Challenges to and Recognition and Enforcement of International Decisions

Competence to hear challenges to arbitral awards is allocated to national courts on the basis of a territorial connection to the seat of the arbitration.  If, for example, the seat of the arbitration is Kathmandu, the Nepali courts are competent to hear a challenge to that award. See also, article 6 of the UNCITRAL Model rules of Arbitration

However, when an international arbitral tribunal has decided a dispute on the basis of international law, particularly in regard to dispute between an individual and a state, the courts of the seat of arbitration cannot challenge the award.

The ICSID Convention establishes an internal mechanism for hearing challenges to ICSID awards:

ICSID, Art. 52 when,

(a)  the Tribunal was not properly constituted;

(b) the Tribunal has manifestly exceeded its powers;

(c)  there was corruption on the part of a member of the Tribunal;

(d) there has been a serious departure from a fundamental rule of procedure; or

(e) the award has failed to state the reasons on which it is based.

This mechanism is designed to ensure that ICSID arbitrations are insulated from the jurisdiction of municipal courts.

Under Art. 52, an ad hoc committee can annul the original award; it cannot substitute the award with its own decision.  If the award is annulled then the dispute can be resubmitted to a new ICSID tribunal which begins more or less de novo.

See generally article 34 of the UNICTRAL Model Rules of Arbitration and article 52 of the ICSID Convention:

  1. Lack of substantive jurisdiction due to invalidity of arbitration agreement
  2. Dispute outside the scope of the arbitration agreement.
  3. Failure to apply the law chosen by the parties or otherwise applicable to the dispute
  4. Incapacity of one of the parties to arbitrate
  5. Irregularity in the constitution of the arbitral tribunal
  6. Procedural irregularity
  7. Uncertainty or ambiguity or formal deficiency in award
  8. Subject matter of the dispute not arbitrable
  9.   Fraud and public policy