- Convention on the Recognition and Enforcement of Foreign Arbitral Awards
The Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the New York Convention, was adopted by a United Nations diplomatic conference on 10 June 1958 and entered into force on 7 June 1959. The Convention requires courts of contracting states to give effect to private agreements to arbitrate and to recognize and enforce arbitration awards made in other contracting states. Widely considered the foundational instrument for international arbitration, it applies to arbitrations which are not considered as domestic awards in the state where recognition and enforcement is sought. Though other international conventions apply to the cross-border enforcement of arbitration awards, the New York Convention is by far the most important.
In 1953, the International Chamber of Commerce (ICC) produced the first draft Convention on the Recognition and Enforcement of International Arbitral Awards to the United Nations Economic and Social Council. With slight modifications, the Council submitted the convention to the International Conference in the Spring of 1958. The Conference was chaired by Willem Schurmann, the Dutch Permanent Representative to the United Nations and Oscar Schachter, a leading figure in international law who later taught at Columbia Law School and the Columbia School of International and Public Affairs, and served as the President of the American Society of International Law.
International arbitration is an increasingly popular means of alternative dispute resolution for cross-border commercial transactions. The primary advantage of international arbitration over court litigation is enforceability: an international arbitration award is enforceable in most countries in the world. Other advantages of international arbitration include the ability to select a neutral forum to resolve disputes, that arbitration awards are final and not ordinarily subject to appeal, the ability to choose flexible procedures for the arbitration, and confidentiality.
Once a dispute between parties is settled, the winning party needs to collect the award or judgment. Unless the assets of the losing party are located in the country where the court judgment was rendered, the winning party needs to obtain a court judgment in the jurisdiction where the other party resides or where its assets are located. Unless there is a treaty on recognition of court judgments between the country where the judgment is rendered and the country where the winning party seeks to collect, the winning party will be unable to use the court judgment to collect.
Countries which have adopted the New York Convention have agreed to recognize and enforce international arbitration awards. As of July 23, 2011, there are 146 signatories which have adopted the New York Convention: 144 of the 193 United Nations Member States, the Cook Islands (a New Zealand dependent territory), and the Holy See have adopted the New York Convention. Only 49 U.N. Member States and Taiwan have not yet adopted the New York Convention. A number of British dependent territories have not yet had the Convention extended to them by Order in Council.
Summary of provisions
Under the Convention, an arbitration award issued in any other state can generally be freely enforced in any other contracting state (save that some contracting states may elect to enforce only awards from other contracting states - the "reciprocity" reservation), only subject to certain, limited defenses. These defenses are:
- a party to the arbitration agreement was, under the law applicable to him, under some incapacity;
- the arbitration agreement was not valid under its governing law;
- a party was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings, or was otherwise unable to present its case;
- the award deals with an issue not contemplated by or not falling within the terms of the submission to arbitration, or contains matters beyond the scope of the arbitration (subject to the proviso that an award which contains decisions on such matters may be enforced to the extent that it contains decisions on matters submitted to arbitration which can be separated from those matters not so submitted);
- the composition of the arbitral tribunal was not in accordance with the agreement of the parties or, failing such agreement, with the law of the place where the hearing took place (the "lex loci arbitri");
- the award has not yet become binding upon the parties, or has been set aside or suspended by a competent authority, either in the country where the arbitration took place, or pursuant to the law of the arbitration agreement;
- the subject matter of the award was not capable of resolution by arbitration; or
- enforcement would be contrary to "public policy".
The text of the convention is available online.
Parties to the New York Convention
As of October 1, 2009, 142 of the 192 United Nations Member States have adopted the New York Convention. The Convention has also been ratified by Holy See and the Cook Islands. Only fifty of the U.N. Member States have not adopted the Convention. In addition, Taiwan has not adopted the Convention and a number of British Overseas Territories have not had the Convention extended to them by Order in Council. British Overseas Territories to which the New York Convention has not yet been extended by Order in Council are: Anguilla, British Virgin Islands, Falkland Islands, Turks and Caicos Islands, Montserrat, Saint Helena (including Ascension and Tristan da Cunha). The British Virgin Islands have implemented the New York Convention into domestic law (Arbitration Ordinance 1976), although Britain has never issued an Order in Council legally extending the New York Convention to the British Virgin Islands.
State Date of Ratification State Date of Ratification Afghanistan 30 November 2005 Albania 27 June 2001 Algeria 7 February 1989 Antigua and Barbuda 2 February 1989 Argentina 14 March 1989 Armenia 29 December 1997 Australia 26 March 1975 Austria 2 May 1961 Azerbaijan 29 February 2000 Bahamas 20 December 2006 Bahrain 6 April 1988 Bangladesh 6 May 1992 Barbados 16 March 1993 Belarus 15 November 1960 Belgium 18 August 1975 Belize 26 November 1980 (extension notice) Benin 16 May 1974 Bolivia 28 April 1995 Bosnia and Herzegovina 1 September 1993 Botswana 20 December 1971 Brazil 7 June 2002 Brunei Darussalam 25 July 1996 Bulgaria 10 October 1961 Burkina Faso 23 March 1987 Cambodia 5 January 1960 Cameroon 19 February 1988 Canada 12 May 1986 Central African Republic 15 October 1962 Chile 4 September 1975 China, People's Republic of 22 January 1987 Colombia 25 September 1979 Costa Rica 26 October 1987 Côte d'Ivoire 1 February 1991 Cook Islands 12 January 2009 Croatia 26 July 1993 Cuba 30 December 1974 Cyprus 29 December 1980 Czech Republic 30 September 1993 Denmark 22 December 1972 Djibouti 14 June 1983 Dominica 28 October 1988 Dominican Republic 11 April 2002 Ecuador 3 January 1962 Egypt 9 March 1959 El Salvador 26 February 1998 Estonia 30 August 1993 Finland 19 January 1962 France 26 June 1959 Gabon 15 December 2006 Georgia 2 June 1994 Germany 30 June 1961 Ghana 9 April 1968 Greece 16 July 1962 Guatemala 21 March 1984 Guinea 23 January 1991 Haiti 5 December 1983 Holy See 14 May 1975 Honduras 3 October 2000 Hungary 5 March 1962 Iceland 24 January 2002 India 13 July 1960 Indonesia 7 October 1981 Iran, Islamic Republic of 15 October 2001 Ireland 12 May 1981 Israel 5 January 1959 Italy 31 January 1969 Jamaica 10 July 2002 Japan 20 June 1961 Jordan 15 November 1979 Kazakhstan 20 November 1995 Kenya 10 February 1989 Korea, Republic of 8 February 1973 Kuwait 28 April 1978 Kyrgyzstan 18 December 1996 Lao People's Democratic Republic 17 June 1998 Latvia 14 April 1992 Lebanon 11 August 1998 Lesotho 13 June 1989 Liberia 16 September 2005 Lithuania 14 March 1995 Luxembourg 9 September 1983 Macedonia, The former Yugoslav Republic of 10 March 1994 Madagascar 16 July 1962 Malaysia 5 November 1985 Mali 8 September 1994 Malta 22 June 2000 Marshall Islands 21 December 2006 Mauritania 30 January 1997 Mauritius 19 June 1996 Mexico 14 April 1971 Moldova, Republic of 18 September 1998 Monaco 2 June 1982 Mongolia 24 October 1994 Montenegro 23 October 2006 Morocco 12 February 1959 Mozambique 11 June 1998 Nepal 4 March 1998 Netherlands 24 April 1964 New Zealand 6 January 1983 Nicaragua 24 September 2003 Niger 14 October 1964 Nigeria 17 March 1970 Norway 14 March 1961 Oman 25 February 1999 Pakistan 14 July 2005 Panama 10 October 1984 Paraguay 8 October 1997 Peru 7 July 1988 Philippines 6 July 1967 Poland 3 October 1961 Portugal 18 October 1994 Qatar 30 December 2002 Romania 13 September 1961 Russian Federation 24 August 1960 Rwanda 31 October 2008 Saint Vincent and the Grenadines 12 September 2000 San Marino 17 May 1979 Saudi Arabia 19 April 1994 Senegal 17 October 1994 Serbia 12 March 2001 Singapore 21 August 1986 Slovakia 28 May 1993 Slovenia 6 July 1992 South Africa 3 May 1976 Spain 12 May 1977 Sri Lanka 9 April 1962 Sweden 28 January 1972 Switzerland 1 June 1965 Syrian Arab Republic 9 March 1959 Tanzania, United Republic of 13 October 1964 Thailand 21 December 1959 Trinidad and Tobago 14 February 1966 Tunisia 17 July 1967 Turkey 2 July 1992 Uganda 12 February 1992 Ukraine 10 October 1960 United Arab Emirates 21 August 2006 United Kingdom of Great Britain and Northern Ireland 24 September 1975 United States of America 30 September 1970 Uruguay 30 March 1983 Uzbekistan 7 February 1996 Venezuela 8 February 1995 Viet Nam 12 September 1995 Zambia 14 March 2002 Zimbabwe 26 September 1994
States which are Not Party to the New York Convention
United States Issues
Under American law, the recognition of foreign arbitral awards is governed by chapter 2 of the Federal Arbitration Act.
However, the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the "Convention") does not preempt state law. In Foster v. Neilson, this Court held “Our constitution declares a treaty to be the law of the land. It is, consequently, to be regarded in courts of justice as equivalent to an act of the Legislature, whenever it operates of itself without the aid of any legislative provision.” Foster v. Neilson, 27 U.S. 253, 314 (1829). See also Valentine v. U.S. ex rel. Neidecker, 57 S.Ct. 100, 103 (1936); Medellin v. Dretke, 125 S.Ct. 2088, 2103 (2005); Sanchez-Llamas v. Oregon, 126 S.Ct. 2669, 2695 (2006). Thus, over a course of 181 years, the United States Supreme Court has repeatedly held that a self-executing treaty is an act of the Legislature (i.e., act of Congress).
- Neil J. Saltzman, The Enforcement of Foreign Awards in New York State
- The New York Convention on the UN Audiovisual Library of International Law, with an introductory note by Albert Jan van den Berg, video footage and photos related to the negotiations and adoption of the Convention.
- ^ "Contracting States". Albert Jan van den Berg. 23 July 2011. http://www.newyorkconvention.org/new-york-convention-countries. Retrieved 23 July 2011.
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