What is the difference between pre-arbitration and arbitration?
Pre-arbitration is a further exchange between the issuer and the acquirer after the merchant’s response, when one side still disagrees or new information appears. Arbitration is the final stage: the card network reviews the case and decides who is liable. Pre-arbitration is settled between the parties, while arbitration is binding and the losing party pays filing fees.
In detail
Both come after the merchant’s first response. They differ in who decides.
Pre-arbitration
- Who: the issuer and the acquirer, on behalf of the cardholder and the merchant.
- When: after a representment the issuer does not accept, or when new information appears. In Visa’s allocation workflow, the merchant’s first answer is itself a pre-arbitration.
- Outcome: the receiving party accepts liability or declines. If it accepts, the case ends.
- Cost: no network ruling fee at this stage.
Arbitration
- Who: the card network.
- When: after a declined pre-arbitration, if one party chooses to continue.
- Outcome: a binding decision. There is no appeal within the network.
- Cost: the losing party pays the disputed amount and the filing fees. Adyen’s documentation mentions a filing fee of 600 dollars for Visa cases.
Pre-arbitration is a chance to correct a weak first response or to answer new claims. Arbitration is worth considering only when the amount is high and the evidence clearly meets the network’s rules. For most merchants, the fee is larger than the dispute.
See the card dispute lifecycle for all stages and RDR and CDRN for ways to settle cases before they start. Operators need each stage and deadline visible in platform supervision.