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Foreign Arbitration Awards

  • Foreign Arbitration Awards 

At the beginning of the twentieth century, when international commercial arbitration was first established, it relied on domestic arbitration laws that varied considerably from each other, thereby proving insufficient for the needs of international arbitration. The primary concern was the non-enforceability of arbitral provisions that apply to arbitration in future disputes. A multilateral convention - the Geneva Protocol on Arbitration Clauses of 1923 - was signed after the First World War. 

This was only the first step, however, it became important to provide assurances that arbitration awards would be upheld in foreign countries where the properties of the award-debtor were situated after addressing the question of the validity of arbitration agreements. Once again, under the auspices of the League of Nations, a new convention was drawn up: the 1927 Geneva Convention on the Execution of International Awards. This Convention provided for the implementation of arbitral awards made on the basis of the award of arbitral awards. 

On the basis of joining the two International Conventions, Indian national legislation has been implemented. On 10 June 1958, India signed the NY Convention and ratified the Arbitration (Protocol and Convention) Act 1937 on 13 July 1960 - which focused on India signing the Geneva Convention (1927), under the auspices of the League of Nations. Act 1961 on International Awards (Recognition and Enforcement) 

In Thyssen Sthlunion GMBH v. Steel Authority of India 1999 [MANU/SC/0652/1999, para 51], the Supreme Court (SC) held that the provisions of the International Awards (Recognition & Compliance) Act, 1961 and the Arbitration and Conciliation Act, 1996 on the enforcement of the foreign award did not vary greatly. 

The definition of 'international award' in both enactments is also the same. The main distinction seems to be that although a decree follows under the International Awards (Recognition & Enforcement) Act, 1961, a foreign award is already stamped as the decree under the present Arbitration Act, 1996. 


  • Grounds to challenge Foreign Awards 

The reasons for contesting the awards referred to in Part I (Section 34) of the Indian Arbitration Act extend only to domestic awards and not to international awards. In Bharat Aluminum Co. v. Kaiser Aluminium Technical Service Inc. on September 6, 2012, the Supreme Court concluded on the basis of its previous judgments that the Indian Arbitration Act should be interpreted in a way that would give effect to the intent of the Indian Parliament. 

In this case, the Court overturned its earlier decisions in the case of Bhatia International v. Bulk Trading S.A. Anr.[xxi] and Venture Global Engg v Satyam Computer Services Ltd Anr.[xxii] argued that the results in those decisions were wrong. 

Part I of the Indian Arbitration Act does not extend to arbitrations outside India whether or not the parties have agreed to apply the Indian Arbitration Act. Most notably, these conclusions of the Supreme Court refer only to arbitration agreements signed after 6 September 2012. Thus, all disputes under the arbitration agreement entered into until 6 September 2012 shall be determined by old precedents, irrespective of the fact that, according to the Supreme Court, such judgments have been erroneous and have been overturned. 

In conclusion, we see that the law relating to the withdrawal of arbitral awards in India is in line with the UNCITRAL model law, as national law is focused solely on the same. However, the interpretation of the Supreme Court in a number of rulings, such as Bhatia International, raised significant problems that have been resolved to some degree in the BAL Co case. Judicial involvement should be minimal and this practice should be encouraged in India so that the arbitration can be successful. 


This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.

  • Foreign Arbitration Awards
  • Brief History of Foreign Arbitration Awards
  • Grounds to challenge Foreign Awards

BY : Shivani Kinniwadi

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