Chapter 11Enforcement of Arbitral Awards

Remedies for Int’s Awards Set aside ( 撤销） Refusing enforcement （拒绝执行） General principle: National courts are entitled to se

t aside their own awards. As to foreign awards, the courts may only decide whether to enforce or not.

Conditions for refusing enforcement under NYC General principle: procedure issues in

stead of merits of the case Invalid arbitration agreement Lack of due procedure Tribunal beyond authority Impropriate composition of the tribunal Non-arbitrability of the dispute Award in conflict with the public policy

Invalid arbitration agreement ELF Aquitaine Iran(France) v. National Iran

ian Oil Co. (Iran) 135 Tibor Varady ， 223-228; Nationalization of oil industry in Iran Arbitration agreement was void. Dispute is settled by the Special Committ

ee of Iran. Sole arbitrator declared its competence.

Lack of due procedure Paklito Investment Ltd. v. Klockner Ea

st Asia Ltd. 251 Sales K between the parties Dispute on the defects of the goods Expert opinions and review Award in favor of the buyer Refusing enforcement

Tribunal beyond its authority

Norsolor S. A. (France) v. Pabalk Ticaret Sirketi S.A. (Turkey) 381

Agency agreement b/w French and Turkey co.

ICC Arbitration award made in Vienna.Tribunal beyond its authority via amica

ble compositeur.

Improper composition of the tribunal Commercial man as arbitrator Engineer of the servant of the

parties during the construction work

R. A. Sally(Fin.) v. S.R.L. Termarea (Italy) p.455 Yearbk. Comm. Arb’n 294(1979) C/P between Sally and Termarea Arbitration clause （ ad hoc) Demurrage claim from Sally Award by two chosen arbitrators Refusing enforcement by the Italian c

ourt due to improper composition of the tribunal

Arbitrability matters Wilko v. Swan (1953) Sherk v. Alberto-Culver Co. (1974) Rodriguez v. Shearson/American Expr

ess (1989)

Public policy consideration Julius A. Furer in the USA （ [1978] 3 Yearbo

ok Commercial Arbitration. 290 ； Army ship wreckaged near Netherlands in 1974 Lloyd’s open form salvage agreement Dispute could not be arbitrated under US P

ublic Vessel Act ， Commercial matters reservation

US Latest Cardegna Case Buckeye Check Cashing, INC. v. Cardegna Et

Al.(US, Feb.21,2006) Agreement for deferred payment transactio

n b/w the parties Cardegna sued that Buckeye charged usuri

ous interest rates and the agreement violated various Florida laws

Trial court denied Buckeye’s motion to compel arbitration because the contract is illegal and void ab initio

Cardegna Case (2) State appellate court reversed in turn was reversed by the Florida

Supreme Court: enforcing an arbitration agreement in a contract challenged as unlawful would violate state public policy and contract law

Reversed by the US Supreme Ct.—the challenge should be decided by the arbitrator instead of the court.

Chinese Practices Domestic awards （国内裁决） Foreign-related awards （ FRA, 涉外

裁决） Foreign awards （外国裁决）

Foreign Related Awards(FRA) Art.260 CPL : award made by the Forei

gn-related Arbitration Institutions in the PRC (CIETAC, CMAC)

Set aside and refusing enforcement in Art. 71, Art. 72 （拒绝执行） CAL (Art. 260 CPL applied)

Jurisdiction of domestic & international arbitration institutions since 1996

Awards Classification by the Place of Arbitration DomesticDomestic awards are those that

were made in the State where the arbitration is taken place.

Foreign awards are those that were made outside of the State where the arbitration is taken place.

International Awards Awards made in China under the

administration of the Chinese arbitration institutions based on the international arbitration agreement

Awards made in China under the administration of foreign arbitration institution (ICC, LCIA, AAA) in accordance with the Rules of such arbitration institutions

Foreign awards made out of China

Court Supervision on the Int’l Commercial Arbitral Awards Int’l award made in China by

Chinese Arbitration Institutions Int’l award made in China by

Foreign Arbitration Institutions Foreign award made outside

China

Draft Provisions by the Supreme Court in 2003 Foreign-related arbitral awards refer t

o those involving foreign element made by the CIETAC, CMAC and other arbitration commissions (domestic arb. commissions) reorganized under CAL.

How about awards made in China by foreign arbitration institutions, such as ICC, AAA, LCIA?

Grounds Refusing Enforcing Domestic Awards: Art.217,CPL No arbitration agreement; Tribunal beyond the authority; Tribunal improperly composed; Main evidence insufficient; Definite error in application of the law; Arbitrators have committed

embezzlement, accepted bribes or done malpractice for personal benefits or perverted the law.

Grounds for Refusing Enforcement FRA

CAL 71 & Art.260, CPL (1991, Art.258 in 2007) No arbitration agreement Lack of due process Improper composition of tribunal Tribunal beyond authority Burden of proof by respondent

Public Interest Art.58(2), CAL If the People's Court determines

that the award is contrary to the public interest, it shall rule to vacate the award.

CIETAC awards on US co. v. Chinese Travel co.

Remedies for Foreign Awards NYC awards Non- NYC awards

Obligations under NYC China acceded NYC in 1986 with the fo

llowing two reservations reciprocal reservation ( 互惠保留声

明） Commercial reservation （商事保留声

明）

Reciprocal Reservation China applies NYC only to

recognition and enforcement of awards made in the territory of another NYC Contracting State.

Territoriality standard to decide the nationality of the arbitral awards

Commercial Reservation China applies NYC only to

differences arising out of legal relationships whether contractual or not which are considered as commercial under the national law.

Commercial Matters in China Notice by the Supreme Court on Apr. 10

1987: Commercial legal relationship of contractual or non-contractual matters refers to such economic rights and obligations under contract and torts as the sale, leasing, CJV, EJV, insurance, credit, agency, consultancy, all types transportation, product liability, environments pollution, etc. excluding dispute b/t the government and foreign investors.

Competent Court for Enforcement

Intermediate People’s Court where the place of business of the respondent or his executing property is located.