Refusing the Foreign Arbitral Awards on the Ground that the Arbitral Proceedings were Unfair - Thesis Example

US claimants have frequently expressed deep dissatisfaction with Kuwait’s legal system, which proceeds at a snail’s pace.

There is a legal system and strong trading history in Kuwait. Its civil code is significantly influenced by Islamic law. Kuwait has been a long-standing trading nation, and this has made its judiciary conversant with international commercial laws. Since the year 1963, Kuwait has been a member of GATT. All the same, it is not a signatory to the Government Procurement Code of the WTO. Although arbitration is permitted in Kuwait, the Foreign Investment Law clearly states that disputes between a foreign investor and other entities can be settled, only by the Kuwaiti courts.

Kuwaiti contracts, seldom stipulate that disputes can be settled by recourse to commercial or political negotiation. Foreign judgments are recognized and enforced in Kuwait, by its judicial system, only when there are reciprocal arrangements. Article 35(1) of the UNCITRAL Model Law on International Commercial Arbitration states that an arbitral award is binding and enforceable. However, this binding nature and enforceability are subject to the provisions of articles 35(2) and 36. Reciprocity has not been made a requirement for such recognition and enforcement.

This was the outcome of the realization that the place of arbitration has limited importance in international disputes. In addition, there was a genuine desire to circumvent territorial limitations. The UNCITRAL Model Law does not specify details relating to the procedure to be adopted while recognizing and enforcing arbitral awards. Such details fall under the purview of national practices and procedural laws. All that the Model Law enjoins are certain conditions for effecting enforcement under article 35(2).

In the year 2006, the Model Law was amended, in order to liberalize formal agreements and take into account the changes made to the form of the arbitration agreement under article 7. Moreover, article 35(2) no longer insists upon the presentation of a copy of the arbitration agreement. International arbitral awards are enforced in foreign countries by the provisions of multilateral conventions and bilateral treaties. However, enforcement of arbitral awards can be refused if the reasons for such refusal are specified in a convention or treaty.

The consent of a court is essential for enforcing an arbitral award against a losing party that had failed to comply with its obligations under the arbitral award. All the same subsequent to being rendered an arbitral award could be set aside by the court of the country where this award had been rendered. This takes place when one of the parties requests the court to do so on the grounds that the award violates the due process of law, the subject matter is non – arbitrable, or breaches the public policy of that nation.

The parties are bound by an arbitral award which may be filed with the court by the parties, in order to confirm it. On confirmation by the court, arbitral awards obtain the status of a court judgment.