How Countries Can Fully Implement the New York Convention: IN FOCUS A Critical Tool for Enforcement of FINANCE, COMPETITIVENESS & International Arbitration Decisions INNOVATION Xavier Forneris and Nina Mocheva INVESTMENT CLIMATE / CREDIT INFRASTRUCTURE © 2018 The World Bank Group 1818 H Street NW Washington, DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org All rights reserved. This volume is a product of the staff of the World Bank Group. The World Bank Group refers to the member institutions of the World Bank Group: The World Bank (International Bank for Reconstruction and Development); International Finance Corporation (IFC); and Multilateral Investment Guarantee Agency (MIGA), which are separate and distinct legal entities each organized under its respective Articles of Agreement. We encourage use for educational and non- commercial purposes. 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Design & Layout: Aichin Lim Jones Photo Credits: Shutterstock.com Table of Contents ABSTRACT 1 WHAT IS THE NEW YORK CONVENTION? 2 WHY DOES THIS MATTER FOR DEVELOPING ECONOMIES? 3 WHAT DO SIGNATORY COUNTRIES NEED TO DO TO GIVE FULL EFFECT TO THE CONVENTION? IS SIGNING AND RATIFYING THE CONVENTION SUFFICIENT FOR IT TO BE IMPLEMENTED AND ACTIONABLE? 5 WHAT ARE THE OBSTACLES TO THE PRACTICAL IMPLEMENTATION OF THE CONVENTION? 6 WHAT ELSE CAN BE DONE TO GIVE EFFECT TO THE NEW YORK CONVENTION? 7 CONCLUSION 9 ADDITIONAL RESOURCES AND READING 11 REFERENCES 13 HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION | I II | HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION Abstract T he year 2018 marked the 60th anniversary of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the most important international convention in the area of international commercial arbitration. The Convention is also said to be the most successful international treaty in the area of private international law, with 161 signatory countries as of December 2019. This note primarily targets policy makers and their legal advisors in countries looking at ways to improve their business environment, to become more attractive locations for trade and investment, through better dispute resolution options for international transactions. It may also be helpful for staff of the World Bank Group and other donor agencies who provide financial or technical support to such business environment reform endeavors. First, the note explains that international commercial arbitration, as part of countries’ legally recognized dispute resolution options, is critical to cross-border contract enforcement. As countries strengthen their international arbitration regimes, they improve their competitiveness in international markets and increase investment and trade by reducing transaction risks and the cost of new infrastructure projects. Countries can improve their international commercial arbitration systems by passing modern legislation consistent with international best practice, ratifying international arbitration conventions, strengthening judicial capacity to enforce arbitral awards, and investing in local arbitration centers. After explaining why the Convention, in particular, matters for private firms as well as countries that want to foster and promote private sector activity in trade and investment, the note proceeds to answer a simple question: What do signatory countries have to do to give full effect to the New York Convention? There is often the misconception that signing and ratifying this Convention is an end in itself. But these are not sufficient steps. There are several complementary measures to be taken by the government of a signatory country for the system to be fully operational. The note describes some of these measures, with no ambition of exhaustivity. For the purposes of this note, the term “arbitration decisions” is used interchangeably with “arbitration awards.” 1 The present note was co-authored by Xavier Forneris, Senior Private Sector Specialist and Investment Protection workstream 2 leader, and Nina Mocheva, Senior Finance Sector Specialist with the Debt Resolution & Insolvency team, both in the Finance, Competitiveness, and Innovation Global Practice of the World Bank Group. The authors are grateful for the useful inputs from Nadim Mansour and Philippe de Bonneval, both lawyers working as consultants for the World Bank Group. The authors express their gratitude to the three peer reviewers for their valuable comments and suggestions, namely, Meg Kinnear, Vice-President and Secretary General, ICSID (World Bank Group, Washington); Corinne Montineri, Legal Officer, International Trade Law Division, United Nations (UNCITRAL, Vienna); and Roberto Echandi (Lead Trade and Investment Specialist, World Bank Group, Wash- ington). The note also benefited from discussions with Pierre-Fabrice Amariglio and Daniela Gomez Altamirano, international legal consultants. An earlier version of this note was accepted by UNCITRAL to be included in the material presented at the international conference celebrating the 60th Anniversary of the Convention, held at United Nations headquarters in summer 2018 (UNCITRAL 2018; https://legal.un.org/ola/media/info_from_lc/mss/speeches/MSS_New_York_Convention_Celebration_28_ June_2018.pdf). HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION | 1 What is the New York Convention? to recognize and enforce awards made in other states, subject to specific limited exceptions. Or, to put it very The Convention on the Recognition and Enforcement of simply, the purpose of the New York Convention is to Foreign Arbitral Awards of 1958, commonly known as the make it easier to enforce an arbitral award rendered New York Convention (based on the place of signature), in one country by attaching assets of the award debtor is one of the most important and successful international in another country. conventions in the area of dispute resolution. Indeed, it is often said to be the most successful international treaty The New York Convention entered into force on June in private international law, with 161 state parties to the 7, 1959 and, as of December 10, 2019, 161 states are Convention as of December 2019—more than any other parties to the Convention. The states that are not yet treaty in this area. a party to the Convention are highlighted in map 1. The New York Convention was developed under The full list of countries that are non-signatories the auspices of the United Nations and adopted by of the New York Convention as of December diplomatic conference on June 10, 1958. Promotion 2019 includes: Chad, Equatorial Guinea, Gambia, of the Convention is an integral part of the work Iraq, Libya, the Federated States of Micronesia, program of the United Nations Commission on Niue, Saint Kitts and Nevis, Belize, the Republic International Trade Law (UNCITRAL).3 of Congo, Eritrea, Ethiopia, Grenada, Guinea- Bissau, Kiribati, the Democratic People’s Republic The Convention is widely recognized as a foundational of Korea, Malawi, Namibia, Nauru, Palau, the instrument of international arbitration and requires Seychelles, Saint Lucia, Samoa, Somalia, Sierra the courts in contracting states to give effect to an Leone, Solomon Islands, Suriname, South Sudan, agreement to arbitrate when seized with an action in a Timor-Leste, Eswatini, Turkmenistan, Togo, Tonga, matter covered by an arbitration agreement, and also the Republic of Yemen, Tuvalu, and Vanuatu. Map 1: States that Are Not Yet Parties to the New York Convention (Total of 39, as of December 2019) Source: UNCITRAL (https://uncitral.un.org/en/texts/arbitration/conventions/foreign_arbitral_awards/status2). 3 For additional information on UNCITRAL and the Convention (such as the status of accession and entry into force), see http:// www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention_status.html. 2 | HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION Along the same vein as the New York Convention, critically important to allow access to international the United Nations Convention on International arbitration, as an alternative and neutral mechanism Settlement Agreements Resulting from Mediation for the resolution of commercial (business-to- was signed in Singapore on August 1, 2019. business) and investment (investor-state) disputes.5 Following in the footsteps of the New York Businesses worldwide value the neutrality and Convention, which deals with recognition and flexibility of arbitration. enforcement of international arbitration awards, this new Convention deals with recognition of This is one of the reasons why most countries have international mediation agreements.4 adopted commercial laws or investment laws that provide such access to arbitration, domestic and international. Most countries have also adopted Why Does This Matter for comprehensive legal regimes governing arbitration, Developing Economies? to ensure that local courts will respect contractual A forward-looking and dynamic economy, where arbitration agreements, suspend court proceedings, the private sector plays a critical role as an engine of and refer litigants to arbitration if either party growth, needs efficient ways to resolve commercial requests so based on a valid arbitration clause and investment-related disputes. A firm from one between the litigants. country (country A) doing business in another However, when parties have recourse to international country (country B) is often concerned that the state arbitration, outside the physical boundaries of the courts in country B may not be even-handed or host economy, otherwise recognized as international impartial when hearing a dispute that the firm has under the law of the host economy,6 a key issue with a company, an individual entrepreneur, or the arises: how to ensure that the decision to be rendered government of country B. The concern is even more by the international arbitrator(s) or foreign arbitral pronounced when the host country (country B) is a tribunal will be enforceable in the host economy developing economy with significant governance (or for that matter in any other country outside the challenges and/or issues of judicial independence. country where the decision was rendered and where To facilitate such cross-border transactions or the award creditor has identified assets of the debtor investments, which developing economies need to enforce against)? for growth and competitiveness, it is therefore 4 For additional information on the United nations Convention on International Settlement Agreements Resulting from Mediation, see https://www.uncitral.org/pdf/english/commissionsessions/51st-session/Annex_I.pdf. 5 For the purposes of this note, the terms “commercial” and “investment,” when referring to types of disputes and arbitration pro- cesses, are assigned the following simplified meanings. (i) A commercial dispute is a dispute arising from a commercial contract, between two or more businesses, or between a state and a businesses; commercial arbitration is the arbitration of disputes be- tween parties to contracts with arbitration clauses. (ii) An investment dispute usually refers to a dispute related to foreign direct investment arising between the foreign investor and the government of the host economy. Although in the case of a commercial dispute, arbitration is based on the contract between the two parties, in the case of a foreign investment dispute, recourse to ar- bitration may stem from (a) a contract or establishment agreement between the host state and the investor, (b) the domestic in- vestment legislation of the host country (Investment Code), and/or (c) an international investment agreement (such as a bilateral investment treaty to encourage the promotion and protection of private investments between the country of the investor and the host country, or a plurilateral free trade agreement with an investment chapter. In practice, the terms “investment dispute” and “investment arbitration” are often used to mean any dispute and arbitration involving a host state and a foreign investor, regardless whether the dispute arises from a contractual agreement or a treaty. 6 The New York Convention, Art. 1, provides that the Convention also applies to awards “not considered as domestic in the State where recognition and enforcement is sought.” One scenario is when the seat of arbitration is in a foreign state (as in the ex- amples provided in this note), and the other scenario is when the award is issued in a host state but considered “non-domestic.” Many national arbitration laws, based on the UNCITRAL Model Law on International Commercial Arbitration, define international arbitration not just based on the seat of the arbitration being outside the host state, but also based on whether the dispute is international in nature; see Art. 1 (3) UNCITRAL Model Law. HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION | 3 Box 1: Typical Scenario Illustrating Why the New York Convention is Needed The names of the countries and the arbitral institution chosen by the parties were selected randomly. The following is a typical (and simplified) scenario to illustrate how the process works and why the New York Convention plays a critical role. A South African company has entered into a commercial contract with a large local firm in Côte d’Ivoire. The parties have included in their contract an arbitration clause providing that any dispute arising from or in connection to the contract will be settled by way of international commercial arbitration under the Rules of Arbitration of the International Chamber of Commerce (ICC). During the course of the contractual performance, a dispute arises and, as per the contract, one of the parties activates the clause by filing a request for arbitration with the ICC Court of Arbitration in Paris, France. Several months later, the arbitral tribunal, convening in Paris, renders its decision (called an arbitral award), finding in favor of the South African company. At this point, the South African company faces a concrete challenge: how can it have this decision enforced in Côte d’Ivoire, where all the assets of the award debtor are located, by the local courts of that country? Fortunately, Côte d’Ivoire has signed and ratified the New York Convention, which means that the government of the country is legally committed to recognizing and enforcing in Côte d’Ivoire, through its state court system, the arbitral awards that have been issued overseas (for instance, as in the above example, in France). If, instead, Côte d’Ivoire had not acceded to the New York Convention, such recognition and enforcement would not be guaranteed and would be extremely difficult to secure. In the reverse situation (the arbitral tribunal in France finding in favor of the company in Côte d’Ivoire), the company in Côte d’Ivoire would also be able to enforce the award in South Africa, which has signed and ratified the same Convention. In this example of a commercial dispute, the companies from Côte d’Ivoire and South Africa are likely to feel more confident about doing business in the other country, knowing that, should a dispute arise and necessitate international arbitration, the award would be enforceable in both countries. Both companies are also able to enforce an arbitral award in their favor in any other country that is a signatory to the New York Convention where they manage to locate assets of the award debtor. Expanding this scenario to all signatory countries and their businesses shows what a powerful and confidence-enhancing instrument the Convention is. Box 1 describes a simple scenario that illustrates It is also important to note that the Convention is why the New York Convention is extremely relevant not only relevant for enforcement of arbitral awards and needed. in commercial (business-to-business) disputes, but also for investment disputes between an investor The scenario described in box 1 is one of the and a host government, what is commonly referred frequent, indeed very common, situations in cross- to as investor-state dispute settlement (ISDS). The border commercial or investment matters, when the Convention applies to foreign awards rendered New York Convention becomes highly relevant. in investor-state arbitration, with one notable 4 | HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION exception: an arbitral award rendered under that signal may not be credible at first, the study the International Center for the Settlement of suggests that the pressure to restore the credibility of Investment Disputes (ICSID)7 can be enforced in domestic institutions eventually leads to improved the courts of any ICSID member state as though it institutional quality. were a final judgment of that state’s courts.8 That exception aside, all other foreign arbitral awards Having established the importance and relevance rendered in the context of international arbitration of the New York Convention as an instrument that of investor-state disputes will face the same issues provides confidence to parties that arbitral awards of recognition and enforcement as any arbitration rendered overseas will be enforceable, we move to award rendered in a commercial dispute. It is fair to a few questions. say, however, that the largest impact of the New York Convention is in the area of commercial disputes, as What do Signatory Countries most investment-related investor-state disputes are Need to do to Give Full Effect to resolved under the ICSID mechanism and thus do the Convention? Is Signing and not need the New York Convention (only the non- ICSID ISDS cases will need it for their recognition Ratifying the Convention Sufficient and enforcement in a different jurisdiction). for it to Be Implemented and Actionable? A specific economic benefit of stronger arbitration regimes, including observance of international The simple answer is no. Signing and ratifying commitments to recognize and enforce foreign the Convention is a necessary but not always arbitral awards through domestic courts, is higher sufficient step. levels of foreign direct investment (FDI).9 Countries Signing and ratifying the Convention sends a strong, that improve their international arbitration regimes positive message to foreign investors and gives them by adopting the New York Convention tend to a sense of confidence that international arbitration receive more FDI inflows. Stronger arbitration agreements are respected and encouraged by the regimes tend to result in increases in FDI because host country. Studies also show that ratification of firms are willing to make larger investments due international conventions on arbitration, such as the to lowered transaction risk. Berkowitz, Moenius, New York Convention (and the ICSID Convention), and Pistor (2006) demonstrate that adopting the helps mitigate the perceived weaknesses in domestic New York Convention has a particularly strong legal systems and sends a signal of the willingness effect on exports from countries with weaker of domestic institutions to commit to international legal systems.10 This is because ratification of arbitration norms.11 international conventions on arbitration, such as the New York Convention, mitigates the perceived However, this is far from enough to ensure that local weaknesses in domestic legal systems and sends a authorities and, most importantly, local courts abide signal of the willingness of domestic institutions to by the commitment that the country has made under commit to international arbitration norms. Although the Convention (see the example in box 2). 7 ICSID is the main forum for the settlement of investment disputes between states and investors under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (1965), also known as the Washington Con- vention. The Washington Convention is the other major international convention in the area of dispute settlement, but it only applies to investor-state disputes. For additional information, see www.icsid.org. 8 Article 54(1) of the ICSID Convention. 9 Paniagua and Myburgh (forthcoming). 10 Berkowitz, Moenius, and Pistor (2006). 11 For instance, Berkowitz, Moenius, and Pistor (2006). HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION | 5 Box 2: Signing and Ratifying the Convention is Not Enough: An Example from Southeast Asia A member country of the Association of Southeast Asian Nations (ASEAN) assented to the New York Convention over 20 years ago, but it has had a negative record on recognition and enforcement of foreign arbitral awards. Between 2005 and 2014, the country’s courts received 52 requests for award enforcement. Of these requests, 46.2 percent were rejected, 44.2 percent were recognized, and 5.8 percent were suspended or still under consideration. This scenario indicates relatively poor performance compared with its peer countries, which have achieved a rate of between 90 and 100 percent recognition and enforcement of the total award requests submitted to the courts. Additionally, due to a lack of adherence to time limits provided under the country’s civil procedure legislation, it commonly took at least one or two years to complete a recognition and enforcement procedure. This situation has had, and continues to have, a major impact on the country’s cotton trade, among other sectors. The country ranks among the biggest “award defaulters” in value owed to suppliers under outstanding arbitral awards. Well aware of the risk of nonenforcement, the cotton suppliers manage this risk by concluding deals only with a limited number of local buyers that they know to be trustworthy, and at higher prices, without extending them trade credit, which is common in the cotton industry. This situation can obviously limit the expansion of the garment industry in this ASEAN economy, since it heavily relies on steady supplies of high-quality cotton. What are the Obstacles to the may have recognized arbitration as a valid dispute Practical Implementation of the settlement mechanism in its domestic laws and may have signed and ratified the New York Convention. Convention? A range of factors explain such implementation In other cases, judges may have a sort of protectionist issues. In some countries, there is sometimes a or nationalistic bias and would choose to ignore the simple lack of understanding or information on the Convention or interpret it in a very narrow way, to part of local (state) judges about arbitration and/or favor the local party and refuse to enforce an award the New York Convention and its effect, especially that was rendered against a local firm. This latter risk if the Convention has not been domesticated in the is even more pronounced when the local firm that country’s legal system through national legislation. is party to the contract is a state-owned enterprise If judges are not aware of the Convention and its (SOE). A local judge may then see it as their “national effect, enforcement of a foreign award in the state duty” to protect the local SOE, an asset or agent of courts is unlikely to be easy or straightforward. the state, against foreign arbitrators and the foreign company with which the SOE has had a dispute. In other instances, there are reports of some hostility on the part of local judges toward arbitration as Another obstacle arises when a country has ratified a way of resolving disputes. Judges sometimes the Convention without subsequently passing see arbitration as a threat to their role, “unfair implementing legislation, when such implementing competition,” or a concept that lacks legitimacy. legislation is required by national law.12 In countries This may be the case even though their country where such a process is required to give full However, the New York Convention is a “self-executing treaty,” which means that state courts can apply it directly without any 3 need for domestic (implementing) legislation. Many countries have passed implementing legislation that is consistent with or even more favorable than the provisions of the New York Convention. 6 | HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION effect to an international convention or treaty, the practicing lawyers, judges, and court officials. It is consequence of that lack of action by the government critically important to provide training to judges, but is that judges simply will not acknowledge the also local lawyers—public and private—and other Convention as being binding on them. government officials on the New York Convention, its meaning, how to interpret it, and so forth. The descriptions of these obstacles should not be interpreted as a criticism of the judicial systems and Training is often organized and conducted by the state judges. By definition, this note looks at situations government, through its Ministry of Justice, the where enforcement is problematic explores reasons Judiciary, or the Attorney General’s office. but training that may explain such difficulties. Fortunately, there can also be organized by the private sector, that is, are many more situations where the enforcement by international or regional arbitration associations, of foreign awards goes without any difficulty. This the national arbitration center (when there is one), focus note acknowledges the positive sequence over or even by law firms. In Myanmar, for example, a many years of awareness raising on the benefits of the British law firm has been successfully delivering Convention for attracting and retaining investment. training on the New York Convention and alternative dispute resolution to a range of government officials, Is there any legal recourse when signatory states fail with support from the U.K. government (Department to implement the Convention? for International Development). Various public and The merits and usefulness of the New York private training institutions and centers around Convention are clear and significant. Precisely the world provide this type of capacity building. because of the importance of the Convention UNCITRAL is very active in this field. The World for fostering cross-border business transactions Bank Group also provides such capacity building and investment, the lack of monitoring of the and, in some countries, has supported training for Convention’s implementation is regretable. In judges on the New York Convention as part of a other words, there is no international body that lending operation or technical assistance project; for actively verifies whether all the signatory countries instance, it has done so in Burundi, Central Africa, (and their courts) are fully in compliance with the Cambodia, and Vietnam. Convention and the commitments made therewith. The World Bank Group has sometimes provided There are examples of countries whose courts refuse further support for the adoption and implementation to enforce valid foreign arbitral awards, often on of the New York Convention. Box 3 describes an dubious grounds, although these countries have example of what a New York Convention–related signed and ratified the New York Convention. Some intervention by the World Bank Group’s Investment recent examples of this phenomenon were observed Policy team would look like. in South Asia and East Asia.13 A second possible solution is the following: What Else can be Done to Give countries that adhere to the Convention could designate a specialized higher-level government Effect to the New York Convention? agency, such as a Ministry of Justice, and/ A first step toward a solution is the provision of or specialized court to review requests for capacity building to stakeholders tasked with enforcement of foreign arbitral awards. The benefit implementing the Convention in each signatory state. of this approach is that it would develop a small Capacity building can take many shapes and forms, cadre of experienced and specialized experts/ from integrating the topic into the curriculum in judges who would build expertise over time and local law schools and judicial schools, to organizing be well versed in how to interpret the Convention. specialized, practical workshops and seminars for This should facilitate the enforcement of foreign awards in the country in question. UNCITRAL (2008). See also Zhang (2018) and Sattar (2017). 13 HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION | 7 Box 3: Supporting a Country in Acceding to and Implementing the New York Convention The World Bank Group Investment Policy and Promotion team can assist a client developing country on the New York Convention in several ways. The specific assistance offered will be tailored to fit the beneficiary country’s needs, circumstances, and starting point. In general, the following activities may be part of an Investment Policy project or components of the broader World Bank Group/International Finance Corporation engagement in a country: • Developing an Action Plan for the country’s accession to and implementation of the New York Convention—the document specifies the actions to be taken, the target dates, and the responsible government entity(ies) for each action • Conducting an assessment of the benefits and potential challenges of accession • Sharing lessons learned by other countries from their accession to the New York Convention and formulating recommendations applicable to the beneficiary country • Evaluating the comments and concerns expressed by key stakeholders (public and private) during the consultation phase • Reviewing state practice in making declarations and reservations under the New York Convention and providing guidance on good international practices on the drafting of such declarations and reservations by the country • Determining the content of the necessary enabling and ancillary legislation related to the accession • Conducting public awareness campaigns in the private sector as well as capacity building (training workshops) for civil servants, lawyers, judges, and other relevant professions. Additional implementation and capacity building can be discussed with the country following its accession to the Convention, based on the specific challenges that are identified. For instance, in Vietnam, the World Bank Group’s Debt Resolution team worked closely with the Supreme People’s Court and the Ministry of Justice to provide a series of trainings on arbitration, mediation, and enforcement of international arbitration awards, to economic court judges from all the provinces in the country. As part of increasing judicial capacity in implementing the Convention, the World Bank Group translated into Vietnamese the International Council for Commercial Arbitration’s Guide to the Interpretation of the 1958 New York Convention,a and assisted the Supreme Court in preparing a detailed Arbitration and Mediation Judicial Manual to guide local judges in the application of the country’s revised national legislation, which domesticates the provisions of the New York Convention in Vietnam.b Notably, the training has had a marked improvement in enforcement of domestic arbitral awards too, as seen from the dramatic decrease in the number of arbitral awards that have been set aside—none in 2015 and only two in 2016. Investors’ increased confidence in utilizing Vietnam’s domestic alternative dispute resolution mechanisms was also observed, as the number of commercial cases settled through mediation or filed to arbitration increased more than tenfold, from 65 to 708. a. To date, the International Council for Commercial Arbitration’s Guide to the Interpretation of the 1958 New York Convention has been translated from English into 20 other languages, with more translations scheduled for the coming months. b Civil Procedure Code of Vietnam, as amended in 2016. 8 | HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION A third way to foster implementation of the international arbitration to resolve their disputes. Convention is to incorporate the main provisions How to enforce in one country an arbitral award of the Convention into a national law, which may rendered in another is one of the main challenges make it easier for local judges to apply. This is raised in this type of dispute resolution method. particularly recommended for countries whose language is not one of the five official languages For countries that want to promote trade and of the Convention (namely, Chinese, Russian, investment in their territory, signing and ratifying English, French, and Spanish). The incorporation the New York Convention is a measure that can of the Convention or its key provisions could, for enhance business confidence. However, as this note instance, be done in the Code of Civil Procedure (as has shown, signing and ratifying the Convention are is the case of Vietnam, for example) or in a stand- necessary but not sufficient steps. The note provided alone Arbitration Act, as the case may be. Going one examples of tangible actions and measures that can step further could include a set of civil procedure and should be taken to give effect to the Convention. rules aimed at expediting enforcement procedures. These measures may be relatively easy to undertake In 2008, UNCITRAL published a comprehensive by the authorities of the countries concerned. study of New York Convention member countries’ However, in the case of developing countries, they approaches to implementing the Convention into may be integrated into programs of assistance by the their national legislation, which also includes World Bank Group and other development partners, information on the specific rules of interpretation to strengthen the judicial system, promote the rule of of the Convention used by national courts.14 The law, build the capacity of judges in commercial law UNCITRAL Secretariat should be the first contact and commercial disputes, and establish functioning point for governments interested in adhering to and alternative dispute resolution centers. The efficient implementing the Convention. functioning of arbitration as a mechanism to resolve commercial and investment disputes largely depends on the local judiciary. State courts and judges have Conclusion and will continue to have a key role to play in Trade and investment are increasingly and understanding and supporting effective arbitration inextricably linked. Firms that engage in commercial frameworks and processes, including through or investment transactions across borders, with instruments such as the New York Convention. other firms or governments, will often resort to The compilation is available at http://www.newyorkconvention.org/uncitral/sessions. 14 HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION | 9 10 | HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION Additional Resources and Reading A large number of efforts by international organizations, public and private, provide guidance on the application and interpretation of the New York Convention. Citing all of them would be impossible. However, we would be remiss not to start with the remarkable work of the UNCITRAL Secretariat. See, for instance, the UNCITRAL Secretariat Guide on the New York Convention and the web platform: http://www. newyorkconvention1958.org. The platform includes cases on the implementation of the New York Convention by certain countries: http://newyorkconvention1958.org/index.php?lvl=cmspage&pageid=9. The International Chamber of Commerce’s guide for enforcement of awards is also a very relevant and useful resource: https://iccwbo.org/media-wall/news-speeches/new-guide-enforcement-awards-now-available-online/. The International Council for Commercial Arbitration (ICCA) has published a detailed guide for judges on the implementation of the New York Convention, which is available in 13 languages (including Arabic, Burmese/Myanmar, Chinese, English, French, Russian, Spanish, Portuguese, and Turkish, among others): http://www.arbitration-icca.org/publications/NYC_Guide.html. The ICCA Yearbook Commercial Arbitration (http://www.arbitrationicca.org/publications.html), published by the same organization, is the major source of international arbitration jurisprudence, including commentary on court decisions applying the New York Convention. HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION | 11 12 | HOW COUNTRIES CAN FULLY IMPLEMENT THE NEW YORK CONVENTION References Berkowitz, D., J. Moenius, and K. Pistor. 2006. “Trade, Law and Product Complexity.” Review of Economics and Statistics 88: 368–73. Columbia Law and Economics Working Paper No. 230, SSRN: https://ssrn.com/ abstract=315969 or http://dx.doi.org/10.2139/ssrn.315969. Government of Vietnam. 2015. Civil Procedure Code of Vietnam 2015, with amendments as adopted in 2016. Paniagua, J., and A. Myburgh. Forthcoming. “Does International Commercial Arbitration Promote Foreign Direct Investment?” Journal of Law and Economics. Sattar, S. 2017. “Enforcement of Foreign Arbitral Awards in Bangladesh: The Law, Its Implementation and Challenges.” In Private International Law, edited by S. Garmella and S. Jolly. Singapore: Springer. UNCITRAL (United Nations Commission on International Trade Law). 1958. “Report on the Survey Relating to the Legislative Implementation of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards.” UNCITRAL, New York, http://www.newyorkconvention.org/uncitral/sessions. ———. 2008. UNCITRAL Model Law on International Commercial Arbitration 1985: With Amendments as Adopted in 2006. Vienna: UNCITRAL, www.uncitral.org/uncitral/en/uncitral_texts/arbitration/1985Model_ arbitration.html. ———. 2018. United Nations Convention on International Settlement Agreements Resulting from Mediation. New York: UNCITRAL. United Nations. 1958. Convention on the Recognition and Enforcement of Foreign Arbitral Awards, New York, June 10, United Nations Treaty Series, vol. 330, No. 4739, p. 3, treaties.un.org/pages/ViewDetails. aspx?src=TREATY&mtdsg_no=XXII-1&chapter=22&lang=en. Zhang, Mo. 2018. “Enforceability: Foreign Arbitral Awards in Chinese Courts.” San Diego International Law Journal 20 (1), https://digital.sandiego.edu/ilj/vol20/iss1/2. INSTITUTIONS FOR INVESTMENT | 13