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Enforcement of arbitral awards

What is the enforcement of an award?

The enforcement of arbitral awards is usually governed by different sets of rules, depending on whether the award is domestic or foreign. Generally, a State will consider an award to be domestic if the seat of arbitration is within its territory—and foreign if it is not.

How is a domestic award enforced?

Each State freely establishes the rules that allow for the enforcement of a domestic award (i.e., one issued within its territory or in accordance with its laws).

Under Spanish law, the enforcement of domestic awards is basically governed by the same rules as judicial decisions. See Arts. 8.4, 44 and 45 of Arbitration Act 60/2003, of December 23, and Book III of Law 1/2000, of January 7, on Civil Procedure.

How is a foreign award enforced?

The recognition and enforcement of foreign awards are guaranteed by the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, made in New York on June 10, 1958. At present 172 States are parties to this treaty. All these States undertake to recognize the effectiveness of the foreign award and to grant its enforcement “in accordance with the rules of procedure in force” in the country. See Art. III of the New York Convention.

This Convention also establishes a numerus clausus list of grounds on which a State may refuse to recognize or enforce a foreign award, namely:

  • The arbitration agreement is not valid.
  • A party has not been able to assert its defences.
  • The award resolves on issues that the parties have not submitted to the arbitrators for decision.
  • The appointment of the arbitrators did not comply with the parties’ agreement or, in the absence of agreement, with the applicable arbitration law.
  • The arbitral proceedings have not been conducted in accordance with the parties’ agreement or, failing agreement, the applicable arbitration law.
  • The award is not yet binding on the parties or has been set aside or suspended by a competent authority of the country in which, or under the law of which, it was made.
  • The award adjudicates on matters which are not arbitrable.
  • Recognition or enforcement of the award is contrary to public policy.
 

See Art. V of the New York Convention.

In  Spain the enforcement of foreign awards is governed by the New York Convention as well as by any international convention that is more favorable to the granting of the exequatur of the specific award. See Art. 46 of the Arbitration Act 60/2003, of December 23.

The exequatur is mainly carried out in accordance with the provisions of Law 29/2015, of July 30, on International Legal Cooperation in Civil Matters, which establishes the procedure for the recognition and enforcement of foreign judgments and instruments.