Unfolding Modern Lex Mercatoria within International Commercial Courts

For decades, legal scholarship has focused on how the global business community has grappled with the challenge of legal fragmentation across national borders. States gradually understood that divergences in legal norms and trade customs pose impediments to profit.

International Commercial Courts (ICC) have emerged as pivotal platforms for advancing a modern iteration of lex mercatoria by systematically integrating international soft law principles into their case law. This merchant law encompasses transnational non-binding standards (including those developed by UNCITRAL) consistently applied by ICC worldwide.  As a result, it can be argued that lex mercatoria is experiencing a renaissance, propelled by the expertise and support of dispute resolution mechanisms.

This post examines how ICC have arisen as specialised domestic tribunals designed to adjudicate cross-border commercial disputes and actively harmonise international commercial law across different jurisdictions. Harmonisation is achieved through the application of transnational standards. The post concludes that collaborative initiatives such as the Standing International Forum of Commercial Courts (SIFoCC) are instrumental in guiding ICC’s case management to foster a network capable of nurturing uniform practices.

1. International Commercial Courts: Moving Towards Reform

ICC are specialized domestic tribunals established to adjudicate cross-border commercial disputes, with notable examples found in Singapore, Dubai and Qatar. Such courts stand at the intersection of conventional judicial practices and arbitration-oriented dispute-resolution mechanisms. On the one hand, ICC retain the characteristic elements of an ordinary domestic court, such as the judicial structure and the institutional equality of arms between the parties. On the other hand, these institutions operate with a refined set of organisational features that elevate their global standing. They rely on English common law as the model legal system, boast benches composed of internationally renowned judges, and apply transnational laws similar to those in London and New York.

By combining these features, ICC act as bridges between domestic legal systems and global commerce, fostering a cohesive legal environment that supports the consistent application of international soft law standards. This role is exemplified in the rules that ICC have gradually applied in areas such as the recognition of arbitration agreements and the management of cross-border insolvency proceedings. In this context, the ICC’s application of the UNCITRAL Model Law creates a unified and reliable framework for resolving cross-border disputes. This approach is anchored in the goal of reducing both the legal uncertainty that jurisdictional arbitrage entails and the risk that settled matters are litigated again.

2. The Open-Ended Harmonisation Process

ICC have spearheaded global convergence in dispute resolution, reigniting discussions about lex mercatoria as a standalone legal system. ICC’s case law supports this view. A significant case in this regard is Re PT Garuda Indonesia (Persero) Tbk [2024] SGHC(I), the first reported decision where the Singapore International Commercial Court (SICC) recognized in Singapore an Indonesian airline debtor’s 'suspension of payments' proceeding under the UNCITRAL Model Law on Cross-Border Insolvency (Model Law). In this landmark ruling, Chief Justice Sontchi underscores—as a member of the panel—the significance of promoting a free-standing corpus of international practices that enables the recognition of foreign restructuring plans and orders.  On this matter, Sontchi emphasises that the Model Law gives effect to the principle of modified universalism through a procedural framework that not only allows but actively promotes cooperation and coordination between jurisdictions. This statement aligns with the SICC’s broader advocacy for pragmatic, principles-driven approaches to harmonise cross-border restructuring practices.

Further, the Dubai International Financial Court of Appeal has recently clarified the distinction between arbitrability and public policy in award enforcement, drawing on the UNCITRAL Model Law on International Commercial Arbitration (Nihan v Nicholas Niaz [2024] DIFC CA 012). In a similar case, these efforts have been mirrored by the Qatar Financial Centre Civil and Commercial Court, which argued that international soft-law instruments ‘provide narrowly defined grounds for judicial intervention reflecting a pro-enforcement policy towards arbitration awards’ (B v C [2024] QIC (F) 20). The application of transnational standards by these tribunals demonstrates their willingness to harmonise dispute resolution practices globally while reinforcing lex mercatoria as a dynamic, self-sustaining legal framework.

Collaborative initiatives such as the SIFoCC also shape the ICC’s decision-making process. This highly integrated network helmed by a community of renowned commercial courts promotes the cross-pollination of perspectives between jurisdictions. The landmark case of Hai Jiao 1306 Limited v Yaw Chee Siew and other suits [2020] SGHC(I) 03 serves as a pivotal reference point for case management innovations tailored to ‘high-volume’ litigation in terms of the scale of evidence and the number of parties involved. In that case, over thirty-seven interlocutory applications were filed. The SICC nonetheless enforced procedural timelines through a proactive, judge-led roadmap, e.g. establishing deadlines for filing applications and time banks to keep the length of oral submissions in check. This methodology reflects the principles outlined in the SIFoCC’s Presumptions of Best Practice in Case Management, demonstrating the ICC’s commitment to efficient and effective adjudication mechanisms in international commercial disputes.

Building upon these foundations, ICC are poised to exert increasing normative influence in upholding international guidelines and model laws, as they promote what Chief Justice Allsop has termed ‘a culture of problem-solving’, within the judicial system. In practice, this means that courts may adapt their procedures - such as simplifying pleadings, encouraging early settlement discussions, or using technology to facilitate hearings - to better serve the interests of justice in each specific case. The overarching aim is to resolve disputes efficiently and fairly, with a focus on outcomes that address the real problems faced by the parties, rather than simply processing cases through the system.

3. Concluding Remarks

This post has considered ICC as the institutional vehicle for advancing the harmonisation of civil procedure rules in the context of cross-border commercial litigation, where soft law instruments gain authoritative traction through judicial practice.

As explained above, the transnational adjudication experience imparts two lessons for achieving greater harmonization. First, as transnational, open to customs, and tailor-made to the practical standpoints of international commercial matters, the current pool of ICC case law effectively promotes procedural convergence in managing transnational disputes. Second, a revitalized court-to-court communication also backs the cause of the lex mercatoria as an effort to introduce order and predictability within the international commercial dispute resolution framework. In the words of Chief Justice Ramesh: ‘[t]he law is an edifice in whose shadow individuals act and negotiate. […] Without a stable lex mercatoria, the shadow cast will be faint, difficult to discern’.

Edoardo Piermattei is a Ph.D. Candidate at the University of Bologna.