Arbitration is based on an arbitration agreement between the, which is usually a part of the main contract between the parties. An arbitration agreement means that a dispute cannot be brought to a court without an approval by the other party, but only an arbitrator is entitled to settle the dispute.
Generally, it has been agreed in the arbitration agreement that the number of arbitrators is either one or three. In compositions of three arbitrators both parties name one impartial and independent arbitrator, and then the arbitrators together select the third arbitrator to become the chairman of the arbitral tribunal.
If it has been agreed in the arbitration agreement that the dispute shall be resolved by only one arbitrator, the naming of the arbitrator has usually been given to a third party (in Finland usually The Board of Arbitration of the Chamber of Commerce of Finland).
The common course of arbitration:
The parties name the arbitrators who settle the dispute, and the parties pay the arbitrators’ retaining fee;
Organizing meeting where the arbitrators and the parties agree on the course of the proceedings;
The plaintiff delivers their statement of claim to the arbitrators and the defendant, where the plaintiff presents their specified claims and the legal facts that they are going to refer to in support of the action;
The defendant delivers their response to the action which indicates, to what extent they admit or contest the plaintiff’s claims, in addition to presenting their possible procedural defense (for example, a claim that the dispute cannot be subjected to arbitration);
If arbitrators see necessary, a second round of statements may be arranged; first, the plaintiff delivers a brief, then the defendant;
Oral main hearing;
The parties give their closing arguments in writing or orally;
The arbitrators render an arbitral award.
The enforceability of the arbitral award in Finland requires that the winning party submits an application for the enforcement to the court of first instance.