ISRAEL Law and Practice Contributed by: Joseph (Yossi) Ashkenazi, Haim Machluf and Roy Schondorf, Herzog Fox & Neeman
If a response objecting to the approval of the arbitral award is not filed, the process should not take more than three to six months. If an objection (or a motion to revoke the arbitral award) is filed, and depending on the nature of the objection and its merits, the process may take a significantly longer period, potentially one to two years. 4.6 Challenging Enforcement of Arbitral Awards Non-International Awards At the request of a party, a court may revoke an arbi - tral award or return it to the arbitrator in the following instances, where: • no valid arbitration agreement was in place between the parties; • the award was rendered by an arbitrator who was not duly appointed; • the arbitrator acted without authority, or deviated from the specific authority granted in the arbitration agreement; • a party to the arbitration was not given the proper chance to raise its claims or to provide its evi - dence; • the arbitrator did not decide on one of the matters put forward for their decision; • the arbitration agreement stipulated that the arbi - trator must provide one or more reasons for their award, and they did not do so; • the arbitration agreement stipulated that the arbi - trator must decide according to the law and they did not do so; • the award was rendered after the period it could be rendered in; • the award is contrary to public policy; or • any cause that could be used to revoke a final, non-appealable judgment. If a party’s application to revoke the arbitral award is denied, the arbitral award will be automatically approved by the court. Furthermore, the award debtor may appeal the arbitral award, in accordance with the agreed appeal mecha - nism (Clause 29B of the Arbitration Law), as follows.
• If the parties agreed that the arbitrator must rule according to the law, they may agree (in advance – in the arbitration agreement) that the award will be appealable upon leave from the court, if the award errs fundamentally. • Should leave to appeal be granted, the appeal will be heard according to the procedures applicable to an appeal on a court’s judgment. • Alternatively, the parties may agree (also in advance as expressed in the arbitration agreement) that the award will be appealable to an arbitra - tor. Under this appeal mechanism, an application to revoke the award may only be based on the grounds stipulated in points (9) and (10) listed above. International Awards In general, Israeli courts are bound to recognise inter - national arbitral awards issued in an Israeli seat unless grounds for revoking and/or objecting to the award under Sections 43 and 45 of the New Law are found to exist. Similarly, Israeli courts are also bound to rec - ognise international awards issued in a seat outside of Israel, unless any of the grounds for objecting to the award’s approval under Section 45 of the New Law (which are based on Article 5 of the New York Con - vention) are substantiated. As mentioned above, the grounds for revoking and objecting to the approval of an award are similar, and include the following. • A party to the arbitration agreement was under some incapacity or the arbitration agreement was not valid. • Proper notice of the appointment of the arbitrator or the arbitration proceedings was not given (or the other party was otherwise unable to present their case). • The award deals with issues not contemplated by or not falling within the terms of the submission to arbitration or contains decisions on matters beyond the scope of the submission to arbitration. • The composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or, failing such agreement, with the New International Commercial Arbitration Law (grounds for revocation) or with the law of the country where the arbitration took place (grounds for objection).
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