USA Law and Practice Contributed by: Jason W. Myatt, Ankita Ritwik and Charline Yim, Gibson, Dunn & Crutcher LLP
• Jurisdiction – For a foreign arbitral award, a rec - ognition and enforcement action may be brought before a federal court in a district where personal jurisdiction over the award debtor can be estab - lished (the FAA provides subject matter jurisdic - tion). Some jurisdictions also allow recognition and enforcement actions where the award debtor has assets within the jurisdiction, while a handful allow recognition even in the absence of assets provided such a proceeding is consistent with the constraints of the due process clauses of the US Constitution’s Fifth Amendment or Fourteenth Amendment. For a domestic arbitral award, the action should be brought before the state courts where the arbitration was seated. • Timing – For non-ICSID foreign arbitral awards, the FAA contemplates that the action be initiated within three years after the arbitral award was made. However, there are certain circumstances in which courts have allowed applications to be made beyond this three-year limit, including by applica - tion of the UFCMJRA. US law implementing the ICSID Convention does not provide a statute of limitations, although recent authorities suggest that the applicable limitation for most ICSID actions, which are typically initiated in the United States District Court for the District of Columbia, will be 12 years. For a domestic arbitral award, under the FAA the time limit is one year. State laws regarding time limits for actions will vary depending on the jurisdiction. • Necessary documentation – The petition seeking recognition or enforcement of the award should be included with a certified copy of the written award and the arbitration agreement. Where the award is in a foreign language, it should be accompanied by a certified translation. 4.2 Variations in Approach to Enforcement of Arbitral Awards As indicated at 4.1 Legal Issues Concerning Enforce- ment of Arbitral Awards , the procedure for enforce - ment of an arbitral award varies depending on whether the arbitral award is domestic, foreign or an ICSID award. • Domestic Awards – Chapter 1 of the FAA applies to domestic awards where the arbitration involves
commerce beyond one US state. Otherwise, the laws of the specific US state at issue apply. • Foreign Awards – Chapters 2 and 3 of the FAA apply to foreign arbitral awards, other than ICSID awards. • ICSID Awards – 22 USC § 1650a applies to awards issued under the ICSID Convention. While the FAA governs federal courts, the “Full Faith and Credit” clause of the US Constitution requires that each state must accept the recognition of an arbitral award confirmed by another state court or federal court (US Constitution, Article IV, § 1). Similarly, the United States will grant the “full faith and credit” presumed for an award of any other domestic court to an award “rendered pursuant to chapter IV” of the ICSID convention (22 USC § 1650a). 4.3 Categories of Arbitral Awards Not Enforced As set out in 4.6 Challenging Enforcement of Arbitral Awards, an arbitral award can be subject to set-aside (or “vacatur”) for the grounds enumerated by the rel - evant applicable law. For example, the FAA provides that both domestic and foreign arbitral awards can be set aside on the following grounds: • where the award was procured by corruption, fraud or undue means; • where there was evident partiality or corruption in the arbitrators, or either of them; • where the arbitrators were guilty of misconduct in refusing to postpone the hearing (upon sufficient cause shown) or in refusing to hear evidence perti - nent and material to the controversy, or of any other misbehaviour by which the rights of any party have been prejudiced; or • where the arbitrators exceeded their powers or so imperfectly executed them that a mutual, final and definite award upon the subject matter submitted was not made.
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