Q: Elaborate Geneva Convention, 1927 and New York Convention, 1958 ?

Ans:  There are two acts i.e., Arbitration Act, 1937 that finds its genesis from the Geneva Protocol, 1923 as well as Geneva Convention, 1927 and similarly, the foreign awards (Recognition and Enforcement) Act, 1961 finds its root in New York Convention, 1958.

In accordance with Section 44 of the Arbitration and Conciliation Act, 1996, a foreign award is defined as, “an arbitral award on differences that are related to the matters which are deemed commercial under the Indian law”. The two requirements for an award to be a foreign award are, firstly, it should resolve the discrepancies which result from a commercial legal relationship or a relationship that is considered commercial under the Indian law. Secondly, the country that is issuing the award must be a country that has been designated by the Indian Government as a country in which the New York Convention is made applicable. Hence only such arbitral awards are considered and implemented as foreign arbitral awards.

If foreign award violates the domestic law of country, the foreign award will not be applicable and if the arbitration award is beyond the scope of arbitration, that portion will be removed which is beyond the arbitration and the rest portion will be applicable.

The Geneva Convention 1927 and New York Convention 1958 was also introduced for international commercial arbitration.

The New York Convention was established as a result of dissatisfaction with the Geneva Protocol on Arbitration Clauses of 1923 and the Geneva Convention on the Execution of Foreign Arbitral Awards of 1927.

There was a requirement of international arbitration for the matters of international dispute and hence international commercial arbitration was introduced by UNCITRAL Model law on international commercial arbitration which was adopted in 1985.

Both section 45 and Section 54 mentions about the power of Judiciary to refer parties to arbitration. 
Section 54 is related to Geneva Protocol whereas section 45 is related to New York Convention. In Genveva  protocol, the award was final whereas in New York Convention,  the award was binding. 

Note : Foreign Award is defined under section 44 of Arbitration and Conciliation Act,  1996. 


Types Of Arbitral Award


Final Award:

An award that is made by the requirements of the law (including signature, reason and delivery), and finally adjudicates on the issues submitted to arbitration, would be a final award.

 


Domestic award:

An arbitral award made within the territory of the state. 2(2) and 2(7). 

 


Foreign award:

An arbitral award made or deemed to be made in the territory of another state. Section 44

 


Settlement Award:

During the arbitration process, the parties may choose to settle the matter instead of having it adjudicated by the arbitrator. In such a situation, the arbitrator could assist the parties in arriving at a settlement. If a settlement is arrived at, and the arbitrator has no objection to it, then terms of the settlement could be made part of an award. This is referred to as a settlement award. (Section 30)

 


Additional Award:

When a final award has been rendered, but it is later found out that certain claims that had been submitted to the arbitral tribunal were not resolved/adjudicated, the parties can request the arbitral tribunal to make an additional award covering the issues that had been left out. Such a request must be made within 30 days from the date of receipt of the final award.


Keywords used: 

Genesis: the beginning or origin of something



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