Federal Arbitration Act

United States Arbitration Act
Great Seal of the United States
Long titleAn Act To make valid and enforceable written provisions or agreements for arbitration of disputes arising out of contracts, maritime transactions, or commerce among the States or Territories or with foreign nations
Acronyms (colloquial)FAA
NicknamesFederal Arbitration Act
Enacted bythe 68th United States Congress
EffectiveJanuary 1, 1926
Citations
Public lawPub. L. 68–401
Statutes at Largech. 213, 43 Stat. 883
Legislative history
United States Supreme Court cases
List

The United States Arbitration Act (Pub. L. 68–401, 43 Stat. 883, enacted February 12, 1925, codified at 9 U.S.C. ch. 1), more commonly referred to as the Federal Arbitration Act or FAA, is an act of Congress that provides for non-judicial facilitation of private dispute resolution through arbitration. It applies in both state courts and federal courts, as was held in Southland Corp. v. Keating. It applies in all contracts, excluding contracts of seamen, railroad employees, or any other class of workers involved in foreign or interstate commerce, and it is predicated on an exercise of the Commerce Clause powers granted to Congress in the U.S. Constitution.

The FAA provides for contract-based compulsory and binding arbitration, resulting in an arbitration award entered by an arbitrator or arbitration panel as opposed to a judgment entered by a court of law. In an arbitration, the parties give up the right to an appeal on substantive grounds to a court.

Once an award is entered by an arbitrator or arbitration panel, it must be "confirmed" in a court of law; and once confirmed, the award is reduced to an enforceable judgment, which may be enforced by the winning party in court, like any other judgment. Under the FAA, an award must be confirmed within one year, and any objection to an award must be challenged by the losing party within three months. An arbitration agreement may be entered "prospectively" (ie., in advance of any actual dispute), or may be entered into by the disputing parties once a dispute has arisen.