Should the Sri Lankan government develop a government-sponsored arbitration centre for the resolution of international commercial disputes? -An effort to make Sri Lanka a viable commercial hub

Abstract

One of the major objectives of Sri Lanka is to achieve economic prosperity after the end of decades long conflict that ravaged the country. The desire to achieve this objective is reflected through massive development programmes undertaken by the present government. It is also evident that these development activities have been designed with a view to promote and prosper in international trade, investment and transnational electronic commerce within the country with the ambition of becoming a major player in Asia. In order to achieve the expected economic and non-economic goals through the development activities, the existence of an effective dispute resolution mechanism is a must in any particular country. In fact, it is questionable as to whether the existing Sri Lankan national courts have been updated adequately from both legal and institutional perspectives to resolve international trade-related cross-border disputes. As an option to overcome the exiting drawbacks of the national courts, it is desirable to analyse and promote Alternative Dispute Resolution (ADR) mechanisms, especially international commercial arbitration for the resolution of such cross-border disputes. In order to substantiate the central argument of this paper, a two-pronged methodological approach is adopted, entailing a case study of Sri Lanka and related literature review. In support of this methodological approach, materials used have been gathered through the Internet and Law Libraries in Sri Lanka. This paper argues that the Sri Lankan government needs to develop an effective government-sponsored internationally viable commercial arbitration centre in Sri Lanka complying with the fundamental requirements which contribute to the development of an effective dispute resolution centre in an international setting in order to promote and prosper international trade and investment. The lack of attention to these fundamental elements can lead to diminishing the objectives of setting up of such an institution. Accordingly, the purpose of this paper is to develop international commercial arbitration-friendly culture in Sri Lanka and to make it a promising hub for providing effective dispute resolution mechanisms for both local and the international business community. Developing such a dispute resolution-friendly environment in the country will be a contributory factor in achieving the development goals of the government and becoming a hub in Asia from a commercial perspective. It is further believed that the leadership from the government is a crucial factor in achieving these overall objectives.