Normally each party will bear their own legal costs during an arbitration. This creates a fair standard where each party has a firm grasp of the eventual legal fees. However, for parties who want to employ a different type of fee arraignment, it is possible to draft the arbitration agreement to fit their needs.
For example, the parties might agree that the costs should be borne by the losing party, or that the costs should be disproportionately covered by the party with “home field advantage” during the arbitration.
In some cases the arbitrator may ask one or both parties to deposit a certain amount of money before the arbitration to cover the costs of the proceedings. This amount will usually be determined by the arbitrator.
If you have any questions about arbitration in Japan, please contact our office for a legal consultation.