In this article, Kriti Kothari discusses The New York Arbitration Convention also known as the Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

The New York Convention

The New York convention also known as the Convention on the Recognition and Enforcement of Foreign Arbitral Awards was first adopted by the United Nations diplomatic conference on 10 June 1958 and was enforced on 7 June 1959. It is often considered as one of the most important treaties in the field of international trade law and has a great significance. It is often described as a foundation stone in the field of international arbitration. It requires courts of the contracting states to give effect to an agreement to arbitrate when seized of an action in a matter covered by an arbitration agreement and also to recognize and enforce awards made in other states, subject to specific limited exceptions. At present, the convention is signed by 156 state parties.

It was adopted mainly for promoting healthy business relations between the countries and to promote harmony and coordination among the states. Further it reduces the burden of the states to decide which laws to be enforced or the procedures of which countries to be followed during the process of the arbitration. Further it also establishes a minimum level of control which the contracting states can exert over arbitral awards and arbitral agreements. The two main actions which were taken by the New York convention are as follows:

Recognition and Enforcement of Foreign Arbitral Award

The first action is to recognize the awards made in the foreign territory and is defined under the Article 1 of the convention. It is the obligation of the states to recognize such awards and enforce them according to the Article 3 of the convention. The state who wants to seek the foreign arbitral award needs to submit the following documents before the court and it lies upon the interpretation of the court to decide that it falls under the scope of the convention or not. A state which needs to seek the enforcement needs to submit the following documents

• The arbitral award
• The arbitral document according to the article 4 of the convention

The state against whom the convention is enforced can object to the enforcement by submitting the proof of even one grounds of refusal of the enforcement which are mentioned in the Article 5 of the constitution. Now it lies on the discretion of the courts to enforce an award or not based on the paragraph 2 of the article 5 of the enforcement.

Referral to the Court by the method of Arbitration

Article II, paragraph 3, provides that a court of a Contracting State, when seized of a matter in respect of which the parties have made an arbitration agreement, must, at the request of one of the parties, refer them to arbitration.

Key features of the New York Convention

Few of the key features of the conventions are described below:

• It creates a uniform international framework which enables various countries to establish strong trade and commercial relations and solve disputes with the help of arbitration. It achieves this by firstly requiring the signatory states to enforce the awards rendered in the signatory state and secondly by limiting the grounds on which the states may refuse recognition and enforcement.
• The states who are a party to this convention are required to bind to the foreign awards and enforce them according to the rules and procedures established by the New York Convention.
• The procedure is free from any complex procedures and charges. The states just need to submit to a competent court in the contracting state where the enforcement is sought.
• The main provisions of the convention are as follows

Article I of the New York Convention

1. This convention shall observe to the popularity and enforcement of arbitral awards made within the territory of a state other than the country in which the recognition and enforcement of such awards are sought and bobbing up out of variations between people, whether bodily or criminal. It shall also practice to arbitral awards no longer considered as home awards inside the nation in which their reputation and enforcement are sought.
2. The term “arbitral awards” shall consist of now not best awards made by way of arbitrators appointed for each case but also the ones made through permanent arbitral bodies to which the parties have submitted.
3. When signing, ratifying or acceding to this convention, or notifying extension beneath article X hereof, any kingdom can also on the basis of reciprocity claim that it’ll follow the convention to the popularity and enforcement of awards made handiest within the territory of any other Contracting state. it can additionally declare that it’s going to follow the convention only to variations arising out of prison relationships, whether contractual or not, that are taken into consideration as industrial below the national regulation of the country making such announcement.

Article II of the New York Convention

1. Every Contracting nation shall understand an agreement in writing which the events adopt to submit to arbitration any or all variations that have arisen or which may get up between them in admire of a described prison courting, whether or not contractual or not, regarding a subject dependable to agreement by arbitration.
2. The term “agreement in writing” shall include an arbitral clause in a settlement or an arbitration agreement, signed by way of the events or contained in an change of letters or telegrams.
3. The court docket of a Contracting nation, while seized of an motion in a be counted in recognize of which the parties have made an agreement inside the meaning of this article, shall, on the request of one of the events, refer the parties to arbitration, unless it unearths that the said agreement is null and void, inoperative or incapable of being carried out.

Article III of the New York Convention

Every Contracting nation shall apprehend arbitral awards as binding and put in force them in accordance with the rules of process of the territory where the award is relied upon, underneath the conditions laid down within the following articles. There shall now not be imposed substantially greater exhausting conditions or better charges or charges on the popularity or enforcement of arbitral awards to which this conference applies than are imposed on the popularity or enforcement of home arbitral awards.

Article IV of the New York Convention

1. To obtain the recognition and enforcement referred to inside the previous article, the celebration making use of for reputation and enforcement shall, on the time of the application, deliver:

(a) The duly authenticated authentic award or a duly licensed copy thereof;

(b) The unique settlement mentioned in article II or a duly licensed reproduction thereof.

2. If the said award or agreement is not made in a professional language of the us of a in which the award is relied upon, the party making use of for reputation and enforcement of the award shall produce a translation of these documents into such language. the translation shall be certified with the aid of an professional or sworn translator or via a diplomatic or consular agent.

Article V of the New York Convention

1. recognition and enforcement of the award may be refused, on the request of the birthday party towards whom it’s miles invoked, simplest if that birthday celebration furnishes to the able authority wherein the popularity and enforcement is sought, evidence that:

(a) The parties to the agreement cited in article II have been, under the law relevant to them, beneath some disability, or the said agreement isn’t valid under the regulation to which the events have subjected it or, failing any indication thereon, below the regulation of the united states of america wherein the award became made; or

(b) The celebration in opposition to whom the award is invoked changed into no longer given right note of the appointment of the arbitrator or of the arbitration complaints or was otherwise not able to present his case; or

(c) The award offers with a distinction now not contemplated by using or not falling within the terms of the submission to arbitration, or it includes choices on matters past the scope of the submission to arbitration, furnished that, if the choices on subjects submitted to arbitration can be separated from the ones now not so submitted, that part of the award which includes decisions on matters submitted to arbitration may be recognized and enforced; or

(d) The composition of the arbitral authority or the arbitral technique was not in accordance with the settlement of the events, or, failing such settlement, became now not in accordance with the regulation of the usa wherein the arbitration happened; or

(e) The award has not but emerge as binding on the parties, or has been set apart or suspended by using a competent authority of the country in which, or underneath the law of which, that award become made.

2. Reputation and enforcement of an arbitral award will also be refused if the able authority in the usa in which recognition and enforcement is sought finds that:

(a) The concern rely of the distinction isn’t able to agreement via arbitration below the law of that united states of america; or

(b)The popularity or enforcement of the award would be contrary to the general public coverage of that usa.

Article VI of the New York Convention

If a utility for the setting apart or suspension of the award has been made to a able authority mentioned in article V(1)(e), the authority earlier than which the award is sought to be relied upon might also, if it considers it proper, adjourn the selection on the enforcement of the award and might also, at the software of the celebration claiming enforcement of the award, order the other birthday party to offer appropriate protection.

Article VII of the New York Convention

1. The provisions of the prevailing convention shall not have an effect on the validity of multilateral or bilateral agreements regarding the recognition and enforcement of arbitral awards entered into by the Contracting States nor deprive any interested celebration of any proper he may additionally must avail himself of an arbitral award in the manner and to the extent allowed via the regulation or the treaties of the u . s . where such award is sought to be relied upon.
2. The Geneva Protocol on Arbitration Clauses of 1923 [2] and the Geneva conference at the Execution of overseas Arbitral Awards of 1927 [3] shall give up to have impact between the Contracting States on their turning into bound and to the volume that they turn out to be certain, by way of this conference.

Article VIII of the New York Convention

1. This convention shall be open till 31 December 1958 for signature on behalf of any Member of the United international locations and additionally on behalf of any other country that’s or hereafter turns into a member of any specialized organization of the United international locations, or which is or hereafter becomes a party to the Statute of the global courtroom of Justice, or any other state to which an invite has been addressed by using the overall assembly of the United nations.
2. This convention shall be ratified and the tool of ratification will be deposited with the Secretary-standard of the United Nations.

Article IX of the New York Convention

1. This convention shall be open for accession to all States stated in article VIII.
2. Accession shall be effected by the deposit of an instrument of accession with the Secretary-popular of the united international locations.

Article X of the New York Convention

1. Any nation might also, at the time of signature, ratification or accession, claim that this conference shall enlarge to all or any of the territories for the worldwide members of the family of which it’s far accountable. One of these announcements shall take impact while the convention enters into force for the nation concerned.
2. At any time thereafter this kind of extension shall be made by using notification addressed to the Secretary-standard of the United international locations and shall take impact as from the ninetieth day after the day of receipt with the aid of the Secretary-trendy of the United international locations of this notification, or as from the date of entry into force of the convention for the state involved, whichever is the later.
3. With appreciate to those territories to which this convention is not prolonged at the time of signature, ratification or accession, each nation concerned shall don’t forget the possibility of taking the vital steps so that you can increase the utility of this convention to such territories, subject, in which important for constitutional reasons, to the consent of the Governments of such territories.

Article XI of the New York Convention

In the case of a federal or non-unitary kingdom, the following provisions shall follow

(a) With recognize to the ones articles of this conference that come inside the legislative jurisdiction of the federal authority, the duties of the federal government shall to this quantity be similar to the ones of Contracting States which are not federal States;

(b) With respect to those articles of this convention that come inside the legislative jurisdiction of constituent states or provinces which are not, beneath the constitutional machine of the federation, sure to take legislative action, the federal authorities shall convey such articles with a favourable advice to the attention of the correct government of constituent states or provinces at the earliest possible moment;

(c) A federal state birthday party to this conference shall, on the request of every other Contracting state transmitted thru the Secretary-trendy of the United international locations, supply a declaration of the law and practice of the federation and its constituent devices in regard to any precise provision of this convention, showing the quantity to which effect has been given to that provision through legislative or other motion.

Article XII of the New York Convention

1. This convention shall come into pressure at the 90th day following the date of deposit of the 0.33 device of ratification or accession.
2. For every state ratifying or acceding to this conference after the deposit of the 0.33 instrument of ratification or accession, this conference shall enter into pressure at the ninetieth day after deposit through such country of its instrument of ratification or accession.

Article XIII of the New York Convention

1. Any Contracting state can also denounce this convention with the aid of a written notification to the Secretary-general of the united countries. Denunciation shall take effect twelve months after the date of receipt of the notification by way of the Secretary-wellknown.
2. Any kingdom which has made a declaration or notification underneath article X might also, at any time thereafter, by notification to the Secretary-widespread of the United international locations, claim that this conference shall cease to extend to the territory worried three hundred and sixty five days after the date of the receipt of the notification by means of the Secretary-preferred.
3. This conference shall stay relevant to arbitral awards in admire of which reputation or enforcement proceedings were instituted earlier than the denunciation takes effect.

Article XIV of the New York Convention

A Contracting kingdom shall no longer be entitled to avail itself of the prevailing conference against different Contracting States besides to the volume that it’s far itself sure to apply the convention.

Article XV of the New York Convention

The Secretary-trendy of the United Nations shall notify the States contemplated in article VIII of the subsequent:

(a) Signatures and ratifications according with article VIII;

(b) Accessions according with article IX;

(c) Declarations and notifications below articles I, X and XI;

(d) The date upon which this convention enters into force in accordance with article XII;

(e) Denunciations and notifications in accordance with article XIII.

Article XVI of the New York Convention

1. This conference, of which the Chinese, English, French, Russian and Spanish texts shall be equally proper, shall be deposited within the documents of the united international locations.
2. The Secretary-trendy of the united international locations shall transmit a licensed copy of this convention to the States contemplated in article VIII.

The article was all about New York Convention and its main provisions. Hope the article explained all the provisions of the New York Convention and how it can be applied practically from a bird’s eye.

Suggested readings

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The controversy underlying foreign seat and place or venue of arbitration

 

REFRENCES:

 http://www.newyorkconvention.org/

http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention.html http://newyorkconvention1958.org/index.php?lvl=cmspage&pageid=10&menu=729&opac_view=-1