The guide to Superyacht law - Fourth edition

Court or arbitration? • Arbitration is seen as less formal and less costly to start than court proceedings, which are considerably stricter from a procedural point of view. It is a matter for debate whether it is still true that arbitration is less costly as the matter progresses, but it remains the case that it can be a more flexible method of dispute resolution. Arbitration also has the benefit of being confidential. Although it is more expensive to start proceedings in the English courts, there is a great benefit of having judges dealing with the matter as they are very experienced lawyers with huge expertise in evidence and deciding commercial disputes Why litigate? • Those unfamiliar with arbitration or the court system can be daunted by the prospect of litigation. However, the vast majority of disputes do not proceed to a full hearing or trial. The aim of litigation is not to drive the parties toward a day in court, but to resolve disputes. Many find litigation to be a useful tool for reaching a commercial solution, and we always advise our clients with their commercial objectives firmly in mind MULTI-JURISDICTIONS Although a contract may be governed by English law, it should not be forgotten where the service is being undertaken. If a superyacht is being built in Italy, the UK, Germany or Turkey, for example, there are different local laws regarding insolvency, title and security that should be considered. The Rome II Regulation will apply, and even if a law and jurisdiction clause is inserted, this can be challenged. If the contract does not include a law and jurisdiction clause, there is a risk the contract will be governed by an unwanted law. Always consider what local laws may apply to your transaction.

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