Monday, November 28 2022   \  Published by Asia IP Law .

Advantages and drawbacks of the arbitration of IP disputes

Advantages and drawbacks of the arbitration of IP disputes

Increasing numbers of parties in IP-reliant industries such as technology, healthcare, aviation, etc., are agreeing to resolve disputes under their cross-border contracts via arbitration. Matthew Shaw considers the unique advantages and some potential downsides of the arbitration of IP disputes.

The ability to resolve IP disputes in arbitration is now well-established in many developed jurisdictions. For example, in 2019, Singapore’s Parliament passed the Intellectual Property (Dispute Resolution) Act. Among other things, this amended the domestic Arbitration Act and the International Arbitration Act to clarify that disputes concerning all forms of intellectual property are arbitrable in Singapore, which followed the broad statement of principle in Tomolugen Holdings Ltd and another v. Silica Investors Ltd and other appeals [2015] SGCA 57, in which the Court of Appeal stated that the question of arbitrability turned on “whether the subject matter of the dispute is of such a nature as to make it contrary to public policy for that dispute to be resolved by arbitration”. In other words, public policy is the only constraint on subject matter arbitrability in Singapore. Hong Kong passed similar legislation, clarifying that IP disputes are capable of being resolved by arbitration. Legislatures and courts have enacted similar measures or reached similar conclusions in many other jurisdictions.

So the availability of arbitration as a means of resolving IP disputes is not in doubt. For parties in industries such as health care, pharmaceuticals, automotive, aviation, technology, media and telecommunications, this may be of particular relevance. Progress and development in these industries is often achieved via a network of interrelated contractual and joint venture relationships that cross jurisdictional borders and continents. Their primary value may lie in one party’s IP and the strategies employed to exploit it. In theory, at least, stereotypical features of international arbitration should be well-suited to these disputes. Read more

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