York Convention Research Articles

The Challenges of the New York Convention and Potential Solutions

This paper analyzes the current challenges of the New York Convention and proposes potential solutions through the actual situation and public reporting. Central to these challenges is the over-dependence on the judicial systems of the target countries, which often results in inconsistent and unreliable enforcement of international arbitration awards. This analysis identifies several key issues impacting the Convention's effectiveness: the conservative attitude of some countries in the enforcement of international arbitration, judicial corruption, the imperfection of the judicial system, and the different enforcement procedures under various judicial systems. To address these impediments, the paper explores innovative solutions inspired by successful practices from other international legal frameworks. Notably, it examines the streamlined processes of the Madrid Agreement Concerning the International Registration of Marks and various bilateral legal assistance agreements. These models provide valuable insights into simplifying procedural complexities and enhancing the uniformity of legal processes. By integrating these practices, the paper proposes actionable strategies to mitigate the current limitations of the New York Convention, aiming to bolster its role as a foundational instrument in the global arbitration landscape.

Nonarbitrability and Mandatory Rules: Brothers, Not Twins

Notwithstanding the lack of clear legislative intent, Belgian judges have unilaterally prohibited the arbitration of exclusive distribution disputes, unless a specific Belgian pro-distributor statute was applied or unless similar substantive foreign rules were applied. However, in 2023, the Court of Cassation finally reversed its jurisprudence. Yet, the syllogism underlying this longawaited reversal remains unsatisfactory. It mistakenly equates a conflict-of-laws issue concerning mandatory rules with questions of nonarbitrability under international arbitration law. Such an overly simplistic assimilation is inappropriate in many respects. It dilutes the tailored legal standard applicable to international arbitration into a lesser question of applicable rules. It unduly prevents a subject matter from entering ratione materiae into the arbitration field. Upon closer examination, it conflates two substantively different gateways to arbitration: the nonarbitrability doctrine (Article V(2)(a) of the New York Convention) and the public policy exception (Article V(2)(b) thereof). In so doing, it needlessly erodes confidence in the arbitral process, which is based on parties’ autonomy, and violates the principles of judicial non-interference in international arbitral proceedings and of competence-competence. In essence, regardless of the pro-arbitration outcome in the case at hand, this flawed syllogism violates the New York Convention’s straightforward language and pro-arbitration ethos by potentially generating unnecessary, unforeseeable, and improper exceptions to arbitration.

The Enka v. Chubb/Anupam Mittal v. Westbridge Controversies: Why Not the Hong Kong (Partial) Solution?

This paper explores the critical theme of determining the governing law of arbitration agreements amidst the intricate landscape of international arbitration. Focusing on divergent approaches from key jurisdictions, including England and Wales, Singapore, and Hong Kong, it elucidates the challenges posed by varying legal frameworks. Recent developments, such as potential statutory adjustments in England and Wales influenced by recommendations from the English Law Commission, underscore the need for clarity in governing law determinations. The controversial ‘composite test’ approach in Anupam Mittal v. Westbridge and the traditional English approach in Enka v. Chubb exemplifies the global concerns surrounding these divergent approaches, highlighting the complexities faced by common law courts worldwide. Drawing on these cases, the paper emphasizes the importance of parties expressly choosing the governing law of arbitration agreements to mitigate uncertainties. It underscores the potential positive contributions of model clauses and jurisdiction-specific approaches, such as the Hong Kong International Arbitration Centre (HKIAC) model clause and Hong Kong’s guidance for HKIAC arbitrations. The paper also addresses enforcement challenges, particularly in light of Article V(2)(b) of the New York Convention. It discusses the discretionary invocation of the public policy exception and its impact on enforcement efficacy, emphasizing the need for a holistic approach transcending contractual formalism.

Which law should govern the ‘arbitrability’ of a dispute in England?

Abstract This article considers, from an English law perspective, the question of which law should govern the arbitrability of a dispute. The focus of the article is on the position preaward as opposed to postaward, which is expressly addressed by the New York Convention. The article analyses this question in light of the decision of the Singapore Court of Appeal in Anupam Mittal v Westbridge Ventures II Investment Holdings, the only authoritative treatment of the relevant issues by a common law jurisdiction. In Anupam, the court concluded that a composite approach to the law applicable to the arbitrability of a dispute should apply, requiring a dispute to be arbitrable under both the law of the seat of arbitration and the law applicable to the arbitration agreement. The authors suggest that a composite approach to the issue of arbitrability should not be followed in England. Instead, English law should apply the more orthodox approach of looking to the law of the seat. An approach that looks to the law of the arbitration agreement would be particularly detrimental to English arbitration law given the decision of the UK Supreme Court in Enka v Chubb. It underlines the need for reform of the Arbitration Act 1996 to address some of the well-known problems caused by Enka and which could be expanded by the additional focus on the law applicable to the arbitration agreement provided by Anupam.

„Brexito“ įtaka arbitražui: anti suit injunction ir investicinio arbitražo aspektai

Concentrating on a few material aspects in relation to the broader theme, the article analyses the effect of Brexit on international commercial arbitration. In particular, the piece firstly treats on the most recent UK Case Law in relation to anti-suit injunction – a phenomenon attributable to the Common Law in the context of the earlier European Union courts’ jurisprudence of the said instrument. Secondly, Brexit’s interplay with the ongoing global investment arbitration reform is considered. The article considers the globally recognised UN 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, on which Brexit had no adverse effect. When analysing the interplay between Brexit and the ongoing global investment arbitration reform, a particular regard is paid to the lack of investment arbitration provisions in the UK-EU Trade and Cooperation Agreement, as well as the termination of various relevant bilateral investment treaties. The article concludes that the influence of arbitration shall continue to grow, anti-suit injunction shall continue to be applied by the United Kingdom courts, and the Brexit’s interplay with the global investment protection overall and the investment arbitration in a particular reform is somewhat consistent.

Актуальные тенденции в законодательстве Китая о международном арбитраже

China did not adopt the UNCITRAL Model law in either version and its arbitration legislation often does not reflect the world-recognised practices of international arbitration. However, during the last few years, China has been softening its approach towards both international commercial and investment arbitration. The recent court decisions, adoption of the new Civil Procedure Law and proposal of the Draft Amended Arbitration Law signify gradual recognition of the concept of ‘seat of arbitration’ instead of relying on the domicile of the arbitration institution. Furthermore, Chinese courts have acknowledged the capacity of foreign arbitration institutions to administer disputes within mainland China — a significant shift from past practices where only Chinese arbitration commissions could administer arbitration proceedings in China under the Arbitration Law. This change is also reflected in the Draft Amended Arbitration Law. Another crucial legislative change is adoption of the Foreign State Immunity Law, which came into effect in January 2024. By enacting this law, China has shifted from absolute to restrictive immunity in disputes between a person or entity and a state. Thereby China allowed claims against foreign states arising out of commercial activities or international investment treaties to be considered in Chinese courts. Nevertheless, challenges remain in regards of recognition and enforcement of investment arbitral awards or conducting of investment arbitration in China. First, China’s reservation under the New York Convention 1958 limits recognition and enforcement of foreign awards to ‘commercial’ disputes, excluding investor-state disputes. Besides, it is discussed that China has not taken proper steps to recognise the ICSID awards as national ones for purposes of enforcement, even though it ratified the ICISD Convention. Furthermore, formally under the current Arbitration Law the investment arbitration is not possible. Finally, considering the latest legislative amendments, recent court practice and updated arbitration rules of Chinese arbitration institutions, it can be concluded that China has taken the pro-arbitration approach.

Hague choice of court convention: current state of affairs and application issues

The article provides a scientific and practical analysis of international legal aspects relating to the issue of determining the exclusive jurisdiction of a dispute by means of a choice of court agreement, which is quite relevant, since the ratification of the relevant Convention, which was signed in 2014, took place during the martial law regime, which complicates the process of implementing the provisions of the Convention in the Ukrainian legal system. The author analyses the current Ukrainian legislation in the area of determining the jurisdiction of private law relations with a foreign element, in particular, proceedings in cases related to the jurisdiction determination procedure, and international documents in the area of choice of court agreements, such as the Laws of Ukraine «On International Private Law», «On Amendments to Certain Legislative Acts of Ukraine in connection with the Ratification of the Convention on Choice of Court Agreements», the Hague Convention on Choice of Court Agreements and the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. The author identifies certain problems of enforcement of the choice of court agreement in the judicial system of Ukraine and issues of procedural protection of the parties to the agreement. It is noted that currently there is no definition of an exclusive choice of court agreement in national legislation and there are problems in the enforcement of a Ukrainian court decision by other states where no agreement on legal assistance has been concluded. The difficulty of applying the Convention on Choice of Court Agreements in comparison with the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards has been proven, which may lead to differences in the practice of use among the countries that are parties to the Convention. The author identifies the need to expand Article 4-1 of the Law of Ukraine «On Private International Law» and improve the implementation of disputes involving an exclusive choice of court agreement. The author emphasises the need to resolve problematic issues, as this will positively affect the international legal image of the state and prepare further legislative changes for more effective synthesis of the legal systems of Ukraine and the EU member states.

Enforcement of Annulled Awards: A Balanced Approach

The enforcement of annulled awards has been an extensively debated topic in international commercial arbitration. The drafting history of Article V of the New York Convention (NYC) indicates that discretion was granted to Member States to refuse enforcement of annulled awards. However, most jurisdictions have either adopted a territorial approach or an internationalist or delocalized approach when it comes to annulled awards. In this paper, we argue that there are many flaws in the delocalized approach adopted by various jurisdictions. The territorial approach is also not feasible due to differing standards of enforcement in different jurisdictions. We bring forth a more balanced approach to the enforcement of annulled awards, which borrows from the stance of William W. Park on this issue. We argue that annulment decisions should be seen as akin to decisions of foreign jurisdictions. Further, we argue that the public policy ground could be used to create sufficient grounds for refusal of enforcement when necessary.

The Plea of Sovereign Immunity in Defence of a New York Convention Award Before the US Superior Courts: Process & Industrial Development v. The Federal Republic of Nigeria (P&ID v. FRN)

The sovereign immunity defence is a plea that had long served sovereign Convention awarddebtors well across jurisdictions worldwide. Although there was a noticeable gradual whittling down of its influence in several jurisdictions in the 1950s and 1960s, the unwary arbitration stakeholder might be mistaken to assume that the principle has gone extinct in popular arbitration jurisdictions. The United States appears to be one jurisdiction where the sovereign immunity plea has recently enjoyed a resurgence; in virtue of the subtle but practical distinction that American superior courts [in their interpretation of the Foreign Sovereign Immunities Act (FSIA), 1976], have drawn between the jurisdiction to entertain suits against a sovereign, founded on commercial activity involving the sovereign, and the jurisdiction to order execution upon the assets of the sovereign. The upshot of how US superior courts have interpreted the Act is that, while subjectmatter jurisdiction invests the US courts with power to entertain suits against a sovereign (as regards their commercial relations), they lack the corresponding power to order execution against the sovereign’s assets. Put differently, the sovereign has executional immunity over their assets but lacks subject matter immunity to be sued before a District Court, as long as it relates to a commercial activity involving the sovereign. The immunity of a sovereign’s asset from execution inevitably leaves the award creditor with a vacuous victory.

Benefits of North Korea's Membership in the New York and ICSID Conventions

This article contends that North Korea should accede to the New York Convention and the ICSID Convention to provide more robust legal protections and dispute settlement mechanisms for foreign investors. While North Korea has enacted various domestic laws and established special economic zones to attract foreign investment, these measures have proved insufficient to fully assuage investor concerns, particularly regarding the enforcement of arbitral awards and protections against expropriation. Joining the New York Convention would mitigate uncertainties surrounding the enforcement of foreign arbitral awards by obligating North Korean courts to recognize and enforce such awards, subject only to limited, internationally accepted grounds for refusal. Accession to the ICSID Convention would enable aggrieved foreign investors to bring claims against North Korea before a neutral, depoliticized arbitral tribunal, providing an additional layer of protection against discriminatory or expropriatory state conduct. Membership in these conventions would significantly enhance North Korea's credibility in the eyes of foreign investors, demonstrating a commitment to upholding the rule of law and aligning its investment framework with global norms. While accession alone is not a panacea, it represents a crucial step toward building investor confidence, facilitating greater FDI inflows, and fostering North Korea's economic development and international engagement.

COMPARISON OF COMMERCIAL DISPUTE RESOLUTION MECHANISMS IN JORDAN AND THE MIDDLE EAST

This article provides a comprehensive comparison of commercial dispute resolution mechanisms across Jordan, Saudi Arabia, the United Arab Emirates (UAE), and Egypt. With the increasing globalization of business and the growth of foreign investments in the Middle East, an effective and efficient legal framework for dispute resolution is critical. The primary goal of this study is to provide a comprehensive comparative analysis of commercial dispute resolution mechanisms in Jordan and key Middle Eastern countries, with the aim of understanding their impact on the business climate and investor confidence in the region. The research employs a comparative analysis approach, drawing on a variety of sources including legal texts, case studies, and interviews with legal experts and business professionals from Jordan, Saudi Arabia, UAE, and Egypt. This comparative analysis examines the similarities and differences in the dispute resolution frameworks of these four countries, focusing on judicial processes, arbitration practices, and the adoption of alternative dispute resolution (ADR) methods. All four nations share a common legal heritage influenced by Islamic Sharia law and have adopted international standards such as the UNCITRAL Model Law to modernize their arbitration systems. Each country has established specialized commercial courts to expedite the resolution of business disputes and is a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, facilitating cross-border enforcement of decisions. However, there are distinct differences shaped by local legal and economic policies. For instance, the UAE features a dual judicial system that includes Sharia-influenced local courts and common law-based courts in its free zones, which are absent in the other three countries. The study highlights the strengths and weaknesses of each jurisdiction's dispute resolution mechanism and discusses ongoing reforms aimed at enhancing the effectiveness and efficiency of legal processes. This analysis not only aids in understanding each country's approach to dispute resolution but also serves as a guide for international businesses and investors considering operations in these regions.

The Concept of Arbitrability under the New York Convention: The Quest for Comprehensive Reform

The Concept of Arbitrability under the New York Convention: The Quest for Comprehensive Reform

An Analysis of Judicial Intervention and Assistance for Arbitral Proceedings: A Look at the Courts of Ghana

Without the support of national courts, arbitral tribunals are unable to function properly, particularly in situations involving the enforcement of arbitration agreements, procedural orders, and arbitral awards, among other things. The arbitral tribunal cannot compel a party to carry out a task, or obligation, or fulfil an obligation. The court has the authority to order a party to carry out an order and can also impose harsh consequences for contempt of court, such as fines, imprisonment, or other punishments. Unless the issue(s) before the court are non-arbitrable pursuant to section 1 of the Alternative Disputes Resolution Act, 2010. The courts of Ghana have the capacity and jurisdiction to enforce applications by a party for arbitration. The New York Convention, which also grants national courts of contracting states authority to hear cases involving the enforcement of arbitration agreements, has been ratified and domesticated by Act 798 under the First Schedule. The paper argues that even though national courts are permitted by statutory laws and international conventions to assist in arbitral proceedings, courts must exercise some restraint and must not be in a hurry to inherit jurisdiction and interfere with disputes before arbitration, since arbitration proceedings are considered alternative methods of resolution of disputes to litigation, and unless expressly provided for and in obvious instances devoid of any controversy. A purported judicial assistance should not be used to whittle away the function of arbitral tribunals and render nugatory the benefits that are to be derived from these proceedings as it would defeat the concept of Alternative Dispute Resolution (ADR). The paper concludes by suggesting that unnecessary interventions by some national courts including Ghana appear to be interfering with party autonomy as well as the competence of the arbitral tribunal, hence, hindering the purpose for which the Alternative Dispute Resolution Act 2010 was enacted and other supporting legislations and conventions as an alternative to litigation which is non-voluntary, expensive, acrimonious and complicated.

Judicial Review of Arbitral Award

Arbitration is the process to settle dispute between the parties speedily and with confidentiality. The arbitration rules provide mechanism for judicial review of arbitral award as a supervision over arbitral process by the state at the seat of arbitration. An award reached by an arbitrator pursuant to a contractual agreement to arbitrate is not subject to judicial review except on the grounds set forth in law. According to article UNCITRAL Model Law recourse to a court against an arbitral award may be made only by an application for setting aside in accordance with paragraphs (2) and (3) of Article 34 (1). The object of research is to examine the ground of annulment of an arbitral award by the courts in the process of judicial review. If an award is set aside, it has no effects in the country where it was vacated. If setting aside occurs in a country in which, or under the law of which the award was made, such setting aside may become a reason under the New York Convention for other contracting states to refuse to recognize and enforce the set aside award. A brief review of legal provisions and judicial decisions demonstrate that courts in different jurisdictions interfered with arbitral awards only in limited circumstances. The study recommends that the judicial review of arbitral award should be done only on the grounds set forth in the law.

Article: Codification, Convenience, and the Common Law: The Rationales Underpinning the Law Commission’s Proposed Reforms to the English Arbitration Act 1996

The Arbitration Act 1996 has regulated arbitrations in England and Wales for almost thirty years. Given the evolution of arbitral practice during this time, the UK Government in 2021 asked the Law Commission to consider potential amendments to the Act to ensure that it continues to be ‘state of the art’. The Law Commission concluded that wholesale reform of the Arbitration Act was not necessary or desirable in order to achieve that aim. The Law Commission instead proposed a series of targeted amendments, which are due to be implemented in legislation during the course of 2024. This article provides an overview of the Law Commission’s review process before discussing its key recommendations and their potential impact on London’s position as a preeminent seat for international arbitration. The article also discusses the rationales underpinning the Law Commission’s recommendations. In summary, some proposals merely modify the wording of the Arbitration Act without changing the substance of English law. A second category represents a conscious effort towards progressive development of the arbitration framework in England and Wales, to ensure in particular that London remains competitive internationally. A third category of changes seeks to build on the strengths of the English courts to ensure that the Arbitration Act continues to reflect the evolving world of arbitration. Taken together, the authors consider that the Law Commission’s targeted recommendations should go some way to ensuring that England – and London – continue to have a prominent place in that world. Arbitration, Arbitration Act 1996, Dispute Resolution, Reform, Law Commission, Consultation, England, London, Model Law, New York Convention

Yegiazaryan v. Smagin (U.S. Sup. Ct.)

Yegiazaryan v. Smagin represents a landmark case within the Supreme Court's (SCOTUS) jurisdiction, revolving around a contractual dispute between John Yegiazaryan and Alex Smagin. The legal intricacies unfolded when Smagin sought to enforce a multimillion-dollar arbitration award against Yegiazaryan in California under the New York Convention. The district court's asset freeze faced complications as Yegiazaryan, residing in California, received an unrelated arbitration award and attempted to evade the freeze. In response, Smagin invoked the Racketeer Influenced and Corrupt Organizations Act (RICO), alleging a coordinated effort to obstruct the collection of the arbitration judgment. The case stands as a pivotal legal milestone marked by complexities and jurisdictional challenges.

Иностранное судебное решение и недействительность арбитражного соглашения (анализ решения Апелляционного суда г. Берлина от 18.05.2006)

The article includes an analysis of the judgment of the Court of Appeal (Kammergericht) of Berlin dated May 18, 2006, concerning the refusal to recognize and enforce the award of the International Chamber of Commerce (ICC) (place of arbitration — China). As an argument for refusal to recognize and enforce the foreign arbitral award, the Berlin Court of Appeal referred to: 1) recognition in Germany of the decision of the Wuxi People's Court to set aside the arbitral award (invalidity of the arbitration agreement); 2) invalidity of the arbitration agreement from the point of view of the applicable law. In our view, the recognition of a foreign judicial act on the annulment of an arbitration agreement contradicts the obligations of the state under the New York Convention 1958, as this international treaty reserves the possibility for the state to recognize and enforce a foreign arbitral award even despite its cancellation in the state rendering. It appears that in this matter the German court should first of all proceed from the invalidity of the arbitration agreement in terms of the applicable law (the law of the People's Republic of China).

More New York Convention: U.S. Court Interpretations On Jurisdiction and Venue for Actions and Proceedings

Last month, the author examined U.S. judicial interpretations of primary and secondary jurisdiction considerations under the New York Convention and its U.S. enabling statute, the Federal Arbitration Act's Chapter 2, with respect to awards issued in international arbitrations. In this month's conclusion, the focus is on the effects of the laws on jurisdiction and venue over actions and proceedings falling under the Convention. See “The New York Convention: How Courts Interpret Jurisdiction on Awards—A U.S. Perspective,” 42 Alternatives 9 (January 2024) (available at https://bit.ly/3RXb3tO).

Between commitment and reality: A critical examination of Jordan's adherence to the New York Convention 1958

AbstractThis study critically evaluates Jordan's bifurcated approach to the enforcement of arbitral awards, with an emphasis on its domestic laws and international obligations under the New York Convention. Utilizing a rigorous methodology that melds doctrinal scrutiny with comparative legal analysis, the research delves into Jordan's Arbitration Law 31 of 2001, its subsequent amendments, and the Enforcement of Foreign Judgments Law 8 of 1952. The analysis reveals a marked incongruence between Jordan's national legal frameworks for recognizing and enforcing foreign arbitral awards and its commitments under Article 3 of the New York Convention. The study further quantifies the financial and procedural barriers erected by Jordan's stratified judicial system, contrasting them with universally accepted benchmarks. Informed by international jurisprudence, the research proffers targeted policy recommendations designed to harmonize Jordan's arbitration regulations with prevailing pro‐enforcement international standards. This investigation fills a scholarly void and offers pragmatic, timely solutions, thereby contributing to the global dialogue on compliance with international arbitration norms, particularly from a Jordanian vantage point.

Awarding costs where no arbitral jurisdiction on the merits: the making and enforcement of negative cost awards

Abstract Arbitral tribunals routinely award costs when they lack jurisdiction on the merits of a dispute. However, most of the identified awards—labelled here as ‘negative cost awards’—fail to adequately explain the source of the tribunals’ authority to award costs, either by omitting the reasoning altogether or by merely relying on the arbitration rules. If the arbitration agreement is found to be invalid or non-existent, it cannot empower a tribunal to award costs, and the arbitration rules ordinarily should not apply if the parties never agreed to them in a valid arbitration agreement. This notwithstanding, tribunals usually have a valid basis to award costs. This authority can be found in the arbitration agreement on the issue of costs, the competence–competence principle or, one way or another, national arbitration laws. Negative cost awards generally should be enforceable both under the New York Convention and the ICSID Convention, but the lack of an express finding of the arbitration agreement or another source of the tribunals’ authority to award costs may jeopardize the enforceability of such awards. Tribunals can avoid this problem by expressly explaining the basis of their authority to adjudicate costs in their awards.