Author : Christopher S. Gibson
Release : 2009
Genre :
Kind : eBook
Book Rating : /5 ( reviews)
Book Synopsis Arbitration, Civilization and Public Policy by : Christopher S. Gibson
Download or read book Arbitration, Civilization and Public Policy written by Christopher S. Gibson. This book was released on 2009. Available in PDF, EPUB and Kindle. Book excerpt: A trend toward delocalization of arbitral law has been underway for the last 50 years, starting with the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Many courts recognizing the merits of arbitration have exercised significant deference toward arbitral awards, reflecting a modern and light-handed attitude and narrow view of the public policy defense to enforcement of international arbitral awards. At the same time, however, the expanding scope of claims that may be submitted to arbitration accentuates emerging concerns about issues of mandatory public law arising in arbitration. There is increased discussion over the authority and obligation of arbitral tribunals to consider issues of public law within the arbitration procedure itself. Further, there is a call for recognition that the liberalization of arbitrable subject matter comes necessarily at the price of some increase in judicial ex post control of the compatibility of the arbitrators' product with public policy, as the second-look doctrine raised by the U.S. Supreme Court in the Mitsubishi case suggests. From time to time it is appropriate to revisit the question of public policy as a bar to enforcement of international arbitration awards. Public policy, by nature, is a dynamic concept that evolves continually to meet the changing needs of society, including political, social, cultural, moral and economic dimensions. My article focuses on how considerations of mandatory public law play into the concept of public policy as a defense to enforcement of international arbitral awards. My claim is that mandatory public law poses a challenge to international arbitration and, in response, in order to sustain the balance and legitimacy of the international arbitral system, a reformed concept of substantive public policy is needed. I do not argue in favor of lowering the standard to be applied - that is, in balancing between finality and justice, a reviewing court should continue to reflect a pro-enforcement bias and refuse enforcement only in "exceptional circumstances." In this respect, I agree with the detailed recommendations that are intended to guide an enforcement court's discretion, which are contained in the International Law Association Committee on International Commercial Arbitration's 2002 Final Report on Public Policy as a Bar to Enforcement of International Arbitral Awards. However, in my view, the scope of public policy as defined in the Final Report is too narrow because it recommends that an enforcement court exclude consideration of the public policies that may be relevant at the place of the underlying performance of the contract. I contend that the public policy standard should permit a supervising court to consider fundamental public policy not only of the enforcement forum, but also at the place with the closest connection to an underlying contract, where the transaction in question has its greatest societal impact. This approach provides proper incentives for the parties and arbitrators to consider relevant issues of mandatory public law during arbitral proceedings and determine whether they are sufficiently fundamental. It also enables courts at a remove from the place of performance to give due regard to the important public policies of another State, reflecting that State's sovereignty and societal values. In this way, public policy mediates between the interests of transnational business and those of the State with closest connection to the contract. While building legitimacy and trust can be complicated and may require balancing paramount interests of arbitral finality against fundamental State principles, the public policy defense is the appropriate mechanism to achieve this counterpoise.
