Meaning
Independent testing process used to resolve technical disputes between a cell supplier and a buyer regarding product quality provides a neutral verdict on disputed batches. When internal test results from the two parties conflict, third party lab arbitration uses an accredited facility to conduct a definitive evaluation. The results of this process are typically binding as per the supply agreement.
Selection Process
Contracts specify which laboratories are acceptable for this role based on their equipment and independence from either party. In third party lab arbitration, the facility must have no financial interest in the outcome of the dispute. The chosen lab must hold relevant certifications and use methods that are identical to the original specification.
Evidence Validation
Samples from the disputed lot are shipped under strict chain of custody to the neutral site. During third party lab arbitration, the testing environment is controlled to eliminate variables that might have caused the initial discrepancy. This step ensures that the data is the most accurate representation of the cell performance.
Dispute Resolution
The final report from the laboratory determines whether the buyer must accept the goods or if the manufacturer must issue a refund. Because third party lab arbitration is expensive and time consuming, it is usually reserved for large shipments or systematic failures. Clear language in the purchase order prevents legal delays once the results are published.
The cost of the testing is typically borne by the party whose internal data is proven to be incorrect by the independent lab.