Comparative Analysis of International Commercial Arbitration Laws in Iran and the UNCITRAL Model Law

Abstract

This article provides a comprehensive comparative analysis of Iranian arbitration laws and the UNCITRAL Model Law on International Commercial Arbitration, highlighting their similarities, differences, and implications. Arbitration has become a crucial mechanism for resolving cross-border commercial disputes, necessitating alignment with international standards to ensure efficiency, predictability, and fairness. Iran’s arbitration framework, influenced by both Islamic jurisprudence and civil law traditions, demonstrates notable efforts to modernize through the adoption of the Iranian Arbitration Act. However, divergences remain in key areas, including jurisdictional limitations, the role of the judiciary, and the application of public policy exceptions. The study explores the historical evolution of arbitration laws in Iran, emphasizing their roots in Islamic and customary practices, and examines the provisions of the Iranian Arbitration Act in relation to the UNCITRAL Model Law. It identifies areas of convergence, such as the recognition of party autonomy and the enforcement of arbitral awards, while also addressing the distinct challenges posed by cultural, legal, and political factors unique to Iran. These differences create practical and theoretical obstacles to harmonization, impacting Iran’s attractiveness as an arbitration venue and its integration into the global arbitration community. The article further assesses the implications of these divergences for international trade and investment, highlighting the legal uncertainties faced by foreign investors and their effect on Iran’s global economic participation. It concludes with recommendations for reform, advocating legislative and institutional changes, enhanced judicial training, and strategies to address cultural and legal challenges. By aligning its arbitration framework with international standards while respecting its unique legal identity, Iran has the opportunity to strengthen its position in the global arbitration network and foster greater international confidence in its dispute resolution practices. This study offers insights for policymakers, legal practitioners, and scholars seeking to navigate the complexities of arbitration in Iran.