Regulation & Law

Alma Forgó (Airbus): “It is becoming increasingly difficult for big-firm lawyers to sit as arbitrators"

After enriching stints in private practice and the ICC International 
Court of Arbitration, Alma Forgó has changed perspective by going in-house. Head of commercial litigation & arbitration at Airbus she confirms that arbitration will continue to play a key role at the renowned aircraft manufacturer.

After enriching stints in private practice and the ICC International Court of Arbitration, Alma Forgó has changed perspective by going in-house. Head of commercial litigation & arbitration at Airbus she confirms that arbitration will continue to play a key role at the renowned aircraft manufacturer.


LEADERS LEAGUE. How is your department organized?
Alma Forgó. The litigation department is divided into three pillars of expertise: product integrity & investigations, regulatory affairs, and commercial litigation & arbitration. I would describe the working environment as one of integrated functions, across all of Airbus’ main business segments (commercial aircraft, helicopters and defence and space). Getting expertise across from where it sits towards where it is needed is an important feature of our way of working.

 

What is specific about dispute resolution in the aerospace industry?
Our industry is highly regulated, and we pride ourselves on having products that meet the highest quality and safety standards. Our disputes are generally technically complex, with considerable amounts at stake. Be it customers or suppliers, we cherish long-standing relationships and are generally eager to resolve disputes through commercial negotiations or mediation rather than litigation or arbitration.Where there is no room for a negotiated solution, arbitration is Airbus’ preferred method of commercial dispute resolution, because it lets parties agree on adequate protection of their confidential information.

‘‘Arbitration is generally Airbus’ preferred method of commercial dispute resolution’’


How do you work with external counsel?

We call upon external counsel in the context of our arbitrations and litigations. The strategy lies principally with the in-house counsel. The in-house counsel considers and weighs the options presented, assesses their risk and adapts them, where necessary, more seamlessly to the business needs and the internal client’s expectations. Diversity is very important to us, and is one of the pertinent criteria when it comes to the selection of arbitrators, alongside independence, expertise and real availability. “The client” is often said to choose reputation over diversity and availability; at Airbus we aim at a less conservative, risk-averse approach based on our belief that this will lead to enhanced quality of the arbitral process.

 

How has arbitration changed since the beginning of your career?
I observe a higher degree of sophistication and technicality in arbitration. This has advantages but has also rendered arbitration proceedings lengthier and procedurally more complex. The current, mostly institution-driven, push towards leaner, faster dispute settlement, is certainly the right answer to this phenomenon and to what generally is perceived as the most detrimental feature of international arbitration: unnecessary length and cost. It has generally become more and more difficult for lawyers of large firms to sit as arbitrators due to potential conflicts; hence the rise of boutique firms and sole practitioners. I have further noticed women increasingly carve out impressive careers in international arbitration.Third-party funding has become a phenomenon of our times that is here to stay.

 

Arbitration has developed steadily and most agree it is an unavoidable form of dispute resolution. Why do you think is that?
The evolution of arbitration is principally due to globalization and the increasing internationality of contractual parties more than a sign of public justice deficiency – but my answer would vary to a certain extent depending on the geographical region. The confidential, private, neutral and flexible character of arbitral proceedings presided over by industry experts chosen by the parties is essential for a global player like Airbus, making alternative dispute resolution difficult to do without.

 

What do you think of third-party funding?
I am in favor of ending endless debates on whether or not we should salute this development. The debate that deserves to be maintained and accelerated is about the right balance between framing and over regulating third-party funding. There certainly is room for regulation with regard to disclosure obligation of third-party funders in arbitral proceedings, not only but particularly with a view to conflicts as well as the necessary protection of the parties’ confidential information.

 

Interview by CG

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