Convention on the Recognition and Enforcement of Foreign Arbitral Awards
Encyclopedia
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.
(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.
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:
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.
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).
United Nations
The United Nations is an international organization whose stated aims are facilitating cooperation in international law, international security, economic development, social progress, human rights, and achievement of world peace...
diplomatic conference on 10 June 1958 and entered into force on 7 June 1959. The Convention requires courts of contracting states
Sovereign state
A sovereign state, or simply, state, is a state with a defined territory on which it exercises internal and external sovereignty, a permanent population, a government, and the capacity to enter into relations with other sovereign states. It is also normally understood to be a state which is neither...
to give effect to private agreements to arbitrate
Arbitration
Arbitration, a form of alternative dispute resolution , is a legal technique for the resolution of disputes outside the courts, where the parties to a dispute refer it to one or more persons , by whose decision they agree to be bound...
and to recognize and enforce arbitration awards made in other contracting states. Widely considered the foundational instrument for international arbitration
International arbitration
International arbitration is a leading method for resolving disputes arising from international commercial agreements and other international relationships...
, it applies to arbitrations which are not considered as domestic awards in the state where recognition and enforcement is sought. Though other international conventions
Treaty
A treaty is an express agreement under international law entered into by actors in international law, namely sovereign states and international organizations. A treaty may also be known as an agreement, protocol, covenant, convention or exchange of letters, among other terms...
apply to the cross-border enforcement of arbitration awards, the New York Convention is by far the most important.
Background
In 1953, the International Chamber of CommerceInternational Chamber of Commerce
The International Chamber of Commerce is the largest, most representative business organization in the world. Its hundreds of thousands of member companies in over 130 countries have interests spanning every sector of private enterprise....
(ICC) produced the first draft Convention on the Recognition and Enforcement of International Arbitral Awards to the United Nations Economic and Social Council
United Nations Economic and Social Council
The Economic and Social Council of the United Nations constitutes one of the six principal organs of the United Nations and it is responsible for the coordination of the economic, social and related work of 14 UN specialized agencies, its functional commissions and five regional commissions...
. 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
Oscar Schachter
Oscar Schachter was an American international law and diplomacy professor, and United Nations aide.Schachter was a native of New York City, graduated Phi Beta Kappa from City College of New York in 1936, and from Columbia Law School, where he was a Kent scholar and first in his class of 1939...
, a leading figure in international law who later taught at Columbia Law School
Columbia Law School
Columbia Law School, founded in 1858, is one of the oldest and most prestigious law schools in the United States. A member of the Ivy League, Columbia Law School is one of the professional graduate schools of Columbia University in New York City. It offers the J.D., LL.M., and J.S.D. degrees in...
and the Columbia School of International and Public Affairs, and served as the President of the American Society of International Law.
International arbitration
International arbitration
International arbitration is a leading method for resolving disputes arising from international commercial agreements and other international relationships...
is an increasingly popular means of alternative dispute resolution
Alternative dispute resolution
Alternative Dispute Resolution includes dispute resolution processes and techniques that act as a means for disagreeing parties to come to an agreement short of litigation. ADR basically is an alternative to a formal court hearing or litigation...
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
United Nations member states
There are 193 United Nations member states, and each of them is a member of the United Nations General Assembly.The criteria for admission of new members are set out in the United Nations Charter, Chapter II, Article 4, as follows:...
, the Cook Islands (a New Zealand dependent territory), and the Holy See
Holy See
The Holy See is the episcopal jurisdiction of the Catholic Church in Rome, in which its Bishop is commonly known as the Pope. It is the preeminent episcopal see of the Catholic Church, forming the central government of the Church. As such, diplomatically, and in other spheres the Holy See acts and...
have adopted the New York Convention. Only 49 U.N. Member States and Taiwan
Taiwan
Taiwan , also known, especially in the past, as Formosa , is the largest island of the same-named island group of East Asia in the western Pacific Ocean and located off the southeastern coast of mainland China. The island forms over 99% of the current territory of the Republic of China following...
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 awardArbitration award
An arbitration award is a determination on the merits by an arbitration tribunal in an arbitration, and is analogous to a judgment in a court of law...
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 incapacityCapacity (law)The capacity of both natural and legal persons determines whether they may make binding amendments to their rights, duties and obligations, such as getting married or merging, entering into contracts, making gifts, or writing a valid will...
; - 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 tribunalArbitral tribunalAn arbitral tribunal is a panel of one or more adjudicators which is convened and sits to resolve a dispute by way of arbitration. The tribunal may consist of a sole arbitrator, or there may be two or more arbitrators, which might include either a chairman or an umpire...
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 arbitriLex loci arbitriThe lex loci arbitri is the Latin term for "law of the place where arbitration is to take place" in the conflict of Laws. Conflict is the branch of public law regulating all lawsuits involving a "foreign" law element where a difference in result will occur depending on which laws are...
"); - 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 policyPublic policyPublic policy as government action is generally the principled guide to action taken by the administrative or executive branches of the state with regard to a class of issues in a manner consistent with law and institutional customs. In general, the foundation is the pertinent national and...
".
Text
The text of the convention is available online.http://www.jus.uio.no/lm/un.arbitration.recognition.and.enforcement.convention.new.york.1958/doc.htmlParties 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 SeeHoly See
The Holy See is the episcopal jurisdiction of the Catholic Church in Rome, in which its Bishop is commonly known as the Pope. It is the preeminent episcopal see of the Catholic Church, forming the central government of the Church. As such, diplomatically, and in other spheres the Holy See acts and...
and the Cook Islands
Cook Islands
The Cook Islands is a self-governing parliamentary democracy in the South Pacific Ocean in free association with New Zealand...
. Only fifty of the U.N. Member States have not adopted the Convention. In addition, Taiwan
Taiwan
Taiwan , also known, especially in the past, as Formosa , is the largest island of the same-named island group of East Asia in the western Pacific Ocean and located off the southeastern coast of mainland China. The island forms over 99% of the current territory of the Republic of China following...
has not adopted the Convention and a number of British Overseas Territories
British overseas territories
The British Overseas Territories are fourteen territories of the United Kingdom which, although they do not form part of the United Kingdom itself, fall under its jurisdiction. They are remnants of the British Empire that have not acquired independence or have voted to remain British 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
Anguilla
Anguilla is a British overseas territory and overseas territory of the European Union in the Caribbean. It is one of the most northerly of the Leeward Islands in the Lesser Antilles, lying east of Puerto Rico and the Virgin Islands and directly north of Saint Martin...
, British Virgin Islands
British Virgin Islands
The Virgin Islands, often called the British Virgin Islands , is a British overseas territory and overseas territory of the European Union, located in the Caribbean to the east of Puerto Rico. The islands make up part of the Virgin Islands archipelago, the remaining islands constituting the U.S...
, Falkland Islands
Falkland Islands
The Falkland Islands are an archipelago in the South Atlantic Ocean, located about from the coast of mainland South America. The archipelago consists of East Falkland, West Falkland and 776 lesser islands. The capital, Stanley, is on East Falkland...
, Turks and Caicos Islands
Turks and Caicos Islands
The Turks and Caicos Islands are a British Overseas Territory and overseas territory of the European Union consisting of two groups of tropical islands in the Caribbean, the larger Caicos Islands and the smaller Turks Islands, known for tourism and as an offshore financial centre.The Turks and...
, Montserrat
Montserrat
Montserrat is a British overseas territory located in the Leeward Islands, part of the chain of islands called the Lesser Antilles in the West Indies. This island measures approximately long and wide, giving of coastline...
, Saint Helena
Saint Helena
Saint Helena , named after St Helena of Constantinople, is an island of volcanic origin in the South Atlantic Ocean. It is part of the British overseas territory of Saint Helena, Ascension and Tristan da Cunha which also includes Ascension Island and the islands of Tristan da Cunha...
(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 |  The 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 |
25 July 1996 |  Kingdom of 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 |
 Mainland 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 |  Independent State of 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 |
 Early Modern France |
26 June 1959 |  Gabon |
15 December 2006 |
 Georgia (country) |
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 |
 Republic of 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 |
| , Republic of | 8 February 1973 |  Kuwait |
28 April 1978 |
 Kyrgyzstan |
18 December 1996 | 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 |
 Republic of 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 |
 Kingdom of 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 |  Kingdom of Romania |
13 September 1961 |
 Russia |
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 | 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 |
| 24 September 1975 |  United States |
30 September 1970 | |
 Uruguay |
30 March 1983 |  Uzbekistan |
7 February 1996 |
 Venezuela |
8 February 1995 |  Vietnam |
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
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") 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).
External links
- http://www.newyorkconvention.org
- Neil J. Saltzman, The Enforcement of Foreign Awards in New York State
- http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention.html
- http://www.wipo.int/amc/en/arbitration/ny-convention/parties.html
- 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.