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In 1958, when the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards was concluded, international commercial arbitration as we know it today was in its relative infancy. Fifty years on, arbitration has become the pre-eminent form of international dispute resolution, at least in relation to international trade and investment.

This pre-eminence is due to many factors, chief among them globalisation. The New York Convention provides the foundation for modern international arbitration and provides for the recognition and enforcement of arbitration agreements and awards in more than 140 jurisdictions, with enforcement only being denied for ‘due process’ and public policy reasons.

As such, the New York Convention is one of the most widely adhered-to international conventions. Its provisions are reflected or incorporated in legislation ranging from Chapter VIII of the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration, to laws in Hong Kong, Ireland, Germany and Japan, to Part III of the English Arbitration Act 1996, to the Swiss Private International Law Act of 1987.

The recognition of arbitration agreements

Where a party to a written arbitration agreement seeks to bring a claim in the national courts of a contracting state, Article II of the convention requires the court (at the request of a party) to enforce the arbitration agreement and refer the parties to arbitration unless the arbitration clause is “null and void, inoperative or incapable of being performed” – wording familiar to anyone who has considered section nine of the English Arbitration Act. This allows the arbitration to proceed without parallel court proceedings and with minimal court interference.

Many national legislatures and courts are now applying a liberal interpretation to ‘in writing’, so as to include, for example, agreements reached by email or similar electronic correspondence. Also, the convention does not require the parties to have signed the arbitration agreement – a common misconception.

The enforcement of arbitration awards

Articles III to V of the convention govern the recognition and enforcement of arbitral awards made in a jurisdiction other than the jurisdiction in which enforcement is sought – often referred to as foreign or ‘convention’ awards. These reflect the convention’s policy in favour of finality and enforcement of awards and:

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