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Assignment on: Question answer Course Code: Law 822 Course Title: International Commercial Arbitration

Assignment on: Question answer Course Code: Law 822 Course Title: International Commercial Arbitration
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    Assignment on: Question answer Course Code: Law 822 Course Title: International Commercial Arbitration  Date of Submission: 09-02-2017 Date of Submission: 17.04.2018 Submitted By:  Md. Mozammel Hoque  Id:181-38-244  Department of Law  Daffodil International University   Submitted to:  Dr. Farhana Helal Mehtab (Associate head)  Department of Law  Daffodil International University  Page | 2   Answer To The Question Number A-2   What state property is subject to execution for the purpose of enforcing an ICSID award? Is it possible to enforce an ICSID award under the New York Convention? Nature of the property : The most important criterion for State immunity from execution is the   nature of the assets which are to be the object of enforcement. A distinction is made between commercial and non-commercial property. Execution is permitted against commercial property but not against property serving official or governmental purposes. The term commercial property (also called commercial real estate, investment or income property) refers to buildings or land intended to generate a profit, either from capital gain or rental income. The Enforcement of ICSID award:  The recognition and enforcement of ICSID awards is governed by Articles 53, 54 and 55 of the ICSID Convention. A party who seeks enforcement of an ICSID award may do so in any ICSID Contracting State, under the same conditions, and may simultaneously do so in more than one State. The choice of enforcement forum will ultimately depend on the availability of assets and domestic laws on enforcement of judgments and sovereign immunity. According to Article 53 of the ICSID Convention, an ICSID award is final and binding, and immune from appeal or annulment, other than as provided in the ICSID Convention. The limited grounds for annulment under Article 52 of the ICSID Convention are the main defense that losing Respondent States put forward to resist the enforcement of an award. Resisting enforcement otherwise and not implementing an award is a clear violation of international obligations. During recognition and enforcement in domestic courts, the court’s authority is limited to only verifying that the award is authentic. According to Article 54 of the ICSID Convention, all Contracting States shall recognize an ICSID award as binding and execute the pecuniary obligations contained therein as a final  Page | 3   domestic judgment of the court of that State. This is usually interpreted to mean a final judgment of the highest court in that State, or in any case a judgment against which no ordinary remedy is available. Pursuant to the same article, the execution of the award will be governed by the domestic laws relating to the execution of judgments in each State where enforcement is sought. According to Article 55 of the ICSID Convention, laws relating to sovereign immunity from execution remain applicable, thus ratification of the ICSID Convention is not a waiver of sovereign immunity from execution. The law of sovereign immunity from execution is governed by customary international law, although many countries have enacted legislation that codifies relevant rules, and the position varies according to jurisdiction. The Draft 2004 UN Convention on Jurisdictional Immunities of States and their Property, while not binding or in force, contain many guiding principles for the execution of judgments and awards against State property. Enforce an ICSID awards Under the New York Convention? Enforce an ICSID awards Under the New York Convention:  As a matter of principle, the outcome of ISDS proceeding, which is the arbitral award, is final and binding. This very feature has made international arbitration a success since it provides a speedy and efficient outcome for both states and foreign investors. International rules such as the ICSID Convention and the New York Convention provide mechanisms to ensure respect for the rule of law outcome in the proceedings. Where a breach of the conventions has occurred, this could result in an annulment or refusal of enforcement of the award. The ICSID Convention has 153 state parties and most ISDS proceedings are conducted under this convention. The convention provides that both the state and foreign investor can request the award to be annulled for limited procedural reasons. Annulment is fundamentally different from appeal, as it only targets the legitimacy of the decision-making by the tribunal, and not the substantive correctness of the award.  Page | 4   Under the ICSID Convention, an award can be annulled for reasons of flaws on the part of the tribunal, among others, if it has manifestly exceeded its powers or if there was corruption by a member of the tribunal. Further, a serious departure from a fundamental rule of procedures is also a ground for annulment. The Chairman of the ICSID Administrative Council will assign an annulment committee to decide on a particular annulment proceeding. In  Enron v. Argentina,  the committee found that the tribunal erred by too simply and quickly drawing legal conclusions from economists’ expert reports. By evaluating Argentina‘s defenses in a manner that was so incomplete, according to the committee, it amounted to a failure to apply the applicable law. The award was therefore annulled. The annulment committee also sided with the state in  Klöckner v. Cameroon,  where it held that the tribunal assumed that certain principles applied to the case, such as principles of loyalty and openness, rather than actually demonstrated that these principles existed. Therefore, the annulment committee found that the tribunal had manifestly exceeded its powers. Outside the scope of the ICSID system, the New York Convention serves as an enforcement and recognition tool for arbitral awards. It provides that a domestic court may refuse to enforce an arbitral award on grounds, among others, that a party to the dispute was not given opportunity to present its case or if the award contains matters on issues beyond the scope of the arbitration agreement.  Page | 5   Answer To The Question Number B-3   How does an ad-doc arbitration proceeding conduct?   Ad hoc Arbitration  is a proceeding that is not administered by others and requires parties to make their own arrangements for selection of arbitrators. The parties are under discretion to choose designation of rules, applicable law, procedures and administrative support.  What would be the grounds for refusing the execution of and arbitral award? Grounds for refusing recognition or execution of arbitral awards: According to section 46 of   The Arbitration Act, 2001this section says that the execution of arbitral awards. There are some ground to execution of arbitral awards. The ground are noted below-   (1) Recognition or execution of foreign arbitral award may be refused only on the following grounds, namely- (a)if the party against whom it is invoked furnished proof to the Court that- (i) a party to the arbitration agreement was under some incapacity; (ii) the arbitration agreement is not valid under the law to which the parties have subjected it; (iii) the party against whom the award is invoked was not given proper notice of the appointment of the arbitrator 27 or of the arbitral proceedings or was otherwise unable due to some reasonable causes to present his case; or (iv) the concerned foreign arbitral award contains decisions on matters beyond the scope of the submission to arbitration; (v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or, failing such agreement, was not in accordance with the law of the country where the arbitration took place.
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