China has been South Korea's biggest trading partner since 2004. Accordingly, companies in Korea have been forced to encounter many claims arising out of international trade with Chinese parties which should be resolved by arbitration.
An arbitrator is a private person who is empowered to proceed the disputed cases that were submitted to arbitration. The arbitrator is expected to be impartial and independent, and will ultimately render an arbitral award pursuant to the Arbitration Act.
Thus, it is most important for arbitral institutions to have knowledgeable and eminent arbitrators onto their own roster of arbitrators, so that the parties may choose a proper arbitrator.
In comparison with arbitrator system between Korea and China, some problems are found. I would like to suggest alternatives to remove legal obstacles which interrupt merits and development of arbitration regime, and to respect principle of freedom of agreement between the parties as follow; (i) it is necessary to establish the standard of arbitrator's quality in Arbitration Act or Arbitration Rules of Korea, (ii) it is essential to empower the right to the KCAB to decide finally on the matter of power of arbitral tribunal and challenge an arbitrator in the above. Act and Rules, and (iii) it should be amended and newly added in the arbitral rules of law providing respective arbitral institutions to appoint an arbitrator(s) by using the List-up Method if the parties are unable to agree on the arbitrator, or where claimant(s) and respondent(s) fail to jointly appoint an arbitrator(s) in case of multi-party involved.
In the meantime, it should be noted for Korean entities using Chinese arbitration system as follow:
It is almost impossible for the parties to agree on the presiding or sole arbitrator and it is, accordingly, the Chinese arbitral institutions to finally appoint an arbitrator(s) which is unfavorable for Korean parties. Thus, it is desirable for the Korean entities to insert a special provision providing that a presiding arbitrator shall be appointed among those who is that of other than nationality of the parties out of roster of their own arbitrators in China from the early stage of negotiation between the parties.
If it is requested for arbitration arising out of the matter above, it is desirable for the Korean parties to rely on the above provision and to appoint any Korean arbitrator registered in the CIETAC's panel of arbitrators for a party-nominated position.
In conclusion, it is meaningful to examine and study on comparative arbitration system between Korea and China, especially to scrutinize arbitrator system in depth, which can be a good tool to prevent any potential disputes and to resolve the disputed matter in an efficient and prompt manner, and finally to protect Korean entities' interest and value by actively participating in appointing process of arbitrator(s). Furthermore, these activities lead to enhancement in competitive power of Korean entities and government and will help facilitate development of arbitration industry.