Under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958) (the New York Convention), the enforcement of an arbitral award made in one New York Convention State in another New York Convention State is, generally, quick and straightforward. However, complications do arise. For example, what happens when (i) an arbitral award is made in country A, (ii) an application to set aside that arbitral award is made to the national courts of country A, and (iii) enforcement of the award is then sought in country B before determination of the application in country A? Furthermore, what happens when the application in country A is unsuccessful but an appeal is brought against that decision? That was the scene faced by the courts of the British Virgin Isles (BVI) and the Cayman Islands in Conocophillips China Inc v Green Dragon Gas Ltd, which raises interesting public policy issues. This article explores the reasons why different approaches were taken by the BVI and Cayman courts, and the approach which the offshore courts are likely to take in the future.
Statutory Rules on the Enforcement of Foreign Arbitral Awards
The New York Convention provides an extensive enforcement regime, under which foreign arbitral awards shall be enforced by the New York Convention member states, and enforcement may only be refused in a limited number of enumerated exceptions. Its purpose is to facilitate the enforcement of awards, while at the same time upholding the generally recognised principles of justice and respecting the sovereign rights of member states.