Choice of Law in International Commercial Arbitration

By Okezie Chukwumerije | Go to book overview

decide to delocalize their arbitration, the defenses under Article V(1)(e) would not be available to the losing party. 137 Responding to the argument that delocalization leaves little mechanism for ensuring the fairness of arbitrations, the court noted that

allowing the parties to untether themselves from pre-existing "national law" still leaves certain safeguards in place to guard against enforcement of an otherwise unfair award. The Convention contains several due process protections requiring notice and the opportunity to be heard as well as a defense to guard against the enforceability of awards contrary to public policy. 138

In summary, the New York Convention does not obligate contracting parties to deny recognition and enforcement to delocalized awards, although the public policy exception may potentially be invoked against such an award in those enforcing jurisdictions that reject delocalization. Further, the courts of the seat of arbitration may rely on the public policy exception under the Model Law to set aside a delocalized award, and this may impair the international enforceability of such an award under the New York Convention. Thus, to guarantee the smooth enforcement of their awards, arbitrators should as a practical matter endeavor to respect the mandatory rules of the seat of arbitration.


CONCLUSION

The nature of the debate about the possibility of delocalizing arbitration procedure and awards often conceals the real concerns that underlie the debate. The cardinal issue is not whether or not arbitrations are jurisdictional or contractual in nature, but to what extent and according to what standards international arbitrations should be regulated and administered. As we have seen, most legal systems accord parties considerable freedom in determining arbitral procedure, while reserving the right to ensure the fairness and integrity of the process. The controversy regarding the independence of arbitration from national law actually addresses concerns regarding the standards by which the fairness and integrity of the process should be governed: domestic or international standards?

To be sure, there is much to be said for setting an international standard by which international arbitrations should be superintended, as opposed to leaving each State to enact its own individual standard, which may run contrary to the aspirations of foreign arbitrating parties. International conventions on arbitration are designed to provide an effective international regime for the conduct of arbitrations. These conventions are aimed at conflating and modernizing national arbitration practices relating to international arbitration, thus obviating the need for States to establish their own domestically influenced regimes. The most notable international convention on arbitration, the New York Convention, governs only the

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Choice of Law in International Commercial Arbitration
Table of contents

Table of contents

  • Title Page iii
  • Contents vii
  • Preface xi
  • Chapter One - General Introduction 1
  • Introduction 1
  • Notes 19
  • Chapter Two - the Arbitration Agreement 29
  • Introduction 29
  • Conclusion 61
  • Notes 62
  • Chapter Three - Law Governing Arbitration Proceedings 75
  • Introduction 75
  • Conclusion 97
  • Notes 98
  • Chapter Four - Law Governing Substantive Issues 107
  • Introduction 107
  • Conclusion 134
  • Notes 134
  • Chapter Five - Issues in the Law Applicable to State Contracts 143
  • Introduction 143
  • Conclusion 164
  • Notes 168
  • Chapter Six - Mandatory Rules of Law in International Commercial Arbitration 179
  • Introduction 179
  • Conclusion 194
  • Notes 194
  • Chapter Seven - Conclusion 199
  • Introduction 199
  • Selected Bibliography 205
  • Index 215
  • About the Author 219
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