Arbitration Cost Calculator
Estimate potential institutional and arbitrator fees for a commercial arbitration based on the amount in dispute and the number of arbitrators. Note: This tool provides a simplified estimate and does NOT include legal fees, expert costs, or other disbursements, which typically constitute the largest portion of arbitration costs.
Enter Arbitration Details
Understanding Arbitration Costs
What are Arbitration Costs?
Arbitration costs typically include:
- Institutional Fees: Charged by the arbitration institution (e.g., ICC, LCIA, AAA) for administering the case. These are often based on a sliding scale tied to the amount in dispute.
- Arbitrator Fees: Paid to the arbitrator(s) for their time and work. These can be based on hourly rates or calculated according to a scale set by the institution, often also related to the amount in dispute.
- Legal Fees: The fees charged by each party's lawyers. This is usually the largest component of arbitration costs.
- Other Expenses: Costs for hearing rooms, transcription, expert witnesses, travel, etc.
This calculator estimates only the Institutional Fees and Arbitrator Fees, as they are often the most directly linked to the claim amount and number of arbitrators according to published scales. Legal fees are highly variable and depend on the complexity, duration, lawyer rates, and strategy, making them impossible to include in a simple generic calculator.
How Fees are Often Calculated (Simplified Model)
While each institution has unique rules, a common approach involves tiered scales based on the amount in dispute. As the amount increases, the fees also increase, but often at a decreasing percentage rate. The number of arbitrators significantly impacts arbitrator fees, with three arbitrators costing substantially more than a sole arbitrator.
Arbitration Cost Examples
Click on an example to see the input values and the estimated output based on our simplified model.
Example 1: Small Commercial Dispute
Scenario: A dispute over unpaid invoices.
Input: Amount in Dispute = $50,000, Number of Arbitrators = Sole Arbitrator
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: This is a basic scenario often falling into the lowest fee tier.
Example 2: Medium-Sized Contract Claim
Scenario: Breach of a distribution agreement.
Input: Amount in Dispute = $750,000, Number of Arbitrators = Three Arbitrators
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: The cost difference between sole and three arbitrators is significant at this claim level.
Example 3: Large Construction Dispute
Scenario: Complex claim related to construction delays and defects.
Input: Amount in Dispute = $15,000,000, Number of Arbitrators = Three Arbitrators
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: High claim amounts trigger the highest fee tiers, though the percentage of the claim paid in fees decreases.
Example 4: Moderate IP Licensing Dispute
Scenario: Dispute over intellectual property licensing fees.
Input: Amount in Dispute = $1,200,000, Number of Arbitrators = Sole Arbitrator
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: Even with a sole arbitrator, costs are substantial for claims over $1M.
Example 5: Shareholder Dispute
Scenario: Dispute among company shareholders.
Input: Amount in Dispute = $400,000, Number of Arbitrators = Sole Arbitrator
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: Costs scale with the amount claimed.
Example 6: International Sales Contract Issue
Scenario: Dispute involving parties from different countries.
Input: Amount in Dispute = $2,500,000, Number of Arbitrators = Three Arbitrators
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: International arbitrations often default to three arbitrators due to complexity and differing legal backgrounds.
Example 7: Small Service Agreement Breach
Scenario: Claim for breach of a service provision contract.
Input: Amount in Dispute = $85,000, Number of Arbitrators = Sole Arbitrator
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: This falls into a lower tier, making it relatively less expensive in terms of institutional/arbitrator fees.
Example 8: Software Development Dispute
Scenario: Claim related to failure to deliver functional software.
Input: Amount in Dispute = $600,000, Number of Arbitrators = Three Arbitrators
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: Three arbitrators increase costs compared to a sole arbitrator for the same claim amount.
Example 9: Royalty Payment Dispute
Scenario: Dispute over calculation and payment of royalties.
Input: Amount in Dispute = $950,000, Number of Arbitrators = Sole Arbitrator
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: Approaching the $1M threshold can shift the cost tier.
Example 10: Very Large Corporate M&A Dispute
Scenario: Post-acquisition dispute over representations and warranties.
Input: Amount in Dispute = $50,000,000, Number of Arbitrators = Three Arbitrators
Estimated Output: (Will be calculated by the tool when you enter these values)
Note: Very high value disputes incur significant, though proportionally smaller, institutional and arbitrator fees.
Frequently Asked Questions about Arbitration Costs
1. What costs does this calculator estimate?
This calculator estimates the Institutional Fees (paid to the arbitration center) and the Arbitrator Fees (paid to the arbitrator(s)) based on the amount in dispute and the number of arbitrators. It then provides an Estimated Total for *these two components only*.
2. What significant costs are NOT included in this estimate?
This calculator does NOT include Legal Fees (your lawyers' costs), expert witness fees, hearing venue costs, transcription services, travel, or other miscellaneous expenses. Legal fees are typically the largest portion of total arbitration costs and are highly variable.
3. How accurate is this calculator?
This calculator provides a **highly simplified estimate** based on typical tiered fee structures. Actual fees vary significantly between different arbitration institutions (e.g., ICC, LCIA, AAA, SIAC, HKIAC) and depending on specific case details, complexity, duration, and the arbitrator's rates or tribunal's discretion. Always consult the specific institution's fee schedule or legal counsel for accurate figures.
4. How does the "Amount in Dispute" affect costs?
Most arbitration institutions have tiered fee scales. As the amount in dispute increases, the institutional and arbitrator fees generally increase, but the rate of increase (as a percentage of the claim) typically decreases for higher value disputes.
5. How does the "Number of Arbitrators" affect costs?
Cases with three arbitrators are significantly more expensive in terms of arbitrator fees than cases with a sole arbitrator, as you are paying three professionals instead of one. Institutional fees might also have small variations based on the number of arbitrators.
6. Why can't legal fees be estimated here?
Legal fees depend heavily on the complexity of the legal and factual issues, the amount of evidence, the number of hearing days, the seniority and hourly rates of the lawyers involved, the negotiating positions of the parties, and unforeseen procedural issues. These factors are too variable for a simple calculator.
7. Are these costs for the whole arbitration or just part of it?
The estimated institutional and arbitrator fees calculated are typically for the entire arbitration process (from commencement to final award), based on the rules of the institution. However, additional fees can arise if the arbitration is unusually long or complex.
8. How are these fees usually paid?
Typically, the institutional and arbitrator fees are advanced equally by both parties throughout the arbitration process (e.g., in installments). The final award will determine how these costs (and legal fees) are ultimately allocated between the parties.
9. Does this calculator use specific institution fee schedules?
No, this calculator uses a generic, simplified tiered model that *approximates* typical structures found in various institutions but does not replicate any specific institution's exact schedule. Fee schedules can change, and each institution has unique calculation methods.
10. What is the minimum input required?
You must enter a non-negative "Amount in Dispute" and select the "Number of Arbitrators". Both inputs are needed for the calculation.
