Scribd Logo
Upload

Welcome to Scribd!

  • 19 views

    Dyalá Jiménez - Enforcement in Latin America of Provisional Measures (Optativo)

    Uploaded by

    Cami Boriz

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content

    You might also like

    Dyalá Jiménez - Enforcement in Latin America of Provisional Measures (Optativo)

    Uploaded by

    Cami Boriz
    19 views14 pages

    Original Title

    Dyalá Jiménez - Enforcement in Latin America of Provisional Measures (optativo)

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    Download as pdf
    19 views14 pages

    Dyalá Jiménez - Enforcement in Latin America of Provisional Measures (Optativo)

    Uploaded by

    Cami Boriz

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    Download as pdf
    of 14
    ENFORCEMENT IN LATIN AMERICA OF PROVISIONAL MEASURES ORDERED BY ARBITRAL TRIBUNALS. WHERE WE ARE? ‘WHERE WE CAN GO? Dyalé Jiménez Figueres (676 Enroscewrw Lari AMERICA OF PROVISIONAL MEASURES ORDERED BY ARBTEAL 1. INTRODUCTION ‘To submit that the success of the New York Convention isthe main reason ‘why the international arbitration system works is not an overstatement. Lacking a Damocles sword, the incentives for a debtor of an arbitral award to pay its «creditor would depend solely on values such as good fith or the reputation gained from a principled conduct. Though not absent in the international commercial community, these values tend to dissipate when parties are in dispute. Thus it is the “teeth’ of our generally friendly system that makes it effective’ In many cases, pressure is needed long before the arbitral award is rendered lest the process becomes a mere performance of legal aptitudes, This pressure against a recalcitrant party often takes the form of an order for provisional measures. The working group of the revision of the UNCITRAL Model Law on International Commercial Arbitration (“Model Law”) deemed provisional measures a pillar of arbitration as a mechanism for resolving international commercial disputes. Since it is usually more convenient and appropriate to request provisional measures from the arbitrators who are dealing with the dispute, the international commercial arbitration system has “borrowed” from the civil procedural systems the regime on provisional measures. The terms of such “loan” vary according to each jurisdiction, depending on how much autonomy is given to arbitration, There exist, thus, concurrent jurisdictions for provisional measures,an exception to the exclusivity of the arbitral jurisdiction. Since there is no international treaty equivalent to the New York Convention for the enforcement of provisional measures, the question that is begged is, how effective are provisional measures ordered by arbitral tribunals? ‘This commentary concerns the status of the enforcement in Latin America of provisional measures ordered by arbitral tribunals. The premise of this article is that effectiveness is measured only by the possibility of court enforcement of the decisions ordering provisional measures. As things stand today, the Dionysius holding the sword can only be the State courts since only they have imperium 1 Tn Latin America, all outros are parties tothe New York Convention, 2 A/CNa/460, 10pril2000, 1° 60 p15, Gventhe concurrent jurdiction with State courts this Statement may go oo far, butt does depict the curetsgnfeanceof provisional mesuresin the international commercial arbitration commu 3 Anexcoption Ariel 9 Ecuador’ Law on Arbitation and Mediation, whereby arbitrators can each cut to public eutorites without going through the judge. The Ectadrian case wil be analyzed below: va miner ovens -677 ‘This issue is a current one in the design of international commercial arbitration regimes in the region, and it reflects a general concern of the interna- tional arbitration community, given the increasing consolidation of arbitration as an effective means to solve commercial disputes. As was explained with insight by a renowned British arbitrator: “Traditionally only national courts were empowered to grant interim or conservatory measures. The power to grant such measures was thought to be a prerogative of the courts’ because of public policy considerations. The national courts’ power was supported by the perceived problems of enforcing provisional measures isued by ut arbitral tribunal, and the fact that an arbitral tribunal did not have any coercive power to enforce its orders or award for these measures. Howeves, in recent years, increasingly national courts have come to see their role as supportive ofthe international arbitration proces. “This ole owes much to the fact that arbitration as a dispute resolution ‘mechanism has demonstrated its reliability. This oles effected both in national legislation and in case Lave" In this context, the role of the courts is naturally determined by the laws that they are called to apply, as well as the underlying public policy towards international arbitration in their respective countries. Both of these elements are surely influenced, in turn, by the reliability of arbitration mentioned above, as sensed by the pertinent State. ‘The purpose of these lines is twofold. First, it measures the grade of reliability sensed by certain Latin American jurisdictions by describing the status quo regarding enforcement of provisional measures ordered by arbitral tribunals, Secondly, it aspires to contribute to the evolution of this fascinating issue by proposing language de lege ferenda for countries that have yct to legislate thereon. In doing so, it will aso look into the applicability of the New York! Convention to decisions by arbitrators on provisional measures. “The first section of this article will assess the laws of Costa Rica, Ecuados, ‘Mexico,and Peru, which include provisions for the enforcement of provisional measures ordered by the arbitrators (Il). The subsequent section will provide ‘an account of case law regarding the possibility of applying the New York ‘DIM Lew, Commentary on Interim and Conservatory Measures patie ICC international Cour of Arbivation Bullet, v1 ICC Itematonal Court of Arbab Bulletin, v.18 12000) pp. 2330, a 24 {678 -Exroncenentin LATIN AEsICA OF PROUISONAL MEASURES ORDERED BY ARBTEAL. Convention to arbitral decisions on provisional measures (ITT). A fourth, section will raise aspects de lege ferenda that may be helpful for countries in the region ~and elsewhere ~ that have not yet accounted for this issue in their respective commercial arbitration legislations, such as Brazil and Venezuela (IV). Logically, conclusions will be drawn at the end. “This article wll not describe or define provisional measures. There has been, ‘much written on the subject, and the target goes beyond such considerations, IL. Laws REGULATING PROVISIONAL MEASURES ORDERED BY ARBITRAL TRIBUNALS A. Costa Rica AND Mexico Costa Rica passed the long-awaited International Commercial Arbitration ‘Act on 25 May 2011. The text is, with the exception of two additional provisions (on arbitrability and confidentiality), identical to the 2006 version, of the UNCITRAL Model Law on International Commercial Arbitration, (the “Model Law 2006". For domestic arbitration Costa Rica maintains its regime of 1997. nits part, Mexico modified sections ofits arbitration law on 27 January 2011, with a reform of the Code of Commerce, which included several provisions of the section on commercial arbitration. Mexico's legislation is ‘monist, 80 it applies to both, domestic and international arbitration. Among other modifications’, special provisions for the enforcement of arbitral tribunal decisions on provisional measures were included. The text of such reform is the 5 ThezooG vnion ofthe UNCTTRAL Mode Lawon Inemationsl Commerc Abtratonincudes 2 descr ofthe types of provsonal meus in Ace Foran exhaustive ale on provisional measures, se francico Gonzsles de Con" Medidas precatoa en ize Eton Them Foro 4 Xl Congreso Nacional de Abogados, Bara Mesican, Colegio de Abogado Acs aor, See ao bythe sume autho, Lae medias pecatoriscoma gare Ge efetnnd cel bj Eton sobre GarstasRelesy sonal ir Homenae Slroferor Manvel Somantta Unduraga torial sis de Cn, Sango deChieomor, 00m, oe inthe preset aril the trme"provlonl esse end"erim mesure ae ccubalet 6 Faravomprehensivessiessment (nd exelent ctque) ofthe Model Law 2005 regime Concerning the evforcement of provonal messes Jean Baptte fain, cexcoalon des ‘tases provaohes données par un ative cage du poet de lanouvcl lo ype de {EXUDCD cles mesure povcts dan arbagecommeral mernatonal Sakon et Innovation, Cores ins exon TEC fre 2008, 7 Therefor ines wha nef the adoption ofthe “elt nega” ofthe place of Competence competence ts wal asthe ekmioation ef xequatur oF recognition of rb “ards before the enforcement sage. Therefog ao includes changes to proisns eg procedure before ordinary courts unrelated to arbitration, ca va Jmenez Fouts - 679, same as the text of Article 17H and 171 of the Model Law 2006, which is also the text in the Costa Rican law. The first provision of both reads as follows: “Article 17H. Recognition and Enforcement* (2) An interim measure issued by an arbitral tribunal shall be recognized as binding and, unless otherwise provided by the arbitral tribunal, enforced upon application to the competent court, spective of the country in which it was issued, subject to the provisions of article 171. (2) The party wh is seeking or has obtained recognition or enforcement ofan interim measure shall promptly inform the court of any termination suspension or modification of that interim measure (2) The court ofthe State where recognition or enforcement is sought may, if t considers it proper, onder the requesting party to provide appropriate security ifthe arbitral tribunal has not alrcady made a determination with respect to security or where such « decision is necessary to protect the rights of third parties.” ‘The first paragraph establishes that the arbitral tribunal's decision shall be deemed binding and enforceable unless the arbitral tribunal has stated otherwise. The provision does not refer to the form of the decision, soit is to bbe understood that the form is irrelevant, since Article 17 of the Costa Rican law mentions “under a reasoned form.” In a similar way, the Mexican version of Article 17, Article 1433, does not describe the form the decision may take, ‘which may also be interpreted as giving freedom to the arbitral tribunal’. It is important to point out is that the enforceability of provisional measures does not extend to “preliminary orders” as established in the Costa Rican law, following the Mode! Law 2006”. The preliminary orders under Taken fon the oficial English version of Model Law 2006. In Mexico, Article 1479 ofthe Code ‘of Commerce 9 Itisnoteworthy that both laws departed fom the Model La language whether intheformot anaward rin another fo 1c Wishard to understand sihy these orders, whose effectiveness i essential per se are not ‘enforceable acconingtothe Morel aw 2006 is saldby mostauhors and practoners-aswell_ tthe UNCTTRAL working group that ths would be gong too fa essentially sincearbitation ‘consensual process (see lear Baptist Racine, «exeeution des mesures provisoiresordonnées per un arbiter Lechirage du projet de la nouvelle oi ype dela CNUDCL, nse mesures provisoies dans aibtage commercial international. xoltions et Innovations, Couocus er tans tensNenis, FEC), ne 2006, p10) Although this subject goes beyond the scope ofthe fpresentartcle,Imustsate that | disagree with thisvew. Consent isrequited to take the dispute {oarbitation butthe dispute exis and te partes are ligating, Indeed oftentimes the aries Adomot even agreeon thelanguage ofthe arbitration! 6680 ~ ENFORCEMENT N LATIN AMGRICA OF PROWSIONAL MEASURES ORDERED By ARSITA. Articles 17B and 17C are granted on an ex parte basis, for an initial period of 20 days. This part of the Model Law 2006 was not included in the Mexican legislative reform. ‘The party requesting enforcement of the provisional measure must inform, the judge “without delay” of any revocation, stay or modification of such measure by the arbitral tribunal. This provision should appease concerns of those who oppose enforcing awards granting provisional measures because of their lack of finality, or their provisional nature, However itis striking that the burden is placed on the claimant and noton the defendant of the measure, con-rary to the logic of the New York Convention. As will be shown below, should the measure be revoked or stayed, the enforcement judge may deny enforcement. Finally, the judge may order the requesting party to deposit “an adequate security”. Here, a second burden is placed ~ or may be placed ~ on the requesting party. Ina certain way, the judge may second-guess the arbitral tribunal's decision. “The second provision relates to the grounds for refusing enforcement of the decisions granting provisional measures. It establishes the following: “Article 17 I. Grounds for refusing recognition or enforcement"* (2) Recognition or enforcement of an interim measure may be refused oly: (a) Atthe request ofthe party against whom it is invoked ifthe court is satisfied that: (Such refusal is warranted on the grounds set forth in article 3¢(1) (2), (i) (i) oF Gu) of () The arbitral tribunal's decision with respect to the provision of security in connection with the interim measure isued by the arbitral tribunal has not been complied with; or (Gi) The interim measure has been terminated or suspended by the arbitral tribunal or, where so empowered, by the court of the State in which the arbitration takes place or under the law of which that Interim measure was granted; oF (b) Ifthe court finds that: Taken fom the offical English version of Model Law 2006. la Mesico, Anice 1480 ofthe Commercial Code Da jtnez Fouenss - 681 () The interim measure is incompatible with the powers conferred ‘upon the court unless the court decides to reformulate the interim measure to the extent necessary to adapt it to its own powers and ‘procedures for the purposes of enforcing that interim measure and ‘without modifying its substance; oF (Gi) Any ofthe grounds st forth in article 36(1)(b)() or i), apply to the recognition and enforcement of the interim measure. (2) Any determination made by the court on any ground in paragraph (4) of this article shall be effective only for the purposes of the application to recognize and enforce the interim measure. The court ‘where recognition or enforcement is sought shall not,in making that determination, undertake a review of the substance of the interim ‘This provision follows a similar approach to that of Article V(1) of the New York Convention and Article 36 of the Model Law, which in Mexico is transcribed in Article 1462(1) of the Commercial Code. In the frst section, the enforcing judge may deny “recognition or enforcement” if, from the submissions ofthe requesting party, it transpires that one of the four grounds for denying enforcement of foreign awards is present (in short, that the arbitration agreement is invalid or the parties do not have the capacity to enter into such. an agreement, that there is a violation of due process, that the arbitration proceeded without conforming to the parties’ agreement, or that the decision, deals with matters that go beyond the scope of what was requested). Should any of these grounds be raised by the defendant, it means that the enforcing judge will have to determine issues that go way beyond the scope and purpose of enforcing provisional measures. Whether the arbitral tribunal ‘was constituted in accordance with the parties’ agreement or whether one of the parties alleges lack of legal capacity for example, are issues are to be left to other judges, whether it be the annulment judge, the enforcing judge of the award, or even the arbitral tribunal. Otherwise, the purpose of providing for the enforcement of provisional measures is defeated. ‘Additionally, and similar to the fifth ground in Article V(1) of the New York Convention, the enforcing judge may deny enforcement if the order has been revoked or stayed by either the arbitral tribunal or a judge from the state where it was rendered or the state of the law according to which it (682 Exroncenewr LanN Attica OF PADVSIONAL MEASLES ORDERED BY ARAL. ‘was rendered. Ic is interesting to aote thar the provision ignores other states where the enforcement of the measure could be sought because of the location of additional goods of the debtor. A sign that over-regulation is sometimes dangerous. Finally, the first section allows the enforcing judge to deny ‘enforcement if the security that has been requested by the arbitral tribunal has not been deposited. This, on the contrary, is clever regulation, Section two includes grounds that the judge may raise ex ofci,which are a) if the measure is incompatible with the measures it is entitled to take under its own legislation, unless it can adapt them, b) the grounds under Article V(2) of the New York Convention, namely that the subject of the arbitration is not “arbitrable” according to the respective legislation and that the decision violates public policy. These grounds are found in Article 1462(II) of the Mexican law. “The subsequent paragraph establishes that the decisions ofthe enforcement judge are only applicable to the enforcement of the provisional measures. This appears to be a “without prejudice” statement. It also provides that the judge's assessment cannot go into the merits of the decision, which is also a welcome statement. ‘One aspect of both provisions is worth mentioning. While the first paragraph of Article 17H establishes the notion that decisions on provisional ‘measures should be recognized as valid, thereby giving the idea that there is no need for an exequatur-type decision, or homologation, the subsequent paragraphs in both Articles 17H and 171, speak of “recognition”. This same approach is taken by Articles 35 and 36 of the Madel Taw The need to use that notion is questionable, since “enforcement” should have sufficed”. Another aspect of the Model Law 2006 that the Mexican statute imported was the equivalent of Article 17G, which the Costa Rican statute also included. Tr provides that any damages caused by the provisional measures shall be compensated by the requesting party®. In Mexico, it was slightly modified to include liability by the arbitral tribunal: 12 __Thissame polntwas raised inthe dating essions, See UNCITRAL Working Group sesion A/ Ng /WGI/Wea5:"As a matter of rating, twas suggested that paragraph (2) ofthe revised sat could omit the words “recognized and since recognition was implied in enforcement, However, concem was expressed that both these terms should be included for the sake of consistency with other at provsiorsas wea ails 94 and 35 of ya UNCITRAL Model Law (4/CN.9/524, para. 34). The revised txt appears to make this concem redundant” 13, ‘Atle 17 G. Coss and damages, Tre party requesting an intern measure or appying for preliminary order shale liable or any costs and damages caused by tne measue othe order ‘oany partyifthe abil ibunal later determinesthat ntheclreumstances the meas orthe DyaA tnrz Foun - 683 “The party requesting an interim measure, as well as the asbitral. ‘eibunal granting i, are liable for any costs and damages caused by the measure.” (Emphasis added.) ‘This has been acutely described as “the flyin the ointment.” Although optimists should expect that the Achilles heel ofthe Mexican reform does not dissuade parties from requesting interim measures against ‘their Mexican opponents, at the very least they can expect that the criteria for ‘granting them will be rather stringent. B. Ecuapor Ecuador's law on arbitration dates from 1997 and it regulates both, domestic and international arbitrations. On provisional measures, the Ecuadorian law goes as far as allowing arbitral tribunals to enforce their own decisions, subject to the agreement of the parties. Article 9 of the statute establishes the followit “Interim Measures ‘Art.9, Arbitrators may order interim measures, in conformity with the provisions of the Code of Civil Procedures or provisions considered necessary for each case, in order to either ensure the material goods of the proceedings or to guarantee the result thereof, Arbitrators may require a security tothe party requesting the measure, with the ‘purpose of covering both the cost of such measure and damages to the opposing party should the claim be dismissed in the award. ‘The party against whom the interim measure is ordered may request a stay of the measure if it provides a sufficient security to the arbitral tribunal. Upon agreement of the parties in the arbitration agreement, for the cenforcementof interim measure arbitrators shall requte the necessary assistance of public judicial, police and administrative officers without Trershold oth ben pated Theva bunalmay award ich cossand damages ars peag tc ccc: Nereus lealtions provelbiy agate requesting aoe anssed tte pry spas born te rewire honed, See UNCTTRAL ony seien A/eN9/ WGA Wer fore deseo the leptons ion, va Goguel ster cbe ode media cael queda esponsbl el que ape as come Sita Aa ue adc, pr consent son de Sacro fos dos pesiucos ue se hse etanltin 15 _Saliontom’eplocnlsopa nrc Gonslese Con, "laMdiacin Derecho Getic eats “Un Comentano chp /woega.comorp6 (684g ~ExroncenenTn Lam AMERICA OF PROWISONAL MEASURES ORDERED BY ARETE having to tum to the judge of the plce of the goods or the place where the measures are required to be earied out: IE the arbitration agreement is silent on the enforcement of interim, ‘measures, either party may request ordinary judges to order the enforcement of such measures, subject to paragraphs two (2) and three (3) of this article, without this Seing deemed a waiver to the arbitration agreement.” “The Ecuadorian ingenious solution probably finds its origin in the ‘Colombian statue on arbitration, which is currently under eform’”. The arbitral tribunal's authority to directly call on the ordre public however, relies on the arbitration agreement, Should there be no specific agreement by the parties on confirming such authority, enforcement must he sought before the state courts, Not @ word on how the courts should deal with such requests or on the form the arbitral tribunal’s decisions may take. In addition, it is not clear whether arbitrators sitting abroad may exercise that power (subject to the agreement of the parties). “This starkness contrasts with the overly-detailed of Model Law 2006 (and, ‘as we will see below, the Peruvian case).’The reference in the frst paragraph of Article 9 refers to the Code of Civil Procedures, which reflects a very direct “loan” from the civil procedure regime for provisional measures. This probably ‘means that, in enforcing arbitral tribunal decisions, the judges will simply apply their own rules and criteria, With such little room for imagination and, therefore, error, this simple yet original regime should function effectively. ‘There are no reported judicial decisions of enforcement of provisional measures ordered by arbitral tribunals in international commercial arbitration cases", although parties to domestic agreements generally include a standard clause Free wandaion. ‘Article 15 of Colombian Decret 1818 provides that anarbitrator may ier alisonterthe property registrar recy to register the claim when the case concermsa dispute egardingchatel Ghent the very limited scope this provision has in practice, wil not be discussed inthe ate. 8 _althoughthere are casesinintematonal commercial arbitration thecal cu’ deerence to ‘narivaltibunals decision on provisional measieswastestedintCSID case n° ARB/06/21 CI (netted Republica del evedor end Empresa Etta de Petree de fevador Petro. In that cas, the arbitral tribunal issued a “ecemmenction” on 19 Navember 2007 for the ‘State to abstain rom or cease to inate proceednge against claimant in Ecuador. Concuenty, the Ecuadorian prosecutor’ ofce inated cera eniminal proceedings against some of the ‘company sofices, The ‘Core Nacional de sti" declared sch ations nl and void in view ‘ofthe ICID tibunats decision, Da lntnez rcuees «685 whereby they grant the arbitrators such power to enforce their own decisions ‘on provisional measures", C. Peru ‘The latest law on arbitration in Peru is from 2008. Since its predecessor of 1996, Peruvian legislation on arbitration has drawn attention in the region ‘because of its attempt to establish an autonomous system, independent from the Peruvian judiciary. Following that purpose, Article 48 of the General ‘Asbitration Act establishes that arbitrators may enforce provisional measures ‘themselves, with or without support from the force public. Parties, however, are also free to seck enforcement from a competent judge. ‘The first part of Article 48 presumably deals with measures ordered by arbitral tribunals sitting in Peru’! “Article 48°, Enforcement of provisional measures ondered by the arbitral tribunal {The arbitral tribunal is empowered to enforce, upon a party's request, its own provisional measures, unless at it sole discretion it deems necessary or convenient to require assistance from the force publi. 2. When the party against whom the measure is ordered does not comply,or when judicial enforcementis required, the interested party shall make an application to the competent judicial authority, who, with the sole verification of a document revealing the existence of the arbitration and the provisional measure, shall enforce the measure without allowing any appeal or objection 3, The judicial authority is not competent to interpret the content oF ‘the scope ofthe provisional measure. Any request for clarification or correction of the measure or the enforcement thercof shall be made by the judicial authority or the partes to the arbitral tribunal ‘Once the measure is enforced, the judicial authority shall notify the arbitral tribunal and provide a certified copy of the file." Jo Eandovan pacitoners Xaver Andrade and Juan Manuel Machin fone the author tat ths patcc has proven to be eflectve 2 : ao Seong Jost Caos temandes ors Lamu te drbiajepervanade 2008; nba evi de abirae Comettaly de ventones, 2008 pp. 703700. 21 riley provides that te decson may ormay nt ake efor ofan award 2 Feetndaton {686 ~ Enrouceexrw Lan AwtRICA OF PROVISIONAL MEASURTS OROFRED By ARBITRAL. Paragraph 1 seems firsthand quite potent; however, paragraphs 2 and a it, since they virtually establish a second step to arrive at a final enforcement of a measusc. Incleed, if application to the judicial authority is foreseen for cases when the party “does not comply” or “when judicial enforcement is required”, the utility of the frst paragraph is difficult to see. In fact, in practice, when the arbitral tribunal orders a provisional measure, it is enforcing it by virtue of its own authority: This provision therefore dock not add anything. Rather, it might be confusing, since it seems that access to the competent judge is available only after the arbitral tribunal has made an om to“enforee”its measures, upon a submission from the requesting party we second part ofthe same provision seems mi by arbitral tribunals sitting eid fl paiieenedlae al “4. Any interim measure ordered by an arbitral tribunal which place is located outside the Peruvian territory shall be recognized and enforced in the national teritory, in application of the provis in ion ofthe provisions of Articles 175,76 and 77, withthe following qualifications: 4. A request for fecognition may be denied only for grounds a,b, ¢ and d of paragraph 2 of Article 75 or when poine d of the present paragraph is not complied with. b-The party requesting recognition of the interim measure shall submit an original or copy of the decision ofthe arbitral tribunal, having due regard to Article 9. «The terms provided for in paragraphs 2 and 3 of Arti aragraphs 2 and 3 of Article be ten (10) days. fi sion i “The judicial authority may order the requesting party to post an quate security ifthe arbitral tribunal has nor decided on such security or when the security is necessary to protect the rights of third parties Failure to comply will allow the judicial authority to deny the request for recognition, «The judicial authority charged with the enforcement of the interim ‘measure may deny the request in cases where the interim measure is incompatible with its capacity, unless it decides to reformulate the ‘measure in order to adjust it to its own capacity and procedures so as, toensure enforcement, without modifying its content and its nature.” 2 Fe wandation, Dyas venez ious - 687 ‘Article 75(2) of the Peruvian Arbitration Laws the equivalent of Article 36 of the Model Law and V of the New York Convention, which means that the groundsare the same as the Custa Rican and Mexican lawe. Therefore, the issues raised in the respective subsection above apply. Article 76 establishes the procedural rules for recognition of awards, while Article 77 refers to the rules of civil procedure for enforcement before the competent court. Otherwise, Article 48(4)(d) begs the same comment as expressed above, and 48(4)(e) isa provision thatallows the judge to adapt a ruling ofan arbitrator that would otherwise be incompatible with its competences. This provision shows a regime truly supportive of international arbitration, Unfortunately, the analyses just made are constrained to the language of the provisions since there are no reported cases in Costa Rica, Mexico, Peru or Feuador that have put toa test che different provisions of those jurisdictions. Te will certainly be interesting to read the interpretation of the courts of these novel articles, which will depend more on the parties’ attorneys’ mastery than. the plain words of the laws, as is usually the case. For parties seeking enforcement of provisional measures ordered by arbitral tribunals in countries that do not have specific legislation on the subject, an obvious approach is to invoke the New York Convention. This will be addressed at present. IIL. APPLICATION OF THE New York CONVENTION TO DECISIONS ORDERING INTERIM MEASURES In countries lacking a specific mechanism for the enforcement of provisional measures dictated by arbitral tribunals, solution isto enforce them using the same rules that are applied for the enforcement of awards, Several questions arise in this regard. In international arbitrations involving parties of nationalities different from thatof the place of arbitration there are two possibilities: ) the provisional ‘measure must be enforced in the place of arbitration, or b) the provisional measure must be enforced in a place outside the place of arbitration. This section will focus on the second hypothesis, which means that the discussion will regard enforcement of foreign decisions applying the New York Convention. ‘A note, however, about the first hypothesis is useful before proceeding, Some State laws governing international commercial arbitration include the provision in Article 35(1) of the Model Law, which reads a follows: (688 - ENroncumenTn Lat AneRICA OF PROWSIONAL MEASURES ORDERED BY ARBITEA. “Article 35. Recognition and enforcement (21) Anarbitral award, respective ofthe country in which itwas made, shall be recognized as binding and, upon application in writing to the ‘competent court, shall be enforced subject to the provisions of this article and of article 36.” (Emphasis added). Since Article 36 of the Model Lawis identical to Article V of the New York. Convention, the analysis in this section will be applicable to both, decisions made in the place of arbitration and decisions made outside the place of arbitation, “The key issue that will be discussed is essentially whether decisions on provisional measures may be qualified as “arbitral awards” under the New York ‘Convention (and Article 36 ofthe Model Law). First, a description of the case law and prevailing views in Latin America will be made (A), followed by an overview of three international cases and European scholarly opinions (B). A. ARE DECISIONS ORDERING PROVISIONAL MEASURES CONSIDERED “ARBITRAL AWARDS” IN THE TERMS OF THE New York CONVENTION IN LaTIN AMERICA? One could think that the simplest approach to answer that question is, the formalistic approach, according to which if the arbitral tribunal chooses to order a provisional measure in the form of an award the decision should be enforced according to the New York Convention. This would be particularly pertinent if the arbitration is governed by any of the rules or laws that allow the arbitral tribunal to decide what form the award should take. Indeed, one ‘would think that the option should be of consequence. Arbitrators may consider that the circumstances of a particular case call for one form over another. One can think of the difference between affecting the parties’ procedural rights (for example, ordering a party to protect evidence) and affecting the parties’ contractual or substantive rights (for example, ordering a party not to call on a bank guarantee). For concerns of speediness and effectiveness, arbitrators may prefer deciding the first type of measures in the form of procedural orders and the second type by awards. Otherwise, why ‘would rules and laws offer a choice to arbitrators? 24 Alice 290) of he ICC Rules and Aticle 212) ofthe AAA International Abitaion tales, for example. Dra jen routs - 689 ‘However, it seems thatin Latin America the form chosen by the arbitrators js of little or no relevance in the determination of whether a decision should or should not be enforced. There is only one reported court decision regarding the ‘enforcement of a decision on provisional measures in Latin America, and itis ‘evident from it that the court was oblivious to the arbitrators’choice of form. In that case", Western Technological Services International Inc. sought to enforce in Chile the decision of an arbitral tribunal siting in Dallas, Texas under the auspices of the American Arbitration Association that ordered Cauchos Industriales S.A. to refrain from competing against it. The order was to remain in force as long as the arbitral tribunal did not render a different dccision or the parties did not agree otherwise. The Chilean Supreme Court of Justice denied enforcing the decision. Although the arbitral tribunal’ order ‘was not rendered in the form of an award, this was apparently not a factor in the court's analysis. ‘The Chilean Supreme Court sought to determine whether, under Chilean lay, the decision was an “award” of the kind that could be enforced under the ‘New York Convention, the local international arbitration law, and the local procedural rules®. The Supreme Court tured to Article 158 of the Code of Civil Procedures to determine whether the arbitral decision was any of the following: a) a final decision, b) an interlocutory decision that establishes a permanent right in favor of a party, orc) an interlocutory decision preparatory ofa final decision and that allows the proceedings to go forward”. “The Supreme Court found that the decision did not fit into the categories mentioned above, since the arbitral tribunal itself had qualified the decision as a temporary one by establishing that the order was valid as long as it did not decide otherwise, and also because ‘precautionary measures are essentially provisional”. As a final consideration it added that, should the measure be 3 Supreme Cour Roln® 5468-09, 38 Declsonsinchileon enforcement of abival awards are not solely aken on thebassofthe New York Convention. They include eferences tothe statute on intomational arbitration andto the Cove of Cl Procedures. See Dyal mene Figueres and Gonzalo Fernand, “La evolucién de las norms de exequatur de Inudosenranerosen Chile in Amat Comin vATHAE DE Inu, 3, Calos A Soto Coagula (Directo) isitato Peruano de Arbitaje 2009). 27 These decisions are called “sentencias™ The ether decisions are autos or ores that docide ‘on incidental matters not fling in the deintion of intefocutory decksions, and "decretos" ‘or cesolutions that serve to prepare for he inal decsion and regard the organization ofthe proceedings {690 - Evroncivtur ey Lan AntRICA OF PROVISIONAL MEASURES ORDERED By ARBITEAL maintained “in time”, it would be equivalent to determining some of the main claims sought by plaintiffin the case, Teappears that the concerns of the Supreme Court were contradictory: a) the fact that the decision could be modified during the arbitration but, should ite maintained, b) the fact that it virtually decided on the main claims sought in the arbitration. What is also odd about the reasoning followed by the Supreme Court is that in Chile provisional measures by judges are taken in the form of decisions of the type b) above, and they are enforced as “provisionally final”, which means that they have the effects of “cosa juzgada formal provisional”. This means that a decision from a foreign arbitral tribunal ordering a provisional measure has a lesser rank than a local judge decision ordering 2 provisional measure. Does this not go against the spirit of Article III of the New York Convention’? Although the only reported case in Latin America regarding specifically the enforcement of a provisional measure is the Chilean case, a Colombian case sheds some light as to the judicial stance in that country on the subject. In Merck et al v. Teonogutmicas, the Colombian Supreme Court of Justice denied enforcing an Interim Award on Jurisdiction in which the sole arbitrator determined inter alia that respondent should abstain from continuing actions, against the arbitration agreements. The Colombian Supreme Court found that the award did not meet the requirements of an “arbitral award” under the New York Convention because it did not finally determine questions of merit. To reach that conclusion, it interpreted Artiele I(1) of the New York Convention as restricting the term “award” to decisions originating in the (substantive) differences between persons. The so-called Interim Award was, in the eyes of the Colombian Supreme Court, a mere order that could be modified by the arbitrator ata later stage. This same line has been followed in subsequent cases of enforcement of awards. Colombian author Eduardo Zuleta agrees in that, in order to qualify for an “arbitral award” in the terms of the New York Convention, a decision must be final on the matter that it determines. Under this definition, only partial or final awards would qualify, and orders that may be modified by the arbitral 2 “The Conventions principal aim i that foreign and non-domestic nds will note discriminated agains andi obliges Paes to ensure sich awards are 'ecognzeand general capable of enforcement in ther jrsdicion inthe same way as domestic assards’ See

    You might also like