The Modern Trend Towards Exclusion of Recourse Against Transnational Arbitral Awards: A European Perspective
606 FORDHAM INTERNATIONAL LA W JOURNAL [Vol. 12:605
Fordham International Law Journal
Copyright c 1988 by the authors. Fordham International Law Journal is produced by The
Berkeley Electronic Press (bepress). http://ir.lawnet.fordham.edu/ilj
The Modern Trend Towards Exclusion of
Recourse Against Transnational Arbitral
Awards: A European Perspective
Klaus Peter Berger
This Article will analyze this trend [the liberal tradition in international commercial
arbitration] and attempt to assess its impact on the efficiency of international commercial arbitration as a
viable alternative to litigation before the national judiciary. Where appropriate, the new laws will
be compared to the UNCITRAL Model Law (the “Model Law”), today’s archetype of modern
commercial arbitration laws. Finally, this Article will focus on the possible influence of the new
laws on arbitration laws of other states, taking the Federal Republic of Germany as an illustrative
Klaw Peter Berger*
• Banking Law Institute, University of Cologne, West Germany. J.D., 1987,
University Bielefeld, West Germany; LL. M., 1988, University of Virginia. The
author is particularly grateful to Professor Dr. Norbert Horn for making available the
research facilities of the Centre for International Trade and Investment Contracts
(CITIC), University of Cologne.
For the actors in internationalcommerce, it is the worst of both worlds
when agreement to arbitrationresults in both arbitrationand
Mark B. Feldman'
It is common knowledge among lawyers from both
common and civil law jurisdictions that the ever-growing case load
of their national judiciary constitutes the main obstacle for an
effective dispute resolution process. In the United States, the
court system is close to breaking down,2 and in Germany it can
take a litigant up to six years to take a case through all
instances for a final judgment.3 Even the European Court
ofJustice in Luxembourg is suffering from an increased case load of
forty percent in 1987, which has triggered the proposal for a
new European Court of First Instance.4 Viewed against this
background, arbitration as an alternative to litigation gains
additional importance. This is especially true for recourse to
municipal courts against final arbitral awards and is of
tremendous importance for the choice of the right situs and the
ultimate enforcement of the award.5
There is an inherent conflict of interests involved in any
arbitration proceeding that makes this relationship so difficult
and problematic. On one side, there are the interests of the
parties to a contract containing an arbitration clause (clause
compromissoire).6 Some reasons for resorting to arbitration
instead of the national courts, apart from its confidentiality,
include the widespread mistrust of the efficiency, technical
expertise, and impartiality of these courts. 7 Parties to a complex
and technically intricate international transaction have always
been and are becoming increasingly reluctant to rely on the
national judiciary for dispute settlement, which, naturally,
often lacks the required special economic, technical, and legal
knowledge.8 The arbitration clause is expected to ensure an
impartial, effective, knowledgeable, 9 and above all speedy
resolution to any conflict that might arise out of or relating to
the contract.'0 In contrast to this "flight from national
6. The term "clause compromissoire" is rooted in French law and refers to future
disputes in contrast to a "compromis," which refers to submitting a current dispute to
arbitration. A. REDFERN & M. HUNTER, LAW AND PRACTICE OF INTERNATIONAL
COMMERCIAL ARBITRATION 8 (1986).
7. See Yates, Arbitration or Court Litigation for Private Internationl Dispute Resolution:
The Lesser of Two Evils, in RESOLVING TRANSNATIONAL DISPUTES THROUGH
INTERNATIONAL ARBITRATION 224, 230-32 (T. Carbonneau ed. 1984).
8. Legal knowledge oftentimes does not keep pace with the growing
internationalization of national legal systems and cases. To make matters worse, the doctrine of
forum non conveniens regards international cases as an "unwarranted burden on our
taxpayer... [and] an added impediment to the speedy disposition of the
controversies between and on behalf of our own citizen[s]." M. FERID, INTERNATIONALES
PRIVATRECHT 54-55 (3d ed. 1986).
arbitration tribunals need to be informed, as procedural designers, about
the state of the art of the common fund of arbitral knowledge, but also in a
more detailed procedural sense, to be familiar with the sub-cultural
practices and nuances of the particular commercial environment in which the
dispute is placed.
Id. at 49. The role of the technical expert varies, however, and seems to be more
prominent in the arbitration proceedings of the Anglo-Saxon type, while on the
Continent, the primary role is still with the lawyer. Glossner, Contract Adaptation Through
Third Party Intervener. The Referee Arbitral, in ADAPTATION AND RENEGOTIATION OF
CONTRACTS IN INTERNATIONAL TRADE AND FINANCE 191, 194-95 (N. Horn ed. 1985).
10. An arbitration clause may provide that: "Any dispute, controversy of claim
arising out of or relation to this contract, of the breach, termination or invalidity
thereof, shall be settled by arbitration in accordance with the UNCITRAL Arbitration
Rules." U.N. Comm'n on Int'l Trade Law, Arbitration Rules, art. 1(
)n. 1, U.N. Sales
No. E.77.V6 (1977) [hereinafter UNCITRAL Rules]. Under U.S. law, a "narrow"
arbitration clause submitting only claims "arising out of" the agreement to the
arbitral tribunal might exclude the power of the tribunal to determine whether the
agreement containing the arbitration clause is valid. SURVEY OF INTERNATIONAL
ARBITRATION SITES 106 (Am. Arbitration Ass'n ed. 1984) [hereinafter INTERNATIONAL
608 FORDHAM INTERNATIONAL
LA WJOURNAL [Vol. 12:605
courts," " one is confronted with the inherent paradox of
arbitration: Arbitration proceedings sometimes cannot function
properly without these courts. 12
The powers vested in national courts by the national
legislature are oftentimes needed throughout the arbitration
proceedings to prevent frustration of the arbitration clause and to
ensure recognition and enforcement of the ultimate award.
The national courts' authority in this area ranges from
enforcing the arbitration agreement' 3 and provisional measures,' 4 to
nominating and replacing arbitrators,' 5 as well as the taking of
evidence.' 6 Most States, however, do not lend their support to
arbitral tribunals operating on their soil without claiming some
degree of control over the conduct of these tribunals.' 7 The
most important way to gain this control is to provide for
recourse against arbitral awards. 8 This procedure, however,
in11. One writer has labeled this phenomenon "conflict avoidance." G. DELAUME,
LAW AND PRACTICE OF TRANSNATIONAL CONTRACTS 290 (1988).
12. "[C]e sont les parties et le tribunal arbitral lui-m me qui sont int~ress~s S la
puissance publique, dont l'aide leur est souvent indispensable ....[L]e r6le de la
puissance public est subsidiare. Elle n'intervient que sur requte." Voyame, L 'Etatet
l'Arbitrage Commercial International,in RECUEIL DE TRAVAUX SUISSES SUR L'ARBITRAGE
INTERNATIONAL 15, 18 (Int'l Council for Commercial Arbitration ed. 1984).
13. Most arbitration laws provide that courts may stay proceedings or decline to
accept jurisdiction to give effect to an arbitration clause in the principal contract.
This is also true for arbitrations in foreign countries according to'article 11(
) of the
New York Convention. New York Convention on the Recognition and Enforcement
of Foreign Arbitral Awards, June 10, 1958, art. 11(
), 21 U.S.T. 2517, 2519, T.I.A.S.
No. 6997, at 1, 330 U.N.T.S. 38, 40 [hereinafter New York Convention]. See generally
Stein & Wotman, InternationalCommercial Arbitration in the 1980s: A Comparison of the
Major Arbitral Systems and Rules, 38 Bus. LAW. 1685, 1688-93 (1983) (discussing
prearbitration judicial proceedings).
14. In the field of interim measures of protection related to the subject matter of
the dispute, there is a duality of recourse to the arbitration tribunal and/or to the
national courts. See UNCITRAL Rules, supra note 10, art. 26(
Chamber of Commerce, Rules of Conciliation and Arbitration of the ICC art. 8(5)
(1975) [hereinafter ICC Arbitration Rules]; see also McDonell, The Availability of
Provisional Relief in International Commercial Arbitration, 22 COLUM. J. TRANSNAT'L L. 273
) (discussing judicial relief measures applicable to arbitration proceedings).
15. For a review on the power of national courts to aid the parties in the
appointment of arbitrators, see G. DELAUME, supra note 11, at 316-19.
16. Under most arbitration laws, arbitrators have broad powers to procure
evidence, but in some countries, such as France, assistance of the courts is necessary to
compel production of documents possessed by third parties. See A. REDFERN & M.
HUNTER, supra note 6, at 234; Stein & Wotman, supra note 13, at 1707-08.
17. See A. REDFERN & M. HUNTER, supra note 6, at 43, 316.
18. See id. at 316.
creases the potential for the use of dilatory tactics by the losing
Thus, the inherent conflict of the recourse problem
becomes apparent: either restrain judicial recourse as much as
possible in order to allow maximum arbitral freedom or
provide for recourse to national courts, which might open the
door to misuse by the losing party resulting in delay of the
conflict resolution process. Where the latter option is
followed, the original purpose of the arbitration clause is
perverted by converting arbitration proceedings into nothing
more than an additional instance of the national judiciary.' 9
In the past decade, national legislatures, especially those
of the "classical" European arbitration nations, 20 have become
increasingly concerned with the relationship between their
courts and arbitral tribunals. Many have tried to relax the grip
of their judiciary on final arbitral awards by confining
supervision to some minimum standards. Realizing that international
commercial arbitration constitutes an important source of
revenues, 2' these states have tried to render their legal
environment more attractive for arbitrations by enacting new, or
revising their old, arbitration laws. These new or revised laws do
not only provide the parties with a more flexible procedural
framework, they also regulate to a varying extent the right of
recourse against a final arbitral award before the national
This trend began in England in 1979 (the "U.K.
Arbitration Act"), 2 2 followed by France in 1981 (the "French
Arbitration Law"), 3 Austria in 1983 (the "Austrian Arbitration
Law"),2 4 Belgium in 1985 (the "Belgium Recourse
Provision"),2 5 The Netherlands (the "Dutch Arbitration Act") 26 in
1986, and Switzerland in 1989 (the "Swiss Arbitration Law").2 7
Sweden, which has a long-standing liberal tradition in
international commercial arbitration,2 8 will also be examined in this
This Article will analyze this trend and attempt to assess
its impact on the efficiency of international commercial
arbitration as a viable alternative to litigation before the national
judiciary. Where appropriate, the new laws will be compared to
the UNCITRAL Model Law (the "Model Law"), 2 9 today's
archetype of modern commercial arbitration laws. Finally, this
TRANSNATIONAL ARBITRAL AWARDS
Article will focus on the possible influence of the new laws on
arbitration laws of other states, taking the Federal Republic of
Germany as an illustrative example.
TRANSNATIONAL COMMERCIAL ARBITRATION. A
In contrast to the term "commercial," which is given wide
meaning in most of the laws and the Model Law,3 ° it is
necessary to find at least a rudimentary definition of "transnational"
or "international" arbitration, since most of the new laws
distinguish between national and international arbitration and
apply the liberal provisions of their laws only to the latter with
domestic arbitration remaining under more stringent control
of municipal courts.'
What exactly constitutes this international character of the
arbitral proceedings is still disputed among courts,
practitioners, and national legislatures. The new laws can be divided
into three categories. The first category consists of those laws
that provide an entire legal framework for international
arbitration. The second category includes laws enacted with
special provisions for recourse to national courts in international
ARB. INT'L 6 (
) (discussing the history of, and negotiation process leading to, the
final version of the Model Law).
30. The Model Law refers to the term "commercial" in a footnote to article 1(
emphasizing that the term
should be given a wide interpretation so as to cover matters arising from all
relationships of a commercial nature, whether contractural or not.
Relationships of a commercial nature include, but are not limited to, the following
transactions: any trade transaction for the supply or exchange of goods or
services; distribution agreement; commercial representation or agency;
factoring; leasing; construction of works; consulting; engineering; licensing;
investment; financing; banking; insurance; exploitation agreement or
concession; joint venture and other forms of industrial or business co-operation;
carriage of goods or passengers by air, sea, rail or road.
MODEL LAw, supra note 29, art. I(I) n.i, reprintedin XI Y.B. COM. ARB. at 381. The
Model Law leaves untouched, however, all laws "by virtue of which certain disputes
may not be submitted to arbitration .... " Id. art. i(5), reprintedin XI Y.B. COM. ARB.
at 381. The new Swiss arbitration law covers "any claim related to a party's assets,
rights or liabilities," which includes "all types of claims, whether contractual,
tortious, commercial, or financial." Poncet & Gaillard, Introductory Note, 27 I.L.M. 37, 45
31. See Lalive, Problemes Sp&ifiques de l'Arbitrage International, 1980 REVUE DE
L'ARBITRAGE 341, 345; Klein, La Nouvelle Reglementation Fran~aisede lArbitrage
International et les Lois Suisses, in RECUEIL DE TRAVAUX SUISSES SUR L'ARBITRAGE
INTERNATIONAL 57, 58-59 (Int'l Council for Commercial Arbitration ed. 1984).
arbitrations. The third category covers the laws that make no
distinction at all between national and international arbitration
taking place on their soil.
The French Arbitration Law belongs to the first category
and is rooted in the case law of the French Cour de
Cassation.12 It focuses on the nature of the dispute and defines
international arbitration as "any dispute that involves the
interests of international trade. '3 3 This formulation requires a
complex consideration of mostly economic criteria inherent in
the transaction, the nationality of the parties, transborder
movement of goods or payment, 34 and seat of the arbitration. 35
Similarly, to be recognized as international under the Swiss
Arbitration Law, "at the time of the conclusion of the arbitration
agreement, at least one of the parties had neither its domicile
nor its habitual residence in Switzerland." 3' 6
The U.K. Arbitration Act belongs to the second category
and by means of a negative definition, uses a geographic
criterion to determine those arbitrations where exclusion
agreements are allowed and regards as domestic any agreement that
does not provide, expressly or by implication, for arbitration
outside the United Kingdom or to which there was no foreign
party, be it individual or corporation, at the time the
agreement was made.3 7 The Belgian Recourse Provision is
applicable only in cases where neither of the parties is a Belgian
national, is a legal entity created in Belgium or has a branch or
any other establishment in Belgium.38 Under Austrian law, an
award is considered "foreign" if it is rendered outside
Austria,39 meaning there is no distinction in Austria between
domestic and international arbitration,40 and this approach also
holds true for the Swedish Arbitration Act.4 The European
Convention Providing a Uniform Law on Arbitration, on the
other hand, although predating the new laws by more than
twenty years, combines the "nature" and geographical test and
looks at interests of international trade and residence or seat of
the parties involved.42
The Model Law, in its efforts to reach maximum
acceptability in the international community, combines all the above
approaches and focuses alternatively on the place of business or
seat of arbitration or place of performance or agreement of the
parties.43 In addition, the Model Law is applicable in cases
where "the parties have expressly agreed that the
subject-matter of the arbitration agreement relates to more than one
The Dutch Arbitration Act belongs to the third category,
since it applies equally to both domestic and international
arbitral proceedings.4 5 The Dutch legislature was well aware of
the problems and uncertainties connected with the traditional
distinction between international and domestic arbitration,
which is the major flaw of today's modern commercial
arbitration.46 The drafters, strongly influenced by the Model Law,
thought that the flexibility of the new law allows application
and, more importantly, adjustment to both kinds of
Interestingly enough, the German delegation was not
successful during the negotiations of the Model Law when it
suggested a broad scope of application covering both domestic
and transnational arbitrations. 48 Many countries opposed this
idea, arguing that traditionally grown arbitrations, which have
evolved out of the typical national particularities of each
country, should be maintained.49 Consequently, negotiations on
this issue were particularly tough and long.50 The traditional
dichotomy, however, is not without flaws. Under the new
Swiss Arbitration Law, a dispute involving a cross-border sale
of goods by two subsidiaries incorporated in Switzerland, but
fully owned by foreign companies, might be deemed domestic
and hence fall outside of the scope of the new law. 5'
The U.S. delegation, during the Model Law negotiations,
tried to find a remedy for these frictions and favored a
provision that included conflicts between domestic companies, if at
least one of them is a foreign owned subsidiary.52 This
proposal was rejected, however, which seems acceptable, given the
fact that the broad coverage provision of article 1(
)(c) of the
Model Law53 might eventually be applied to these cases. 54
The French judiciary has encountered considerable
TRANSNATIONAL DISPUTES THROUGH INTERNATIONAL ARBITRATION 195, 223 (T.
Carbonneau ed. 1984).
47. See van den Berg, The NetherlandsArbitrationAct 1986, 15 INT'L Bus. LAW. 356
48. See B6ckstiegel, Das UNCITRAL-Modell-Gesetzfzir die Internationale
WirtschaftsSchiedsgerichtsbarkeit, 30 RECHT DER INTERNATIONALEN WIRTSCHAFT [RIW] 670, 675
). Professor B6ckstiegel participated in the negotiations of the Model Law as a
representative of the International Law Association.
49. See Id.
50. Id. France favored a general, abstract definition, which was also rejected
since many countries feared this would leave too much freedom to national courts to
interpret this definition too restrictively. Id.
51. See Poncet & Gaillard, supra note 30, at 39. The result might be different
under French law. See Gaillard, The UNCITRAL Aodel Law and Recent Statutes on
InternationalArbitrationin Europe and North America, 2 ICSID REV.- FOREIGN INVESTMENT L.J.
424, 428-29 (
52. See B6ckstiegel, supra note 48, at 676.
53. MODEL LAW, supra note 29, art. 1(
)(c), reprinted in XI Y.B. COM. ARB. 380,
381 (1986). Such conflict might involve substantial foreign commercial interests
which might be sufficient to fall under the Model Law. See B6ckstiegel, supra note 48,
54. See B6ckstiegel, supra note 48, at 676.
problems in determining consistent criteria for the
international character of arbitration under the French Arbitration
Law. The Cour d'appel, Paris, for example, had to pierce the
corporate veil of one of the parties to consider as international
an arbitration involving the sale of a vessel between two Italian
companies in Rome that had provided for arbitration under
the auspices of the International Chamber of Commerce (the
"ICC") in Paris.55 In contrast, the Cour de Cassation refused
to consider as international an arbitration involving an agency
contract between two French parties concerning
representation of one of the parties in Colombia.56
The German proposals during the Model Law
negotiations and the new Dutch Arbitration Act question the different
treatment of domestic and international arbitration.5 7 Today's
dispute over the nature of transnational or international
commercial arbitration seems to polarize the analysis into two
extreme positions: either continue to cope with conflicting
definitions deemed necessary to uphold a different treatment of
both domestic and international arbitrations or abolish this
traditional dual approach and find a uniform law for both. The
latter extreme may lead to a harmonization of the national law
but would by no means guarantee harmonization of the
different national arbitration laws. In view of the still existing
multifaceted picture of domestic arbitrations in many countries, the
way of the Model Law seems more practical.
At present, however, there is no uniform picture as to the
scope of the new laws, and one needs to look at the approach
chosen by the respective national legislature when interpreting
the new laws.
55. Judgment of Apr. 26, 1985, Cour d'appel, Paris, Fr., reprinted in 113 J.D.I.
175 (1986), where the court, leaving aside the legal criteria of siege social(seat), which
is used in French jurisprudence to determine the seat of a company, focused on two
purely economic criteria, the foreign shareholders controlling the company and the
funds for the transaction being obtained from foreign sources. Id., reprinted in 113
J.D.I. at 179-80.
56. Judgment of Oct. 7, 1980, Cass. civ. Ire, Fr., La Semaine Juridique
(JurisClasseur Priodique) UJ.C.P.] II No. 54, 19480.
57. It should be pointed out that the element of consumer protection, a basic
premise for control of domestic arbitration, is of less importance in international
arbitrations. See A. REDFERN & M. HUNTER, supra note 6, at 10.
RECOURSE AND RELA TED REMEDIES
When a litigant is dissatisfied with the judgment of a
national court, he may appeal to a court of higher instance. The
two- or multi-instance court system is established in both
common- and civil-law systems and is designed to ensure justice
and uniformity of case law. 58 The appeal is the only ordinary
remedy and can be based on issues of procedural or
substantive law and leaves the case within the court system.
The arbitration process, on the other hand, is more
complicated due to its dual private and jurisdictional nature.5 9 A
first distinction has to be made between internal recourse,
which leaves the case within the arbitral system, and external
recourse, which transfers the case from arbitration into the
national judicial system. The former is rarely utilized but can be
found in commodity arbitrations or other arbitrations
established by trade associations, 60 as well as in the Dutch
Act,6 ' and to a lesser extent the
Modern arbitration laws and institutional arbitration
58. See M. GLENDON, M. GORDON, & C. OSAKWE, COMPARATIVE LEGAL
TRADITIONS 191 (
). The authors discuss appellate review in the civil-law systems,
pointing out that a party dissatisfied with the results of the appeal may seek review by
the highest court (Cour de Cassation in France, Bundesgerichtshof in Germany)
which, however, may only consider questions of law and not of facts. Id. For a
discussion of appellate procedure in common-law jurisdictions, see id. at 547.
Commercial arbitration is consensual in that it rests upon the agreement of
the parties to submit their dispute for resolution to a third party. However,
it is also judicial in that it provides for a final determination of the dispute
which carries with it the possibility of direct enforcement, as does the
judgment of an ordinary court.
tween "quality" and "technical" arbitration since appeal provisions are usually only
applicable to the latter. See ZENSKE, DIE SCHIEDSGERICHTSBARKEIT IM
INTERNATIONALEN HANDEL MIT BAUMWOLLE, GETREIDE, KAFFEE UND ZUCKER 362 (1975). The
Dutch arbitration law, however, provides that arbitration may be used to determine
"only... the quality or condition of goods." Rv. art. 1020(
)(a), reprinted in XII Y.B.
COM. ARB. 370, 372 (
) (English trans.).
61. See Rv. art. 1050, reprinted in XII Y.B. COM. ARB. 370, 378-79 (
62. See ZPO § 594(
), reprinted in IX Y.B. COM. ARB. 301, 304 (1983) (English
frameworks or standard arbitration clauses tend not to provide
for internal recourse procedures, mainly because the parties
want a speedy resolution of their dispute.
External recourse is further distinguished between appeal
to a court on points of law or factual mistakes and other
grounds for recourse. Again, provisions that provide for
appeal in international arbitration are unknown or have been
abolished in most jurisdictions 63 and can only be found in the
United Kingdom under the U.K. Arbitration Act.6 4 In the
other jurisdictions that are analyzed in this Article, the term
"recourse" includes any motion to vary or set aside (annul) the
award or to remit it for reconsideration to the arbitral
tribunal.65 In contrast to an appeal, however, the grounds for this
recourse are limited to procedural deficiencies or violations of'
public policy. 66
These forms of recourse, all of which may be characterized
as ordinary remedies similar to those generally found in codes
of civil procedure, have to be distinguished from mere
corrections of awards, which are allowed under many national
arbitration laws, 67 including the Model Law68 and the Arbitration
Rules. 69 This refers to corrections of minor clerical or
typographical errors in awards by the arbitral tribunal, which is
63. "Under the law of most countries, there is no appeal against an
[international] arbitral award." Delaume, supra note 46, at 217. This general trend is
understandable, given the fact that appeal'would lead to a reconsideration of the merits of
the case with the court substituting its own decision for that of the arbitral tribunal, a
procedure that runs counter to the trend of arbitral autonomy. See A. REDFERN & M.
HUNTER, supra note 6, at 319, 325. The situation is different in domestic arbitrations,
like in France, where the parties have the right to appeal. C. Civ. art. 1481, reprinted
in VII Y.B. CoM. ARB. 272, 278 (1982) (English trans.).
64. Arbitration Act, 1979, ch. 42, § 2, reprinted in V Y.B. COM. ARB. 239, 240
); see infra notes 175-176 and accompanying text.
65. See A. REDFERN & M. HUNTER, supra note 6, at 321.
66. For an analysis of whether the notion of "public policy" in this context
comprises substantive rather than procedural issues, see infra notes 253-55 and
67. See, e.g., Rv. art. 1060(
), reprinted in XII Y.B. COM. ARB. 370, 381 (
(English trans.) (correction justified no later than 36 days after deposit of award in
the case of "manifest computing or clerical error," either upon request or upon its
own initiative); Arbitration Act, 1950, 14 Geo. 6, ch. 27, § 17 (correction restricted to
"any clerical mistake or error arising from any accidental slip or omission").
68. The Model Law imposes a time limit of 30 days from the receipt of the
award. MODEL LAW, supra note 29, art. 33(l)-(
), reprinted in XI Y.B. COM. ARB. at
69. UNCITRAL Rules, supra note 10, art. 36.
common in many court systems, 70 and constitutes an informal
procedure falling outside the scope of recourse or appeal.
There is an inherent danger, however, that application for
correction may be abused as a well disguised attempt to achieve
review of the award on the merits. 7'
The Model Law7 2 inspired the Dutch legislature to give
parties the opportunity to apply to the tribunal for an
"additional award" - in case of a material omission in the original
award, i.e., the tribunal not having decided one of the issues
before it (decision infra petita).73 Such application is an
indispensible precondition for an action to have the award set
aside.7 ' The new laws did not go as far, however, as to allow
application to the tribunal for authoritative interpretation of
the award, since the potential for abuse was deemed too
dangerous for effective arbitration and enforcement
A further important distinction has to be drawn between
recourse from a final arbitral award and the defenses raised in
enforcement proceedings under article V of the New York
Convention on the Recognition and Enforcement of Foreign
Arbitral Awards (the "New York Convention"). 76 This is all
the more important since most of the legislatures have tried to
avoid frictions between judicial supervision of the award and
the ensuing enforcement proceedings abroad by adapting the
grounds for challenging an award to the defenses of article V
of the New York Convention. In addition, decisions of the
courts in the enforcement proceeding may be appealed to a
higher court, so that there may be parallel recourse
proceedings, one against the award itself and the other abroad against
the enforcement decision of the foreign court.77
THE NEWARBITRATION LAWS
The new arbitration laws analyzed in this section are in
order of rigidity with which each national legislature has dealt
with the issue of recourse and appeal to its national courts.
This section also includes a brief look at the genesis of each
law to reveal that the problem of challenging international
arbitral awards was of paramount importance, in one way or
another, in the drafting of the new laws.
France: Limited, Non-Excludable Recourse
The French Arbitration Law was mainly a response to the
G6taverken 78 and NORSOLOR 79 cases in which the Cour
d'appel, Paris flatly declined appellate jurisdiction over an
award rendered in France under the ICC Arbitration Rules.
The court, in these cases, reasoned that since the awards had
no link whatsoever with the French legal system-even though
in the NORSOLOR case the defendant was a French
company-and appeal under the then existing French arbitration
law8° was permissible only for domestic and not for
international arbitration, the awards were insulated from any judicial
review by the French courts. In the aftermath of these
decisions, French arbitration experts feared that as a result of this
laissez-faire attitude of the Cour d'appel, the international
community would lose confidence in French international
commercial arbitration, s and transnational awards rendered in France
would become unenforceable abroad under the New York
Convention.82 In response to these concerns, the French
Arbitration Law was enacted to allow actions for annulment of
transnational awards ("recours en annulation") if (i) there was
no valid arbitration agreement or if the agreement had
lapsed 8 3 (ii) there were irregularities in the appointment of the
arbitrators or composition of the tribunal,8 4 (iii) the arbitrators
exceeded their authority,85 (iv) the "principle of adversarial
process" (due process) was ignored,8 6 or (v) the recognition or
enforcement would be contrary to international public
policy. 87 The action has to be brought within one month
following official notification ofjudicial declaration of the award's
executory force.88 The French legislature did not leave it up to
the parties to exclude these mandatory recourse provisions,8 9
but the exhaustive list of grounds for annulment constitutes
the minimum standard for judicial review and enforceability of
transnational awards. 90
It should be noted, however, that execution of the award
is suspended during the one-month period of challenge and
the challenge itself.9 This provision may have serious
repercussions on the enforceability of the award abroad under
)(e) of the New York Convention, since the court of the
enforcement jurisdiction may refuse enforcement on the
grounds that the award has been suspended in the country in
which it was made.92
Sweden: Limited, Non-Excludable Recourse
Sweden, under the Swedish Arbitration Act, 93 has long
maintained a liberal attitude towards the relation of its
judiciary to arbitrations taking place on its soil,94 thus there is no
appeal of arbitral awards to domestic courts under the Swedish
Arbitration Act. An award is void ipso iune only if (i) there was
no valid arbitration agreement, 9 5 (ii) the subject matter was
non-arbitratable, 96 (iii) the award was not in writing or was not
signed by at least a majority of the arbitrators, 97 (iv) the award
involved a question that was subject to a pending court
action,98 or (v) the award is so obscure as to make enforcement
impossible. 99 The nullity of the award can be invoked by the
parties, without prior motion to have the award set aside, but a
declaratory action is permissible.' 00 In the case of "voidable"
awards, the party has to launch an action to set aside the award
within sixty days after the service of the award on pain of being
considered to have waived the right.' 0 ' A waiver may also be
inferred from procedural conduct of the party, one example
being the party taking part in the proceedings without
96. Id. § 20(
), reprinted in ARBITRATION IN SWEDEN, supra note 93, at 177.
97. Id. § 20(
), reprintedinARBITRATION IN SWEDEN, supra note 93, at 177.
98. Id. § 20(
), reprinted inArbitration in Sweden, supra note 93, at 177, in
connection with § 1,reprinted in Arbitration in Sweden, supra note 93, at 172.
99. Id. § 22, reprinted in ARBITRATION IN SWEDEN, supra note 93, at 178.
100. See Alley, InternationalArbitration: The Alternative of the Stockholm Chamber of
Commerce, 22 INT'L LAW. 837, 843 (1988).
101. 1929 SFS 145, § 21, reprintedin ARBITRATION IN SWEDEN, supra note 93, at
tions. 0 2 The grounds for challenge include (i) excess
ofjurisdiction, 10 3 (ii) choice of Sweden as improper forum, 10 4 (iii)
improper appointment or disqualification of arbitrators, 0 5 (iv)
award given after agreed arbitration period,'0 6 and (v) other
procedural irregularities that "in probability" may be assumed
to have influenced the decision of the tribunal.' °7 The action
must be brought within sixty days from receipt of the original
or certified copy of the award, 0 8 and decisions of the court
may be appealed to the Court of Appeal and even to the
Supreme Court, but neither court is allowed to review the
award on the merits.' 0 9 The statutory time limit of six months
for rendering an award does not apply to arbitrations when at
least one party is domiciled outside Sweden. Section 17 of the
Stockholm Chamber of Commerce Arbitration Rules, however,
provides for a time limit of one year, extendable upon request
of a party or the court,' 10 which triggers the mechanism of
section 18 of the Swedish Arbitration Act."' Under this section,
tdheereadrbwitritahtiinonthaegrpeeermioedntstbipecuolamteeds bvyoidthief tphaertaiwesa."rd2is not
The Netherlands: Limited, Non-Excludable Recourse
The Dutch Arbitration Act replaced the old Dutch
arbitration law, which had remained almost unchanged since 1838.'13
Interestingly enough, the old Dutch arbitration law, though
rooted firmly in the continental civil-law tradition, was strongly
influenced and shaped by domestic case law to an extent that
102. See W.L. CRAIG, W. PARK &J. PAULSSON, supra note 20, § 31.03; Alley, supra
note 100, at 843.
103. 1929 SFS 145, § 2 1(
), reprintedin ARBITRATION IN SWEDEN, supra note 93,
104. Id. § 21(
), reprintedin ARBITRATION IN SWEDEN, supra note 93, at 178.
105. Id. § 21(
), reprintedin ARBITRATION IN SWEDEN, supra note 93, at 178.
106. Id. § 21(
), reprintedin ARBITRATION IN SWEDEN, supra note 93, at 178.
107. Id. § 21(
), reprintedin ARBITRATION IN SWEDEN, supra note 93, at 178.
109. See INTERNATIONAL ARBITRATION SITES, supra note 10, at 72.
110. Rules of the Arbitration Institute of the Stockholm Chamber of Commerce,
art. 17, reprintedin ARBITRATION IN SWEDEN, supra note 93, app. 6, at 211, 215.
111. 1929 SFS 145, § 18, reprintedin ARBITRATION IN SWEDEN, supra note 94, at
112. Id. An award without reasons is not sufficient to keep this deadline. See M.
ADEN, INTERNATIONALE HANDELSSCHIEDSGERICHTSBARKEIT 206 (1988).
113. See Vellekoop, The New Arbitration Law in the Netherlands, INT'L FIN. L. REV.,
May 1987, at 16.
reference to boilerplate arbitration frameworks like that of the
ICC becomes impossible.22 1
The filing of an action to set aside does not per se have a
suspensive effect unless the court grants suspension. 2 22 A
Swiss scholar has suggested that the Swiss courts should go
beyond the letter of the new law and develop grounds that
render an award void per se for non-arbitrability or violation of
public policy, and to allow recourse in case of fraud, fraudulent
documents, or wrong testimonies. 223 This would mean a
serious set-back for the new law, since it would reduce its value as
a predictable and modern arbitration law. One can only hope
that Swiss courts respect the decision of the Swiss legislature
and look at other jurisdictions, such as the German, where the
statutory list of grounds to set aside arbitral awards is not open
for construction praeter legem.224
G. Belgium: Exclusion of Recourse Ex Lege
The Belgian legislature has taken the most radical
approach towards restraint of judicial supervision of arbitral
awards. Under the old law,225 which covered any award
rendered in Belgium without distinguishing between national and
international arbitration, appeal to a court on points of law was
abolished, 22 6 and the only remedy available was the action to
set aside on grounds of violation of public policy,
non-arbi221. See W.L. CRAIG, W. PARK &J. PAULSSON, supra note 20, § 32.08. For a
discussion of the liberal case law of the English courts, see supra note 184 and
222. IPRG art. 190(l), SR 291, RS 291, RS 291, reprintedin XIII Y.B. COM. ARB.
446, 450 (1988) (English trans.). The Dutch arbitration law contains a similar
provision. See Rv. art. 1066(
), reprinted in XII Y.B. COM. ARB. 370, 383 (
trans.). One author has pointed out that Swiss courts under the Concordat showed
considerable reluctance to grant suspensive effect. Blessing, supra note 203, at 73.
223. See Habscheid, supra note 199, at 771.
trability of the subject matter of the dispute, award obtained by
fraud or based on false evidence, and other procedural
irregularities. 221 Pre-arbitration agreements to contract out all or
some causes for annulment are impermissible and void.228
The Belgian Arbitration Provision abolishes any judicial
review of arbitral awards if no party has a connection to
Belgium. 229 This new provision bluntly prohibits the action to
set aside in cases of international arbitration between two
foreign parties, instead of leaving the choice to the parties as in
England and Switzerland.
The situation in Belgium is now parallel to that in France
before the enactment of the French Arbitration Law when the
French Cour de Cassation flatly declined to review awards
rendered in international arbitration in France. 230 The burden of
reviewing the award is shifted to those courts abroad where the
winning party seeks to have the award enforced under the New
York Convention or the respective national laws. Again, the
underlying premise for this revision to the law was that means
of recourse against arbitral awards at the seat of the arbitration
often serve merely dilatory purposes. 23' Although the U.K.
Arbitration Act served as a model for the Belgian Arbitration
Provision,232 Belgium went much further in that it excluded
any judicial review directly ex lege and not indirectly through
party agreement. Further, the Belgian Arbitration Provision
abolished any review, whereas under the U.K. Arbitration Act,
supervision over arbitrators' misconduct remains
non-excluda227. C. JUD. art. 1704(
) (providing thirteen grounds for annulment).
228. C.JuD. art. 1704(
). For a discussion of the possible effects on article 1704
resulting from the enactment of the Belgium Arbitration Provision, see Matray,
Belgium, V Y.B. COM. ARB. 1, 22 (
); Vanderelst, Increasingthe Appeal of Belgium as
an InternationalArbitrationForum? The Belgian Law ofMarch 27, 1985 Concerningthe
Annulment of ArbitralAwards, J. INT'L ARB., June 1986, at 77, 80.
229. C. JuD. art. 1717(
). Article 1717(
) provides as follows:
Les tribunaux beiges ne peuvent connaltre d'une demande en annulation
que lorsqu'au moins une partie au diff~rend tranch6 par la sentence
arbitrale est soit une personne physique ayant la nationalit6 beige ou une
r~sidence en Belgique, soit une personne morale constitute en Belgique ou y
ayant une succursale ou un si~ge quelconque d'op6ration.
230. See supra note 78-82 and accompanying text.
231. See Nelissen-Grade, The Annulment ofArbitral Awards in Belgium, Int'l Fin. L.
Rev., Nov. 1986, at 35.
232. See id.
UNSETTLED ISSUES UNDER
THE NEW LAWS
The new laws have considerably liberalized international
arbitration in general and the review of arbitral awards in
particular. Narrow grounds for review, time limits for motions to
set aside, and optional exclusion agreements contribute to the
growing attractiveness of many European arbitration centers.
Finality seems to be more important than legality of awards.23 4
This development has gained such momentum that the U.K.
Arbitration Act has become outdated before it has reached its
Yet, the new laws are by no means a pan
acea for the problems and intricacies of transnational
commercial arbitration. This is especially true for the concept of
public policy in international arbitration and the issue of
Public Policy: Appeal Through the Back Door?
The above analysis reveals that there are basically three
groups of grounds for recourse against arbitral awards in
international arbitration laws. The first group addresses the
contractual basis for an award, including incapacity of a party to
the arbitration agreement or invalid arbitration clause,2 3 5
excess ofjurisdiction, 23 6 and non-arbitrability of the
subject-matter. 1 7 The second group encompasses procedural
True it is, that formerly the Court was careful to maintain its supervisory
jurisdiction over arbitrators and their awards. But that aspect of public
policy has now given way to the need for finality. In this respect the striving for
legal accuracy may be said to have been overtaken by commercial
Id. at 423.
235. MODEL LAw, supra note 29, arts. 34(
)(a)(i), reprinted in XI Y.B.
CoM. ARB. 380, 389, 390 (1986); New York Convention, supra note 13, art. V(l)(a),
21 U.S.T. at 2520, T.I.A.S. No. 6997, at 4, 330 U.N.T.S. at 40.
236. MODEL LAW, supra note 29, arts. 34(
)(a)(iii), 36(l)(a)(iii), reprinted in XI
Y.B. CoM. ARB. at 389, 390; New York Convention, supra note 13, art. V(I)(c), 21
U.S.T. at 2520, T.I.A.S. No. 6997, at 4, 330 U.N.T.S. at 42.
237. MODEL LAW, supra note 29, arts. 34(
)(b)(i), 36(l)(b)(i), reprintedin XI Y.B.
CoM. ARB. at 389, 390; New York Convention, supra note 13, art. V(
)(a), 21 U.S.T.
at 2520, T.I.A.S. No. 6997, at 4, 330 U.N.T.S. at 42.
ties including forged documents, defects of the award itself,
improper notice of arbitrator appointment or the proceedings
or inability to state one's case,2 38 and the composition of the
tribunal violating the agreement of the parties. 23 9' The third
category involves violation of public policy. 2 0 The Model
Law, both in its recourse 24' and enforcement 24 2 provisions, as
well as the New York Convention,2 43 clearly reflect this
classical trias and present an example "par excellence" for the
growing unification of international arbitration law.
The most important ground in the first group, which is
comparatively easy to detect and open to objective
ascertainment, is the issue ofjurisdiction of the arbitrator.2 4 4 The
tribunal has the right to rule on its own jurisdiction
(KompetenzKompetenz),2 4 5 but the ultimate determination is left to the
national courts. 246 Under English law, excess of jurisdiction is
part of the arbitrator's misconduct, a ground for setting aside
that cannot be excluded through party agreement, 24 7 thus
forcing the courts to distinguish between errors of law, which cin
be excluded as grounds for recourse, and excess of
jurisdiction, which cannot. 248
The grounds included in the second group are concerned
with procedural irregularities and defective awards and vary
according to the rigidity and requirements of the domestic law.
A typical example is the missing arbitrator's signature, which is
a ground for setting aside under the Austrian Arbitration
Law 2 49 and under the Dutch Arbitration Act, 250 but not under
the Swiss Arbitration Law, even though all three jurisdictions
require the award to be signed by the arbitrators. 251 A
fundamental principle, reflected in most of the laws, is that of "due
process," i.e., procedural equality of the parties and the right
to be heard and to present one's case. 2 52
The third group, setting aside an award on the ground
that it is in violation of "public policy," is contained in all of
the laws and the Model Law, but is by far the most
problematic. The problem lies in the hybrid and ambiguous nature of a
provision that embraces both procedural and substantive
aspects2-5 and that refers to "the fundamental economic, legal,
moral, political, religious and social standards of every State or
extra-national community ....[which are] 'so sacrosanct as to
require their maintenance at all costs and without
exception.' ,254 Since the procedural aspect of public policy is
ready covered by the various grounds included within the first
and second group discussed above, the ground of public policy
will be mainly concerned with the substantive defects of the
award.2 5 5 This might ultimately reintroduce review of awards
on the merits, which would run counter to the modern trend of
arbitral autonomy and independence.
The legislatures were well aware of this danger when they
enacted the new arbitration laws and some of them have tried
to confine this ground to the very basic principles of law and
morality. The Austrian legislature, for example, no longer
relies on "violation of mandatory provisions of Austrian law, ' 2 56
which covered a broader field than just Austrian public
ordAeurs,2tr5i7anbultegoanl isnycstoemmp.2a5t8ibiTlihtyis ws hitihft thine pbuabsliicc pproi nlicciyplfeoscuosf
itmheplies that an award might well be contrary to mandatory
provisions of Austrian domestic law without violating Austrian
public policy. 259 Violation of mandatory law is not totally
excluded, however, but the applicable Austrian procedural rules
are not relevant in international arbitration.2 6 ° A
differentapproach has been taken by the French and Swiss legislatures.
Both the French Arbitration Law and the Swiss Arbitration
Law have restricted the notion of public policy to
"international" public policy2 6C1 in order to save the award from the
strict application of purely domestic rules of public policy.
The change to international public policy is particularly
surprising in the Swiss legal context, since the Swiss Federal
Tribunal has held that "[i]t cannot be ascertained how an 'ordre
public international' would limit the application of foreign law
more, or in other manner, than Swiss public order does. ' 262
The French and Swiss legislatures have, therefore, reacted to a
general trend in international arbitration, whereas the courts
have carefully begun to develop a narrow and restricted
concept of "international" public policy. 2 63
Though difficult to define, international public policy
involves the fundamental rule of natural law, the principles of
"universal justice," jus cogens in public international law, and
the general principles of morality and public policy accepted
by civilized nations.264 It is clear that if the courts do actually
adhere to this restrictive notion of public policy, awards will be
set aside only in very rare "absolutely blatant cases."' 265 The
concept of international public policy, however, does not
alleviate the burden of the courts to determine the contents of
"public policy." Its vagueness and flexible character, leaving it
in a constant state of flux, leaves great responsibility with the
courts, especially since international public policy may well
embrace principles of domestic public policy. 26 6 This fact may
tempt the French and Swiss courts to rule according to the
wider principles of "their" domestic public policy, a concept
with which they are more familiar.
A final but important safeguard against a liberal
application of the public policy ground is found in Swiss, Austrian,
and French legal doctrine according to which the holding of
the award itself, and not just the reasons given by the
arbitra262. Judgment of May 5, 1976, Bundesgericht, Switz., 102 BGE la 574, 583
(translation by author).
263. See, e.g., id.;Judgment of July 12, 1984, Cours d'appel, Paris, Fr., reprinted in
23 I.L.M. 1048 (
) (English trans.); see also Domke, Towards an
"International"Public Policy in CommercialArbitration, in FESTSCHRIFT FOR ARTHUR BOLOw 49, 51 (K.H.
B6ckstiegel ed. 1981).
264. SeeJ. LEW, supra note 254, at 534. Typical examples would be protection of
fundamental human rights and abhorrence of slavery; racial, religious, and sexual
discrimination; kidnapping; murder; piracy; and terrorism. Id.
265. Blessing, supra note 203, at 70. "[Qjue le tribunal f~dral limite son
examen aux cas absolument crasses." Id. at 70-71 (quoting the minutes of the Swiss
266. In France, the principle of suspension of individual claim in bankruptcy law
is an element of both domestic and international public policy: "est Aila fois d'ordre
public interne et international . Judgment of Mar. 8, 1988, Cass. civ., Ire, Fr.,
1988 Bull. Civ. 1, 42, 43.
tors, have to violate public policy. 26 7 If the award can be
upahweladrdanitdsejluf,sttihfieend thoenregriosunnodsviooltahteiornthoafnputhbolisce ploislitceyd. 2i6n8 the
In all jurisdictions that subject international awards to
judicial control of violations of international public policy, much
will depend on whether the courts are able and willing to
develop a restrictive concept of public policy that does not lead
to an appeal through the back door.
The New Laws and DelocalizedAwards
1. Delocalization Through Party Agreement
Under the U.K. Arbitration Act, Swiss Arbitration Law,
and to a much more limited extent the Austrian Arbitration
Law, parties may agree. to exclude judicial supervision of
arbitral awards. This leads to the much disputed question of
whether parties to an arbitration agreement may, regardless of
any provisions allowing exclusion agreements, avoid
constraints of any domestic procedural arbitration law, and with it
the intervention and supervision of national courts, by
"detaching" the proceedings from domestic laws and lifting them
on a transnational, even non-legal plane. 269 This involves both
the law applicable to the merits of the dispute (substantive
aspect of denationalization) and the rules governing the
procedure (procedural aspect of denationalization), an important
distinction that is oftentimes not properly drawn.270
This is astounding, given the fact that in a transnational
context it happens more often than not that different laws
govern the procedure and the substance of the arbitration
proceeding. 27' In the context of this analysis, only the procedural
aspects of the theory are of interest.17 2 The premise
underlying this theory is clear. If states do actually have less interest in
arbitrations involving non-nationals and if the only legal basis
of any arbitration and the source of the arbitrator's power is
the arbitration agreement, then the parties should be entitled
to create their own transnational arbitration law, the lex arbitri,
which is totally different from the arbitration law of the seat,
the lex loci arbitri.2 73 The arbitration law is thus
"contractualized."' 7 4 This approach, which emerged in the 1960s,2 7 5
seems to give maximum effect to the current trend towards
arbitral autonomy and renders choice of situs meaningless for
questions of applicable law.
This doctrine, however, is also impractical for two
reasons. First, there is no comprehensive and consistent
procedural framework provided by international law that could
cover any issue arising during the arbitration proceedings
where the parties, having expressly excluded application of any
domestic law, exclude the "supplemental ' 2 76 role of these laws
and of the relevant courts to fill gaps in the arbitration
agreement where necessary. This is especially true for recourse to
national courts. The parties themselves cannot "create"
authority for national, and frequently, foreign courts' supervision
of arbitral awards in their arbitration clause unless the law of
the situs allows such "contracting in."' 2 77
Hence, the losing
Seguros del Peru,  1 Lloyd's Rep. 116 (C.A.). There the court stated that all
contracts providing for arbitration may involve three potentially relevant systems of
law: the law governing the substance, the law governing the arbitration clause, and
the law governing the conduct of the arbitration proceedings, i.e., the lex arbitri, and
the latter two will often be different from the first. Id. at 119.
272. For a comprehensive analysis of the various ways to determine the
applicable substantive law rules-with or without reference to a particular national system of
private international law-and of arbitrations governed by non-national law, see J.
LEW, supra note 254, at 285-508.
273. For a discussion of this distinction, see Hirsch, The PlaceofArbitration and the
Lex Arbitri, ARB. J., Sept. 1979, at 43; Park, The Lex Loci Arbitri and International
Commercial Arbitration, 32 INT'L & COMP. L.Q. 21 (1983).
274. "La loi est en d'autres termes, 'contractualis~e.' " Klein, supra note 31, at
275. See P. FOUCHARD, L'ARBITRAGE COMMERCIAL INTERNATIONAL 22-27 (
276. See Bfihler, Staatsgerichtliche Aufhebungskontrolle am Schiedsort? Zur Reform
Belgiens, 7 PRAXIS DES INTERNATIONALEN PRIVAT-UND VERFAHRENSRECHTS [IPRAx] 253,
) (discussing "Aushilfsfunktion" (supportive function) of courts); Shindler,
ArbitrationStill Bound, 102 L.Q. REV. 500, 504 (1986).
277. Professor Schmitthoff suggests that the principle of "contracting out" used
in the 1979 Arbitration Act should be reversed by the principle of "contracting in,"
claimant would not be able to challenge the "de-localized"
award even if the law of the seat provides for recourse to
national courts, a result that seems to contradict the basic notions
of procedural fairness and equity. The losing defendant, on
the other hand, would be forced to raise defenses under article
V of the New York Convention in every country where
enforcement is sought by the claimant, instead of having the award
declared void once and for all before the courts of the situs, a
very cumbersome procedure that also hinders the losing party
from obtaining redress.2 78
More important, it is more than doubtful whether the New
York Convention applies at all to these kinds of
internationalized awards, 27 an argument that ultimately led to the revision
of the French law in the aftermath of the G6taverken case 2 80
and hints at the strong interaction of judicial supervision and
ultimate enforcement of the award. This is also expressed in
article 24 of the ICC Arbitration Rules, which commands the
tribunal to ensure enforceability of its award.2 8 ' Under article
)(e) of the New York Convention, enforcement may be
refused if the award has been set aside "by a competent authority
of the country in which, or under the law of which, the award was
made,' ' 282 implying that every award must have a nationality
and every arbitration is to be governed by a national
arbitration law. 83 This law has to be the law of the seat and only if
i.e., allowing the parties to provide for judicial review on points of law in their
arbitration agreement. Schmitthoff, supra note 190, at 20.
278. See Vanderelst, supra note 228, at 86. "Lui permettre de contester
imm~diatement et sur place la r~gularit6 de la sentence est pour la partie condamn~e
une garantie essentielle, et non un encouragement lachicane." Fouchard, supra
note 34, at 412.
279. See A. VAN DEN BERG, THE NEW YORK ARBITRATION CONVENTION OF 1958, at
280. Judgment of Feb. 21, 1980, Cours d'appel, Paris, Fr., 1980 Recueil
DallozSirey,Jurisprudence[D.S. Jur.] 568.
281. ICC Arbitration Rules, supra note 14, art. 24. "In conferring authority
upon an arbitrator to settle an international dispute, a term is implied in the parties'
agreement with the arbitrator that he will render an award which is enforceable
under the New York Convention." Poznanski, supra note 59, at 86 (footnote
282. New York Convention, supra note 13, art. V(
)(e), 21 U.S.T. at 2520,
T.I.A.S. No. 6997, at 4, 330 U.N.T.S. at 42 (emphasis added).
283. SeeJ.G. WETTER, supra note 270, at 409. For a discussion on the emerging
enforcement problems under the New York Convention, see van den Berg, Some
Recent Problems in the Practiceof Enforcement Under the New York and ICSID Conventions, 2
ISCID REV.-FOREIGN INVESTMENT L.J. 439, 445 (
) [hereinafter Recent Problems];
this law allows party autonomy may the parties create their
own procedural framework, which has to comply, however,
with the mandatory provisions of the lex loci arbitri2.8 4
States have a legitimate interest in regulating arbitrations
on their soil. 2 8 5 The growing conviction that arbitrations
should be linked to the law of the seat is also reflected in the
Dutch Arbitration Act, which requires application of Dutch law
to arbitrations taking place in the Netherlands.2 8 6 The same is
true under the U.K. Arbitration Act 28 7 and is also reflected in
the Model Law. 288 However, the Swiss Arbitration Law, after
lengthy parliamentary debates, disconnected the international
arbitration from domestic procedural law. 28 9 This doctrine
must necessarily lead to the converse conclusion that in cases
where the arbitration clause provides for a certain law to
govern the proceedings without determining the seat, that country
has to be the seat and its courts are competent to control and
assist the arbitration.2 90
Detachment from any national law may be appropriate in
arbitration with state parties where international comity and
respect of the jurisdictional immunity of states that are parties
to an arbitration may require application of non-national
van den Berg, Should an InternationalArbitratorApply the New York ArbitrationConvention
of 1958?, in THE ART OF ARBITRATION 39, 47 (J. Schultsz ed. 1982).
284. Mann, Lex FacitArbitrum, in INTERNATIONAL ARBITRATION 157, 161 (P.
Sanders ed. 1967). "It is the law that confers such a right [to disregard the national law of
the forum]. Where the law fails to grant it, no arbitrator can lawfully arrogate it to
himself." Id. at 170 (footnote omitted); see also Catranis,'Problemeder Nationalisierung
Ausldndischer Unternehmen vor Internationalen Schiedsgerichten, 28 RIW 19, 21 (1982);
Iwasaki, supra note 5, at 67; Recent Problems, supra note 283, at 443; von Hoffmann, Die
Novellierung des Deutschen Schiedsverfahrensrechtsvon 1986, 6 IPRAx 337 (1986).
285. "Certes, 6tant une institution juridique, l'arbitrage ne peut se soustraire A
l'autorit6 de l'Etat." Voyame, supra note 12, at 22.
286. See Tebbens, supra note 115, at 143.
287. Arbitration Act, 1950, 14 Geo. 6, ch. 27, § 12(6); see also Mann, England
Rejects "De-Localized" Contracts and Arbitration, 33 INT'L & COMP. L.Q 193, 197-98
). But see G. DELAUME, supra note 11, at 326 (noting that French law is more
liberal in this respect and does not adhere to the lex loci arbitri doctrine).
288. It has been pointed out that the mandatory character of some provisions of
the Model Law shows that the Model Law does not accept the concept of delocalized
or floating arbitration. B6ckstiegel, supra note 48, at 675.
289. Otherwise the parties "have to take the trouble to look into the local
niceties of purely domestic procedural rules and appoint Swiss counsel to look into bulky
commentaries and trace abundant case law of purely domestic courts, materials not
even available in English." Blessing, supra note 203, at 47.
290. See Naviera Amazonica Peruana S.A. v. Compania Internacional de Seguros
del Peru,  1 Lloyd's Rep. 116, 119 (C.A.).
standards. 29 ' Example of this would be the awards of the
USIran Claims Tribunal in The Hague 29 2 and investment
arbitration under the auspices of ICSID.293 These rules, however,
cannot be transferred to private party arbitration. As a matter
of international practice, arbitrators frequently have the
nationality of the seat and tend to apply "their" arbitration law in
case no predetermination has been made by the parties.294
This serves as an additional safeguard for the lex loci arbitri rule..
If an effective interaction of arbitration and enforcement
requires respect of the law of the seat, the question remains
whether these laws may abolish judicial review of transnational
awards-directly as in Belgium or indirectly by allowing
exclusion agreements as in Switzerland-without destroying the
complicated equilibrium of arbitration and enforcement.
In Belgium, the proceedings are still governed by
domestic law 2 95 and domestic courts may still exercise their assistory
role during the proceedings. 296 The award, however, cannot
be supervised by the courts of the seat, although its law, to the
291. The delocalization doctrine was first employed in the Saudi Arabia v.
ARAMCO, 27 INT'L L. REP. 117 (1963), and Lybia v. TOPCO, 17 I.L.M. 3 (1979),
arbitrations. Both arbitrations involved state parties (Saudi Arabia and Libya
respectively) where the arbitrators held that the respect for the jurisidictional immunity of
foreign states forbids a state party in arbitration to be subject to the law of another
292. Some consider the awards of the Tribunal as "anational" since they are
governed by the UNCITRAL Rules instead of Dutch arbitration law. van den Berg,
Recent Problems, supra note 283, at 442. But see Dallal v. Bank Mellat, 1986 QB. 441,
where the court recognized an award of the arbitration tribunal as valid even though
the arbitration agreement violated Dutch arbitration law. The court stressed that the
decision would have been different in case of a purely "consensual arbitration"
involving only non-state parties with no authority and competence derived from
international law. See id. at 456.
293. The ICSID Convention takes account of the interaction of arbitration and
enforcement and obligates member states to enforce ICSID awards, thereby
insulating them from any national enforcement provisions. Delaume, Foreign Sovereign
Immunity: Impact on Arbitration, 38 ARB. J. 34, 35-36 (1983)..
294. See Triebel & Viertel, Die Bundesrepublik Deutschland wird als Schiedsgerichtsort
im Internationalen Schiedsverfahrengemieden, 41 BETRIEBS-BERATER 1168, 1169 (1986).
295. See Buihler, supra note 276, at 255; Vanderelst, supra note 228, at 85.
Awards rendered in Belgium are considered Belgium awards under the Belgium
Judicial Code. See Matray, La Loi Beige du 27 Mars 1985 et Ses Repercussions sur IArbitrage
Commercial International,64 REVUE DE DROIT INTERNATIONAL ET DE DROIT COMPARi
243, 256 (
296. See Vanderelst, supra note 228, at 84. "[T]here can be no question that the
extent that it contains mandatory provisions, has to be applied
by the arbitrators. This is a paradoxical situation and it seems
that these legislatures have gone too far in their efforts to
achieve "the best of both worlds."
Judicial control during the proceedings seems to be no
appropriate surrogate for recourse,2 9 7 since oftentimes parties
and their counsel cannot determine chances for recourse
-before they have the ultimate award. It also seems very
problematic to rely on the expertise and reputation of
acknowledged arbitration centers instead of judicial control, 298
because this can by no means guarantee insulation from any
procedural irregularities to an extent that would render judicial
control superfluous and would mean an invitation for executor
shopping by the winning party.2 9 9 More importantly, courts of
the enforcement state frequently rely on judicial control
through the courts of the situs. Apart from these practical
considerations, it seems that, as in the case of delocalization
through party agreements, article V(
)(e) of the New York
Convention prohibits the enforcement of awards insulated
from any judicial control of the situs, requiring not only
application of its law but also control through its courts. 30 0
awards, though no longer subject to annulment, are still subject to the control of the
Belgian courts." Nelissen-Grade, supra note 231, at 36.
297. Mr. Nelissen-Grade seems to argue that judicial control during the
proceedings makes control of the ultimate award redundant. See Nelissen-Grade, supra
note 231, at 36.
298. "To us, there seems to be only little danger that the award is defective so as
to prevent enforcement under the New York Convention; this is especially true for a
well respected and experienced arbitration center like the Zurich Chamber of
Commerce." Letter from the Zurich Chamber of Commerce to Klaus Peter Berger (Sept.
27, 1988) (copy on file at the FordhamInternationalLaw Journaloffice) (translation by
the author). Mr. Buihler, the former legal counsel to the ICC Court of Arbitration in
Paris, maintains that in institutional arbitration such as that under the auspices of the
ICC, reputation of arbitrators may be adversely affected by defective awards, a fact
that they want to avoid especially when interested in their reelection. Biihler, supra
note 276, at 255 n.39. Lord Justice M. Kerr recommends that arbitrations be
conducted without an exclusion agreement "unless it is possible to agree in advance on
an arbitral tribunal of known high calibre-but in practice this is rarely a realistic
possibility." Kerr, supra note 157, at 14.
299. Mr. Nelissen-Grade concedes that "[a]lthough difficulties may exist for the
winning party trying to obtain an exequatur if the award contains serious flaws, its
existence is not impaired. The losing party cannot have it annulled by a Belgian
court." Nelissen-Grade, supra note 231, at 37; see also Vanderelst, supra note 228, at
300. See Habscheid, supra note 199, at 772 (Swiss law).
Although it is true that awards rendered by the Arbitration
Court at the USSR Chamber of Commerce and Industry are
enforceable under the New York Convention, though they are
not subject to any means of recourse, 0 l this is mainly due to
the specificities of the Soviet legal system and should not be
generalized.30 2 If the arbitrator has to apply the mandatory
standards of the local law, which under the new laws constitute
the minimum standards of international arbitration, then it
should be the judiciary of this country that controls the
application of these standards once and for all with binding force
for the enforcement jurisdiction. Article V(
)(e) of the New
York Convention, in connection with a bilateral treaty
containing special enforcement provisions, led the Austrian Supreme
Court in NORSOLOR 30 3 to accept jurisdiction of Austrian
courts for actions of annulment over an award rendered in
Austria between two foreign parties, though there was a
movement in Austria that its courts should refrain from reviewing
such "international" awards. 0 4 In Sweden, where
commentators have voiced similar concerns against judicial review of
purely international awards, a lower court has accepted
jurisdiction for an action under section 21 of the Swedish
Arbitration Act.3 5 The Austrian Arbitration Law has introduced a
provision that provides for a competent court for any
applications during the arbitration proceedings, including actions to
set aside, 0 6 while in Sweden the issue remains to be settled. 7
Judicial control over international awards through the
courts of the situs should hence be maintained, °8 and the
Belgian solution, aimed at increasing the attractiveness of
Belgium for international arbitration, might turn out to be a
flop, because the Belgian legislature, focusing solely on the
dilatory aspect of the problem, might not have been aware of the
legal and practical problems connected with its radical
approach. 0 9 Today's modern arbitration practice shows that
parties generally want the mandatory rules of the local
arbitration law to govern the proceedings, because parties want their
case to be decided in clearly defined and workable procedural
frameworks that guarantee effective enforcement
DEVELOPMENTS IN GERMAN LA W: GOING AHEAD
OR LAGGING BEHIND?
The trend towards more arbitral freedom and judicial
restraint has gained momentum both within and outside Europe.
Italy,3 1' Australia,3 12 Canada, 31 3 and Hong Kong 31 4 have
opened the worldwide competition. Egypt is considering
308. The annulment of awards solely in the jurisdiction in which they were
rendered results in a "simplication considerable du statut international des sentences;
elles ne pourraient ktre annul~es que dans le pays o6 elles ont &6 rendues, mais elles
pourraient toujours y tre, pour les causes d~termines par cet Etat." Fouchard,
supra note 34, at 411. This is also the opinion of the German Committee on
Arbitration, Bonn. "We are of the opinion that it does not promote arbitration if such
ground for annulment [i.e. for violation of public policy] is negated." Letter from
the German Committee on Arbitration, Bonn, to Klaus Peter Berger (Aug. 31, 1988)
(copy on file at the Fordham InternationalLaw Journaloffice) (translation by the author).
309. See Vanderelst, supra note 228, at 84-85.
310. See Habscheid, supra note 199, at 767. Interested parties during the
negotiations of the Model Law opposed the concept of "denationalized" awards, which they
considered to peril the predictability of the proceedings and the enforcement of the
transnational award. See B6ckstiegel, supra note 48, at 675.
TRANSNATIONAL ARBITRAL A WARDS
adopting a modified version of the Model Law,. 15 and the 1983
Lebanese Code of Civil Procedure 316 contains new arbitration
provisions closely modeled after those of the French
Arbitration Law, an indication that the trend has reached the trade
centers of the Middle East.
In view of this international development it seems strange
that the Federal Republic of Germany is still relying on an
arbitration law that is now more than 100 years old (the "German
Arbitration Law").3 t 7 In spite of Germany's strong position in
world trade, only 2.5% of ICC arbitrations conducted between
1980 and 1982 took place in Germany, and of the two hundred
arbitration proceedings conducted in Europe in 1985, only
seven had a German situs.3 1 8 The reasons for this skepticism
are the perceived flaws of German Arbitration Law, which are
partly justified and partly due to international practitioners'
lack of familiarity with the German laws on arbitration." 9
In spite of its age, the German Arbitration Law is
considered to be one of the most liberal and flexible in the world,320
but it is still not without flaws. In contrast to most
jurisdictions, the German Arbitration Law recognizes as international
every arbitration that is not covered by German Arbitration
Law irrespective of the situs.3 2 ' This may lead to unforeseen
frictions with other arbitration laws.3 The 1986 revision of
the German International Private Law 32 3 has further improved
the legal environment in that it allows signatures of the
majority of arbitrators instead of all of them, thus following the
Model Law and the French Arbitration Law, Swiss Arbitration
Law, and Austrian Arbitration Law.3 24 It also allows different
ways of notification of the award to the parties instead of solely
by formal service through state organs3 2 5 and no longer
requires as mandatory recording of the award at the clerk's office
of the competent court.3 26 This revision was intended to make
it more difficult for an unwilling foreign party to escape a final
award under German procedural law, thus meeting concerns
that had been raised before the revision.3 2 7
As to grounds for setting aside an award, German
Arbitration Law provides that awards may be set aside only if (i) there
was no valid arbitration agreement,3 28 (ii) the award is based
on improper proceedings (including violation of institutional
arbitration rules, application of lex mercatoriawithout
authorization, 329 improper appointment of arbitrators,3 3 0 excess
ofjurisdiction and awards infra and ultrapetita3 3 1), 3 32 (iii) the party was
not represented according to the provisions of the law (unless
recourse according to their domestic arbitration law. See Triebel & Petzold, Grenzen
der lex Mercatoria in der InternationalenSchiedsgerichtsbarkeit, 34 RIW 245, 249 (1988).
323. Gesetz zur Neuregelung des Internationalen Privatrechts [GNIP], 1986
Bundesgesetzblatt, Teil 1 [BGBI.I] 43 (W. Ger.), reprintedin 27 I.L.M. 6 (1988)
(English trans.); see also Gildeggen & Langkeit, The New Conflict of Laws Code Provisions of the
Federal Republic of Germany, 17 GA. J. INT'L & CoMP. L. 229 (
324. Compare ZPO § 1039(
), as amended by GNIP, art. 4(10), 1986 BGBI.I 1152,
reprintedin 27 I.L.M. 6, 28 (1988) (English trans.) with MODEL LAW, supra note 29, art.
), reprintedin XI Y.B. CoM. ARB. at 388. Under the former § 1039, an arbitrator,
sometimes influenced by "his" party, could prevent the award from becoming final
by simply refusing his signature. To sue the arbitrator for his signature was possible
but particularly cumbersome, especially in the case of foreign arbitrators.
325. ZPO § 1039(
), as amended by GNIP, art. 4(10), 1986 BGBI.I 1152, reprinted
in 27 I.L.M. 6, 28 (1988) (English trans.).
326. ZPO § 1039(
), as amended by GNIP, art. 4(10), 1986 BGBI.I 1152, reprinted
in 27 I.L.M. 6, 29 (1988) (English trans.).
327. See Triebel & Viertel, supra note 294, at 1170-72.
328. ZPO § 1041(
329. Application of lex mercatoriawithout authorization also constitutes a ground
for refusing enforcement under article V(
)(c) of the New York Convention. See
Triebel & Petzold, supra note 322, at 250.
330. Judgment of May 5, 1986, Bundesgerichtsnof, W. Ger., 49 Neue Juristiche
Wochenschrift [NJW] 3079, 3080 (1986).
331. See BAUMBACH, LAUTERBACH & ALBERS, supra note 224, at 2151.
332. ZPO § 1041(
it has agreed either tacitly or explicitly to the proceedings), 333
(iv) there existed a violation of the right to be heard,334 (v) the
award is rendered without reasons, 335 or (vi) as grounds for a
trial de novo-in case of fraud, forged documents, wrong
testimonies under oath, and other violations of criminal laws.3 3 6
As to violations of public policy, the German Arbitration Law
no longer relies on mere "violation of public policy," because
the 1986 revision of Germany's International Private Law has
changed the wording to any awards the recognition of which
would lead "to a result that is manifestly incompatible with
essential principles of German law, in particular if the
recognition is incompatible with fundamental rights. ' 337 The changed
wording of this provision finds some parallels in the Austrian
Arbitration Law.338 The German solution is more ambiguous,
though, because it relies on a "manifest" violation, leaving the
exact determination to future case law, which does not
contribute to certainty and predictability. It was for this reason that
the Swiss legislature expressly avoided such qualifications. 39
As in the case of the French Arbitration Law, Austrian
Arbitration Law, and the Swiss Arbitration Law, the award itself
has to violate the essential principles of German law. 3 40
According to the German Federal High Court, parties cannot
waive their right of recourse until after the award has been
rendered and the ground for setting aside is known to them.3 4 '
The right to have the award set aside for absence of reasons,
however, may be waived in advance by the parties. 34 2
Improper application of substantive law does not constitute a
ground for setting aside,343 but the German Federal High
333. Id. § 1041(
334. Id. § 1041(
335. Id. § 1041(
336. Id. § 1041(
337. Id. § 1041(l)(
), as amended by GNIP, art. 4(11), 1986 BGBI.I 1152, reprinted
in 27 I.L.M. 6, 29 (1988) (English trans.).
338. See supra notes 143, 258 and accompanying text.
339. See Blessing, supra note 203, at 70.
340. See BAUMBACH, LAUTERBACH & ALBERS, supra note 224, at 2152 (discussing
this issue as developed by German scholars and practitioners).
341. See Judgment of Sept. 26, 1985, Bundesgerichtshof, W. Ger., 39 NJW 1436
(ICC Arbitration Rule article 24 does not constitute a valid waiver ofjudicial review
under German arbitration law); Judgment of Dec. 21, 1983, Oberlandesgericht,
Frankfurt, W. Ger., 37 NJW 2768.
342. See ZPO § 1041.
343. Judgment of Sept. 26, 1985, Bundesgerichtshof, W. Ger., 96 BGHZ 40, 46.
Court has applied article 1041 of the German Code of Civil
Procedure in a case where the tribunal disregarded a choice of
law contract of the parties,344 which is clearly an error related
to substantive and not to procedural law. 45 This illustrates
the still existing problems and intricacies of German
arbitration case law.
All in all, the 1986 revision has not substantially changed
the legal environment for international arbitrations except for
the issue of achieving finality. In view of the worldwide
development towards more uniformity of law and more arbitral
freedom, it seems sensible to suggest a principal revision of
German arbitration law and adoption of the Model Law.346 This
would mean that judicial control of international awards would
be maintained 347 but confined to the exhaustive catalogue of
article 34 of the Model Law. In addition, German arbitration
law would no longer be a conglomerate of statutory and
voluminous case law, thus becoming more attractive for foreign
counsel. To safeguard a speedy disposition of such cases
through the national judiciary, the legislature should work
towards a substantial reduction of case duration. Under the
present German Arbitration Law, parties may take an action to
have an award set aside through three instances up to the
Federal High Court, which may refer the case back to the second
instance. If the award is set aside, the court has to decide the
case instead of remitting it to the arbitral tribunal, because the
arbitration clause is consummated when the award has been
set aside. 48 In a recent case, the German Federal High Court
referred a case back to the second instance nine years after
344. Id. at 44.
345. See Sandrock, supra note 318, at 374-75.
346. Several authors have already suggested this step. See L6rcher, supra note
319, at 232; von Hoffmann, supra note 284, at 340. The 1987 working group at the
German Institute for Arbitration in Cologne recommended the adoption of the
Model Law, albeit limited to international arbitrations. See Schwab, Das
UncitralModel Law und das Deutsche Recht, in BEITRAGE ZUM INTERNATIONALEN
VERFAHRENSRECHT UND ZUR SCHIEDSGERICHTSBARKEIT 427, 445 (H. Nagel ed. 1987).
347. Most German commentators favor judicial control of arbitral awards
according to some minimal principles. See Biuhler, supra note 276, at 256; Sandrock,
supra note 318, at 378; von Hoffmann, supra note 284, at 340.
348. See R. SCHUTZE, D. TSCHERNING & W. WAIS, HANDBUCH DES
SCHIEDSVERFAHRENS: PRAXIS DER DEUTSCHEN UND INTERNATIONALEN
SCHIEDSGERICHTSBARKEIT 84 (
). The parties may provide for the reopening of arbitral
commencement of the arbitral proceedings 4 9 and the case was
still far from settled. The district court had to reconsider the
whole case, English documents had to be translated and
English speaking witnesses required translators. 5 ° In addition,
since the court language has to be German, parties had to hire
German attorneys that were admitted at the court, thus
incurring substantial attorneys' fees.
According to a very promising proposal, 5 ' one should
concentrate the jurisdiction to recognize and enforce
international awards and to have them set aside in one court, possibly
of a higher instance, without the possibility of further appeal.
This would guarantee accumulation of expertise in
international matters in this court and consistency and predictability
of case law. The latter would substantially increase the
confidence of foreign parties and their counsel in German
arbitration law. This proposal should also be considered in other
jurisdictions, because it seems to offer an ideal way to reconcile
the expectations of the parties to an international arbitration
with the intricacies of a national court system. This proposal
would curtail the stages of appeal, in that it bars appeal to the
Federal High Court,3 52 which is the ultimate supervisory
instance of the German civil court system, but this is no real
disadvantage given the high expertise of the new court, which
would guarantee legally and economically sound decisions.
Interestingly enough, this system has already been established,
albeit optional and on a smaller scale, in Switzerland, where
the parties may agree for the cantonal court to hear the action
for setting aside instead of the Federal Tribunal. 53 These
decisions cannot be appealed, though in all other matters,
cantonal court decisions may be appealed up to the Federal
Supreme Court. 54
349. Judgment of Sept. 26, 1985, Bundesgerichtshof, W. Ger., 96 BGHZ 40.
350. See Sandrock, supra note 318, at 377-78.
351. See Glossner, Eine Zentrale Gerichtsinstanzfir InternationaleSchiedsverfahren in
der Bundesrepublik Deutschland?, 32 RIW 214 (1986).
352. One author considers circumvention of the Federal High Court the major
flaw of the proposal. Raeschke-Kessler, Neuere Entwicklungen im Bereich der
Internationalen Schiedsgerichtsbarkeit, 4 1'NJW 3042, 3051 (1988).
353. IPRG, art. 191(
), SR 291, RS 291, RS 291, reprinted in XIII Y.B. CoM. ARB.
446, 450 (1988).
354. Id. "Cantonal courts ... have earned a high degree of confidence, and
from this point of view it is a welcome decision that parties are given the option to
International commercial arbitration and its relation to
national courts is still far from being a settled issue. However,
the attempts made by the legislatures within and outside
Europe coupled with the strong influence of the Model Law
represent a promising step in the right direction.
These legislatures had to fulfill a difficult task. The
international arbitration community demanded more arbitral
freedom while the complicated and fragile equilibrium of
arbitration and enforcement abroad requires a careful and deliberate
approach in order to maintain the major benefit of arbitration,
the quick and easy enforcement of arbitral awards.
Radical solutions, often praised as panaceas to all
problems, be they "contracting-in," "contracting-out," or
abolishing all judicial review, are not suitable for the solution
of this sensitive issue. Instead, most legislatures have taken
the right way in maintaining judicial control of transnational
awards but confining it to the minimum standards of
international arbitration law as embodied in the Model Law and
developed by national courts over the past decades.
The national court judge as "guarantor of arbitral
integrity" 355 remains an indispensable factor in the international
arbitration system, but he also holds an enormous responsibility.
He has to develop the right "sensitivity to the need of the
international commercial system for predictability in the
resolution of disputes. '3 56 In international arbitration cases more
than in others, he has to be aware of the effects of his decision,
which go beyond the case before him, especially since such
cases are ca3r5e7fully monitored by the international arbitration
Review of arbitral awards also involves an important
psychological aspect. The constant threat ofjudicial review along
clearly defined criteria leads arbitrators to pay due regard to
the interests of the parties and factual and legal setting of the
agree on an action for setting aside being heard by the cantonal court acting in place
of the Federal Supreme Court." Blessing, supra note 203, at 74.
355. Schlosser, Notwendige Reformen des Deutscheni Rechts der Schiedsgerichtsbarkeit,8
ZEITSCHRIFT FiR WIRTSCHA-rSRECHT 492 (
) (translation by the author).
356. Mitsubishi Motors Corp. v. Soler Chrylser-Plymouth, 473 U.S. 614, 629
357. Raeschke-Kessler, supra note 352, at 3042-43.
case, thus further contributing to more legality in arbitral
As to stages of appeal, the practice of the Swiss cantonal
courts and the English commercial courts, both having
acquired substantial expertise in arbitration matters, shows that
courts with a high degree of experience in international
commercial matters can make the multi-instance recourse system
obsolete without being a "denial of justice" to the parties.
If the courts support the efforts of national legislatures
and develop a liberal attitude towards international
arbitrations on their soil, parties to an international contract
resorting to arbitration instead of litigation will ultimately realize
that they have chosen the best and not the worst of both
worlds, provided however, they pay due regard to the careful
drafting of the arbitration clause instead of just "hop[ing] for
358. "In practice both parties tend to be exhausted by the time the negotiations
have reached the stage of the arbitration clause. They will rarely get beyond the
applicable rules (if any) and the venue. For the rest they just hope for the best."
Kerr, supra note 157, at 14.
Introduction ............................................ 606
Definitional Approach ............................. 611
II. Recourse and Related Remedies ................... 615
III. The New Laws .................................... 619
A . France: Limited, Non-Excludable Recourse ... 619
B. Sweden : Limited, Non-Excludable Recourse .. 621
Recourse ..................................... 622
Recourse ..................................... 625
R ecourse ...................................... 627
F. Switzerland : Limited, Excludable Recourse ... 632
G. Belgium : Exclusion of Recourse Ex Lege ...... 636
IV. Unsettled Issues Under the New Laws ............. 638
D oor? ......................................... 638
B. The New Laws and Delocalized Awards ....... 643 1. Delocalization Through Party Agreement.. 643 2. Detachment Through National Legislatures 647
Lagging Behind? .................................. 650 1 . Feldman, The Annulment Proceedings and the Finality of ICSID Arbitral Awards , 2
ICSID REV.-FOREIGN INVESTMENT L.J . 85 , 87 ( 1987 ). 2. "We have reached the point where our system ofjustice-both state and fed-
tives to Litigation: TheirApplication to InternationalBusiness Disputes, ARB . J., Dec . 1983 , at
4 (quoting ChiefJustice Warren Burger). 3. M611er, Die Handelsschiedsgerichte sind eine Alternative zur Steitbeilegung vor den
Staatlichen Gerichten , Handelsblatt, Oct. 7 /8, 1988, at 8, col. 4. For a comprehensive
tion: The German Designfrom an American Perspective , 5 HASTINGS INT'L & COMP. L. REV .
27 ( 1981 ). A German judge, complaining about the case load and insufficient staffing
gen , West Germany, in Bielefeld, West Germany (Sept. 26 , 1988 ). 4. See CriticalSituation Pending in Luxembourg, Bus. L. BRIEF, Apr. 1988 , at 19. 5. See Iwasaki , Selection of Situs: Criteriasand Priorities, I ARB. INT'L 57 ( 1986 ). 9. Shilston, The Evolution of Modern Commercial Arbitration , J. INT'L ARB ., June
1987, at 45. Shilston notes that
19. See Schlosser , Schiedsgerichtsbarkeitund Rechtsmittel zu den Staallichen Gerichten,
92 ZEITSCHRIFT FUR ZIVILPROZESS 125 , 150 ( 1979 ). 20 . Some countries have been traditionally preferred as situs of arbitral proceed-
32. 5% of the arbitrations under the auspices of the ICC between 1980 and 1982 took
place in France, 26 .5% in Switzerland, 9 % in the United Kingdom, 5 % in Belgium,
3% in Austria, and 3% in The Netherlands . W.L. CRAIG, W. PARK & J. PAULSSON ,
INTERNATIONAL CHAMBER OF COMMERCE ARBITRATION app. I, at 15 ( 1984 ). Around
85% of the ICC arbitrations are held in Europe . See Jarvin , The Enforcement of I.C.C.
ArbitralAwards , 1988 REVUE DE DROIT DES AFFAIRES INTERNATIONALES 242, 243 . 21. Lord Cullen of Ashborne estimated that a new English arbitration law might
attract as much as £500 million per year of additional revenues in the form of fees for
PAULSSON , supra note 20, § 29 . 03 . 22. Arbitration Act , 1979 , ch. 42, reprintedin V Y.B. COM . ARB. 239 ( 1980 ). The 32 . The court focused on this criterion as early as 1930 . See Judgment of Feb.
19, 1930 , Cass. civ., Fr., 1930 Bulletin des arrts de la Cour de cassation, chambres
civiles [Bull . Civ.] 75 ( "mettant ainsi enjeu des int~rts de commerce international" );
accordJudgment ofJanuary 27 , 1931 , Cass. civ., Fr., 1931 Bull. Civ . 13 . 33. C. Civ . art. 1492 , reprinted in VII Y.B. CoM. ARB. 280 ( 1982 ) (English trans .). 34 .. "[L] e contrat doit produire comme un mouvement de flux et de reflux au-
Fouchard , L ArbitrageInternationalen FranceAprs le Decret du 12 Mai 1981 ; 109JOURNAL
DU DROIT INTERNATIONAL U.D .I.] 374 , 377 ( 1982 ) (quoting Judgment of May 17,
1927, Cass. Civ., Fr., 1928 P6riodique et Critique 25) . 35. SeeJudgment of Apr. 26 , 1985 , Cour d'appel, Paris, Fr., reprintedin 113J.D.I.
175 , 179 ( 1986 ) ; see also Fouchard , Quand un Arbitrageest-Il International?, 1970 REVUE
DE L'ARBITRAGE 59. 36 . IPRG art. 176 ( 1 ), SR 291, RS 291, RS 291, reprinted in XIII Y.B . COM. ARB.
446 , 447 ( 1988 ) (English trans .). 37 : Arbitration Act , 1979 , ch. 42, art . 3 ( 7 ), reprintedin V Y.B. CoM. ARB. 239 , 243
( 1980 ). 38. C. JUD. art. 1717 ( 4 ), reprinted in XI Y.B. CoM. ARB. 369 ( 1986 ) (English
trans.) . 39 . See Melis, supra note 24 , at 29 . 40. See Melis , Austria, IV Y.B. COM. ARB. 21 , 35 ( 1979 ). 41 . See ARBITRATION IN SWEDEN 160 (Stockholm Chamber of Commerce ed.
1984). 42. European Convention Providing a Uniform Law on Arbitration, June 20 ,
1966, art. l(1)(a), II Europ . T.S. No. 56 . 43. MODEL LAW , supra note 29, art. 1 ( 3 ), reprinted in XI Y.B. COM. ARB. at 381 . 44. Id. art. 1 ( 3 )(c), reprinted in XI Y.B. COM. ARB. at 381 . 45. The new Arbitration Rules of the Netherlands Arbitration Institute , in force
as of December 1 , 1986 , contain some provisions that apply only to international
arbitration. Article 1 ( g ), for example, defines international arbitration as "an arbitra-
art. l(g), reprinted in XIII Y.B. COM. ARB . 205 , 209 ( 1988 ) (English trans .). The
Netherlands Arbitration Institute has, thus, adopted the Swiss approach . 46. See generally Delaume, Court Intervention in Arbitral Proceedings, in RESOLVING 59 . See Poznanski, The Nature and Extent of an Arbitrator's Powers in International
Commercial Arbitration , J. INT'L ARB ., Sept . 1987 , at 71 . 60. Typical examples are the Grain and Feed Trade Association Arbitration
Rules , reprintedin 3 C. SCHMITrHOFF, INTERNATIONAL COMMERCIAL ARBITRATION Pt. V
( 1985 ), and Netherlands Oils, Fats and Oilseeds Trade Association, Rules of Arbitra-
tion, reprinted in C. SCHMITrHOFF, supra . In this context, one has to distinguish be70. See, e.g., Zivilprozessordnung [ZPO] § 319 (W . Ger.) (corrections of judg-
ments) . 71 . English courts require strong prima facie proof of mistake by arbitrator . See
Food Corp . of India v. Marastro Cia Naviera S.A. , 1986 Lloyd's Rep . 209 , 216 (C. A .). 72 . The MODEL LAW, supra note 29 , art. 33 ( 3 ), reprintedin XI Y.B. COM. ARB. at
388- 89 , and the UNCITRAL Rules, supra note 10 , art. 37, both impose a time limit of
30 days upon receipt of the award . 73. Rv. art. 1061 , reprinted in XII Y.B. COM. ARB. 370 , 381 - 82 ( 1987 ) (English
HUNTER , supra note 6, at 328. 74. Rv. art. 1065 ( 6 ), reprinted in XII Y.B. COM. ARB. 370 , 383 ( 1987 ) (English
trans.) . 75 . For a comment on the result under the Swiss arbitration law , see Briner, Die
Anfechtung und Vo1streckung des Schiedsentscheides, in DIE INTERNATIONALE SCHIEDSGER-
ICHTSBARKEIT IN DER SCHWEIZ (II) 99, 106 (K . B6ckstiegel ed. 1989 ). 76 . New York Convention, supra note 13, art . V, 21 U.S.T. at 2520, T.I.A.S. No .
6997, at 4, 330 U.N. T.S. at 40. 77. In Judgment ofJuly 12 , 1984 , District Court Amsterdam (The Pyramids), re -
printed in X Y.B. CoM . ARB. 487 ( 1985 ) (English trans.), an arbitration award was
Judgment of July 12 , 1984 , Cour d'appel, Paris, Fr. (The Pyramids), reprinted in 23
I.L.M. 1048 ( 1984 ) (English trans .). 78 . Judgment of Feb. 21 , 1980 , Cour d'appel, Paris, Fr., 1980 Recueil Dalloz-
Sirey , Jurisprudence[D.S. Jur.] 568 . 79 . Judgment of Dec. 9 , 1980 , Cour d'appel, Paris, Fr., reprintedin 20 I.L.M. 887
( 1980 ) (English trans .). 80 . France had just promulgated a new law on domestic arbitration , Decree No.
80- 354 , 1980J .O. 1238 ( codified as amended at C. Civ . art. 1442 - 1491 ). For a gen-
eral discussion of Decree No. 80-354 , see La Reforme de Droit Fran~ais de IArbitrage,
1980 REVUE DE L'ARBITRAGE 579. 81 . See W.L. CRAIG , W. PARK & J. PAULSSON , supra note 20, § 30 . 03 . 82. See Fouchard , Les Recours Contre les Sentences Non Fran~aises , 1980 REVUE DE
L'ARBITRAGE 693 , 696 . 83. C. Civ . art. 1504 , reprintedin VII Y.B. CoM . ARB. 272 , 282 ( 1982 ) (English
trans.) . 84 . Id. art. 1502 ( l ), reprintedin VII Y.B. Com. ARB. at 281 . 85. Id. art. 1502 ( 2 ), reprintedin VII Y.B. COM. ARB. at 281 . 86. Id. art. 1502 ( 3 ), reprintedin VII Y.B. COM. ARB. at 281 . 87. Id. art. 1502 ( 5 ), reprintedin VII Y.B. COM. ARB. at 282 . 88. Id. art. 1505 , reprinted in VII Y.B. CoM. ARB. at 282. 89. In Judgment ofJuly 12 , 1984 , Cours d'appel, Paris, Fr., reprintedin 23 I.L.M.
1048 ( 1984 ) (English trans.), the court held that article 24 of the ICC Arbitration
Rules did not contemplate a waiver of recourse under French law . Id., reprintedin 23
I.L.M. at 1055. 90. W.L. CRAIG , W. PARK & J. PAULSSON , supra note 20, § 30 . 04 . 91. C. Civ . art. 1506 , reprinted in VII Y.B. CoM. ARB. 272 , 282 ( 1982 ) (English
trans.) . 92 . New York Convention, supra note 13, art . V, 21 U.S.T. at 2520, T.I.A.S. No .
6997, at 5, 330 U.N.T.S. at 40 . 93. Lag om skiljemin, 1929 SVENSK FORFATrNINGSSAMLING [SFs] 145 , reprintedin
ARBITRATION IN SWEDEN app. 2 , at 172 (Stockholm Chamber of Commerce ed. 1984 )
(English trans .); Lag om utlindska Skiljeavtal och skiljedomar , 1929 SFS 147 , re-
printed in ARBITRATION IN SWEDEN, supra , app. 3, at 181. 94. Judgment of Oct. 11 , 1955 , 1955 NyttJuridiskt Arkiv [NJA] 500 . There the
TransnationalCommercial Arbitration , 21 VA. J. INT'L L . 211 , 230 ( 1981 ). 95 . 1929 SFS 145, § 20 ( i ), reprintedin ARBITRATION IN SWEDEN, supra note 93 , at 224. See BAUMBACH , LAUTERBACH & ALBERS, COMMENTARY ON THE GERMAN CODE
OF CIVIL PROCEDURE § 1041 (44th ed. 1986 ). 225 . Loi Approuvant la Convention Europ6enne Loi Uniforme en Matibre
d'Arbitrage, Faite A Strasbourg 20 Janvier 1966 et Introduisant dans le Code
Judiciaire une Sixi~me Partie Concernant I'Arbitrage (1), 1972 MONITEUR BELGE
8717 (implementing the European Convention) . Belgium is the only European
country to have adopted the Convention . 226 . It was one of the goals of the European Convention to abolish any rights of
appeal to national courts in order to avoid dilatory tactics by the losing party . See 3 P.
SANDERS , ARBITRATION INTERNATIONAL COMMERCIAL 387 ( Int'l Ass 'n of Lawyers ed .
1965 ). 233 . Compare C. JUD. art. 1717 ( 4 ), reprinted in XI Y.B. CoM. ARB. 369 ( 1986 )
(English trans.) with Arbitration Act , 1950 , 14 Geo. 6, ch. 27 , §§ 22 - 23 . 234 . Typical in this respect is the statement of Judge Leggat , in Arab African
Energy Corp . v. Olieprodukten Nederland B.V. , [ 1983 ] 2 Lloyd's Rep. 419 (QB .). 238. MODEL LAW , supra note 29, arts. 34 ( 2 ) (a)(ii ), 36 ( 1 ) (a)(ii), reprintedin XI Y .B.
CoM. ARB. at 389 , 390; New York Convention, supra note 13, art . V( 1)(b ), 21 U.S.T.
at 2520, T.I.A.S. No . 6997 , at 4, 330 U.N.T.S. at 42 . 239. MODEL LAW , supra note 29, arts. 34 ( 2 ) (a)(iv ), 36 (l) (a)(iv), reprintedin XI Y .B.
CoM. ARB. at 389 , 390; New York Convention, supra note 13, art . V( 1)(d ), 21 U.S.T.
at 2520, T.I.A.S. No . 6997 , at 4, 330 U.N.T.S. at 42 . 240. See Schlosser, supra note 19 , at 131. Some authors suggest that challenges
of awards should be allowed only in case of (1) violation of procedural fairness, (2)
excess of arbitral authority, or (3) violation of international public policy . See Stein &
Wotman , supra note 13, at 1725 . 241. MODEL LAW , supra note 29, art. 34, reprinted in XI Y.B. CoM. ARB. at 389 . 242. MODEL LAW , supra note 29, art. 36, reprinted in XI Y.B. CoM. ARB. at 390 . 243. New York Convention, supra note 13, art . V, 21 U.S.T. at 2520, T.I.A.S. No .
6997, at 5, 330 U.N.T.S. at 42 . 244. See A. REDFERN & M. HUNTER , supra note 6, at 330. 245. See , e.g., MODEL LAW, supra note 29 , art. 16 ( 1 ), reprintedin XI Y.B. CoM. ARB.
at 385; Rv. art. 1052 ( 1 ), reprinted in XII Y.B. CoM. ARB. 370 , 379 ( 1987 ) (English
trans.); IPRG art . 186 ( 1 ), SR 291, RS 291, RS 291, reprinted in XIII Y.B. CoM. ARB.
446 , 449 ( 1988 ) (English trans.); ICC Arbitration Rules , supra note 14 , art. 8 ( 3 ). See
generally Schmitthoff, TheJurisdictionof the Arbitrator , in THE ART OF ARBITRATION 285
U. Schultsz ed. 1982 ) (discussing issues affecting arbitrators'jurisdictional decisions ). 246 . See , e.g., MODEL LAW, supra note 29, art. 6 , 16 ( 3 ), reprintedin XI Y.B. CoM.
ARB. at 382 , 385; Rv. art. 1065 ( 1 ) (a), (b), reprintedin XII Y.B. CoM . ARB. 370 , 380 - 81 ,
382 ( 1987 ) (English trans .); IPRG art. 190 ( 2 )(b), SR 291, RS 291, RS 291 , reprintedin
XIII Y.B. CoM . ARB. 446 , 450 ( 1988 ) (English trans .); see also Judgment of July 12 ,
1984, Cour d'appel, Paris, Fr., reprinted in 23 I.L.M. 1048 ( 1984 ) (English trans .).
the power without being subject to review to rule on its jurisdiction . Id. at 1054
(emphasis added) . 247. See supra note 177 and accompanying text . 248 . "Whenever a tribunal goes wrong in law, it goes outside the jurisdiction
supra note 20, § 29.06 (quoting Lord Denning) . 249 . ZPO § 595 ( 1)(3), reprinted in IX Y.B . COM. ARB. 301 , 304 ( 1984 ) (English
trans.) . 250 . Rv. art. 1065 ( 1 )(d), reprintedin XII Y.B. COM. ARB . 370 , 383 ( 1987 ) (English
trans.) . 251. ZPO § 592 ( 2 ), reprinted in IX Y.B. COM. ARB. 301 , 304 ( 1984 ) (English
trans.); Rv. art. 1057 ( 2 ) -(3), reprintedin XII Y.B . COM. ARB. 370 , 380 ( 1987 ) (English
trans.); IPRG art . 189 ( 2 ), SR 291, RS 291, RS 291, reprinted in XIII Y.B . COM. ARB.
446 , 450 ( 1988 ) (English trans .). 252 . See , e.g., IPRG art . 190 ( 2 )(d), SR 291, RS 291, RS 291 , reprintedin XIII Y.B.
COM. ARB . 446 , 450 ( 1988 ) (English trans .). 253 . "[Tihe term 'public policy', which was used in the 1958 New York Conven-
A /40/17, § 297 ( 1985 ) (empahsis added). 254 . J. LEW , APPLICABLE LAW IN INTERNATIONAL COMMERCIAL ARBITRATION 532
( 1978 ) (quoting CHESHIRE & NORTH , PRIVATE INTERNATIONAL LAW 149- 50 (9th ed.)).
A comprehensive and generally accepted definition has not yet been proposed . 255. C. CALAVROS, DAS UNCITRAL-MDELLGESETZ UBER DIE INTERNATIONALE
HANDELSSCHIEDSGERICHTSBARKEIT 161 ( 1988 ). 256. ZPO § 595 (l)( 6 ) (repealed 1983 ). 257 . See Melis , Austria, IX Y.B. CoM . ARB. 42 , 48 ( 1984 ). This was seen as offer-
ing the possibility for Austrian courts to review cases on the merits . Id . 258. ZPO § 595 (l)( 6), reprinted in IX Y.B. CoM . ARB. 301 , 304 ( 1984 ) (English
trans.) . 259 . See H. FASCHING , supra note 144, at 1001. A decision of the Swiss Federal
foreign rule is contrary to a mandatory provision of Swiss law . Judgment of May 5 ,
1976, Bundesgericht, Switz. (Bangladesh), 102 BGE Ia 574. 260. See supra note 147 and accompanying text . 261. C. Civ . art. 1502 ( 5 ), reprinted in VII Y.B. COM. ARB. 280 , 282 ( 1982 ) (Eng-
190 (e), SR 291, RS 291, RS 291 , reprintedin XIII Y.B. CoM . ARB. 446 , 450 ( 1988 )
public policy . See Bucher, supra note 210 , at 121 . 267. See H. FASCHING , supra note 144, at 1001 (Austrian law); Blessing, supra
note 203, at 71 (Swiss law); Fouchard, supra note 34, at 417 (French law) . 268 . See Fouchard, supra note 34 , at 417. Mr . Blessing gives the example that
Blessing , supra note 203, at 71 . 269. See Mann , State Contractsand InternationalArbitration, 1983 BRIT. Y.B. INT'L L.
1; Paulsson , Arbitration Unbound: Award Detachedfrom the Law of Its Country of Origin, 30
INT'L & COMP. L .Q 358 ( 1981 ). 270 . See 2 J.G. WEITER, THE INTERNATIONAL ARBITRAL PROCESS: PUBLIC AND
PRIVATE 369 ( 1979 ). 271 . See , e.g., Naviera Amazonica Peruana S.A . v. Compania Internacional de
2. 301 . See Timmermans , The New Statute on the ArbitrationCourt at the USSR Chamber
of Commerce and Industry, J. INT'L ARB ., Sept . 1988 , at 97 , 100 - 02 . 302 . But see Matray, supra note 295 , at 261 ( wanting to generalize experience
with Soviet awards) . 303. Judgment of Feb. 1 , 1980 , Oberster Gerichtshof , Aust., reprintedin VII Y.B.
COM. ARB . 312 ( 1982 ) (English trans .). The court also referred to art. IX(l) of the
tually set aside the award . Id. at 313 . 304. See Melis, supra note 135 , at 134. The arbitral proceedings involved a
VII Y.B. COM . ARB. 314 , 315 ( 1982 ). With the Austrian courts having jurisdiction,
the action to have the award set aside again reached the Austrian Supreme Court . Id. 305 . See W.L. CRAIG , W. PARK & J. PAULSSON , supra note 20, § 31 . 04 . 306. ZPO § 582 , reprintedin IX Y.B. CoM . ARB. 301 , 302 ( 1984 ) (English trans .). 307 . See Paulsson, supra note 94, at 230-35. 311. Law No. 28 of Feb. 9 , 1983 (codified as amended at Codice di Procedura
Civile , arts. 806 - 831 (Italy)), reprinted in IX Y.B. COM. ARB . 309 ( 1984 ) (English
trans.) . 312 . Most Australian states have adopted a "uniform" arbitration law since
1984, which has substantially changed the powers of the courts to entertain chal-
lenges to arbital awards and is closely modelled on the U.K . Arbitration Act, 1979 ,
Australia , XIII Y.B. COM . ARB. 381 - 92 ( 1988 ). 313 . See Noecker & Hentzen, The New Legislation on Arbitration in Canada, 22 INT'L
LAW. 829 , 830 n. 10 ( 1988 ). 314 . See De Speville, Arbitration in Hong Kong, 1 ARB. INT'L 109 ( 1985 ). 315 . See Rashed , The UNCITRAL Model Law and Recent Developments in Egypt, 3
ICSID REV.- FOREIGN INVESTMENT L.J . 126 ( 1988 ). 316 . Legislative Decree No. 90 /83 of Sept. 16 , 1983 (Lebanon), reprinted in 27
I.L.M. 1022 ( 1988 ) (English trans .). 317. ZPO §§ 1025 - 1048 . 318 . See Sandrock , Zigzgkeit und Leichtigkeit Versus Grindlichkeit , 41 JURISTEN
ZEITUNG 370 n.2 ( 1986 ) ; von Hoffmann , supra note 284 , at 338 . 319. See Lrcher , Schiedsgerichtsbarkeit: b'bernahme des UNCITRAL-Modellgesetzes?,
20 ZEITSCHRIFT FUR RECHTSPOLITIK 230 , 231 ( 1987 ). 320 . See von Hoffmann, supra note 284, at 340. 321. See Judgment of Sept. 26 , 1985 , Bundesgerichtshof, W. Ger ., 96
Bundesgerichtshof in Zivilsachen [BGHZ] 40 , 41; Judgment of Oct. 3 , 1956 ,
Bundesgerichtshof , W. Ger ., 27 BGHZ 365. The law implementing the New York
einkommen vom 10 . Juni 1958 uber die Anerkennung und Vollstreckung auslandis-
cher Schiedssprfiche § 2 ( 1 ), 1961 BGBI 11 121 (W. Ger.) . 322 . An award subject to English arbitration law but rendered in Germany