AI is being increasingly integrated into arbitration proceedings to improve efficiency and reduce costs. According to a report from Freshfields LLP, AI tools are being used for various tasks including legal research, document review, drafting and summarising documents, comparing arguments, predictive analysis, transcription services and case management.
AI-powered platforms are seen as revolutionising legal workflows, offering significant time and cost-saving benefits. These tools can improve efficiency in arbitration, benefiting both arbitrators and advocates by streamlining processes such as document management, legal research and even the drafting of awards.
While AI can enhance efficiency, there are concerns about security, transparency and potential errors, particularly with generative AI tools. Freshfields highlighted risks such as "hallucinations", where AI presents fictional cases or legal arguments as facts. The firm also emphasised the need for increased oversight to ensure the responsible use of AI in arbitration.
Currently, there are no binding regulations governing the use of AI in arbitration. However, some ethics publications, like those from the American Bar Association, provide guidelines. Additionally, legal frameworks have been shared by entities in the EU, specific US states like California and Colorado and arbitration hubs such as Brazil and Canada.
Generative AI is already being applied in various aspects of arbitration practice, including document management, reviewing contracts, automating arbitrator selection and drafting awards. While it brings efficiency, there are cautions around biases, hallucinations and privacy concerns.
Yes, AI is being actively incorporated by arbitration providers and legal technology startups. For example, JAMS, an alternative dispute resolution provider, has introduced AI-powered tools for transcription services and conversation search. Additionally, Fortuna Arbitration has launched an AI-driven private court system, Arbitrus.ai, which claims to dramatically reduce the cost of dispute resolution.
The ongoing development of AI tools promises to further enhance efficiency and effectiveness in arbitration. Freshfields’ report anticipates that new guidelines and regulations by arbitral institutions and governments will ensure that AI is used responsibly and securely, minimising risks while maximising its potential benefits.
The adoption of AI in arbitration is happening alongside broader geopolitical shifts, including the internationalisation of arbitration, changes in investor-state mediation and evolving trends in arbitration hubs like Brazil and the Middle East. These changes reflect the growing global interest in AI as a tool to streamline arbitration processes.
