International commercial arbitration is celebrated as the preferred method for resolving cross-border business disputes. Efficient, neutral, and enforceable in 172 countries under the New York Convention 1958: the argument for arbitration is compelling. But a growing body of critical scholarship asks a sharper question. When a corporation can bury the outcome of a dispute in a confidential process it helped design, is that justice, or is it just a better deal for the party with more power?

This post works through one of the central tensions in modern arbitration law: the relationship between confidentiality and accountability. The question is not whether arbitration is better than litigation in the abstract. It is whether the confidentiality architecture of the system creates structural cover for corporate misconduct, and what the legal framework should do about it.

What Confidentiality in Arbitration Actually Means

Confidentiality in arbitration is not a single rule. It is a patchwork of obligations that varies across institutions, governing laws, and individual contracts. The ICC Rules do not impose a general confidentiality obligation by default. The LCIA Rules do. The DIAC Rules include confidentiality provisions. The UNCITRAL Model Law, which forms the basis for UAE Federal Arbitration Law No. 6 of 2018, does not mandate confidentiality unless the parties agree to it.

What this means in practice is that the scope of confidentiality depends on what the contract says, which institutional rules apply, and which seat the parties chose. Tribunals sitting in England operate under a common law implied obligation recognised since Dolling-Baker v Merrett [1990]. The UAE's approach, particularly in DIFC-seated arbitration, reflects English law principles.

The Case for Confidentiality

The arguments for keeping arbitration private are real. Commercial parties have legitimate interests in keeping sensitive business information out of the public record. A dispute about a failed joint venture, a licensing breakdown, or a construction defect can expose pricing strategies and financial data that competitors would find valuable. Confidentiality also, in theory, encourages candour: parties may be more willing to engage openly in a private process than in one that ends up in a publicly accessible judgment.

The Problem: When Confidentiality Becomes Cover

The problem arises when confidentiality is not used to protect legitimate commercial sensitivity, but to prevent accountability for conduct that regulators, the public, or future contracting parties would want to know about.

Consider the structure. A multinational corporation enters arbitration with a supplier who claims systematic non-payment and contract manipulation. The corporation, as a repeat player, has engaged its preferred institutional rules, retained experienced international counsel, and can absorb the cost of proceedings. The supplier cannot. Even if the supplier wins, the award is confidential. The corporation's conduct is not on public record. It can enter the next contract with the next supplier in exactly the same position.

The empirical literature on repeat players, developed by scholars including Marc Galanter and extended by researchers at the European University Institute, documents the systematic advantage that frequent arbitration users hold over one-time participants. Confidentiality amplifies this: repeat players accumulate knowledge of tribunal tendencies and procedural strategies that one-shot players cannot access.

The Access to Justice Dimension

Cost and confidentiality interact to compound the problem. ICC arbitration for a mid-complexity dispute costs on average between USD 500,000 and USD 1.5 million. For an SME whose claim falls near that range, the rational decision may be not to arbitrate at all, regardless of the legal merits. Confidentiality means that pattern of non-pursuit is invisible: there is no public record of the claims that were never brought.

This connects to a broader argument that arbitration does not merely resolve disputes neutrally, but shapes the distribution of legal outcomes in ways that track existing power asymmetries. The UNCITRAL Working Group III reform process has grappled with this question without yet producing a comprehensive answer.

What the Legal Framework Could Do

Three approaches are worth considering. First: mandatory disclosure for awards involving regulatory or public interest dimensions. Some jurisdictions already require this in investor-state arbitration. There is an argument for extending a version of this principle to commercial arbitration where the conduct at issue involves potential regulatory violations or patterns of contractual abuse. Second: third-party funding reform to correct the cost imbalance that drives smaller parties out of arbitration. Third: a database of anonymised awards, similar to what ICSID publishes for investment arbitration, which would reduce information asymmetry without exposing commercially sensitive detail.

A Genuinely Hard Question

There is no clean answer. Confidentiality serves real purposes, and mandatory disclosure would change the character of arbitration in ways that some legitimate commercial users would find unacceptable. The challenge is that the system as currently designed is most accessible to those who need accountability the least. Whether the legal framework will respond depends on whether the arbitration community is willing to treat structural fairness as a genuine design constraint, not an optional add-on.

If your business sells goods across borders, there is a real chance that a United Nations convention is already governing your contracts, whether you know about it or not. The UN Convention on Contracts for the International Sale of Goods (CISG) has been in force since 1988. It applies automatically to qualifying transactions unless the parties have expressly excluded it. A surprising number of businesses discover this only when something goes wrong.

This is relevant whether you are running a UAE trading company, sourcing goods from Europe for a Dubai-based startup, or managing supply chain contracts across multiple jurisdictions.

When the CISG Applies

The CISG applies to contracts for the sale of goods between parties whose places of business are in different contracting states. Three things need to be true: it must be a sale of goods contract (not services, not software, not consumer purchases); both parties must have their places of business in different states; and both states must be CISG contracting states, currently 97 of them.

The UAE acceded to the CISG and it entered into force for the UAE on 1 January 2014. UAE-based businesses contracting with counterparties in France, Germany, the United States, China, or Singapore are contracting under the CISG by default. India is a notable exception: India has not ratified the CISG, so UAE-India goods contracts are not automatically governed by it.

The Exclusion You Need to Know About

Under Article 6, parties can exclude the CISG entirely. The exclusion must be express. Writing "This agreement is governed by UAE law" is not enough: UAE law as a CISG contracting state includes the CISG. To properly exclude it, the clause needs to say something like: "This agreement is governed by the laws of the UAE, excluding the United Nations Convention on Contracts for the International Sale of Goods."

What It Actually Changes

The remedies framework is where the CISG most often catches businesses off guard. Under Article 25, a seller's breach only entitles a buyer to avoid the contract if it constitutes a "fundamental breach" that substantially deprives the buyer of what they expected to get. This is a higher threshold than many buyers assume. If the goods are non-conforming but the seller can cure the defect, the buyer's right to reject is constrained.

For startups and SMEs sourcing goods internationally, this matters. A UAE company importing goods from Germany that arrive with defects cannot automatically refuse the shipment. The seller may have a right to cure. Understanding this before the contract is signed is considerably more useful than discovering it after the goods have arrived.

For HR and Operations Teams

If your company buys or sells physical goods internationally and you manage supplier or vendor contracts, this is not just a lawyer problem. Standard procurement templates often include boilerplate governing law clauses that do not address the CISG. Before your next contract renewal, flag this to whoever handles your legal review. The fix is a single clause. The cost of not doing it is uncertainty about which law governs if a dispute arises.

Dubai operates two parallel employment law regimes, and most people working here do not know which one applies to them. The difference determines how your end of service gratuity is calculated, what happens if you are dismissed, whether your non-compete clause is enforceable, and where you would bring a claim if something went wrong.

Which Law Applies to You

The UAE mainland employment regime is governed by Federal Decree-Law No. 33 of 2021. It applies to private sector employees across the UAE, with the exception of employees working in financial free zones. The Dubai International Financial Centre has its own employment law: DIFC Law No. 4 of 2005, as amended, applied by the DIFC Courts using English common law principles. Which regime applies depends on where your employer is incorporated, not what your contract says.

End of Service Gratuity: The Numbers That Actually Matter

On the mainland, gratuity is calculated on basic wage only. Allowances are excluded. The rate is 21 days' basic wage per year of service for the first five years, and 30 days per year thereafter. Many Dubai employment packages have a low basic wage with higher allowances for housing and transport. The gratuity figure may be significantly lower than employees expect.

In the DIFC, gratuity is calculated on total remuneration including allowances and regular bonuses. For employees in financial services or professional roles, this difference is material. Some DIFC employers have moved to DEWS (DIFC Employee Workplace Savings), which replaces the gratuity entitlement with employer contributions to a savings plan.

Termination and What You Are Actually Protected Against

Under mainland UAE law, an employer can terminate by giving notice and paying gratuity. Arbitrary dismissal compensation is capped at around three months' remuneration. DIFC employees with more than six months of service have broader protection: a DIFC employer who dismisses without valid reason or fair procedure can be ordered to pay up to one year's remuneration. The DIFC Courts Small Claims Tribunal handles claims up to AED 500,000, in English, applying common law procedure.

Non-Competes: What They Can and Cannot Do

On the mainland, Article 10 of Federal Decree-Law No. 33 of 2021 permits clauses limited in time (maximum two years), geography, and type of work. UAE courts will reduce overly broad clauses. In the DIFC, courts assess non-competes against the common law test of reasonableness. If you are considering moving to a competitor and your contract includes a non-compete, get advice before you resign. The enforceability question is highly fact-specific.

For Recruiters and HR Teams

If you are placing candidates in Dubai, the DIFC vs mainland distinction affects gratuity, termination risk, and the enforceability of post-employment restrictions. Candidates moving between the two regimes are moving between substantively different legal environments. That should be part of the conversation.

There is a clause at the back of almost every international commercial contract that receives less attention than the payment terms or the indemnity provisions. It is usually one sentence, placed in the boilerplate. It reads something like: "This Agreement shall be governed by and construed in accordance with the laws of England and Wales." That clause determines how your contract is interpreted if you disagree, what remedies are available, and where any award will be enforced. It is one of the most consequential decisions in the negotiation. It is also the decision most likely to be made by default.

What It Actually Does

Governing law is the substantive law that a court or arbitral tribunal applies when resolving a dispute. It determines what the words of the contract mean, whether any terms are implied, what the standard of performance is, and how damages are measured. This is separate from jurisdiction: which court or tribunal has authority to hear the dispute. Contracts that run them together, or fail to address jurisdiction at all, create expensive arguments before anyone can address the merits.

The Choices in the UAE Context

For businesses operating from the UAE, the practical choice is typically between UAE law, English law, or occasionally Singapore or Swiss law as a neutral option. UAE law is the natural choice for entirely domestic contracts. English law is the most frequently chosen governing law for major international commercial contracts globally, including many entered into by UAE parties, because of the enormous body of commercial case law behind it and its global predictability.

Enforcement: Where the Strategy Matters Most

An English court judgment is not automatically enforceable in the UAE. The UK-UAE civil and commercial cooperation treaty ratified in 2022 has begun to change this, but enforcement remains more uncertain than it would be for an arbitral award. A properly constituted arbitral award is enforceable under the New York Convention in 172 states, including the UAE under Federal Arbitration Law No. 6 of 2018. The DIFC Courts add another dimension: parties can submit disputes to the DIFC Courts by agreement, and DIFC judgments can be enforced against assets in Dubai efficiently through the Dubai Courts enforcement arrangement.

Three Questions to Ask Before You Sign

First: whose law is chosen, and do you understand what it says about the things most likely to go wrong? Second: is the dispute resolution clause consistent with the governing law and does it name a seat? Third, and most importantly: where does the other party have assets, and can you actually enforce against them there? This question is rarely asked before the contract is signed. It is almost always the right question to start with. The governing law clause deserves to be treated as the strategic decision it is, not boilerplate inherited from the last contract you signed.