“Public Order” as Grounds for Refusal in the Recognition and Enforcement of a Decision in International Commercial Arbitration: Ukrainian Realities and International Experience

Abstract

Background: The question of recognition and enforcement of international commercial arbitration (ICA) decisions, as a prototype of a foreign court decision, finds radically opposite answers in different legal systems and in the doctrine of the ICA. Thus, in the Regulation of the Council (EU) 44/2001 of 22 December 2000 on the jurisdiction, recognition, and enforcement of judgments in civil and commercial matters, formerly the Brussels Convention of 1968 and the Lugano Convention of 1988, the notion of ‘arbitration’ was excluded from the sphere of execution and recognition of foreign court decisions. Methods: Nevertheless, the procedure for recognising and enforcing an ICA award has a unified approach in many countries around the world. Thus, national courts, when deciding on the recognition and enforcement of an ICA award, are increasingly faced with such problematic issues as the grounds for refusing to recognise and enforce such an award. This article reveals that these grounds for refusing to recognise and enforce the award of the ICA are a violation of public order of the country where the arbitral award is subject to recognition and enforcement. Particular attention is paid to the distinction between ‘substantive’ and ‘procedural’ public order and the practical approaches of national courts in some countries to this issue. Results and Conclusions: The authors state that the way to overcome this inconsistency is still a unified approach to understanding ‘public order’ in all member states of the New York Convention of 1958 and clearer international regulation of this issue.