How does arbitration differ from litigation?

Arbitration is fundamentally characterized as a private dispute resolution process, which distinguishes it significantly from litigation. In arbitration, the parties agree to resolve their disputes outside of the courtroom, typically by presenting their case to one or more arbitrators who render a binding decision. This process allows for more privacy, as the proceedings and outcomes are not part of the public record, contrasting with litigation, where disputes are resolved through formal court processes that are public and adhere to established legal protocols and rules.

In addition, arbitration often allows for more flexibility in procedures and timelines, as parties can choose their arbitrators and tailor the arbitration process to their specific needs, making it a quicker and potentially less expensive alternative to litigation. The informal nature of arbitration contributes to a generally quicker resolution compared to the often lengthy and procedural nature of court cases, where the complexities of litigation can lead to extended timelines.

The other choices reflect misunderstandings about these processes. For instance, litigation is not less formal than arbitration; rather, it involves stricter adherence to formal rules and procedures. Furthermore, arbitration is not limited to international disputes; it is commonly used in domestic cases as well. Lastly, while arbitration often leads to quicker resolutions than litigation, saying that litigation can be resolved quicker is misleading as it