Enforcement of Arbitration Awards in Different Jurisdictions attracted an international audience for the London Shipping Law Centre’s first ever webinar. Some 150 participants, one fifth of whom were from 15 countries outside the UK, heard experts cover enforcement procedures and problems, particularly those in China, India and Africa.
Introducing this first webinar in the LSLC’s Global Webinar Series, Dr Aleka Sheppard, LSLC Founder and Chairman, said this technical development in communication about key maritime subjects showed that the Centre was “up to the mark and ready to adapt to a brave new world. Undoubtedly, it is a great advantage of digitisation that we can reach out to delegates all over the world. We all hope, however, that digitalisation will not take over the community element, an essential component of the LSLC.”
The webinar was run from the London offices of Norton Rose Fulbright in late May, under the chairmanship of Mr. Justice Robin Knowles, who fielded questions from the audience. One participant found the session “an excellent trip around the arbitration world.”
Francis Hornyold-Strickland of 36 Stone instanced various judgments addressing the question of what law governed the particular arbitration agreements in those cases. The key questions included whether, in the absence of express choice, the law of the seat to which the arbitration was subject or the applicable law of the main contract should take precedence.
Ultimately, the courts should return to the touchstone of contractual interpretation. Guiding principles should adhere most closely to what the courts felt the contractual parties actually intended. In Mr Strickland’s view, where there was no express choice, arbitration agreements should normally be governed by the law of the substantive contract.
Having made a choice about the law of the contract, commercial parties did not readily assume that its different parts should be subject to different laws.
Sherina Petit of Norton Rose Fulbright reflected on the changing landscape of enforcement of foreign arbitration awards in India. She discussed recent case law and outlined the changes brought about by the 2015 and 2019 amendments to the Indian Arbitration Act 1996.
The courts had been historically interventionist, with India only recognising foreign arbitral awards made by New York and Geneva Convention countries identified in its Official Gazette. In recent years, however, the Indian courts had been moving towards a more pro-arbitration stance—with a few exceptions.
Through a selection of cases from the past two decades, Ms Petit showed how the approach of the courts had evolved from decisions in which the judiciary had intervened or caused significant delays in enforcement—even where a contract was governed other than by Indian law—to .cases where the Indian courts had been much more robust, non-interventionist and intolerant of delays.
She touched upon the landmark judgements of Bhatia International v Bulk Trading SS (2002) and Bharat Aluminium Co v Kaiser Aluminium Technical Services Inc. (2012), with the latter effectively turning the tide for Indian arbitration.
She cited more recent pro-arbitration decisions, including a charterparty case in which the court refused to set aside a foreign arbitral award and “look into the merits of the case;” and a decision that enforcement of an arbitral award would not be stayed automatically upon filing a challenge thereto.
Ms Petit also touched upon the recent controversial Supreme Court decision in NAFED and Alimenta SA which, she felt, could open up the floodgates for a new wave of interventionist judgments.
She concluded that the courts in India had demonstrated an increasingly favourable attitude towards the enforcement of foreign arbitration awards—in line with the political agenda for making India both an investor and arbitration friendly jurisdiction.
James Rogers, a partner of Norton Rose Fulbright, discussed the enforcement of arbitral awards in China, with Chinese law categorising such awards according to the place of arbitration and the presence or absence of “foreign elements.” The relevant enforcement regimes—the People’s Republic of China, Hong Kong, Macau and Taiwan—had their own particular relationships with the New York Convention.
The PRC was a party thereto while Hong Kong was not but nevertheless enjoyed the benefits of the Convention because of its status as a special administrative region of the PRC. Enforcement of awards rendered in those jurisdictions in China was, therefore, via separate specialist regimes, albeit with similar procedures.
For foreign related awards—domestic awards with foreign elements or international awards—there was a special reporting regime. Ultimately, only the Supreme Court could refuse to enforce foreign-related and international awards. In Mr Rogers’ view, the Supreme Court had the necessary depth of expertise and experience. As a result, the special reporting system had engendered a very strong pro-enforcement mentality with well reasoned decisions published and widely reported.
Mr Rogers reflected on Hong Kong’s place in the arbitration world. Notwithstanding controversy about its relationship with China, the courts had remained robustly independent with deep arbitration expertise and experience.
Duncan Bagshaw of Howard Kennedy LLP summarised the key factors pertaining to enforcement of international arbitration awards in Africa. He reminded his audience that while Ethiopia had just signed up to the New York Convention, 13 countries had not.
Practices and the rigour behind enforcement varied considerably. Fraud, corruption and the effect of taxation (sometimes unexpected or inappropriate) on the proceeds of arbitral awards had to be reckoned with. Regional enforcement hubs might serve as a platform from which to launch enforcement in jurisdictions selected according to asset base.
In Nigeria, key factors were the recently updated Arbitration and Conciliation Act 2004; a six-year enforcement limit; and pathological delays in the court system—although these were being addressed. In Mauritius, the International Arbitration Act 2008, which incorporates the New York Convention, laid down that enforcement should be considered by three Supreme Court judges. Appeals were to the Privy Council. The recent Peepul case and, prospectively, the Betamax case under IAA 2008 explore public policy grounds for refusing enforcement.
Under its 1995 Arbitration Act, the limitation period for enforcing awards in Kenya was also only six years. Under the long awaited International Arbitration Act No 15 of 2017, the UNCITRAL Model Law now only applied to international arbitrations in South Africa. The act removed the anachronistic restrictions on the enforcement of foreign arbitral awards against the state.
In the 17 Organisation pour l’Harmonisation en Afrique du Droit des Affaires countries there was a unified system of awards in and between OHADA states. Recent updates to the uniform law on arbitration, which applied across the region, had introduced a very rapid system for enforcing awards, reducing states’ scope for arguing for immunity from execution of enforcement judgments.
This webinar can be viewed on https://youtu.be/szJAS6dJPsU
The London Shipping Law Centre is staging a series of webinars on pivotal issues. Practical and Legal Issues in Shipbuilding: the SAJ Form, Scrubber Issues and MARPOL Annex 6 took place on June 23rd. For details of past and future webinars, contact firstname.lastname@example.org or go to the Centre’s website https://www.shippinglbc.com
Consultant – LSLC