ENFORCEMENT OF FOREIGN AWARDS

UNDER GENEVA CONVENTION

ALTERNATE DISPUTE RESOLUTION

PSDA

SUBMITTED TO: SUBMITTED BY:

Mrs. Leena Moudgil Mananshu Jain

CLASS: 5 - C

ENROLLMENT
No.:11417703818

SEMESTER: FIFTH

SUBJECT: ADR

VIVEKANANDA SCHOOL OF LAW AND LEGAL

STUDIES
 INDEX
SERIAL TOPICS
NO.
1. INTRODUCTION
2. OBJECTIVE
a) RESEARCH TITLE
b) RESEARCH OBJECTIVE
3. HYPOTHESIS
4 Frameworks for Enforcement of Foreign Awards in
India

5 Geneva Convention
6 Enforcement of foreign awards under the Geneva
Convention under the Arbitration and Conciliation
Act, 1996

7 Time Limit
8 Grounds for refusal of enforcement of foreign awards

7. CONCLUSION
8. BIBLOGRAPHY
a) BOOKS
b) WEBSITES
c) STATUTE AND CONVENTION
 INTRODUCTION
With the expansion of international trade in recent years, the business world has been
increasingly reluctant to litigate in courts of law for differences arising from international
commercial transactions. Ability to communicate with and commute to distant places with the
utmost speed enables a merchant in a few minutes or hours, to conclude a contract abroad
which a generation ago would have taken weeks or months. However, when it becomes
necessary to resort to the machinery of justice to settle a dispute connected with that contract,
to enforce a judgment in another country is still a complicated, time-consuming and expensive
operation. It is not surprising, therefore, that businessmen have been turning with increasing
frequency to arbitration as a quicker and simpler means of settling international commercial
disputes. There has been a noticeable movement in favor of arbitration. Arbitration facilities
and institutions have increased over time. The favorable trend towards arbitration has been
reflected in legislative enactments, international treaties and other measures by which
arbitration has gradually acquired a more solid legal standing.

India forms a vital cog of the wheel of the global economy. The ever-increasing level of
globalization has led to raise international business disputes too. In this context, the
enforcement of foreign judgment and foreign Arbitral Awards becomes significant. A foreign
judgment may be enforced in India either by proceedings in execution or by a suit upon it.1 An
arbitral award is a determination on the merits by an arbitration tribunal in arbitration, and is
analogous to a judgment in a court of law. Arbitration is particularly popular as a means of
dispute resolution in the commercial sphere. One of the reasons for doing so is that in
international trade, it is often easier to enforce an arbitration award in a foreign country than
it is to enforce a judgment of the court. The enforcement of foreign arbitration awards in India
is governed by the Arbitration and Conciliation Act, 1996 through New York Convention and
Geneva Convention and a non- conventional award will be enforceable in India under the
common law grounds of justice, equity and good conscience.

OBJECTIVE
1
Code of Civil Procedure, 1908.
RESEARCH TITLE:
Enforcement of foreign Arbitral Awards under Geneva Convention

RESEARCH OBJECTIVE:
The researcher seeks to critically analyze the enforcement of foreign Arbitral Awards under
Geneva Convention in India.

HYPOTHESIS
Under the Arbitration and Conciliation Act, 1996, there are two avenues available for the
enforcement of foreign awards in India, viz., the New York Convention and the Geneva
Convention, as the case may be. The Indian Legal System have a well laid down and established
procedure for the enforcement of foreign awards under Geneva Convention in India.

RESEARCH METHODOLOGY:

The methodology applied by the researcher in this research work is purely doctrinal in nature. It
involves in depth study of statutory materials, cases decided by the courts, text review and
comparative study. The study also takes help from books, articles and journals written by experts
on the topical theme, for better understanding of the situations. Use of internet has also been
made by the researcher for gathering the relevant information relating to the subject matter of
study. The research is analytical and descriptive in nature. All these materials collected are
subjected to critical scrutiny and the analytical frame work.

Frameworks for Enforcement of Foreign

Awards in India
The primary framework as regards the enforcement of arbitral awards is the 1958 United Nations
Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the
New York Convention. The Convention facilitates the enforcement of arbitral awards in all the
contracting states, that is, those nations which are a party to and are signatories to the
Convention, one among which is India. Prior to the New York Convention, enforcement of
arbitral awards of another country in the jurisdiction of another State was provided for in the
Geneva Protocol on Arbitration Clauses, 1924 as well as the Geneva Convention on the
Enforcement of Awards of 1927. 

The laws of India, as a result of India being a signatory to both the New York as well as the
Geneva Conventions, have primarily always provided for enforcement, within the local territory
of India, of foreign arbitral awards. Examples of these include the laws such as the Arbitration
(Protocol and Convention) Act, 1937 and the Foreign Awards (Recognition and Enforcement)
Act, 1961 which were in tune with the Geneva and New York Convention, in that they provided
for enforcement of foreign arbitral awards in India, provided that the parties have consented to
the dispute being settled in the as per the law of the place chosen for the proceeding. However,
today, the law that is in force is the Arbitration and Conciliation Act of 1996, enacted both on the
UNCITRAL Model Law on Arbitration as well as to revamp and replace the 1937 and 1961 laws
on the same. Thus, today, it is the 1996 Act that provides for the enforcement of foreign arbitral
awards in India. 

Further, the Code of Civil Procedure of 1908 does also play in the role in the enforcement of
foreign awards in India. The arbitral award has been accorded the status of a decree and thus the
procedure that applies to set aside or challenging of a decree applies in equal measure to an
arbitral award. 

GENEVA CONVENTION
On the international level, there are numerous bilateral treaties including provisions for the
enforcement of arbitral awards. As to multilateral treaties, the most significant developments
since the First World War have been the Geneva Protocol on Arbitration Clauses of 1923, the
Geneva Convention on the Execution of Foreign Arbitral Awards of 1927, and the United
Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958.
The application of both treaties is limited to persons who are subject to the jurisdiction of
different contracting states. Under the Protocol, an arbitration agreement relating to existing or
future differences is recognized as valid, that is, irrevocable. The agreement may relate to any
matter capable of settlement by arbitration, but the contracting states may limit their
obligations to commercial contracts. If a suit is brought despite the arbitration agreement,
courts are required to refer the parties to the arbitrators, except where the agreement or the
arbitration cannot proceed or has become inoperative. The Convention is supplementary to the
Protocol in that it applies to awards made pursuant to arbitration agreements covered by the
Protocol. Only states parties to the Protocol may become parties to the Convention. Each
contracting state is required to recognize as binding and to enforce, in accordance with the
procedure of the forum, awards rendered in the territory of another contracting state, on the
following conditions:
a) The award was rendered pursuant to arbitration agreement valid under the law
applicable to the agreement;

b) The object of the award is capable of settlement by arbitration under the law of the
country of the forum;

c) The award was rendered by the arbitral tribunal provided in the arbitration agreement
or constituted as agreed by the parties and in conformity with the law governing the
arbitration procedure;

d) The award has become final and no proceedings are pending for the purpose of
contesting the validity of the award. An award still subject to opposition or appeal or
the equivalent is not regarded as final;

e) The recognition or enforcement of the award would not be contrary to public policy or
the "principle of the law" of the forum.

Even where these conditions have been met, recognition and enforcement of the award must
still be refused if the court finds that:

(a) The award has been annulled in the country where it was rendered; or

(b) The party against whom the award has been invoked did not have sufficient notice, or
being under a legal incapacity, was not properly represented; or

(c) The award deals with a dispute not included under the terms of the agreement, or the
award goes beyond the scope of the agreement. Furthermore, a court may refuse
enforcement or give the losing party reasonable time to seek annulment if that party
proves that under the law of the country where the arbitration took place, there is a
ground (other than those specified in the Convention) to contest the validity of the
award in a court of law.

The Geneva treaties have been criticized for the following legal and practical
reasons:

a) There is some ambiguity in the expression “subject to the jurisdiction of different

Contracting States” which defines the scope of application of the treaties. It is not clear
whether it means subject to the sovereignty of a state in the sense of nationality, or
subject to the jurisdiction of the courts of a state by reason of residence, domicile, or
other criteria.

b) It has also been observed that a plaintiff seeking enforcement in one country would
find it particularly difficult to prove that the arbitral tribunal was constituted in
conformity with the law of another country and that the award has become final in that
country.

c) Finally, the possibility of contesting the validity of an award on grounds other than
those listed in the Convention has been regarded as making it too easy for a recalcitrant
defendant to avoid the enforcement of an award by resorting to obstructionist tactics.
This state of affairs prompted the International Chamber of Commerce, which had originally
taken the initiative leading to the Geneva Convention, to submit to the United Nations
Economic and Social Council a proposal for a new convention on the enforcement of
international arbitral awards. In the opinion of the ICC, the main defect of the Geneva
Convention was the condition that to be enforced, an arbitral award must be “strictly in
accordance with the rules of procedure laid down in the law of the country where arbitration
took place.” In order to meet the requirements of international trade, the ICC advocated the
idea of an ‘international award, i.e., an award completely independent of national laws, and
suggested that arbitral awards based on the will of the parties should be automatically
enforceable. The ICC draft sought to attain this purpose mainly by widening the scope of
application and providing that, as a condition for enforcement, the composition of the arbitral
authority and the arbitral procedure must be in accordance with the agreement of the parties.
Only in the absence of such agreement, they should conform to the law of the country where
arbitration took place. The other conditions for enforcement in the ICC draft did not differ
greatly from those of the Geneva Convention, except for the omission of the requirement of
finality of awards, regarded by the ICC as encouraging dilatory measures.

Enforcement of foreign awards under the

Geneva Convention under the Arbitration
and Conciliation Act, 1996
The conditions for enforcement of foreign awards under the Geneva Convention are provided
under Section 57 of the Arbitration and Conciliation Act, 1996. These are as follows:

a. the award has been made in pursuance of a submission to arbitration which is valid under
the law applicable thereto;
b. the subject-matter of the award is capable of settlement by arbitration under the law of
India;
c. the award has been made by the arbitral tribunal provided for in the submission to
arbitration or constituted in the manner agreed upon by the parties and in conformity with
the law governing the arbitration procedure;
d. the award has become final in the country in which it has been made, in the sense that it
will not be considered as such if it is open to opposition or appeal or if it is proved that
any proceedings for the purpose of contesting the validity of the award are pending;
e. the enforcement of the award is not contrary to the public policy or the law of India.

The Amendment Act has restricted the ambit of violation of public policy for international
commercial arbitration to only include those awards that are: (i) affected by fraud or corruption,
(ii) in contravention with the fundamental policy of Indian law, or (iii) conflict with the notions
of morality or justice.

TIME LIMIT
The 1996 Act does not prescribe any time limit within which a foreign award must be applied
to be enforced. However, various High Courts have held that the period of limitation would be
governed by the residual provision under the Limitation Act, 1963 i.e., the period would be
three years from the date when the right to apply for enforcement accrues. The High Court of
Bombay has held that the right to apply would accrue when the award is received by the
applicant.2

Grounds for refusal of enforcement of

foreign awards

Section 57 for Geneva Convention of the Act of 1996 lay down the grounds where the

2
2007 (1) RAJ 339 (Bom).
enforcement may be refused if the objector can prove one of the following grounds:

i. Incapacity: That a party to the arbitration agreement was, under the law applicable to
him, under some incapacity;

ii. Invalid Arbitration Agreement: That the ‘arbitration agreement’ was invalid under
the law to which the parties subjected it, or, failing any indication thereon, under the
law of the country where the award was made;

iii. Due Process: That a party was not given proper notice of the appointment of the
arbitrator or of the arbitration proceedings or was otherwise unable to present his case;

iv. Jurisdictional Defect: that the award deals with a difference not contemplated by the
terms of arbitration agreement.

v. Composition: That the composition of the arbitral authority or the arbitral procedure
was not in accordance with the agreement of the parties, or failing such agreement,
with the law of the country where the arbitration took place.

vi. That the award has not yet becomes binding on the parties, or has been set aside or
suspended by a competent authority of the country, in which, or under the law of
which, it was made.

Section 57 further enumerate the grounds where the court may also refuse to enforce a foreign
award if it finds:

i. That the award is in respect of a matter which is not capable of settlement by

arbitration under the laws of India. In the case of Fuerst Day Lawson Ltd. v. Jindal
Export Ltd.3 the Supreme Court held that once the court determines that a foreign

3
2001 (6) SCC 356.
 award is enforceable it can straightaway be executed as a decree. In other words, no
other application is required to convert the judgment into a decree.
ii. That the enforcement of the foreign award would be contrary to public policy of India.
The violation of rules of public policy is a ground for refusal of enforcement or a
ground for setting aside. Indian law does not restrict (or extend) this ground to
violation of International Public Policy even where the arbitration is an international
commercial arbitration. Where enforcement of a foreign award is sought in any Court
in India, the rules of public policy applicable will only be the “Public Policy of India”.

CONCLUSION
To conclude, it can be stated that the Indian Legal System does indeed have a well laid down and
established procedure for the enforcement of foreign awards under Geneva Convention in India.
However, there is a rising need to reform the same in order to make it more business-friendly and
lessen the burden on our already overworked judiciary. 

BIBLOGRAPHY
1. BOOKS

 O.P. Malhotra and Indu Malhotra, The Law and Practice of Arbitration and Conciliation
(LexisNexis Butterworths Wadhwa, Nagpur, Second Edition, 2006)
 P. C. Markanda, Law relating to Arbitration and Conciliation (LexisNexis Butterworths
Wadhwa, Nagpur, Seventh Edition, 2009)

2. WEBSITES

 http://jurisonline.in/2010/10/enforcement-of-foreign-arbitral-awards/
 http://www.legalserviceindia.com

 http://www.kaplegal.com/articles/AIAJ_V4_N1_2008_Book_(Sumeet_Kachwaha).pdf

3. STATUTES AND CONVENTIONS

 Arbitration (Protocol & Convention) Act, 1937

 Arbitration and Conciliation Act, 1996

 Geneva Convention in the Execution of Foreign Arbitral Awards, 1927