Incapacity of Parties and Arbitration Agreement as Grounds for Refusing Recognition in Kuwait - Thesis Example

Arbitration was therefore developed solely as a private means for parties to resolve their disputes without resorting to the courts for resolution of the same. Arbitration is considered much faster, more flexible, and inexpensive as compared to litigation. Additionally, the parties under commercial dispute enjoy the autonomy of selecting experts in their field to serve as arbitrators in their disputes.

Therefore, arbitration serves the additional purpose of providing a neutral body for resolving transnational disagreements in international commerce without having to resort to the judicial systems of either party. The New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958) has been deemed by many commentators as one of the most successful accords on arbitral agreements in the context of international commerce. In essence, the convention covers both the enforcement and jurisdiction facets of arbitration in international commerce.

This convention was initiated by the International Chamber of Commerce (ICC) with the backing of the UN and was opened for signature in 1958. By July 2005, 136 nations had ratified it with Kuwait becoming a signatory on 28th April 1978. This convention presents the legal basis for putting into effect a majority of international commercial arbitration awards. The convention accomplishes this by making provisions for mutual recognition and implementation of arbitral awards by signatory states.

In addition, the convention seeks to eliminate wasteful, duplicative litigation following arbitration through the limitation of defenses to confirmation of an arbitral award. This Convention has thus been instrumental in representing a remarkable success in the struggle to achieve a universal system for resolving commercial disputes. However, the harmonization achieved by this convention is deemed deficient on the basis that the convention leaves crucial determinations to the national courts of signatory states that are mandated to establish the validity of arbitration agreements and awards.