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10 N.Y.U. J.L. & Bus. 189 (2013-2014)
International Investment Treaty Arbitration as a Potential Check for Domestic Courts Refusing Enforcement of Foreign Arbitration Awards

handle is hein.journals/nyujolbu10 and id is 195 raw text is: INTERNATIONAL INVESTMENT TREATY ARBITRATION AS A POTENTIAL CHECK FOR DOMESTIC COURTS REFUSING ENFORCEMENT OF FOREIGN ARBITRATION AWARDS CLAUDIA PRIEM* International commercial arbitration has proven a popular means for dis- pute resolution in commercial conflicts. Due to the New York Convention, many countries allow foreign arbitral awards to be recognized and enforced in their local courts, resulting in effective means for execution of the award. However, what happens when domestic courts are reluctant to enforce a for- eign arbitral award ? Under the principles of state responsibility, a state can be held liable for the conduct of the state's independent local courts. If domestic courts wrong- fully refuse to comply with their obligations under the New York Convention to recognize or enforce a foreign arbitral award, or if the courts cause undue delay in enforcing such an award, these actions can be attributed to the sovereign state itself As such, the state can be held liable for breach of its obligations under international treaties. The Article analyzes seven recent cases where domestic courts refused to enforce the foreign commercial arbitral awards, after which aggrieved parties have attempted to seek enforcement via international investment arbitration. Several investment arbitration tribunals have ruled that refusing such en- forcement, under certain exceptional circumstances could amount to a breach of international law or to a breach of a Bilateral Investment Treaty (BIT), more specifically through breaching the Expropriation-clause, the Effective Means-clause or the Denial of Justice-clause as found in these BITs. The Note examines the growing use of international investment arbi- tration as a supervisory mechanism when domestic courts wrongfully refuse to enforce a commercial arbitral award, and argues why it is vital to attri- bute investment arbitration with such supervisory jurisdiction. * Claudia Priem is an associate in the Amsterdam office of De Braun Blackstone Westbroek. LL.M., New York University School of Law, 2013; LL.M., VU University Amsterdam, 2012; LL.B., Erasmus University Rotter- dam, 2011. The author would like to thank Professor Franco Ferrari and her fellow students in the LL.M of International Business Regulation, Litigation, and Arbitration at NYU for their helpful comments during the presentation on an earlier draft of this article. Also, she would like to give special thanks to the editorial staff of the NYU Journal of Law & Business, especially to Bridget Harris, for their invaluable editing and advising throughout the writ- ing process. All errors remain the author's own. 189 Imaged with Persmission of N.Y.U. Journal of Law and Business

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