CHILE Law and Practice Contributed by: Andrés Jana, Rodrigo Gil, Francisco Grob and Victoria Demarchi, Jana & Gil Dispute Resolution
Refusing Recognition One of the grounds recognised by the ICAL for refus - ing recognition or enforcement of an international arbitration award is that the award has been annulled or suspended by a court of the country in which, or under the law of which, it was rendered (Article 36 (v) of the ICAL). The suspension of the arbitral award by a court of the country in which, or under the law of which, the award was rendered constitutes a ground to refuse enforce - ment of the award (Article 36 (v) of the ICAL). Also, in the case of an annulment procedure pending abroad, the Supreme Court has ruled that the award is not binding on the parties. Citing Article 28 No 6 of the ICC Rules 1998, the Supreme Court has stated that the award rendered by such court is unreformable in the system provided by such rules, so that the appeal filed before such court does not suspend the effects of the award – which remains in force – and it is possible to enforce the award as long as there is no contrary resolution (Supreme Court, Case No 5228-2008 and Case No 7854-2012). Immunity From Execution As a general rule, the Chilean state and its entities are subject to immunity from execution. Nevertheless, the state and its entities may waive such immunity in cer - tain cases. Specifically, Decree Law No 2,349, which governs international contracts for the public sector, provides in Article 2 that the state and its organisa - tions, institutions and companies may renounce their immunity from execution. It should be noted that this has a restricted scope, as it applies only to the enforcement of awards rendered in proceedings directly related to international contracts containing such waiver. 12.3 Approach of the Courts Recognition and Enforcement of Arbitral Awards The national courts have adopted the general approach of recognising and mostly accepting the enforcement of arbitral awards, regardless of the country in which they were rendered and as long as they comply with the legal requirements. By way of example, regard - ing the enforcement of a foreign arbitral award, the
Supreme Court’s case law accepts the exequatur, as opposed to a minority of case law that rejects it. Thus, in the case of Klion SRL v Pesquera Villa Alegre SA , Case No 41841-2017 dated 26 July 2018, the Supreme Court states: “It has become evident that, in the case of the enforcement of an arbitral award, according to the wording of Law 19,971 [ie, the ICAL], regardless of the country in which it was issued, it is recognised as binding in Chile if it complies with the requirements of Articles 35 and 36 of that Law, which otherwise constitutes a repetition of the relevant provi - sions of the New York Convention.” In another case, the Supreme Court accepted a request for the execution of an award issued in an international commercial arbitration, ruling that it is not relevant for its recognition in another country that reciprocity exists between the country in which it was rendered and Chile. According to the Supreme Court, whenever the requirements of the ICAL are complied with, national legislation recognises the award’s bind - ing character because it is an international arbitration ( I Schroeder KG ( GmbH & Co ) v Exportadora Las Tina- jas Limitada , Supreme Court, Case No 104262-2020 dated 19 July 2021). This has been executed in a number of cases allowing the enforcement of foreign arbitral awards, including: • Gold Nutrition Industria y Comercio v Laboratorios Garden House SA v Laboratorios Garden House SA , Supreme Court, Case No 6615-2007 dated 15 September 2008; • Almendra y Miel SA v GLG , Supreme Court, Case No 82442-2016 dated 30 November 2017; and • Bose Corporation v MusicWorld Audiovisión Limi- tada , Supreme Court, Case No 12710-2018 dated 9 July 2019. Refusal to Recognise Regarding the refusal to recognise or enforce an arbi - tral award on the grounds of public policy in general, it is understood that this should be applied restric - tively and be limited only to the infringement of basic and fundamental rules of the Chilean state, so as to avoid limiting the enforcement of international awards in Chile by simply invoking local public policy (San -
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