The Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the New York Convention, was adopted by a United Nations diplomatic conference on 10 June 1958 and entered into force on 7 June 1959. The Convention requires courts of contracting states to give effect to private agreements to arbitrate and to recognize and enforce arbitration awards made in other contracting states. Widely considered the foundational instrument for international arbitration, it applies to arbitrations which are not considered as domestic awards in the state where recognition and enforcement is sought. Though other international conventions apply to the cross-border enforcement of arbitration awards, the New York Convention is by far the most important.

Background

In 1953, the International Chamber of Commerce (ICC) produced the first draft Convention on the Recognition and Enforcement of International Arbitral Awards to the United Nations Economic and Social Council (ECOSOC). With slight modifications, the ECOSCOC submitted the convention to the International Conference in the Spring of 1958. The Conference was chaired by Willem Schurmann, the Dutch Permanent Representative to the United Nations and Oscar Schachter, a leading figure in international law who later taught at Columbia Law School and School of International and Public Affairs, and served as the President of the American Society of International Law.

International arbitration is an increasingly popular means of alternative dispute resolution for cross-border commercial transactions. The primary advantage of international arbitration over court litigation is enforceability: an international arbitration award is enforceable in most countries in the world. Other advantages of international arbitration include the ability to select a neutral forum to resolve disputes, that arbitration awards are final and not ordinarily subject to appeal, the ability to choose flexible procedures for the arbitration, and confidentiality.

Once a dispute between parties is settled, the winning party needs to collect the award or judgment. Unless the assets of the losing party are located in the country where the court judgment was rendered, the winning party needs to obtain a court judgment in the jurisdiction where the other party resides or where its assets are located. Unless there is a treaty on recognition of court judgments between the country where the judgment is rendered and the country where the winning party seeks to collect, the winning party will be unable to use the court judgment to collect.

Countries which have adopted the New York Convention have agreed to recognize and enforce international arbitration awards. As of September 2007, 141 of the 192 United Nations Member States and the Holy See have adopted the New York Convention. Only 51 Member States and Taiwan have not yet adopted the New York Convention. A number of British Dependent Territories have not yet had the Convention extended to them by Order-in-Council.

Summary of provisions

Under the Convention, an arbitration award issued in any contracting state can generally be freely enforced in any other contracting state, only subject to certain, limited defenses. These defenses are:

1. a party to the arbitration agreement was, under the law applicable to him, under some incapacity;
2. the arbitration agreement was not valid under its governing law;
3. a party was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings, or was otherwise unable to present its case;
4. the award deals with an issue not contemplated by or not falling within the terms of the submission to arbitration, or contains matters beyond the scope of the arbitration (subject to the proviso that an award which contains decisions on such matters may be enforced to the extent that it contains decisions on matters submitted to arbitration which can be separated from those matters not so submitted);
5. the composition of the arbitral tribunal was not in accordance with the agreement of the parties or, failing such agreement, with the law of the place where the hearing took place (the "lex loci arbitri");
6. the award has not yet become binding upon the parties, or has been set aside or suspended by a competent authority, either in the country where the arbitration took place, or pursuant to the law of the arbitration agreement;
7. the subject matter of the award was not capable of resolution by arbitration; or
8. enforcement would be contrary to "public policy".

Text

The text of the convention is available online.

Parties to the New York Convention

State	Date of Ratification	State	Date of Ratification
	30 November 2005		27 June 2001
	7 February 1989		2 February 1989
	14 March 1989		29 December 1997
	26 March 1975		2 May 1961
	29 February 2000		20 December 2006
	6 April 1988		6 May 1992
	16 March 1993		15 November 1960
	18 August 1975		16 May 1974
	28 April 1995		1 September 1993>
	20 December 1971		7 June 2002
	25 July 1996		10 October 1961
	23 March 1987		5 January 1960
	19 February 1988		12 May 1986
	15 October 1962		4 September 1975
, People's Republic of	22 January 1987		25 September 1979
	26 October 1987		1 February 1991
	26 July 1993		30 December 1974
	29 December 1980		30 September 1993
	22 December 1972		14 June 1983
	28 October 1988		11 April 2002
	3 January 1962		9 March 1959
	26 February 1998		30 August 1993
	19 January 1962		26 June 1959
	15 December 2006		2 June 1994
	30 June 1961		9 April 1968
	16 July 1962		21 March 1984
	23 January 1991		5 December 1983
	14 May 1975		3 October 2000
	5 March 1962		24 January 2002
	13 July 1960		7 October 1981
, Islamic Republic of	15 October 2001		12 May 1981
	5 January 1959		31 January 1969
	10 July 2002		20 June 1961
	15 November 1979		20 November 1995
	10 February 1989	, Republic of	8 February 1973
	28 April 1978		18 December 1996
	17 June 1998		14 April 1992
	11 August 1998		13 June 1989
	16 September 2005		14 March 1995
	9 September 1983	, The former Yugoslav Republic of	10 March 1994
	16 July 1962		5 November 1985
	8 September 1994		22 June 2000
	21 December 2006		30 January 1997
	19 June 1996		14 April 1971
, Republic of	18 September 1998		2 June 1982
	24 October 1994		23 October 2006
	12 February 1959		11 June 1998
	4 March 1998		24 April 1964
	6 January 1983		24 September 2003
	14 October 1964		17 March 1970
	14 March 1961		25 February 1999
	14 July 2005		10 October 1984
	8 October 1997		7 July 1988
	6 July 1967		3 October 1961
	18 October 1994		30 December 2002
	13 September 1961		24 August 1960
	12 September 2000		17 May 1979
	19 April 1994		17 October 1994
	12 March 2001		21 August 1986
	28 May 1993		6 July 1992
	3 May 1976		12 May 1977
	9 April 1962		28 January 1972
	1 June 1965		9 March 1959
, United Republic of	13 October 1964		21 December 1959
	14 February 1966		17 July 1967
	2 July 1992		12 February 1992
	10 October 1960		21 August 2006
	24 September 1975		30 September 1970
	30 March 1983		7 February 1996
	8 February 1995		12 September 1995
	14 March 2002		26 September 1994

     

States which are Not Party to the New York Convention

		, Dem. Republic of the
		, Fed. States of

     

United States Issues

Under American law, the recognition of foreign arbitral awards is governed by chapter 2 of the Federal Arbitration Act.

In 2007, proposed legislation was introduced before Congress to authorize the Court of Interntional Trade to adjudicate the recognition under the New York Convention of foreign arbitral awards.

External links

• Neil J. Saltzman, The Enforcement of Foreign Awards in New York State
• http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention.html
• http://www.wipo.int/amc/en/arbitration/ny-convention/parties.html