Third Party Funding: India’s Framework And Global Standards
- IJLLR Journal
- 4 days ago
- 1 min read
Dr V.B.N.H. Saroja Achanta, PhD. M.B.A., M.L.(Law), Certified Corporate Director, Diploma in Corporate Litigation, Certification in ADRDirector, Zorvy Digital Pvt. Ltd.
ABSTRACT
International arbitration has grown into the preferred method for resolving commercial disputes between countries, but the quick growth of Third-Party Funding (TPF) has significant implications for the core principles of arbitration. As arbitration costs escalate, TPF—in which specialized investment entities cover parties’ legal expenditures in exchange for a preset amount of any decision or settlement—has become increasingly popular as a means of assisting claimants who are struggling economically in attaining justice. TPF democratizes dispute resolution by reducing financial barriers, but it also raises challenging procedural and ethical questions about conflicts of interest, transparency standards, and the impartiality of arbitral processes. Uncertainty is created by inconsistent rules for disclosing funding agreements, which could compromise arbitrators’ impartiality and procedural justice.
The present scenario of TPF regulation is examined in the present study by analysing tribunal jurisprudence and institutional instructions from well- known arbitral bodies. The fundamental dispute between the long-standing arbitration secrecy restrictions and the increasing demand for transparency regarding Third-Party Funding arrangements is examined. While safeguarding legitimate confidentiality interests, disclosure duties are given special consideration as instruments for identifying potential conflicts of interest.
The analysis indicates that to maintain the integrity of arbitral processes, comprehensive legal frameworks are necessary. The present paper compares India’s regulatory stand to international best practices to make the case for fair reforms that allow TPF while maintaining arbitration’s core characteristics as an impartial, efficient, and trustworthy conflict settlement process.
Keywords: Investment Arbitration, Confidentiality, Disclosure Framework, Transparency, Third-Party Funding (TPF)
