Over the past few years Armenia has been laying the groundwork for a more transparent and business friendly environment. One domain that has great potential but somewhat remains untapped, is arbitration.

In today’s rapidly changing global market, investors look for fast results, impartiality and flexibility, something that can be achieved through arbitration and not traditional court proceedings. 

For Armenia, providing this level of efficiency should not just be optional; it should be a necessity, since we are closer than ever to making arbitration a defining feature of our legal and business landscape. 

The Armenian landscape: What’s the Current Status?

Armenia is no longer a trend follower; it has gained solid momentum in arbitration. Adopting UNCITRAL Model Law in 2006 was its beginning. The real progress should be in how we continue to adapt and meet the evolving needs of foreign investors and businesses. We are, I believe, moving beyond theory, and the ongoing shift from policy to real-world application reflects Armenia’s growing commitment to becoming a key player in the region’s arbitration landscape.

What Needs to Happen for Armenia to Move Forward

Armenia has come a long way in positioning itself as a reliable and business-friendly destination. In fact, it may be further along in arbitration than many may realize. The legal infrastructure is ready and the international ties are improving. Geographically, it is uniquely positioned between Europe and Asia and this could be a great opportunity to become a regional arbitration hub in the South Caucasus. What is needed now is not a complete overhaul, the right steps simply need to be taken to fully tap into the potential.

As Armenia steps deeper into regional trade, especially with major initiatives like the North-South Transport Corridor, arbitration is becoming more than relevant. It is essential.

Its location between Iran, Russia, and the EAEU gives it real leverage, and trade is growing fast. Sectors like banking, logistics, and infrastructure are seeing more cross-border deals and with that comes risks, not every deal goes smoothly, and that’s exactly where arbitration plays a crucial role.

The North-South Corridor is already changing the game. It is bringing in investments, improving infrastructure, and creating long-term commercial links. Naturally, this dynamic creates the need for reliable dispute resolution.

Armenia has what it takes. But now, it is about sharpening the tools. We need more institutional backing to ensure international partners see us as stable, fair, and ready. With a few smart moves, Armenia can position itself as a trusted hub for resolving regional trade disputes not just in the INSTC, but well beyond it.

That said, the next step should focus on encouraging a mindset shift by raising awareness and education, particularly among the local business community. While arbitration as an alternative dispute resolution method is gaining popularity, there is still a need for more open dialogue and hands-on guidance to help with the shift, people need to see real examples and tangible benefits.

Institutional support is the next crucial step. Armenia is becoming more active in the global arbitration scene and it is no longer sitting on the sideline. It is strengthening its connections with respected international arbitration institutions such as ICC. With more support and presence from these bodies, it can gain greater trust amongst international investors that shows Armenia is engaged, forward-thinking and serious about creating incentives and favorable conditions. 

Moreover, making a few practical moves could go a long way, such as offering incentives by reducing arbitration related fees and promoting contracts that are arbitration-ready and include clear clauses. These may seem like minor adjustments, but they could create a real difference and encourage more businesses to choose arbitration from the outset.

With all that said, the vision of becoming an arbitration hub is not far-fetched, the path is being paved, the foundation is solid. With just a few constructive refinements, we can own that space.

Why Arbitration Matters for Armenia’s Future

Arbitration should not be merely seen as an alternative legal tool, it is a strategic asset tied directly to Armenia’s future economic growth. The global trend is clear, according to The World Bank, countries with strong arbitration systems attract more foreign direct investments (FDI). And it makes sense, Investors need reassurance that their interest will be protected at all cost and building that foundation of trust can go a long way.

By leveraging arbitration, Armenian can offer exactly that, a solid sense of security and trust for foreign investors. This kind of reputation does not just bring in capital, but more importantly builds long-term partnerships, strengthens the economy and positions it on the international map. At this stage, arbitration is not just ‘nice to have’, it is a critical component in turning this country into a thriving and investment-ready nation. 

Looking Ahead: What It’ll Take

Arbitration has the potential to fundamentally transform the way business is done in Armenia. It is a strategic key that can unlock real economic growth and long-term trust in the system. It has the chance to go from being a place where business just happens to a place where it thrives. 

The adoption of the Model Law was only the beginning, the real change has to happen in the mindset. Arbitration should not be seen as an alternative, it should be the default way that commercial disputes are handled, efficient, and forward-thinking.

So, what’s next? More legal professionals need to be trained, and more systems that support arbitration must be built at every level to make it part of the business DNA. By doing this, Armenia would not only encourage foreign investment, but also build something sustainable, a solid foundation of trust and clarity that international partners can rely on.

The vision is already in motion, and the structure is solid. With just a few strategic moves, Armenia can become a trusted arbitration hub in the region.

This analysis is provided by Ms. Ani Davoodi, an Australian-registered international lawyer, currently visiting ELL Partnership Law Firm to support legal research and cross-jurisdictional exchange.