FAA (Federal Arbitration Act, USA)

The Federal Arbitration Act (FAA) is a U.S. law that promotes the use of arbitration to resolve disputes. It makes arbitration agreements—contracts where parties agree to settle disagreements outside of court—generally enforceable and binding. The FAA supports arbitration as a faster, often less costly alternative to litigation, and preempts conflicting state laws. It applies primarily to contracts involving interstate commerce, ensuring that courts uphold arbitration clauses and facilitate their implementation. Overall, the FAA encourages parties to resolve disputes privately through arbitration, while still maintaining the enforceability of such agreements in the legal system.