Recognition In Switzerland Of A Foreign Award : In Case Of A Challenge, When Is An Award Biding?

Author:Mr Frank Spoorenberg
Profession:Tavernier Tschanz
 
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The ex lege suspensive effect of a challenge is no bar

to the recognition of the award unless the suspensive effect is

confirmed in a judicial decision issued in the state where the

award is challenged.

Under certain legal systems,

extraordinary means of judicial review of international arbitration

awards are deprived of any suspensive effect; this is the case for

instance under Swiss law, where a suspensive effect of annulment

proceedings is granted upon a party's request and under

extremely restricted conditions. In other jurisdictions, in

contrast, certain extraordinary means of judicial review can have

by law a mandatory suspensive effect, giving rise to some

speculations as to the immediate enforceability of awards issued in

these jurisdictions.

Putting an end to years of

uncertainty, the Swiss Supreme Court has eventually fully endorsed

the view taken by the majority of the scholars, that mere the

existence, by virtue of the law, of a mandatory suspensive effect

to annulment proceedings in the country of origin of an award (the

"Source State") would constitute no bar to the

recognition and enforcement of said award in Switzerland. An

express judicial decision granting or confirming the suspensive

effect of the annulment proceeding remains necessary even in such

instances, which in turns implies that the annulment proceeding has

indeed been filed (i).

Facts

On June 5 2007, an ICC Arbitration

Tribunal (the "Tribunal") seated in France had issued a

final award (the "Original Award") communicated to the

Parties two days later. The exequatur in France was requested and

obtained by the winning Party on June 25 2007 (the "Original

Award Exequatur Order"). The Original Award Exequatur Order

was communicated to succumbing Party on July 13 2007 and a

three-month deadline imparted to challenge it before the French

Court of Appeal. Meanwhile, rectification proceeding had been filed

by the succumbing Party on July 5, 2007, prompting the Tribunal to

issue a new document called Addendum on October 17, 2007 (the

"Addendum") partly admitting the rectifications

requested. No exequatur order was communicated (and presumably

sought) with respect to the Addendum. On June 8 2008, the winning

Party sought the recognition of the Original Award in Switzerland,

without any reference being made to the Addendum. The succumbing

Party objected to such recognition on the ground that the Original

Award as rectified by the Addendum was not yet binding on the

Parties...

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