ENFORCEMENT OF FOREIGN ARBITRATION AWARDS IN INDIA after 2015

Similar documents
Circular of Supreme People's Court on Implementing Convention on the Recognition and Enforcement of Foreign Arbitral Awards Entered by China

INTERNATIONAL AIR SERVICES TRANSIT AGREEMENT SIGNED AT CHICAGO ON 7 DECEMBER 1944

1994 No PATENTS

Global Variations in Growth Ambitions

1994 No DESIGNS

PROTOCOL RELATING TO AN AMENDMENT TO THE CONVENTION ON INTERNATIONAL CIVIL AVIATION ARTICLE 45, SIGNED AT MONTREAL ON 14 JUNE parties.

geography Bingo Instructions

Contracting Parties to the Ramsar Convention

SCALE OF ASSESSMENT OF MEMBERS' CONTRIBUTIONS FOR 1994

The Madrid System. Overview and Trends. Mexico March 23-24, David Muls Senior Director Madrid Registry

VISA POLICY OF THE REPUBLIC OF KAZAKHSTAN

PROTOCOL FOR THE PROHIBITION OF THE USE IN WAR OF ASPHYXIATING, POISONOUS OR OTHER GASES, AND OF BACTERIOLOGICAL METHODS OF WARFARE

Geneva, 20 March 1958

Q233 Grace Period for Patents

GLOBAL RISKS OF CONCERN TO BUSINESS WEF EXECUTIVE OPINION SURVEY RESULTS SEPTEMBER 2017

HUMAN RESOURCES IN R&D

1. Why do third-country audit entities have to register with authorities in Member States?

Commonwealth of Australia. Migration Regulations CLASSES OF PERSONS (Subparagraphs 1236(1)(a)(ii), 1236(1)(b)(ii) and 1236(1)(c)(ii))

Human Resources in R&D

Copyright Act - Subsidiary Legislation CHAPTER 311 COPYRIGHT ACT. SUBSIDIARY LEGlSLA non. List o/subsidiary Legislation

Contributions to UNHCR For Budget Year 2014 As at 31 December 2014

CONVENTION ON THE PHYSICAL PROTECTION OF NUCLEAR MATERIAL. Texts of reservations/declarations made upon expressing consent to be bound, pages 3-5

South Africa - A publisher s perspective. STM/PASA conference 11 June, 2012, Cape Town Mayur Amin, SVP Research & Academic Relations

A/AC.105/C.2/2009/CRP. 3

ARRANGEMENT OF SECTIONS

ENGLISH CONVENTION ON THE PHYSICAL PROTECTION OF NUCLEAR MATERIAL

92 El Salvador El Salvador El Salvador El Salvador El Salvador Nicaragua Nicaragua Nicaragua 1

The Three Elephants in the Room: Coal, Oil and Gas in the Primary Energy Consumption (PEC) and their CO2 Emissions up to 2013 Bernard CHABOT

Ratifications or definitive accessions

Dashboard. Jun 1, May 30, 2011 Comparing to: Site. 79,209 Visits % Bounce Rate. 231,275 Pageviews. 00:03:20 Avg.

4B. Limitation and prescription period not to apply 5. Proof of documents and evidence 6. Regulations 7. SCHEDULE

Share of Countries over 1/3 Urbanized, by GDP per Capita (2012 $) 1960 and 2010

LIST OF CHINESE EMBASSIES OVERSEAS Extracted from Ministry of Foreign Affairs of the People s Republic of China *

A Partial Solution. To the Fundamental Problem of Causal Inference

The 46 Antarctic Treaty nations represent about two-thirds of the world's human population.

Vienna, 11 April 1980

Countries exempt from South African Visas

PASSPORT HOLDERS WHO ARE EXEMPT FROM VISAS FOR SOUTH AFRICA SUBJECT TO CHANGE WITHOUT NOTICE

CONFERENCE ON DISARMAMENT

UAE E Visa Information

IMO MANDATORY REPORTS UNDER MARPOL. Analysis and evaluation of deficiency reports and mandatory reports under MARPOL for Note by the Secretariat

The National Police Immigration Service (NPIS) forcibly returned 412 persons in December 2017, and 166 of these were convicted offenders.

GUIDELINE OF COMMITTEES IN TASHKENT MODEL UNITED NATIONS CONFERENCE 2019

Trends in international higher education

Article 1 Field of Application

KINGDOM OF CAMBODIA NATION RELIGION KING 3 TOURISM STATISTICS REPORT. September 2010

QGIS.org - Donations and Sponsorship Analysis 2016

Diplomatic Conference to Conclude a Treaty to Facilitate Access to Published Works by Visually Impaired Persons and Persons with Print Disabilities

Overview of JODI Gas Milestones and Beta Test Launch

Governing Body Geneva, November 2006 LILS FOR INFORMATION

Countries for which a visa is required to enter Colombia

PISA 2015 in Hong Kong Result Release Figures and Appendices Accompanying Press Release

CONVENTION ON THE RECOGNITION AND ENFORCEMENT OF FOREIGN ARBITRAL AWARDS 1

2016 Europe Travel Trends Report

REINVENTION WITH INTEGRITY

PISA 2009 in Hong Kong Result Release Figures and tables accompanying press release article

APPENDIX 1: MEASURES OF CAPITALISM AND POLITICAL FREEDOM

Hilde C. Bjørnland. BI Norwegian Business School. Advisory Panel on Macroeconomic Models and Methods Oslo, 27 November 2018

SEVERANCE PAY POLICIES AROUND THE WORLD

KINGDOM OF CAMBODIA NATION RELIGION KING 3 TOURISM STATISTICS REPORT. March 2010

Financing of the United Nations peacekeeping forces in the Middle East: United Nations Interim Force in Lebanon

Article (1) Article (2) Khalifa Bin Zayed Al Nahyan President of the United Arab Emirates NEW YORK CONVENTION Article I Article II

A Global View of Entrepreneurship Global Entrepreneurship Monitor 2012

Proposed Indicative Scale of Contributions for 2016 and 2017

s t a t ute for refugees united nations high commissioner of the office of the

31/03/2015. Subject: Candidates for election to the UNESCO Executive Board. Sir/Madam,

Emerging Asian economies lead Global Pay Gap rankings

WORLDWIDE DISTRIBUTION OF PRIVATE FINANCIAL ASSETS

The 2012 Global Entrepreneurship and Development Index (GEDI) Country Rankings Excerpt: DENMARK

UNITED NATIONS FINANCIAL PRESENTATION. UN Cash Position. 18 May 2007 (brought forward) Alicia Barcena Under Secretary-General for Management

UNHCR, United Nations High Commissioner for Refugees

CHAPTER XXVI DISARMAMENT 1. CONVENTION ON THE PROHIBITION OF MILITARY OR ANY OTHER HOSTILE USE OF ENVIRONMENTAL MODIFICATION TECHNIQUES

Figure 2: Range of scores, Global Gender Gap Index and subindexes, 2016

CHILE NORTH AMERICA. Egypt, Israel, Oman, Saudi Arabia and UAE. Barge service: Russia Federation, South Korea and Taiwan. USA East Coast and Panama

Consumer Barometer Study 2017

INTERNATIONAL FEDERATION OF SOCIAL WORKERS

Mapping physical therapy research

Decision 2018/201 E Elections, nominations, confirmations and appointments to subsidiary and related bodies of the Economic and Social Council

IR 1 Visitors

Middle School Level. Middle School Section I

Translation from Norwegian

the Federal Reserve Board.

World Refugee Survey, 2001

Global Prevalence of Adult Overweight & Obesity by Region

11. a) Convention for the Suppression of the Traffic in Persons and of the Exploitation of the Prostitution of Others

2016 (received) Local Local Local Local currency. currency (millions) currency. (millions)

Cambridge International Examinations Cambridge International Advanced Subsidiary and Advanced Level

2017 Social Progress Index

Letters of Request; Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents

The Multidimensional Financial Inclusion MIFI 1

Analyzing the Location of the Romanian Foreign Ministry in the Social Network of Foreign Ministries

Collective Intelligence Daudi Were, Project

Education Quality and Economic Development

SKILLS, MOBILITY, AND GROWTH

A GLOBAL PERSPECTIVE ON RESEARCH AND DEVELOPMENT

Delays in the registration process may mean that the real figure is higher.

United Nations Conference on the Law of Treaties

The Political Economy of Public Policy

The National Police Immigration Service (NPIS) returned 444 persons in August 2018, and 154 of these were convicted offenders.

CONVENTION ON NUCLEAR SAFETY FINAL ACT

Transcription:

ENFORCEMENT OF FOREIGN ARBITRATION AWARDS IN INDIA after 2015 Authored by: Mr. S Ravi Shankar Senior Partner

S Ravi Shankar 1 India has been always a pro-arbitration country and it ratified New York Convention 2 on 13.7.1960. After the said ratification to implement the New York Convention, The Foreign Awards (Recognition and Enforcement), Act 1961 was enacted by India. Hence, the above said 1961 Act confined itself to the challenge to an arbitral award only on the limited grounds permitted under the New York Convention. The UNICTRAL Model law on International commercial arbitration 3 was drafted and adopted by United Nations Commission on International Trade Law (UNICITRAL) on 21st June 1985. To bring Indian arbitration law in line with the said model law, in the year 1996 India enacted the present legislation which governs the arbitration field in India, Arbitration and Conciliation Act, 1996. Since the above said 1996 is the complete law occupying the field of arbitration, it deals with domestic arbitration in India as well as the enforcement of International Arbitration awards in India. Even though the above said 1996 Act was a complete legislation enacted in the lines of UNICITRAL Model Law, over a period of time due to various judicial interpretations made by the Supreme Court of India with regard to the term public Policy in various cases including SAW pipes case 4, venture Global case 5 and Phulchand Exports 6 the scope for judicial interventions and the possibility of courts in India refusing to enforce an international arbitral awards got enhanced. The Same Supreme Court of India in Renusagar case 7, while interpreting the term Public Policy in section 7(1)(b)(ii) of 1961 Act 8 held that the enforcement of a foreign award can be refused only if such enforcement is found to be contrary to (1) fundamental policy of Indian law (2) the interests of 1 Is an International & Domestic Arbitration lawyer and Senior Partner of Law Senate law firm based out of New Delhi ravi@lawsenate.com 2 The United Nations Convention on the recognition and enforcement of foreign arbitral awards (New York, 10 th June 1958) 3 The United Nations Commission on International Trade law (UNICITRAL) on International Commercial arbitration, General Assembly Resolution No.40/72 adopted on 11 th December 1985( the Model law ) 4 Oil and Natural Gas Corporation Limited Vs Saw Pipes Limited reported in (2003) 5 SCC 705 5 Venture Global Engineering Vs Sathyam Computer Services (2010) 8 SCC 660 6 Phulchand Exports Limited Vs Patriot (reported in (2011) 10 SCC 705) 7 Renu Sagar Power Co Limited Vs General Electrical Co 1994 Supp (1) SCC 644 8 Foreign Awards (Recognition and Enforcement Act,1961

India (3) justice or morality. In Shri Lal mahal 9 the Supreme Court of India reconfirmed the law laid down in the earlier Renusagar case, with regard to public policy while dealing with S.48(2)(b) of the 1996 Act. In Mc Dermott International case 10, the Supreme Court of India read down the interpretation given in the SAW pipes case and confirmed the narrow interpretation of the term Public policy. In an endeavour to further reduce the scope of intervention by courts under the term public policy, the Law Commission of India, a statutory body created by the Constitution of India, prepared a report explaining the requirements and necessity to amend the above said 1996 Act, suggested an amendment to S. 48(2) by inserting two explanations. The Government of India promulgated an ordinance 11, exercising its rights under the Constitution of India, since parliament was not in session at that point of time. The amended 1996 Act has come into force with effect from 23rd October 2016. For all the arbitrations initiated after the above said date will have the applicability of the amended act. Even though the amendment has come in to force only prospectively, it has drastically reduced the chances of refusal by courts in India, with regard to an international arbitration award. The above said explanations inserted into S.48(2) of the 1996 Act is reproduced below: [Explanation 1: For the avoidance of any doubt, it is clarified that an award is in conflict with the public policy of India, only if, - (i) the making of the award was induced or affected by fraud or corruption or was in violation of section 75 or section 81; or (ii) it is in contravention with the fundamental policy of India law; or (iii) It is in conflict with the most basic notions of morality or justice. Explanation 2: For the avoidance of doubt, the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.] Hence After the new 2015 explanations, the scope for court intervention in the enforcement of a foreign award under the excuse of Public Policy is considerably reduced. Foreign arbitral awards under Indian law: To become eligible to get enforced the International arbitral award should fall under the category of Foreign award. The said 1996 Act, classifies all the awards arising out of an Indian seat, whether it is domestic arbitration or an international arbitration, as a domestic award. The part I of the above said 1996 Act applies to all the arbitrations 9 Shri Lal mahal Ltd Vs Progetto Grano Spa 10 McDermott International Inc Vs Burn Standard Co Ltd., Reported in 2006(11) SCC 181 11 Arbitration and Conciliation (amendment) Ordinance,2015 (Ord 9 of 2015) dated 23.10.2015

seated in India. The enforcement of an international arbitration award arising out of a foreign seat, is a foreign award and covered by the part II of the above said Act, reads as under: S.44. In the Chapter, unless the context otherwise requires, foreign award means an arbitral award on difference between persons arising out of legal relationships, whether contractual or not, considered as commercial under the law in force in India, made on or after the 11 th day of October,1960,- (a) in pursuance of an agreement in writing for arbitration to which the Convention set forth in First Schedule applies, and (b) in one of such territories as the Central Government, being satisfied that reciprocal provisions have been made may, by notification in the Official Gazette, declare to be territories to which the said Convention applies. Hence it is important to note that all foreign seated awards are not foreign awards as per Section 44. The seat of arbitration requires to be a New York Convention seat and also must have been a territory recognised by Government of India on the basis of reciprocity. This is because the New York Convention permits a member state to declare that it will recognise and enforce arbitral awards applying New York Convention only if the awards are made in country which recognises its awards under the principle of reciprocity. Hence, Section 44(b) of the Act requires the Government of India to issue a notification in the Official Gazette recognising a reciprocating country. Hence it is evident that an international arbitration award made in a non-notified Convention country will not be considered as a foreign award for the purpose of enforcement under the Act. The countries which have been notified so far by the Government of India include: Austria, Belgium, Botswana, Bulgaria, Central African Republic, Chile, Cuba, Czechoslovak Socialist Republic, Denmark, Ecuador, Arab Republic of Egypt, Finland, France, German Democratic Republic, Federal Republic of Germany, Ghana, Greece, Hong Kong, Hungary, Italy, Japan, Kuwait, Republic of Korea, Malagasy Republic, Mauritius, Mexico, Morocco, Nigeria, The Netherlands, Norway, Philippines, Poland, Republic of China, Romania, San Marino, Spain, Sweden, Switzerland, Syrian; Arab Republic, Thailand, Trinidad and Tobago, Tunisia, Union of Soviet Socialist Republics, United Kingdom, United Republic of Tanzania, and United States of America. It is also important to note that Supreme Court of India while dealing with Transocean shipping Agency case 12 held that the creation of a new political entity would not make any difference to the enforceability of the foreign award rendered in a territory (Ukraine) which was initially a part of the notified Convention country. Enforcement Procedure of a foreign award: A foreign award is required to go through a procedure of enforcement in which there are two stages, one is to check whether the award is enforceable as 12 Transocean Shipping Agency Vs Black sea Shipping & others 1998(2) SCC281

per Section 48 and the next is enforcement under Section 49. The said Sections are reproduced below: Section 48: Condition for enforcement of foreign awards (1) Enforcement of a foreign award may be refused, at the request of the party against whom it is invoked, only if that part furnishes to the court proof that, - (a) the parties to the agreement referred to in Section 44 were, under the law applicable to them, under some incapacity, or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made; or (b) the party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitral proceedings or was unable to present his case; or (c) the award deals with a difference not contemplated by or not failing within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration: PROVIDED that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be enforced; or (d) the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties, or, failing such agreement, was not in accordance with the law of the country where the arbitration took place; or (e) the award has not yet become 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, that award was made. (2) Enforcement of an arbitral award may also be refused if the court finds that, - (a) the subject-matter of the difference is not capable of settlement by arbitration under the law of India; or (b) the enforcement of the award would be contrary to the public policy of India. (3) If an application for the setting aside or suspension of the award has been made to a competent authority referred to in clause (e) of sub-section (1) the court may, if it considers it proper, adjourn the decision on the enforcement of the award and may also, on the application of the party claiming enforcement of the award, order the other party to give suitable security. To enforce a foreign award, the party applying for the enforcement of a foreign award shall at the time of making an application, produce before the court (a) Original award duly authenticated in the manner required by law of the country in which it was made (b) the original agreement for

arbitration or a duly certified copy and (c) such evidence as may be necessary to prove that the award is a foreign award. In addition to that in case if the award is not in English it should be officially translated and produced before the court. Now as per the 2015 amendment 13 all the above said execution proceedings of a foreign award shall take place in the High Court having jurisdiction. That means the High Court having the jurisdiction over the place where the properties of the losing party are situated. There is no prescribed limitation under the 1996 Act, to enforce a foreign arbitral award but some courts in India have held, three years from the date of getting the right to enforce a foreign award. More over there is no appeal provided under the 1996 Act, to appeal against an order of enforcement of a foreign award. Hence the enforcement of a Foreign award in India has become much easier than earlier. 13 Substituted by Arbitration and Conciliation Amendment Ordinance, 2015