The world’s first international tribunal for complex financial litigation has opened in the Netherlands, headquartered at the Peace Palace in The Hague.
National or local governments and private companies may bring cases before the dispute resolution facility, called PRIME Finance, short for Panel of Recognised International Market Experts in Finance. There are more than 80 of these specialised ‘judges’.
Jeffrey Golden, chairman of the management board, at the inauguration on Monday said: “In large parts of the world this tribunal is important, because although our standard form contracts would frequently send parties with disputes to either the courts of England or New York – and judges in those courts have done a terrific job – the decisions of those courts would not necessarily be enforceable in any number of jurisdictions where we need enforceable results.”
The global financial crisis has added urgency to the founding of the new institution.
Operating by arbitration and mediation is intended to make it possible to handle cases involving vast sums efficiently – in the space of a year – faster than in other courts.
Lawyer Derk Lemstra said: “If it’s an international dispute, it may be beneficial first of all to do it in private, because of course arbitration is confidential. Secondly, there may in some cases be issues of perceived independence, although I am not arguing that the courts in London and New York are not independent. But I think if you are a bank in a third country, litigating against the bank in one of those countries, it may give you added advantage. I think the most important thing is that it goes quickly, that you are assured that you have experts on your arbitration panel, who really know these intruments.”
PRIME is a private foundation backed by the Dutch government. Supported financially by The Hague, which is already host to the International Court of Justice and the International Tribunal for the Former Yugoslavia, PRIME Finance will also work on a fee basis.
Its rulings will be binding in more than 140 countries, with no right of appeal.