Recognition and enforcement of international arbitration awards

INTRODUCTION
With the development of economy and technology, world trade has expanded, and, as a result, the potential for more international business disputes bas rose significantly. To resolve such disputes, mainly there are two way to choose. One is litigation, another is arbitration. It called international Commercial Arbitration when such commercial dispute involves international factors. Now many international commercial affairs are using international commercial arbitration, as opposed to a national court system, to resolve their international contractual disputes. Arbitration is preferred because it offers the following benefits: confidentiality; freedom to choose the arbitrators, the place of arbitration, and the rules governing the arbitration; and a flexible procedure which is usually more conducive to settlement and less adversarial than litigation. Arbitration is completely private, arbitrators' decisions are not subject to a substantive review, and arbitrators are accountable solely to parties to a dispute.

For arbitration to work in an international setting, a legal framework was needed.
The 1923 Geneva Protocol on Arbitration Clauses and the 1927 Geneva Convention on the Execution of Foreign Arbitral Awards were early attempts to establish this legal framework. Due to the deficiencies of these attempts, the International Chamber of Commerce ("ICC") proposed that the United Nations draft an improved international convention. The United Nations' involvement produced the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards ("Convention"/"New York Convention"). Signed by over one hundred countries, including United States, the UK, and China, etc, it has become "the most important Convention in the field of arbitration and ... the cornerstone of current international commercial arbitration." The Convention addressed two important aspects of the enforcement of foreign arbitration, requiring, first, the enforcement of foreign arbitral awards and, second, the enforcement of agreements to arbitrate disputes.

As many companies expand into global markets, the extant business reality of prosecuting or defending lawsuits arises from companies relying upon standard or "boiler plate" contracts or invoices when selling goods and services to customers or buying products from suppliers or third parties. It is trite to say that a review of the wording of a company's sales contracts or invoices is advisable. However, any domestic or foreign company which conducts business or sells products in Canada should be mindful of the conflict of law issues and jurisdictional disputes which may result in costly litigation affecting the company's "bottom-line."