they have not expressly agreed on the law governing the arbitration clause, the tribunal will apply the governing law of the main contract or the law of the state in which the arbitration is seated.

5.1 Applicable restrictions

The FAA does not restrict the types of disputes that can be resolved through arbitration, and U.S. courts have historically avoided limiting the availability of arbitration as a means of dispute resolution.

Courts have also held some narrow categories of disputes over divorce or child custody to be non-arbitrable. More recently, there have been state legislative efforts to ban or limit arbitration clauses in cases brought by consumers and in employment disputes.

6.1 Stay of proceedings

If a party commences court proceedings in breach of an arbitration agreement, the counterparty can seek to stay this action (9 U.S.C. § 3) or compel arbitration in accordance with the parties’ arbitration agreement (9 U.S.C. § 4).

6.2 Anti-suit injunctions

U.S. courts have issued anti-suit injunctions to prohibit a party from pursuing proceedings abroad in violation of an arbitration agreement. Courts typically consider international comity when deciding a motion for an anti-suit injunction.

7.1 Restrictions on the parties’ freedom to choose arbitrators

The FAA does not impose any restrictions on the parties’ freedom to choose arbitrators.

7.2 Requirement of arbitrator independence and impartiality

The FAA does not contain any specific requirements regarding arbitrator independence, impartiality, or the disclosure of potential conflicts of interest. However, it creates an implicit standard by providing that an award can be set aside on the ground of evident partiality or corruption in the arbitrators. Under that standard, U.S. courts have generally held that a mere failure to disclose a potential conflict of interest is not a sufficient basis to annul an award; instead, the challenging party must demonstrate that the partiality is direct, definite, and capable of demonstration rather than remote, uncertain or speculative.

7.3 Mandatory rules applicable to the appointment process

There are no mandatory rules applicable to the appointment process.

7.4 Appointment mechanism in the absence of party agreement or applicable institutional rules

Where parties fail to specify a method for appointing arbitrators, the institutional rules governing the arbitration provide for default appointments, usually of one to three arbitrators, depending upon the complexity of the case. Under section 5 of the FAA, a court may intervene if: the arbitration agreement fails to specify a method; a party does not follow the specified method; or there is a “lapse in the naming of an arbitrator.” Such court-appointed arbitrators act with the “same force and effect as party appointed arbitrators.”

7.5 Mandatory rules applicable to the replacement process

There are no mandatory rules applicable to the replacement process. Section 5 of the FAA, described in Section 7.4, above, governs if there is no method for “filling a vacancy.”

7.6 Mandatory disclosure obligations

There are no mandatory disclosure obligations.

7.7 Grounds for challenge

The FAA does not address the challenge of arbitrators.

7.8 Mandatory rules governing the challenge of arbitrators

There are no mandatory rules governing the challenge of arbitrators.

7.9 Removal

The FAA does not address the removal of arbitrators.

New York state courts, by contrast, have found that they have the “inherent” authority to disqualify an arbitrator before an award is rendered when there exists a real possibility that injustice will result. Whether the FAA rule pre-empts the New York rule is not settled.

7.10 Liability and immunity of arbitrators

The FAA does not address immunity for arbitrators, but the 2000 Uniform Arbitration Act that has been adopted by many U.S. states explicitly provides for arbitrator immunity from civil liability. U.S. courts have similarly held that an arbitrator is immune from civil liability for actions in the execution of the arbitrator’s decision-making function.

Reflecting the strong U.S. policy in favor of arbitration, U.S. courts generally will not intervene in international arbitration proceedings. When an arbitration is seated in the U.S., however, courts will intervene in limited instances (described below) to support arbitral proceedings. Courts may also order provisional relief in support of international arbitral proceedings seated outside of the United States.

8.1 Interim measures

8.1.1 Overview of interim measures

A party can apply to a court for injunctive relief before the appointment of the arbitral tribunal to preserve the status quo (for example, to prevent the termination of a contract before the tribunal is constituted). The court examines whether the typical requirements for issuance of injunctive relief are satisfied.

8.1.2 Relevance of availability of emergency arbitrator mechanism

A party can also seek the appointment of an emergency arbitrator to preserve the status quo.

8.2 Taking of evidence

Section 7 of the FAA gives an arbitral tribunal the authority to summon any person to testify and supply documentary evidence. Federal and state courts, where they have jurisdiction, can enforce an arbitral subpoena.

8.3 Appointment or challenge of arbitrators

See Sections 7.4, 7.5 and 7.9, above.

8.4 Other available assistance

No other types of assistance to arbitration are commonly available.

9.1 Domestic scope of sovereign immunity from jurisdiction

Foreign sovereigns are presumptively immune from the jurisdiction of U.S. courts under the Foreign Sovereign Immunities Act. There are exceptions to that immunity, including in actions to enforce arbitral awards against foreign sovereigns under an international treaty calling for the enforcement of arbitral awards and where the foreign sovereign has waived immunity.

9.2 Immunity from execution

Non-commercial assets of foreign sovereigns are immune from execution under the Foreign Sovereign Immunities Act.

There are no mandatory procedural rules that arbitrators must follow. Arbitrators are typically bound by the arbitration rules and procedures agreed on by the parties in their arbitration agreement.

The FAA does not provide default rules governing arbitral procedure where the parties fail to designate applicable rules. There are a few exceptions to this, such as section 7, which gives arbitrators the power to subpoena witnesses in certain instances.

The FAA does not address the confidentiality of arbitral proceedings and U.S. courts are reluctant to find any implied duty of confidentiality in arbitral proceedings. Applicable procedural rules may contain provisions regarding confidentiality.

Parties often enter into confidentiality agreements to govern proceedings. Courts generally enforce these confidentiality agreements. However, given the public policy of access to documents filed in open court, arbitral awards and certain underlying evidence may become public on the filing of a motion to confirm or vacate an arbitral award.

12.1 Requirements as to content and form

To be enforceable in the United States, an award must be in writing. A tribunal need not provide reasons for its award under the FAA unless a reasoned award is required by the arbitration rules applicable to the dispute or by the parties’ arbitration agreement.

12.2 Time limit

The FAA does not impose a time limit for rendering an award.

12.3 Remedies

The FAA does not limit the types of remedies that an arbitral tribunal can award. However, the parties can agree to limits. If the substantive law governing the contract allows for equitable remedies such as specific performance or rescission or reformation of a contract when damages are inadequate, the arbitrators can order those remedies.

The governing law may establish other limitations on the remedies available, for example, by prohibiting the recovery of punitive damages.

The FAA does not expressly address whether arbitral tribunals seated in the U.S. can order interim measures. However, consistent with the general rule of giving effect to the parties’ arbitration agreement, courts broadly accept that tribunals can order interim relief if the arbitration agreement or applicable arbitration rules grant them the authority to do so. Preliminary or interim relief typically takes the form of an injunction (for example, ordering the parties to preserve the status quo or an attachment).

13.1 Interpretation and correction of awards

The FAA requires a party to seek to modify or correct an award within three months of its issuance (9 U.S.C. § 12).

13.2 Challenge of an award

The FAA requires a party to seek to vacate an award within three months of its issuance (9 U.S.C. § 12). A court may vacate an award: if the award was procured by corruption, fraud or undue means; if there was evident partiality by the arbitrators; if there was arbitrator misconduct; or if the tribunal exceeded its powers.

13.3 Recognition and enforcement proceedings

The FAA requires a party to seek to confirm an award rendered in the United States that is not governed by the New York Convention or the Panama Convention within one year of its issuance (9 U.S.C. § 9). By contrast, a party has three years to seek to confirm an award governed by the New York Convention or the Panama Convention (9 U.S.C. §§ 207, 302).

13.4 Cost of enforcement

Absent agreement to the contrary, each party will bear its own costs incurred in an enforcement proceeding.

13.5 Enforcement of orders of emergency arbitrators

U.S. courts are split on whether orders of emergency arbitrators are enforceable under the FAA.

14.1 Process for enforcing New York Convention awards

A party may file a petition to confirm a New York Convention award, i.e., convert it into a judgment, in federal court. Courts have held that proceeding to confirm a New York Convention award is summary in nature.

14.2 Grounds for resisting enforcement of New York Convention awards

A court may deny recognition or enforcement of a New York Convention award on the basis of the grounds set out in Article V of the New York Convention. Courts have held that those grounds should be narrowly construed, including the public policy exception.

14.3 Enforcing non-Convention awards

A court may deny recognition or enforcement of an award not governed by the New York Convention on the same grounds it could vacate an award, as described above in Section 13.3.

15.1 Applicable to counsel

The conduct of counsel is governed by various rules, including mandatory ethical rules applicable in the jurisdiction(s) in which they are licensed, the ethical rules of the place where the conduct occurs, and any ethical rules or guidelines imposed by the tribunal or the arbitration agreement.

15.2 Applicable to arbitrators

While there are no mandatory professional or ethical rules imposed by the FAA, many arbitral institutions have developed codes of conduct for arbitrators.

16.1 Applicable regulatory requirements

The U.S. has historically prohibited third-party litigation funding pursuant to the doctrine of champerty. In recent years, however, the trend has been towards limiting the doctrine’s reach. There is currently no explicit prohibition of third-party funding of arbitration claims.

16.2 Overview of the third-party funding market

The U.S. is now considered the largest third-party litigation funding market in the world. In 2020, six leading funders created the International Legal Finance Association in Washington, D.C., suggesting the growing popularity of third-party funding in the United States. It has been reported that, in 2023, litigation funders in the U.S. market had a combined USD 15 billion assets under management, remaining relatively flat from the prior year. The Swiss Re Institute estimated in December 2021 that 52% of the USD 17 billion investment into litigation funding globally was deployed in the U.S.

17.1 Types of specialist arbitration

Securities arbitration, construction arbitration, and employment and labor arbitration are prominent in the U.S. Securities arbitrations are administered by the Financial Industry Regulatory Authority (FINRA), a private independent regulator of securities firms.

17.2 Key legal principles

The legal principles are dependent on the governing law of the contract at issue in the given arbitration.

17.3 Types of claim and defences typically brought in that area

See response to Section 17.1, above.

17.4 Issues and strategic considerations to take note of

Whether specialist arbitration is used will depend on the contract at issue.

There have been two recent notable developments in the jurisprudence regarding international arbitration in the U.S.:

• In 2022, the Supreme Court unanimously held, in ZF Automotive US, Inc. v. Luxshare, Ltd., that 28 U.S.C. § 1782 does not permit discovery in aid of disputes being heard by international arbitral tribunals seated abroad, as those tribunals lack governmental or intergovernmental authority. Although the decision did not address the applicability of § 1782 to ICSID tribunals, in July 2024, the Second Circuit, in Webuild S.P.A. v. WSP USA Inc. held, citing the Supreme Court’s decision, that § 1782 does not apply to an ICSID tribunal.
• As noted above in Section 2.6, in 2024 the U.S. Court of Appeals for the D.C. Circuit held that Spain was not immune from an action to enforce an intra-EU arbitration award.