SPAIN: An Introduction to Arbitrators

Madrid is Booming: The Bright Present and Future of International Arbitration Conducted in Spain

International arbitration conducted in Spain is expanding and consolidating at a rapid pace. More than 600 million people speak Spanish all around the world. The latest statistics from the ICC confirm that Spanish is the second most common language with respect to awards rendered in the ICC Court of Arbitration, only surpassed by English. The ICC statistics also show that two Spanish-speaking countries – Mexico and Spain – are amongst the top ten countries selected as the location for arbitration. In this context, a few months ago, the Spanish Ministry of Foreign Affairs, together with the Spanish and Ibero-American Club of Arbitration (Club Español e Iberoamericano del Arbitraje; CEIA) and the Madrid International Arbitration Centre-Ibero-American Arbitration Center (Centro Internacional de Arbitraje de Madrid-Centro Iberoamericano de Arbitraje; CIAM-CIAR) signed a manifesto for the promotion of the use of Spanish in international arbitration.

Against this background, Madrid has emerged as a particularly attractive seat for international arbitrations. Madrid’s most valuable assets remain its deep ties to the Ibero-American community as well as a reliable and high-quality legal environment. The following seven elements underscore the city’s privileged position as a seat for international arbitration.

• Madrid is particularly recommended for disputes arising in Ibero-America. This is because the Ibero-American countries share the same language, Spanish, which is now spoken by more than 600 million people worldwide according to Instituto Cervantes’ latest figures. Secondly, the countries have very similar legal systems and share practically the same Arbitration Act (since the Spanish Arbitration Act is also based on the UNCITRAL Model Law). Moreover, the private law systems of the Ibero-American countries have remarkable similarities.
• Madrid-based arbitration is cost-effective, being significantly more affordable than other major European or American seats while providing the same legal quality. In all cases, the cost of, for instance, accommodation, meals, transport and venues for holding hearings is significantly lower than in other major arbitration seats like Miami, Geneva, London, Paris and New York. In particular, the legal costs are significantly lower despite the prestige and reputation of Spanish counsel.
• Madrid has very competitive and efficient institutions for administering international arbitrations. The latest trend and clearest example of this is the CIAM-CIAR, which has a very sophisticated set of rules in line with the latest and highest standards of international practice of the most prestigious arbitration institutions. The CIAM-CIAR was founded in 2019, bringing together a constellation of smaller pre-existing arbitration chambers and merging them into a unified and stronger institution that now centralises international arbitration cases. Statistics from the CIAM-CIAR show that, on average – as of 2023 – the cases that it administers are resolved in one year and three months, with cases being heard by tribunals or sole arbitrators of up to 12 nationalities, and with parties from up to 24 countries.
• Madrid is a completely safe and reliable city in which to arbitrate, where (i) the national courts respect the role and remit of arbitrators and (ii) intervention by the national courts is kept to a minimum. Furthermore, a doctrine that had been held by the Regional Court of Madrid regarding the annulment of awards has been overcome in the last few years via continued deference to arbitration by the Spanish Constitutional Court. In fact, the recent Decision of the Constitutional Court of 2 December 2024, which essentially reiterated its long-standing jurisprudence, once again stated that public order does not justify annulling an award on the basis that the judiciary may have reserves or a different opinion as to the motivation for the award, emphatically stating that the annulment action cannot be used to review the merits of the arbitrators’ decision, nor their assessment of the evidence or their interpretation of the law. It can safely be said that, nowadays, an action for annulment, far from being a risk, is a guarantee with very limited scope that is only intended to ensure respect for the due process rights of the parties. Madrid’s safe and arbitration-friendly environment was confirmed by recent research from Pompeu Fabra University showing that, in Spain, “[t]he rate of judicial annulment of awards, which has been decreasing in recent years, is low”.
• Madrid has a sophisticated legal landscape and highly qualified lawyers and arbitrators. Legal firms in Spain, both national and international, are used to dealing with all sorts of international matters, and the quality and preparedness of Spanish lawyers, experts and arbitrators is one of the main factors leading to Madrid being selected as the seat. Moreover, the majority of the world’s most relevant legal firms now have an office in Madrid.
• Madrid’s outstanding international connections make it easily reachable and accessible for all actors involved. Madrid has the largest number of international flights to Ibero-America. Normally, Ibero-American nationals do not need a visa to enter the EU, which means that Madrid can easily be accessed by all the witnesses, experts, arbitrators and lawyers involved in a dispute.
• Spain’s Arbitration Act is very favourable for arbitration matters given that, under the Act, an international dispute is arbitrable if it meets the requirements established by the rules of law chosen by the parties to govern the arbitration agreement, the rules of law applicable to the substance of the dispute or Spanish law. This means that even if the matter is not arbitrable under Spanish law, the parties of an international dispute will still be able to choose Spain as the seat for the arbitration, as it is sufficient that the matter is arbitrable as per the law applicable to the substance of the dispute.