Resisting Enforcement of aForeign Arbitral Award underthe New York Convention

Matthias Scherer Sam Moss

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1. Introduction: the Legal Frameworkfor the Recognition and Enforcementof Foreign Arbitral AwardsThe Convention on the Recognition andEnforcement of Foreign Arbitral Awards (the "NewYork Convention" or "Convention"), which setsout the basic legal framework for the recognitionand enforcement of foreign arbitral awards, hasbeen described as the "(t)he mortar in the edificeof international commercial arbitration". i Indeed,the enforcement regime created by the Conventionis "almost universal",2 as all major jurisdictionsare parties to the Convention, including the keyAsian jurisdictions.3 The Convention focuses onthe recognition and enforcement of arbitral awards,whereas annulment proceedings fall outside itsscope. It sets out a restrictive list of grounds onwhich the enforcement of foreign awards can berefused. Grounds for annulment of awards, on the

This article explores issuesand considerations that mayarise in connection with achallenge to the enforcementof an arbitral award under theNew York Convention

other hand, are provided for in domestic law, andit is generally recognized that the annulment of anaward cannot be sought in a jurisdiction other thanthe place of arbitration.4

The grounds on which enforcement of an awardcan be refused are provided for in article V of theConvention. The list is an exhaustive one,s as hasbeen confirmed by the jurisprudence interpretingthe Convention.6 Article V(1) sets out five groundswhich, in order to be successful, must be proven bythe party contesting enforcement: (a) the invalidityof the arbitration agreement, (b) violation of dueprocess, (c) the arbitrator exceeded his or herauthority, (d) irregularity in the composition of thearbitral tribunal or the arbitral procedure, and (e)the award is not binding or has been set aside. Thegrounds in article V(2) can be examined ex offcio,and therefore can be examined even if the requestfor enforcement is unopposed.? They are: (a) thenon-arbitrabilty of the subject-matter of the award,

and (b) the violation of public policy. An importantfeature of the Convention is that the grounds inarticle V do not permit any review of the merits ofthe arbitral award.8

The New York Convention is considered tohave a "pro-enforcement" bias. Indeed, it sets outonly a minimum standard for the recognition andenforcement of foreign awards,9 allowing for theapplication of other international instruments and

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municipal law where they are more favourableto recognition. The Convention on the Settlementof Investment Disputes Between States and theNationals of Other States is an example of such aninstrument, as it provides for automatic recognitionand enforcement of awards from the InternationalCenter for the Settlement of Investment Disputes.This pro-enforcement bias has been reflected in thecourts' application of the New York Convention.Indeed, cases in which enforcement has beenrefused have been quite rare, representing roughlyten percent of the cases reported in the YearbookCommercial Arbitration, which compiles NewYork Convention decisions.

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While parties to arbitration agreements aregenerally expected to comply with any awardrendered by the arbitral tribunal, there may be validgrounds to resist enforcement. Yet, the outlookappears to be bleak for any party seeking to resistenforcement of a prejudicial award. Enforcementcan, however, successfully be challenged in certaincases, and parties must be cognizant of a numberof issues in order to maximize their chances ofsuccess in this respect. This article identifies andelaborates on certain of these key issues. We wilfirst briefly deal with the formal and proceduralrequirements for seeking enforcement, which canat times provide fertile ground for resisting anaward. We wil then explore the risk a party runsof losing or waiving the already limited groundsthey can invoke for challenging enforcement,and what parties can do to prevent that risk frommaterializing. Lastly, we wil provide someexamples of grounds for challenging enforcementwhich have been successful in the relatively rarecases in which enforcement has been refused by acourt.

It is generally accepted that the multinationalinstrument that is the New York Conventionshould be applied in a uniform manner. Whileno signatory state is bound by the case law ofanother signatory state, courts should not applythe Convention without taking note of what othercourts have decided in similar circumstances. i iParties wishing to enforce or resist enforcementof an award are therefore well advised to searchfor New York Convention precedents in otherjurisdictions that might support their case.

2. Limitations on the Scopeof the New York ConventionIt is useful to recall that the Convention isapplicable only to arbitral awards, and thereforeis not applicable to procedural orders anddecisions on interim measures, or decisionsrendered by bodies other than arbitral tribunals.The Convention does not define what constitutesan award. Essentially, what is relevant to such

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a determination is the content of the decision,not the terms that are used to designate it. 12 Tworequirements must be met in order for a decisionto qualify as an award: (1) the decision musthave been rendered by an arbitral tribunal, ie aprivate body, offering suffcient guarantees ofindependence and impartiality, and (2) it mustdecide on a legal dispute between the parties in afinal and binding manner.13 The decision need not,however, be a final award on the entire dispute.Preliminary awards are also enforceable.

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Many States, including China, Indonesia,Malaysia, Korea and Japan, reserve the applicationof the Convention to awards made in otherContracting States. The reciprocity requirement isexplicitly reserved in Article 1(3).

3. Formal and Procedural Requirementsfor Seeking EnforcementWhile the burden of proving that one of thegrounds in article V(1) is applicable in a given casefalls on the party challenging the enforcement ofan award, it is first incumbent on the party seekingenforcement to ensure that certain formal andprocedural requirements are satisfied. First, theparty seeking enforcement must produce to thecourt the duly authenticated original award and theoriginal arbitration agreement, or a duly certifiedcopy of those documents. IS What law governs

authentication or certification is not specifiedby the Convention, although it appears that ifthe authentication or certification is valid eitherpursuant to the law at the place of arbitration orthe law at the place of enforcement, it wil beconsidered as valid by the court. 16 Indeed, such anapproach is consistent with "the purpose ofArticle iv to ease as much as possible theconditions to be fulfilled by the pary seekingenforcement.,,17 Where the language of either theaward or the arbitration clause is not an officiallanguage of the country in which enforcement issought, a certified translation or a translation by asworn translator must also be produced.

18 These

requirements are the only conditions which mustbe fulfilled pursuant to the New York Conventionby the party seeking enforcement,19 and thereafter

the onus shifts to the opposing party.A number of court decisions applying the New

York Convention have relied on the requirementsof article iv to refuse enforcement. These includea 2005 decision of the Spanish Supreme Courtrefusing to enforce an award that had beenrendered in London on the basis that the partyseeking enforcement had failed to supply a validarbitration agreement as it was required to do underarticle IV(l)(b) of the New York Convention.2D Ina recent decision of the Swiss Federal SupremeCourt, enforcement of an award was refused on

the basis that the arbitration clause on which it wasbased did not bind the defendant. 21 In a third suchcase, a German court refused enforcement becausethe applicant had failed to show that the partieshad concluded a valid arbitration agreement.22The court found that if the party applying forenforcement does not prove there is an arbitrationagreement that satisfies the requirements of articleII(2) of the Convention, "the further questionwhether there is one of the grounds for refusal ofart. V(1) is not dealt with.',2 These cases couldsuggest an uneasy co-existence between articlesiv and V(1)(a) of the Convention, and it has been

argued that they "may lead to the mistaken beliefthat a petitioner must not o~ly submit the originalarbitration agreement or a certified copy thereof,but also prove that the agreement is valid.,,24

Ambiguities in the operative part of theaward may also prove to be a source of problemsfor a winning party to secure enforcement. Indeed,in many jurisdictions, enforcement courts requestthat the operative part of an arbitral award set outclearly the specific acts that the award debtor isordered to perform or refrain from for the award tobe enforceable.25 Declaratory relief granted in theaward may thus pose problems.26

The party seeking enforcement must also becareful to respect time limits for enforcement ofarbitral awards. As the New York Convention issilent on the question, these periods of limitationare governed by domestic law and vary greatlyfrom country to country. For example, the timelimit imposed under the US Federal Arbitration Actis three years from when the award is made.2? InEngland, enforcement of an award becomes time-barred six years after the refusal of the debtor tohonour it,28 while in Switzerland, the period appearsto be ten years.29 In China, the time limit is muchshorter. It used to be one year from the date of theaward if at least one of the parties was a naturalperson, and only six months if neither party was anatural person. With the recent amendment of theCivil Procedural Law, the time limit was extendedto two years for both individual persons and legalentities.

3D Depending on the jurisdiction, winning

parties must therefore act rapidly once an award isissued in order to avoid the expiration of the statuteof limitations, and losing parties should always bemindful of the potential argument that an action inenforcement is time-barred.

4. Can a Party Lose Grounds on which theEnforcement of an Award Can Be Challenged?A party must be mindful that its conduct throughoutthe proceedings and after the issuance of the awardin the place of arbitration may affect its abilityto subsequently enforce or resist enforcement ofthe award. First, the manner in which it couches

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its relief sought wil be reflected in the arbitralaward. The relief sought should thereforebe drafted carefully. Ambiguities may entaildiffculties in enforcing an award. Second, whilethe jurisprudence on the question is by no meansunanimous, courts in a number of jurisdictionshave ruled that parties contesting the enforcementof an award are precluded from invoking groundsset out in the New York Convention as a resultof their prior conduct. Although the New YorkConvention does not deal expressly with theprohibition of contradictory conduct, such aprohibition is considered to be inherent in theConvention as a result of the principle of goodfaith, and because contradictory conduct "wouldviolate the goal and purpose of the Convention,that is, the summary procedure to expedite therecognition and enforcement of the arbitrationprocess.,,31

Depending on the jurisdiction, a party runsthe risk of waiving or otherwise losing a groundfor contesting enforcement, or may even beestopped from contesting enforcement altogether,in three different situations: (i) if it does notraise the ground during the arbitration itself, (ii)if the award is not challenged in the place ofarbitration, or (iii) if the ground was raised butproved unsuccessful in annulment or enforcementproceedings elsewhere.

(i) Failure to raise the groundfor challengingenforcement during the arbitration itselfThe situations contemplated in a number of thegrounds provided for in the New York Conventioncould already be objected to during the arbitrationproceedings themselves. These include invalidityof the arbitration agreement, breach of dueprocess (if, of course, the prejudiced party hadthe opportunity to take part in the proceedingsnotwithstanding the breach), improper compositionof the arbitral tribunal, and failure of the arbitralprocedure to conform to the parties' agreement.With this in mind, courts have precluded partieswho failed to raise objections during the arbitrationitself from raising them for the first time duringenforcement proceedings, relying on the doctrineof estoppel or its equivalent.

A Hong Kong court, for example, applied thedoctrine of estoppel against a party invoking theinvalidity of the arbitration agreement becauseit failed to contest the jurisdiction of the tribunalduring the arbitration even though it was awarethat the constitution of the tribunal may have beenimproper.32 The Higher Court of Appeal of Bavaria

came to the same conclusion in the K Trading Cov Bayerische Motoren Werke AG case, in whichBMW argued that the signatory of the arbitrationagreement did not have the power to conclude

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an agreement on its behalf, even though it failedto raise an objection during the arbitration. Thecourt set out a general principle that "( w )here, inviolation of good faith, the formal invalidity ofthe arbitration agreement is raised (by a partywhich has) participated in the arbitration withoutraising any objection, this objection is not to beexamined.,,33 Although the doctrine of estoppel isnot explicitly set out in the New York Convention,the court ruled that "(i)t appears from theinterpretation of (article I1) that the prohibition ofcontradictory behaviour is a legal principle impliedin the Convention.,,34 In another more recentGerman case, the party resisting enforcementon the basis of the invalidity of the arbitrationagreement had itself initiated the arbitrationproceedings, prompting the court to find that it wasestopped from raising the ground.3s The case lawtherefore shows that parties must be careful to raiseany concerns they may have with respect to thevalidity of the arbitration clause in the arbitrationproceedings themselves.

The warning also extends to the other groundsidentified above. In an enforcement proceedingin Singapore, for example, a judge rejected theargument that the award was not in accordancewith proper arbitral procedure when it was madeby a party which had refused to participate in thearbitration and against which a default award hadbeen issued as a result. Although the judge in thecase also relied on other considerations to reject theargument, he noted: 'I

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The defendants ... themselves were givenevery opportunity by the Commission topresent their case in reply to the claim. Theychose deliberately to reject that opportunity.It appeared to me that having chosen not toattend they had very little right to criticisethe way in which the arbitration had beenconducted.36

In the above-mentioned K Trading Co vBayerische Motoren Werke AG case, the court alsorejected the argument that the arbitral tribunal hadexceeded the time limit for rendering its awardon the basis that the procedural defect could havebeen, but was not, raised during the arbitrationitself.3?

Timely objections during the arbitrationitself may therefore be considered a sine quanon condition for subsequently raising certainof the New York Convention grounds to resistenforcement. Courts in many jurisdictions wilnot accept a party waiting until enforcement ofa prejudicial award is sought to raise argumentswhich could already be identified and addressed atan earlier stage.

(ii) Failure to challenge the award at the place ofarbitrationAs was set out above, annulment of an arbitralaward cannot be sought in a jurisdiction other thanthe place of arbitration. The decision of whether tochallenge the award at the place of arbitration mayhowever affect a party's ability to successfullyresist enforcement in secondary jurisdictions. InGermany, jurisprudence has gone so far as to holdthat the grounds in the New York Conventionfor resisting enforcement may only be invokedif the award can stil he challenged at the seat ofarbitration and if there is "at least a likelihoodof success on the merits".38 In a case involvingan award issued in Taiwan, a German court didhowever note that the jurisprudence to that effectwas controversiaL. Ultimately, however, the court'sruling was equally unfavourable to parties seekingto resist enforcement. Indeed, the court held thatthe statutory rule, applying to domestic awards,that courts may not refuse to enforce an award ifthe party resisting enforcement has failed to seekto have the award set aside in a timely fashion, isalso applicable to international awards governedby the New York Convention.39 As the losingparty had failed to petition a Taiwanese court toannul the award within the thirty day time limitimposed by Taiwanese law, its enforcement couldnot be challenged. In a recent case, however, theGerman Supreme Court ruled that the mere factthat a party resisting enforcement of an award didnot challenge an award in the country where itwas rendered is not tantamount to contradictorybehaviour. The court acknowledged that there maybe legitimate reasons not to seek the annulmentof the award, and ruled that the setting aside ofan award and the request for enforcement are twodifferent causes.40

Even partial awards on jurisdiction mayhave to be challenged at the seat of arbitration inorder to avoid being estopped from challengingthe enforcement of the subsequent award onthe merits. In a 2005 case in which a party hadcontested the jurisdiction of the tribunal in thearbitration proceedings but had not challenged thearbitral tribunal's unfavourable interim award onjurisdiction, the Hamm Court of Appeal ruled thatthe party was estopped from resisting enforcementon the basis of the invalidity of the arbitrationagreement.41

If the jurisdiction where enforcement is likelyto take place requires that awards be challenged inthe country where they were rendered, a party thatconsiders resisting the enforcement may thereforehave to seek annulment in order not to forfeit itschances to oppose enforcement.

Ongoing annulment proceedings beforethe competent court are not a ground to refuse

enforcement. Under the Convention, theenforcement courts may but are not obliged tosuspend enforcement proceedings until a decisionon annulment is issued.42

(iii) Grounds already raised unsuccessfully inannulment or enforcement proceedings elsewhereThe situations set out above highlight how theconduct of a party during and after the arbitrationproceedings can have an impact on its abilityto resist enforcement of an award; however,other considerations beyond its control may alsoprejudice that ability. Indeed, courts in a numberof jurisdictions have ruled that a pary is estoppedfrom relying on grounds for resisting enforcementif those grounds have already been unsuccessfullyrelied on in annulment or enforcement proceedingselsewhere.

For example, a Singapore court ruled that aparty resisting enforcement should not be given"two bites at the cherry" by being permtted tocontest the enforcement of an award on the samegrounds that were rejected by a court at the place ofarbitration in annulment proceedings.43 In that case,the losing party had sought unsuccessfully to havethe award set aside before the Chinese courts, andthen relied on the same grounds in the enforcementproceedings in Singapore.44 An Indian courtcame to the same conclusion in the InternationalInvestor KSCSC v Sanghi Polyesters case, holdingthat grounds unsuccessfully raised in annulmentproceedings in England were to be considered resjudicata.4s

Parties may also be estopped not only frominvoking grounds which proved unsuccessful inannulment proceedings, but also from invokinggrounds unsuccessfully raised in enforcementproceedings elsewhere. A 2003 Hong Kongjudgment is a good ilustration of this: in that case,the winning party had already had the award, whichwas issued in Switzerland, enforced by a US courtbefore it sought enforcement in Hong Kong. Withrespect to the New York Convention grounds whichhad been argued unsuccessfully by the losing partyin the US court, the Hong Kong court applied thedoctrine of issue estoppel. After considering thatthe conditions for the application of issue estoppelwere met in the circumstances,46 it found that thelosing party was estopped from raising them againand granted enforcement of the award.

While courts have found parties to be estoppedfrom invoking previously unsuccessful groundscontained in article V(L) of the New YorkConvention, it is questionable whether partieswould be similarly estopped with respect to groundscontained in article V(2). Indeed, the latter grounds,which include arbitrability under the law of thecountry in which enforcement is sought, as well as

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public policy of that country, are distinct in thatthey rely on the law at the place of enforcement.A determination of a court in another jurisdictionwould therefore have little or no relevance giventhat the issues to be considered may be completelydifferent.47 Another reason why parties would beunlikely to be estopped in raising those groundsis that a court in enforcement proceedings mayinvoke them ex offcio.

Although the approach of different courts wilvary on this issue, it is important for a party to anarbitration to maximize its chances of enforcementin all jurisdictions. Indeed, depending on thenature of the case, it may be difficult to predictwhere the winning party wil enforce an awardin its favour. A party must therefore think ahead,from the beginning of the proceedings, and becognizant of the potential pit-falls described aboveso as to protect the already limited grounds it hasat its disposal to challenge enforcement.

5. Examples of Grounds on whichEnforcement was Successfully ResistedAs noted above, the pro-enforcement bias ofthe New York Convention entails that refusalson the part of courts to enforce awards arerare. However, the Convention is not a basis tosimply rubberstamp foreign awards, and courtsdo occasionally refuse to enforce awards. Thissection sets out a few examples of such decisions,and in particular explores the public policyground, which is often invoked by parties resistingenforcement.

A first example is a German case in which,pursuant to article V(1)(a) of the Convention,the court refused enforcement of an award onthe grounds that the arbitration agreement wasinvalid under Chinese law, the law of the seat ofarbitration, as had previously been determinedby a Chinese court.48 Applying the due processground in article V(l)(b), the Hong Kong HighCourt in the Paklito Investment Ltd v KlöcknerEast Asia Ltd case refused to enforce a Chineseaward rendered under the auspices of the ChinaInternational Economic and Trade ArbitrationCommission (CIETAC) on the grounds that a paryhad not been given an opportunity to commenton the reports of a tribunal-appointed expert.49

Another example of a refusal based on article V(l)(b) is that of a German court in a case in whichthe respondent's participation in the proceedingswas limited to nominating an arbitrator andsubmitting documents on the contract in dispute.The respondent was not informed of the argumentspresented by the claimant, and the court concludedthat merely being given the opportunity to giveits view "without knowing the arguments of theopponent, is not sufficient for due process '" ."so

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jIt appears that the excess of jurisdiction groundin article V(l)(c) has only very rarely provided abasis for refusal of enforcement.S! One of those rarecases to invoke it is a Hong Kong decision in whichthe Court of Appeal refused enforcement rulingthat the "arbitrators made their purported awardsin excess of jurisdiction and such awards shouldnot be enforced here. "S2 On the basis of articleV(l)(d), which permts refusal of enforcementwhere there is an irregularity in the compositionof the arbitral tribunal or in the arbitral procedure,an award that had been rendered by a truncatedtribunal was refused enforcement in Germany.Contrary to the applicable procedural rules, onlytwo of the three arbitrators had participated in theissuance of the award.s3 Interestingly, the award inthat case had been set aside in the country where ithad been rendered (Belarus). The German courtsdid not, however, consider that such annulmentwas a mandatory ground to refuse its enforcementabroad.s4 Nevertheless, article V(l)(e) providesthat enforcement of an award which has been setaside at the place of arbitration can be refused. Anexample of a case refusing enforcement on thatground is the US Court of Appeals for the Districtof Columbia decision in Termorio v Electranta, acase dealing with an award that had been renderedand subsequently annulled in Colombia.

ss The

court ruled that because "the arbitration award waslawfully nullified ... (and) there is nothing in therecord here indicating that the proceedings beforethe (Colombian court) were tainted ..., appellantshave no cause of action in the United States to seekenforcement of the award... . "S6

The public policy ground contained in articleV(2) of the New York Convention can in somecircumstances provide a basis on which to resistenforcement of an arbitral award. The chances ofsuccess in invoking public policy wil, however,depend very much on the jurisdiction in whichit is raised. Indeed, France, for example, takes avery narrow view of public policy, which is welldemonstrated by the Cour dappel de Paris's

decision in the well known SNF SAS v CytecIndustries BV case.S7 In its decision grantingenforcement of an award rendered in Belgium,the Court of Appeal ruled that enforcement wouldonly be refused on public policy grounds if theviolation was "flagrant, actual, and concrete. "S8

A Hong Kong court took an equally restrictivestance:

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(to refuse enforcement of a Conventionaward) the award must be so fundamentallyoffensive to that jurisdiction's notionsof justice that, despite it being a party tothe Convention, it cannot reasonably beexpected to overlook the objection.59

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Public policy has nevertheless successfullybeen relied on to resist enforcement in a numberof cases in many jurisdictions. For example, anIndian court refused to enforce an award on thegrounds that it rejected an Indian pary's pleaofforce majeure despite the fact that the party'sperformance was rendered ilegal by an IndianGovernment directive.60 In another example, aGerman court determined that German publicpolicy was violated by the fact that a party in anarbitration had not been given the opportunity toexamine a document submitted to the arbitrator byits opponent, and therefore refused enforcement.61In some cases, the way courts use the public policyground to refuse enforcement of awards can appearquestionable.62 For example, in a recent decision,a court in the Philippines refused to enforce anaward rendered in Singapore after it concludedthat it violated Philippine public policy because,among other things, it awarded attorney fees andfailed to apply Philppine law as was required bythe contract. Such decisions are, however, "fewand far between.,,63

By and large, though, public policy is quitea small loophole to escape enforcement as itshould be construed restrictively by the courtsand only prevent enforcement in extraordinarycircumstances.64 Fraud, for instance, could

constitute such an extraordinary circumstance. AFrench court concluded that the dispositions of anaward affected by one of the parties' fraudulentsubmission of an erroneous expense report to thetribunal were "contrary to French international

Notes.'

2

Richard J Graving, "Status of the New YorkArbitration Convention: Some Gaps inCoverage but New Acceptances Confirm itsVitality", 10 ICSID Review (1995).Hans Smit, "Annulment and Enforcementof International Arbitral Awards: A PracticalPerspective" in Lawrence W Newman &Richard B Hil, eds, The Leading Arbitrators'

Guide to International Arbitration, 2nd ed(New York: Juris, 2008), p 591 at p 591.Among the countries that have not accededto the Convention are Bhutan, North Korea,Myanmar, and Timor-Leste.

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public policy".6s Although it was in an annulmentand not an enforcement proceeding, the Frenchcourts would arguably have applied the samereasoning in an enforcement case. If, however, apary could have raised a fraud allegation in thearbitration but failed to do so, it may be preventedform resisting enforcement, or even from adducingevidence for the alleged fraud in the enforcementproceedings.66

A party that does not wish to pay an awardbut has a claim, or has acquired a claim in themeantime, against the winning party, may alsotry to set off its claim from the amounts awardedagainst it in the arbitral award. The admissibilityand prerequisites for such a set off wil varydepending on the jurisdiction.67

6. ConclusionIn conclusion, paries intending on resisting theenforcement of an award wil generally face anuphil battle. Whether resisting enforcement wilprove to be successful wil depend on the groundsthat are invoked, as well as on the jurisdiction inwhich it is sought. Parties must also be cognizantthat their conduct throughout the proceedingsand after the issuance of the award in the place ofarbitration may affect their abilty to subsequentlyresist enforcement of an award. Often, a morepractical approach may be to try to reach a post-award settlement, which may be interesting tothe winning party as it does not have to engage incostly and lengthy enforcement proceedings withan uncertain outcome.

4 See eg Gulf Petro Trading Co Inc v NigerianNational Petroleum Corp, F3d, 2008 WL 62546

(US Court of Appeals for the 5th Circuit, 2008),Intl Arb LR (2008), n17, p 17.Albert Jan van den Berg, The New YorkArbitration Convention of 1958 (The Hague:Kluwer, 1981), at 265 (Van den Berg, NYConvention).Parson & Whittemore Overseas Co v Sociétégénéral de l'industrie du papier (RAKTA),508 F2d 969 (US Court of Appeals for the2nd Circuit, 1974); see Domenico Di Pietro& Martin Platte, Enforcement of International

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Arbitration Awards.' the New York Conventionof 1958 (London: Cameron May, 2001), p 135.Seven Seas Shipping Ltd v Tondo Limitada,1999 US Dist LEXIS 9574 (US DistrictCourt, Southern District of New York, 1999),YBCA,Vol XXV (2000), P 987.Van den Berg, NY Convention, supra note 4 atpp 265, 269-273.Article VII( 1) of the Convention reads asfollows: "(t)he provisions of the presentConvention shall not affect the validity ofmultilateral or bilateral agreements concerningthe recognition and enforcement of arbitralawards entered into by the Contracting Statesnor deprive any interested party of any right hemay have to avail himself of an arbitral awardin the manner and to the extent allowed by thelaw or the treaties of the country where suchaward is sought to be relied upon."

10 Albert Jan van den Berg, "New York

Convention of 1958: Refusals of Enforcement",ICC ICArb Bull Vo1l8 (2007) N02, P 15 at 49(Van den Berg, "Refusals of Enforcement").

11 Van den Berg, NY Convention, supra note 5

at p 1 f. See also Paolo Michele Patocchi inInternational Arbitration in Switzerland: AnIntroduction to and a Commentary on Articles176-194 of the Swiss Private International LawStatute (The Hague: Kluwer Law International,2000), Art 194, No 3: the courts should"actively adopt a uniform and comparativeapproach when called upon to interpret andconstrue the Convention, and in particular theyshould take judicial notice of the precedentsmade in other Contracting States."

12 Publicis v True North, 206 F3d 725, 2000 US

App LEXIS 3765 (US Court of Appeals forthe 7th Circuit, 2000), 18 ASA Bull 2/2000,

P 427, YBCA, Voi XXV (2000), P 641 (in thiscase, a disclosure order is qualified as an awardunder the New York Convention). The solutionadopted by the Court in Publicis is one thatis identical in many jurisdictions: PhilippePinsolle, "Observations -.Cour d'appel desEtats-Unis (7e circuit) 14 mars 2000", Rev arb2000, p 657 at p 659. See eg Cour d'appel deParis, 1 July 1999, Brasoil, Rev arb 1999,p 834, note Ch Jarosson.

13 An arbitral award has been defined as "a

final decision by the arbitrators on all or parof the dispute submitted to them, whether itconcerns the merits of the dispute, jurisdiction,or a procedural issue leading them to end theproceedings." (Emmanuel Gailard & JohnSavage, Fouchard Gailard Goldman OnInternational Commercial Arbitration (TheHague: Kluwer Law International, 1999),N 1353.) DiPietro & Platte state that "(i)n

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practice, the term award should be reservedfor decisions which finally determine thesubstantive issues they deal with." (DiPietro& Platte, supra note 6, at p 30.) This view isreflected for example in a US case in which theDistrict Court refers to an award as "finally anddefinitely dispos(ing)" of a claim submitted toarbitration. (Zephyros Maritime Agencies, Incv Mexicana de Cobre, 662 F Supp 892 at p 895(US District Court, Southern District of NewYork, 1987.) Because the Convention does notdefine what constitutes an award, the definitionmust be found in domestic law. While oneauthor writes that it "appears to depend on thearbitration law governing the award" (Van denBerg, supra note 10, at p 39), another addsthat a foreign decision must also be regardedas an award under the law of the place ofenforcement to qualify as such, and that courtsshould take note how the concept of an "award"has been interpreted by foreign courts applyingthe Convention (Patocchi, supra note 11, Art194, No 2.).

14 See eg Austin John Montague v Commonwealth

Development Corporation, 27 June 2000,Appeal No. 8159 of 1999, SC No 29 of 1999,(Supreme Court of Queensland, Court ofAppeal Division), YBCA, Vol XXVI (2001),

P 744 at para 14, in which the court ruled thatan interim award on jurisdiction could beenforced. In another case, an Indian court ruledthat an interim award providing for interimmeasures "can be enforced as an arbitralaward": Marriott International Inc et al v AnsalHotels Limited et ai, 5 July 2000, FAO (OS)No 335 of 1999 (Delhi High Court), YBCA,Vol XXVI (2001), P 788 at para 28.

IS Art IV(l) of the New York Convention. It should

be noted however that not every jurisdictionrequires a party seeking enforcement to producea copy of the arbitration agreement (see eg forGermany Oberlandesgericht (Court of Appeal),Bayern, 23 September 2004, K Trading Co v

Bayerische Motoren Werke AG, No 4Z Sch005-04, YBCA, Vol XXX (2005), P 568.)

16 Patocchi, supra note 11, No 50; Van den Berg,

NY Convention, supra note 5 at p 252.17 Van den Berg, NY Convention ibid at 252.18 Art IV(2) of the New York Convention.19 V.an den Berg, NY Convention, supra note 5 at

p 248. While these are the only requirementsimposed by the New York Convention,certain jurisdictions impose additionalpractical requirements on the pary seekingenforcement. In China for example, a partyseeking enforcement must submit "the nameand quantity of the relevant assets (of thelosing party), their location and evidence of the

economic situation of the defendant." (Clarissevon Wunschheim & Fan Kun, "Arbitrating inChina", 26 ASA Bull 1/2008, p 35, at p 48.)The lack of assets of the losing party in Chinais "a frequent reason for failure of enforcementprocedures". (/bid)

20 Tribunal Supremo (Spanish Supreme Court),

14 January 2003, Glencore Grain Ltd vSociedad Ib rica de Molturacion, 64 CuadernoCivitas de Jurisprudencia Civil (January-April2004),p 71, no 1715, YBCA, Vol XXX (2005), P 605.

21 Swiss Federal Supreme Court, DFf

4P10212001-4P.104/2001, 21 ASA Bull 2/2003,

P 364.22 Oberlandsgericht (Court of Appeal), Celle, 4

September 2004, No 8 Sch 11-02, YBCA, VolXXX (2005), P 528.

23 Ibid, para 8.24 Van den Berg, "Refusals of Enforcement",

supra note 10 at p 48.2S See, eg, Austria: Hubertus Schumacher, "Zu

Inhalt und Bestimmtheit von Schiedsspr chenund Vollstreckungsantr gen", 25 ASA Bull312007, p 493.

26 For a matter where declaratory relief was

enforced see, Oberlandesgericht (Court ofAppeal), Köln, 22 April 2004, SchiedsVZ/German Arbitration Journal (2004), n04, pVIII.

27 Art 207 Federal Arbitration Act, 9 USC

Section 1 et seq. See Flatow v Iran, 1999 USDist LEXIS 18957 (US District Court, Districtof Columbia, 1999), YBCA, Vol XXV (2000),

P 1102.28 Art 13 Arbitration Act 1996.

29 Art 137 Swiss Code of Obligations: the

provision however refers to a judgment, not anarbitral award, and no rule applies specificallyto arbitral awards. The courts have not yetaddressed the question. See Chrstian Aschauer,"La prescription des sentences arbitrales", 23ASA Bull 4/2005, p 599.

30 Art 219 Civil Procedure Law of China; VonWunschheim & Fan Kun, supra note 19, p 35at p 47.

31 La société nationale des hydrocarbures v

Shaheen National Ressources Inc, 585 F Supp57 (US District Court, Souther District of NewYork, 1983), YBCA, Vol X (1985), P 540 atpara 16.

32 China Nanhai Oil Joint Service Corporation

Shenzlien Branch v Gee Tai Holdings Co Ltd,(1995) HKLR 215 (Supreme Court of

HongKong, 1994), YBCA, Vol XX (1995), P 671.

33 K Trading Co v Bayerische Motoren Werke

AG, supra note 15, at para 5.34 Ibid, para 5.

3S Oberlandesgericht (Court of Appeal), Koblenz,

28 July 2005, 2 Sch 04/05, YBCA, Vol XXXI(2006), P 673.

36 Hainan Machinery Import and Export

Corporation v Donald & McArthy Pte Ltd,(1996) 1 Singapore Law Reports 34 (HighCourt, 1995), YBCA, Vol XXII (1997), P 771.

37 K Trading Co v Bayerische Motoren Werke AG,

supra note 15.38 Oberlandesgericht (Court of Appeal), Karlsruhe,

14 September 2007, N v M, headnote, online:www.k1uwerarbitration.com. referrng toGerman Supreme Court, BGH NJW-RR 2001,

P 1059.39 Ibid, headnote.40 German Supreme Court, BGH, 17 April 2008,

II ZB 97/06, Schieds VZ/German ArbitrationJournal (2008), no 4, p 196.

41 Oberlandesgericht (Court of Appeal), Hamm,

27 September 2005,29 Sch 1/05, SchiedsVZ/German Arbitration Journal (2006), no 3, p 106at paras 5-6.

42 Aricle VI of the New York Convention reads:

"If an application for the setting aside orsuspension of the award has been made to acompetent authority referred to in article V(l)(e), the authority before which the award issought to be relied upon may, if it considers itproper, adjourn the decision on the enforcementof the award and may also, on the applicationof the party claiming enforcement of theaward, order the other party to give suitablesecurity." For an example of a court decisionrefusing enforcement as a result of ongoingannulment proceedings, see Creighton vGovernment of Qatar, 22 March 1995, No94-1035 RMU (US District Court, District ofColumbia), YBCA, Vol XXI (1996), P 751,dealing with an award issued and challengedin France. For an example of a case in whicha court granted enforcement despite pendingannulment proceedings, see Cour d'appel (Courtof Appeal, Luxembourg), 28 January 1999,YBCA, Vol XXIVa (1999), p 714.

43 Newspeed International Ltd v Citus Trading Pte

Ltd,4 June 2001, OS No 600044 (SingaporeHigh Court), YBCA Vol XXVII (2003), p 829at para 6.

44 Ibid at para 6.4S International Investor KCSC v Sanghi

Polyesters Ltd, 9 September 2002, CivilRevision Petition Nos 331 and 1441 of 2002

(High Court, Andhra Pradesh (India)), YBCA,Vol XXX (2005), P 577.

46 Karaha Bodas Company LLC v Perusahaan

Pertambangan Minyak Dan Gas Bumi Negara,27 March 2003, (High Court of the Hong KongSpecial Administrative Region, Court of First

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Instance), 21 ASA Bull 3/2003, P 667, at paras50-51.

47 See eg Hebei Import and Export Corporation

v Polytek Engineering Co Ltd, (1999) 2 HKC205 (Court of Final Appeal of the Hong KongSpecial Administrative Region), YBCA, VoiXXIVa (1999), p 652 at para. 44, which heldthat a party was not estopped from resistingenforcement on the ground of public policyeven though it did not raise a public policyargument before the court of supervisoryjurisdiction, reasoning that "(i)n the court ofsupervisory jurisdiction, the public policy tobe applied would be a different public policy,namely that of the supervisory jurisdiction."

48 Kammergericht (Higher Regional Court),

Berlin, 18 May 2006, SchiedsVZ/GermanArbitration Journal (2007), No 1, P 100,YBCA, Voi XV (2007), P 347.

49 Paklito Investment Ltd v Klöckner East Asia

Ltd, 15 January 1993 (High Court of HongKong), YBCA, Voi XiX (1994), P 664.

so Landgericht (Court of First Instance), Bremen,

20 January 1983, YBCA Voi XII (1987), p 486,at p 487.

si Professor Albert Jan van den Berg writes

that only two cases reported in the ICCAYearbooks have refused enforcement forexcess of jurisdiction: Van den Berg, "Refusalsof Enforcement", supra note 9 at p 24.

S2 Tiong Huat Rubber Factory v Wah-Chang

International Company Ltd, 28 November1990 (Hong Kong Court of Appeal), YBCA,Voi XVII (1992), P 516, at para 19.

S3 German Supreme Court, BGH, 21 May 2008,

II ZB 14/07, SchiedsVZ/German ArbitrationJournal (2008), No 4, P 195.

S4 They examined therefore whether the awards

could, in principle, be enforced in Germany.This was not the case as the composition ofthe arbitral authority or the arbitral procedurewas not in accordance with the agreement ofthe parties (Article V(I)(d) of the New YorkCovention). The Supreme Court subsequentlyconfirmed this finding. The court's approachto the enforcement of annulled awards has alsobeen taken in other jurisdictions, in particularFrance, see Cour Cass, 29 June 2007, PTPutrabali v Rena Holding, 25 ASA Bull4/2007, P 826. The French courts enforced anarbitral award rendered in a dispute between anIndonesian party, Putrabali, and French RenaHolding which had been annulled in England.

ss Termorio v Electranta, 487 F2d 928 (US Court

of Appeals for the District of Columbia Circuit,2007), note Goldstein, 25 ASA BulL. 3/2007,p643.

Ea IPSA Journal Sep 20081

S6 Ibid, at p 930.S7 Cour d' appel de Paris (Paris Court of Appeal)

(Ire Ch C), 23 March 2006, Rev Arb 2007,p 100, note S Bollée.

S8 Ibid.S9 Hebei Import and Export Corporation v

Polytek Engineering Co Ltd, supra note 46at para 87; Teresa Cheng, "Experience inEnforcing Arbitral Awards in Asia - A HongKong Perspective", (2000) 3 Intl Arb LR 185 at187.

60 COSID Inc v Steel Authority of India Ltd, 12

July 1985 (High Court of New Delhi), YBCA,Voi XI (1986), P 502, at 506-07.

61 Oberlandesgericht (Court of Appeal), Hamburg,

3 April 1975, Recht der internationalenWirtschaft 1975, p 432, YBCA, Voi 11 (1977),

P 241.62 Van den Berg, "Refusals of enforcement",

supra note 10 at p 35.63 Ibid.64 International Law Association, Final Report

on Public Policy as a Bar to Enforcement ofInternational Arbitral Awards, New DelhiConference 2002, available at http://www.ila-hq .org/en/committees/index.cfmlcid/19.

6S Cour d'appel de Paris (Paris Court of Appeal),

30 September 1993, European Gas Turbines SAv Westman International Ltd, YBCA, Voi XX

(1995), P 198 at 206.66 In the Westacre Investments Inc v Jugoimport

- SDPR Holding case, in which the partyresisting enforcement alleged that the opposingparty had adduced perjured evidence in thearbitration, the English Court of Appeal ruledthat in order to adduce evidence of fraud at thelevel of enforcement, that evidence must nothave been available "at the time of the hearingbefore the arbitrators." (12 May 1999 (Courtof Appeal, Civil Division), YBCA, Voi XXIVa(1999), p 753 at para 45.)

67 See eg Mangistaumunaigaz Oil Producton

Association v United World Trade Inc, 17June 1997, Civil Action No 96-WY-1290-WD (US District Court, District of Colorado)at paras. 1-2, YBCA, Voi XXIVa (1999), p808, in which the US District Court rejecteda party's attempt to set off its claims from theamount granted in the award, ruling that "(t)he Convention does not provide any basis forthe assertion of counterclaims" in enforcementproceedings. See also Oberlandesgericht (Courtof Appeal), Dresden, SchiedsVZ/GermanArbitration Journal (2005), No 4, p 210, atp 213; Oberlandesgericht (Court of Appeal),Düsseldorf, Schieds VZ/German ArbitrationJournal (2005), no 4, p 214.

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