ABOUT ARBITRATION

What is arbitration?

Arbitration is a means of resolving disputes that is private, less formal, less costly and less time-consuming than traditional litigation. The parties agree to submit their dispute to an impartial arbitrator authorized to resolve the controversy by rendering a final and binding award. A matter may proceed to arbitration usually in a matter of months, instead of the several years it may take to have a case heard in court.

The matter is heard in a conference room, as opposed to a courtroom. The court’s rules of evidence are not strictly applicable, and there is usually no significant motion practice. Formal rules of discovery do not apply, although the arbitrator may allow for some discovery, such as production of relevant documents and depositions under oath.

Institutional Arbitration

In institutional arbitration, the arbitration proceeding is administered by an arbitration institution such as BDAC. Arbitration is conducted under the auspices of the arbitration institution. BDAC can hear high value, multi-sectoral, cross-border disputes.

Wide range of disputes can be administered by BDAC including, among others, corporate and commercial, trade and investment, construction/engineering, shipping/maritime and insurance. There is no maximum or minimum claim amount for cases to be administered by BDAC.

Brunei Darussalam's legislations on arbitration are based on the UNCITRAL Model Law. Moreover, Brunei Darussalam is a party to the 1958 New York Convention (on enforcement of arbitration awards). Arbitral awards are therefore enforceable in 149 countries.

Generally, arbitration proceedings are conducted under arbitration rules selected and agreed by parties. BDAC has its own arbitration rules which sets out the conduct for arbitration proceedings from the issuance of notice of arbitration to the delivery of the arbitral award.

Emergency Arbitration

A party in need of emergency interim relief may make an application concurrent with or following the filing of a Notice of Arbitration but prior to the constitution of the arbitral tribunal, to BDAC.

The application for emergency relief shall be made in writing and shall be sent simultaneously to the appointed Chairman of BDAC and all other parties to the arbitration.

The Chairperson of BDAC shall determine to accept the application seek to appoint an emergency arbitrator within 2 business days (meaning working days and not including weekends and public holidays) of receipt by the appointed Chairman of BDAC of such application and payment of any required fee.

Once the emergency arbitrator has been appointed, BDAC shall notify the parties. Thereafter, all written communications from the parties shall be submitted directly to the emergency arbitrator with a copy to the other party and BDAC.

Any order or award of the emergency arbitrator shall be made within 15 days from the date of appointment notification of the arbitrator to parties.

Ad Hoc Appointment of Arbitrator Services

Chairperson of BDAC is the default appointing authority in Brunei under the Arbitration Order 2009 and International Arbitration Order 2009.

Where parties require an arbitrator to be appointed in an ad hoc cases where its seat is in Brunei Darussalam and parties have failed to agree in the appointment of an arbitrator, parties can make a request to BDAC to assist in the appointment of the arbitrator.

Benefits of Arbitration

Arbitration is a less formal process than court litigation, and it is conducted in private, away from the glare of the media and the public. Parties to the arbitration, as well as arbitrators, are generally obliged to maintain the confidentiality of all matters relating to the arbitration proceedings and the arbitration award.

  • Flexibility - Parties are free to appoint their own arbitrators, engage their preferred counsel (lawyer) and choose the procedures and rules for the conduct of an arbitration.
  • Enforcement of award - Parties are generally assured of finality once the arbitration award is issued as there are limited avenues for appeal against an arbitration award.
  • Cost-effective - Arbitration process can be more cost-effective and efficient than court litigation.

BDAC Schedule of Fees

Registration Fees



Domestic Administrative Cost



Internationa Administrative Cost



Arbitrator's Fee

For arbitrations conducted pursuant to and administered under these Rules, the fee calculated in accordance with the Schedule below is the maximum amount payable to the arbitrator, unless otherwise agreed by the parties and the arbitral tribunal to determine the fees and expenses, including any rates it intends to apply pursuant to Rule 12(4) of BDAC Arbitration Rules.

The fees payable to the arbitrator do not include any possible taxes such as service tax, withholding tax or other taxes or charges applicable to the arbitrator’s fees. Parties have a duty to pay any such taxes or charges; however the recovery of any such taxes or charges is a matter solely between the arbitrator and the parties.

Domestic Arbitrator’s Fee (BND)



International Arbitrator’s Fee (BND)



Emergency Interim Relief

These following fees shall be payable in an application for emergency interim relief under Rule 7 and Schedule 2 for an emergency interim relief.

Administrative Cost (Non-Refundable)



Emergency Arbitrator's Fee



The Chairman of the BDAC shall fix a provisional advance deposit in an amount intended to cover the costs of the arbitration. Any such provisional advance deposit shall be paid by the parties in equal shares and will be considered as a partial payment by the parties of any deposits of costs fixed by the Chairman of the BDAC under Rule 12.

Med-Arbs Fee

Where the parties have referred their dispute to mediation under BDAC’s Mediation Procedure and they have failed to reach a settlement and thereafter proceed to arbitration, then one-half of the administrative costs paid to BDAC for the mediation shall be credited towards the administrative costs of the arbitration.

General Conduct of Arbitration Proceedings

Initiating arbitration proceedings

  1. Parties have agreed to refer the dispute to arbitration to be administered by BDAC and/or in accordance with BDAC Arbitration Rules;
  2. Filing a Notice of Arbitration (NoA);
  3. Payment of registration fee stipulated in the Rules.

Commencement of arbitration proceedings

  1. Date of commencement;
  2. Estimated maximum costs of arbitration and deposits on costs;
  3. Filing of Response to NoA;

Composition of Arbitral Tribunal

  1. Appointment of Sole Arbitrator
    • Parties shall jointly nominate for sole arbitrator. In the event, where parties have not agreed on the prospective sole arbitrator within 30 days from NoA, Chairperson of BDAC shall make the appointment (Rule 4(5) of BDAC Rules);
    • BDAC will perform conflicts check with prospective arbitrator to screen any conflicts that may rise in accordance with BDAC Rules, if applicable;
    • Prospective arbitrators shall make a signed Declaration and then will be appointed by the Chairperson of BDAC.
    • BDAC shall inform the parties of the appointment of the arbitrator.

  2. Three-member Tribunal
    • Each party shall appoint 1 arbitrator. Thus, 2 arbitrators have been appointed and shall choose the third arbitrator who will act as the presiding arbitrator of the arbitral tribunal (Rule 4(6) of BDAC Rules).
    • If parties fail to make an appointment, the Chairman of BDAC can assist in the appointment of an arbitrator.
    • BDAC will perform conflicts check with prospective arbitrator to screen any conflicts that may rise in accordance with BDAC Rules, if applicable;
    • Prospective arbitrators shall make a signed Declaration and then will be appointed by the Chairperson of BDAC.
    • BDAC shall inform the parties of the appointment of the arbitrator.

Arbitral Proceedings

  1. Conduct of Proceedings
    • The Arbitral Tribunal shall make a provisional timetable for each party to present its case (Rule 10 of BDAC Rules)
    • Seat of Arbitration shall be Brunei Darussalam in the event the parties fail to make an agreement (Rule 6 of BDAC Rules)

  2. Applications before Tribunal
    • Interim and emergency interim relief (Rule 7 of BDAC Rules)

  3. Award / Consent Award
    • On completion of the hearings, the arbitral tribunal shall render its final award. (Rule 11(1) of the BDAC Rules)
    • Award shall only be released to the parties upon full settlement of the costs of the arbitration. (Rule 11(4) of the BDAC Rules)

How Does Arbitration Commence?

Domestic and International Arbitration



Model Arbitration Clause

In drawing up domestic as well as international contracts, BDAC recommends that parties include the BDAC Model Clause: