LUXEMBOURG Law and Practice Contributed by: Emilie Waty and Kloris Vjerdha, KLEYR_GRASSO
law. Therefore, an award granting punitive damages would have to be set aside for being in violation of public policy. 10.3 Recovering Interest and Legal Costs The Luxembourg Arbitration Law does not contain a specific provision with respect to recovering interest. Accordingly, the recovery of interest is determined with respect to the law applicable to the dispute. Pursuant to Luxembourg procedural law, and in the absence of a prior agreement between the parties, the allocation of costs falls within the discretion of the arbitral tribunal, which shall take into account the circumstances of the case as well as the ultimate out - come of the proceedings. Accordingly, the arbitral tribunal may, at its own dis - cretion, order each party to bear its own costs, or even direct that one of the parties alone bears the entirety of the costs. Arbitral awards rendered in Luxembourg are not sub - ject to appeal in any form, thereby reflecting their binding and final nature. The only recourse available to parties against an arbi - tral award rendered in Luxembourg is an application for annulment (recours en annulation) before the Lux - embourg Court of Appeal pursuant to Article 1237 of the NCCP as well as an application for review ( recours en révision ) pursuant to Article 1243 of the NCCP. In accordance with Article 1238 of the NCCP, an arbi - tral award can be annulled for any of the following reasons: 11. Review of an Award 11.1 Grounds for Appeal • the arbitral tribunal wrongly declared itself compe - tent or incompetent to rule on the proceedings; • the constitution of the arbitral tribunal was irregu - lar; • the arbitral tribunal rendered an award without complying with its terms of reference; • the award violates public policy;
• the arbitrators, except where the parties have waived this requirement, failed to provide reasons for the award rendered; or • there has been an infringement of a party’s right to defence. An application for annulment is only admissible where the award can no longer be challenged before the arbi - tral tribunal. Such an application must also set forth the entirety of the grounds upon which the application for annulment is based. Article 1243 of the NCCP also allows the parties to file an application for review of the award rendered by the arbitral tribunal in one of the following circumstances: • subsequent to the rendering of the award, it becomes apparent that the award was obtained through fraud committed by the prevailing party; • following the rendering of the award, it appears that decisive evidence was withheld by the other party; • the award was rendered on the basis of evidence recognised, after the fact, as false by the court; or • following its rendering of the award, the arbitral tribunal recognises that the award was based on testimonies, affidavits or sworn declarations that were false. 11.2 Excluding/Expanding the Scope of Appeal Under the Luxembourg Arbitration Law, the parties cannot exclude or expand the scope of appeal or challenge under the national law. 11.3 Standard of Judicial Review The courts do not rule on the merits of a dispute sub - mitted to arbitration, even in the context of judicial review. The only exceptions to this principle are where the dispute involves a matter of public policy or where an allegation of fraud is made by one of the parties.
12. Enforcement of an Award 12.1 New York Convention
Luxembourg formally ratified the Convention on the Recognition and Enforcement of Foreign Arbitral
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