Arbitration and its Impact on Resolving Oil Contract Disputes Iraq and the Kurdistan Region as a Model

Abstract

Oil contracts are one of the most important types of investment contracts that have a close relationship with the country's economy and infrastructure. Thus, oil-rich countries are keen to take adequate measures to ensure that they can exploit their resources to meet their objectives. During the implementation of the contract terms, no doubt conflicts may arise between the oil company and the host country resulting from conflicting interests, which requires finding means to resolve the dispute and protect the parties’ rights. Arbitration is a vital alternative for resolving disputes outside the traditional legal system. Arbitration is a crucial method for resolving various types of disputes, as it serves as an alternative to the legal system for the parties involved. Its importance is increasing daily due to the expanding trade relations between nations and multinational corporations, which naturally leads to a rise in trade disputes. Many countries have codified arbitration rules and integrated them into their legal systems, either by enacting specific legislation or amending existing laws. It is an effective way to resolve contract-related conflicts due to its many advantages, which is particularly crucial for disputes in oil contracts. In this context, we found that most oil contracts require both parties to use arbitration to resolve disputes over the agreement's terms, making such clauses common in the industry.