On the Effect of Domestic Arbitral Award — Focused on the interpretation of Article 35 of the Korean Arbitration Act —

Abstract

In 2016 when the Korean Arbitration Act(KAA) was revised in full scale, Article 35, which stipulates the effect of a domestic arbitral award was revised to resolve the disputes over the interpretation of the Article. However, there is still a conflict on the interpretation of the Article in connection with the setting aside of an arbitral award. Some assert that an award retains the effect as a final judgment, unless it is actually set aside, while others assert that an award cannot retain such effect without setting aside of the award, if any one of grounds on which the recognition or enforcement of the award may be refused exists. This paper attempted to draw a reasonable conclusion, by examining in detail the New York Convention, UNCITRAL Model Law on the International Commercial Arbitration, and the legislation of other countries, especially those of Germany and Japan on the subject. In conclusion, the losing party of an award retains the defense to assert any ground on which recognition or enforcement of the award may be refused, without applying for setting aside of the award, as both application of setting aside an arbitral award and defense in the recognition or enforcement proceeding of the award are the internationally recognized means of a losing party of the award to deny the effect of the award. And only through such interpretation, Article 35 and 38 of KAA. can be interpreted harmoniously.