Restatement of the Law Third The U.S. Law of International ...arbitrateatlanta.org/wp-content/uploads/2012/04/US-InterComArbit... · appendix a Convention on the Recognition and Enforcement

2011 by The American Law InstituteAll Rights Reserved

This document is submitted for discussion at the meeting of the Council of The American Law Institute on January 26 (at 10:00 a.m.), and 27, 2012, at the Wolkin Conference Center, 4025 Chestnut Street, Philadelphia, Pennsylvania. This Draft is scheduled for discussion on Friday, January 27. As of the date it was printed, it had not been considered by the Council or membership of The American Law Institute, and therefore does not represent the position of the Institute on any of the issues with which it deals.

Restatement of the Law Third The U.S. Law of International Commercial Arbitration

Council Draft No. 3(December 23, 2011)

subjects covered

chapter 1 Definitions (revised)chapter 4 Post-Award Relief (revised)appendix a Convention on the Recognition and Enforcement of

Foreign Arbitral Awardsappendix b Inter-American Convention on International Commercial

Arbitrationappendix c Federal Arbitration Actappendix d Black Letter of Council Draft No. 3

The Executive OfficeThe American Law Institute

4025 Chestnut StreetPhiladelphia, PA 19104-3099

Telephone: (215) 243-1626 Fax: (215) 243-1636 E-mail: [email protected] Website: http://www.ali.org

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The American Law InstituteRoberta Cooper Ramo, PresidentAllen D. Black, 1st Vice PresidentDouglas Laycock, 2nd Vice PresidentCarolyn Dineen King, TreasurerSusan Frelich Appleton, SecretaryLance Liebman, DirectorStephanie A. Middleton, Deputy Director

COUNCILKenneth S. Abraham, University of Virginia School of Law, Charlottesville, VAShirley S. Abrahamson, Wisconsin Supreme Court, Madison, WISusan Frelich Appleton, Washington University School of Law, St. Louis, MOKim J. Askew, K&L Gates, Dallas, TXJos I. Astigarraga, Astigarraga Davis, Miami, FLJohn H. Beisner, Skadden, Arps, Slate, Meagher & Flom, Washington, DCSheila L. Birnbaum, Skadden, Arps, Slate, Meagher & Flom, New York, NYAllen D. Black, Fine, Kaplan and Black, Philadelphia, PAAmelia H. Boss, Earle Mack School of Law at Drexel University, Philadelphia, PAWilliam M. Burke, Shearman & Sterling (retired), Costa Mesa, CAElizabeth J. Cabraser, Lieff Cabraser Heimann & Bernstein, San Francisco, CAEdward H. Cooper, University of Michigan Law School, Ann Arbor, MIN. Lee Cooper, Maynard, Cooper & Gale, Birmingham, ALMary B. Cranston, Pillsbury Winthrop Shaw Pittman, San Francisco, CAGeorge H. T. Dudley, Dudley, Topper and Feuerzeig, St. Thomas, U.S. VIChristine M. Durham, Utah Supreme Court, Salt Lake City, UTKenneth C. Frazier, Merck & Co., Inc., Whitehouse Station, NJPaul L. Friedman, U.S. District Court, District of Columbia, Washington, DCYvonne Gonzalez Rogers, Superior Court of California, County of Alameda,

Oakland, CAAnton G. Hajjar, ODonnell, Schwartz & Anderson, Washington, DCGeoffrey C. Hazard, Jr.*, University of California, Hastings College of the Law,

San Francisco, CA; University of Pennsylvania Law School, Philadelphia, PAD. Brock Hornby, U.S. District Court, District of Maine, Portland, MEWilliam C. Hubbard, Nelson Mullins Riley & Scarborough, Columbia, SCWallace B. Jefferson, Texas Supreme Court, Austin, TXMary Kay Kane, University of California, Hastings College of the Law, San Francisco, CAHerma Hill Kay, University of California at Berkeley School of Law, Berkeley, CACarolyn Dineen King, U.S. Court of Appeals, Fifth Circuit, Houston, TXCarolyn B. Lamm, White & Case, Washington, DCDerek P. Langhauser, Maine Community College System, South Portland, MEDouglas Laycock, University of Virginia School of Law, Charlottesville, VADavid F. Levi, Duke University School of Law, Durham, NCMartin Lipton, Wachtell, Lipton, Rosen & Katz, New York, NYGerard E. Lynch, U.S. Court of Appeals, Second Circuit, New York, NYMargaret H. Marshall, Massachusetts Supreme Judicial Court (retired),

Cambridge, MAM. Margaret McKeown, U.S. Court of Appeals, Ninth Circuit, San Diego, CAJohn J. McKetta, III, Graves, Dougherty, Hearon & Moody, Austin, TXDaniel J. Meltzer, Harvard Law School, Cambridge, MA Judith A. Miller, Chevy Chase, MD Robert H. Mundheim, Shearman & Sterling, New York, NY

*Director Emeritus

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Kathryn A. Oberly, District of Columbia Court of Appeals, Washington, DCHarvey S. Perlman, University of Nebraska, Lincoln, NERoberta Cooper Ramo, Modrall Sperling, Albuquerque, NMDavid W. Rivkin, Debevoise & Plimpton, New York, NYLee H. Rosenthal, U.S. District Court, Southern District of Texas, Houston, TXGary L. Sasso, Carlton Fields, Tampa, FLMary M. Schroeder, U.S. Court of Appeals, Ninth Circuit, Phoenix, AZAnthony J. Scirica, U.S. Court of Appeals, Third Circuit, Philadelphia, PAMarsha E. Simms, Weil, Gotshal & Manges (retired), New York, NYJane Stapleton, Australian National University College of Law, Canberra, Australia;

University of Texas School of Law, Austin, TXRobert A. Stein, University of Minnesota Law School, Minneapolis, MNLarry S. Stewart, Stewart Tilghman Fox Bianchi & Cain, Miami, FLElizabeth S. Stong, U.S. Bankruptcy Court, Eastern District of New York, Brooklyn, NYCatherine T. Struve, University of Pennsylvania Law School, Philadelphia, PA David K. Y. Tang, K&L Gates, Seattle, WAMichael Traynor**, Cobalt LLP, Berkeley, CABill Wagner, Wagner, Vaughan & McLaughlin, Tampa, FLDiane P. Wood, U.S. Court of Appeals, Seventh Circuit, Chicago, IL

COUNCIL EMERITIPhilip S. Anderson, Williams & Anderson, Little Rock, ARBennett Boskey***, Washington, DCMichael Boudin, U.S. Court of Appeals, First Circuit, Boston, MAHugh Calkins, Initiatives in Urban Education Foundation, Cleveland Heights, OH Gerhard Casper, Stanford University, Stanford, CAWilliam T. Coleman, Jr., OMelveny & Myers, Washington, DCRoger C. Cramton, Cornell Law School, Ithaca, NYGeorge Clemon Freeman, Jr., Hunton & Williams, Richmond, VAConrad K. Harper, Simpson Thacher & Bartlett (retired), New York, NYVester T. Hughes, Jr., K&L Gates, Dallas, TXNicholas deB. Katzenbach, Princeton, NJPierre N. Leval, U.S. Court of Appeals, Second Circuit, New York, NYBetsy Levin, Washington, DCHans A. Linde, Portland, ORMyles V. Lynk, Arizona State University, Sandra Day OConnor College of Law,

Tempe, AZRobert MacCrate, Sullivan & Cromwell, New York, NYVincent L. McKusick, Pierce Atwood, Portland, MERoswell B. Perkins**, Debevoise & Plimpton, New York, NYEllen Ash Peters, Connecticut Supreme Court (retired), Hartford, CTLouis H. Pollak, U.S. District Court, Eastern District of Pennsylvania,

Philadelphia, PAWm. Reece Smith, Jr., Carlton Fields, Tampa, FLPatricia M. Wald, Washington, DCLawrence E. Walsh, Crowe & Dunlevy (retired), Oklahoma City, OKWilliam H. Webster, Milbank, Tweed, Hadley & McCloy, Washington, DCGeorge Whittenburg, Whittenburg Whittenburg Schachter & Harris, Amarillo, TXHerbert P. Wilkins, Boston College Law School, Newton, MA

***President Emeritus and Chair of the Council Emeritus***Treasurer Emeritus

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Restatement of the Law ThirdThe U.S. Law of International Commercial Arbitration

Council Draft No. 3

Comments and Suggestions Invited

Written comments on this draft are welcomed and should be addressed to the Director and the Reporters; their contact information appears below. Unless ex-pressed otherwise in the submission, by submitting written comments the author authorizes The American Law Institute to retain the submitted material in its files and archives, and to copy, distribute, publish, and otherwise make it available to others, with appropriate credit to the author.

ReporterProfessor George A. BermannColumbia University School of Law435 W. 116th St.Box A-10New York, NY 10027-7201Fax: (212) 854-7946Email: [email protected]

DirectorProfessor Lance LiebmanThe Executive OfficeThe American Law Institute4025 Chestnut StreetPhiladelphia, PA 19104-3099Fax: (215) 243-1636Email: [email protected]

Associate ReportersProfessor Jack J. Coe, Jr.Pepperdine University School of Law24255 Pacific Coast HighwayMalibu, CA 90263-3999Fax: (310) 506-4063Email: [email protected]

Professor Christopher R. DrahozalJohn M. Rounds Professor of LawUniversity of Kansas School of Law1535 W. 15th St.Green HallLawrence, KS 66045-7577Fax: (785) 864-5054Email: [email protected]

Professor Catherine A. RogersThe Pennsylvania State University,

Dickinson School of Law324 Katz Bldg.University Park, PA 16802-1910Fax: (814) 863-7274Email: [email protected] andUniversit Commerciale Luigi

Bocconi 3Via Gobbi, 520136 MILAN ITALYEmail: [email protected]

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REPORTERGeorge A. Bermann, Columbia University School of Law, New York, NY

ASSOCIATE REPORTERSJack J. Coe, Jr., Pepperdine University School of Law, Malibu, CAChristopher R. Drahozal, University of Kansas School of Law, Lawrence, KSCatherine A. Rogers, The Pennsylvania State University, Dickinson School of Law,

University Park, PA; Bocconi University, Milan, Italy

ADVISERSGerald Aksen, New York, NY Jos I. Astigarraga, Astigarraga Davis, Miami, FL R. Doak Bishop, King & Spalding, Houston, TX Andrea K. Bjorklund, University of California at Davis School of Law, Davis, CA Gary Brian Born, Wilmer Cutler Pickering Hale and Dorr, London, EnglandDavid D. Caron, University of California at Berkeley School of Law, Berkeley, CA James H. Carter, Dewey & LeBoeuf, New York, NY Cedric C. Chao, Morrison & Foerster, San Francisco, CA Donald F. Donovan, Debevoise & Plimpton, New York, NY Dana H. Freyer, Skadden, Arps, Slate, Meagher & Flom, New York, NY Horacio A. Grigera Nan, American University, Washington College of Law, Washington, DC Toni D. Hennike, Hess Corporation, Houston, TX Louis B. Kimmelman, Allen & Overy, New York, NY Jeffrey D. Kovar, Washington, DC Carolyn B. Lamm, White & Case, Washington, DC Michelle Leetham, Ogletree, Deakins, Nash, Smoak & Stewart, San Francisco, CA M. Margaret McKeown, U.S. Court of Appeals, Ninth Circuit, San Diego, CA Douglas Earl McLaren, Washington, DC Lawrence W. Newman, Baker & McKenzie, New York, NY William W. Park, Boston University School of Law, Boston, MA Jan Paulsson, University of Miami School of Law, Coral Gables, FL Alan Scott Rau, University of Texas School of Law, Austin, TX Lucy Reed, Freshfields Bruckhaus Deringer, New York, NY W. Michael Reisman, Yale Law School, New Haven, CT David W. Rivkin, Debevoise & Plimpton, New York, NY Kathleen M. Scanlon, New York, NY Linda J. Silberman, New York University School of Law, New York, NY Robert H. Smit, Simpson Thatcher Bartlett, New York, NY Abby Cohen Smutny, White & Case, Washington, DCThomas J. Stipanowich, Pepperdine University School of Law, Malibu, CA Elizabeth S. Stong, U.S. Bankruptcy Court, Eastern District of New York, Brooklyn, NY

[from 2011]John M. Townsend, Hughes Hubbard & Reed, Washington, DC Elpidio Villarreal, GlaxoSmithKline, Philadelphia, PA

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Kristen David Adams, Gulfport, FLRobert H. Alsdorf, Seattle, WAOwen L. Anderson, Norman, OKWilliam G. Arnot, Houston, TXRonald G. Aronovsky,

Los Angeles, CARichard A. Bales,

Highland Heights, KYJrgen Basedow, Hamburg, GermanyWilliam G. Bassler, Red Bank, NJ Peter V. Baugher, Chicago, ILKarl Bayer, Austin, TXBruce J. Berger, Washington, DCSanford L. Bohrer, Miami, FLWilliam J. Boyce, Texas Court of

Appeals, Fourteenth District, Houston, TX

Ronald A. Brand, Pittsburgh, PACharles H. Brower II, University, MSCharles N. Brower, London, EnglandMichael K. Brown, Walnut Creek, CAStephen B. Burbank, Philadelphia, PATimothy W. Burns, Madison, WIJohn P. Burton, Santa Fe, NMWilliam E. Butler, Carlisle, PA Fabrizio Cafaggi, Florence, ItalyCharles Calleros, Tempe, AZDavid N. Calvillo, McAllen, TXMarilyn Blumberg Cane,

Fort Lauderdale, FLElena A. Cappella, Philadelphia, PAWilliam Richard Casto, Lubbock, TXJohn Allen Chalk, Fort Worth, TXSteve Charnovitz, Washington, DCDavid A. Chaumette, Houston, TXTai-Heng Cheng, New York, NYStephen Yee Chow, Boston, MAJacob Katz Cogan, Cincinnati, OHDavid K. Cohen, Chevy Chase, MDMichael Marks Cohen, New York, NYNeil B. Cohen, Brooklyn, NYLord Collins of Mapesbury,

United Kingdom Supreme Court, London, England

Edward H. Cooper, Ann Arbor, MIRobert A. Creamer, Cambridge, MA

Thomas L. Cubbage, III, Washington, DC

Vivian Grosswald Curran, Pittsburgh, PA

Christopher Scott DAngelo, Philadelphia, PA

George A. Davidson, New York, NY Evan A. Davis, New York, NYFranois Dessemontet,

Saint Barthelemy, French West Indies

Anthony M. DiLeo, New Orleans, LAWilliam S. Dodge, San Francisco, CAGordon L. Doerfer, Boston, MARichard F. Dole, Jr., Houston, TXMitchell F. Dolin, Washington, DCThomas A. Dubbs, New York, NYAllyson K. Duncan, U.S. Court of

Appeals, Fourth Circuit, Raleigh, NCSheldon H. Elsen, New York, NYRobert Evans III, New York, NYJohn N. Fellas, New York, NYJoseph Z. Fleming, Miami, FLMichael D. Floyd, Birmingham, ALC. Allen Foster, Washington, DCHenry D. Gabriel, Greensboro, NC Richard Garnett,

Melbourne, AustraliaSteven S. Gensler, Norman, OKE. Duncan Getchell, Jr.,

Richmond, VAJames W. Gewin, Birmingham, ALLlewellyn J. Gibbons, Toledo, OHDaniel C. Girard, San Francisco, CAMarc J. Goldstein, New York, NYRandy Gordon, Dallas, TXKatherine Ann Graham, St. Paul, MNMarvin L. Gray, Jr., Seattle, WANorman L. Greene, New York, NYMichael Greenwald, Philadelphia, PACharles E. Griffin, Ridgeland, MSPatricia Isela Hansen, Austin, TXMicalyn Shafer Harris, New York, NYRobert W. Hillman, Davis, CA

MEMBERS CONSULTATIVE GROUP


(as of December 5, 2011)

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Maria Tankenson Hodge, St. Thomas, U.S. VI

Richard W. Hulbert, New York, NYJohn E. Iole, Pittsburgh, PAMelissa B. Jacoby, Chapel Hill, NCKirk C. Jenkins, Chicago, ILMark R. Joelson, Washington, DCJennifer J. Johnson, Portland, ORCally Jordan, Victoria, AustraliaLee L. Kaplan, Houston, TX Catherine Kessedjian, Paris, FrancePaul F. Kirgis, Jamaica, NYChristopher M. Klein, U.S. Bankruptcy

Court, Eastern District of California, Sacramento, CA

Daniel M. Kolkey, San Francisco, CARichard H. Kreindler,

Frankfurt, Germany Peter B. Kutner, Norman, OK Herbert I. Lazerow, San Diego, CAE. Bruce Leonard,

Toronto, ON, CanadaJohn Leubsdorf, Newark, NJWilliam H. Levit, Jr., Milwaukee, WIEric L. Lewis, Washington, DCCynthia Crawford Lichtenstein,

Sarasota, FL Peter Linzer, Houston, TXAndreas F. Lowenfeld, New York, NYHouston Putnam Lowry, Meriden, CTRobert E. Lutz, II, Los Angeles, CAWilliam Cullen Mac Donald,

New York, NYPeter B. Maggs, Urbana, ILC. Scott Maravilla, Washington, DCAndrew J. Markus, Miami, FLPedro Julio Martinez-Fraga,

Miami, FL Lorelie S. Masters, Washington, DC Andrea J. Menaker, Washington, DCCarrie J. Menkel-Meadow,

Washington, DCJames P. Mercurio, Washington, DCJohn Eric Middleton, Federal Court

of Australia, Melbourne, AustraliaJ. W. Montgomery, III, Pittsburgh, PAJonathan M. Moses, New York, NYMargaret L. Moses, Chicago, ILRichard M. Mosk, California Court of

Appeal, Los Angeles, CAMark L. Movsesian, Jamaica, NY

Edward M. Mullins, Miami, FLDaniel T. Murphy, Richmond, VAPeter L. Murray, Portland, MEVed P. Nanda, Denver, CO Barbara Reeves Neal,

Los Angeles, CAJoseph E. Neuhaus, New York, NYDavid John OCallaghan,

Melbourne, AustraliaSir Geoffrey Palmer, Wellington,

New ZealandStephen Patrick Pate, Houston, TXFrank A. Pfiffner, Anchorage

Superior Court, Anchorage, AKHansel T. Pham, Washington, DCSheldon Raab, New York, NYLuca G. Radicati di Brozolo,

Milano, ItalyFlorentino Ramirez, Dallas, TXCarey R. Ramos, New York, NYBernard D. Reams, Jr.,

San Antonio, TX Joe R. Reeder, Washington, DCC. Ryan Reetz, Miami, FLHenry duPont Ridgely, Delaware

Supreme Court, Dover, DEDelissa A. Ridgway, U.S. Court of

International Trade, New York, NYJames L. Robertson, Jackson, MSSteven S. Rosenthal, Washington, DCMary Massaron Ross, Detroit, MIPeter B. Rutledge, Athens, GAMichael D. Sandler,

Mercer Island, WAMichael A. Scodro, Chicago, ILDavid W J Scorey, London, EnglandLeopold Z. Sher, New Orleans, LA Matthew D. Slater, Washington, DCDouglas G. Smith, Chicago, ILDavid V. Snyder, Washington, DCLuis Eduardo Sprovieri,

Buenos Aires, ArgentinaE. Blythe Stason, Jr., DeKalb, IL Hans Rudolf E. Steiner, Zurich,

SwitzerlandPaul B. Stephan III, Charlottesville, VADavid P. Stewart, Washington, DCS. I. Strong, Columbia, MOGuy Miller Struve, New York, NY Rolf Strner, Freiburg, GermanySymeon C. Symeonides, Salem, OR

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Louise Ellen Teitz, Bristol, RILarry D. Thompson, Greenwich, CTPeter D. Trooboff, Washington, DCGeorge K. Walker, Winston-Salem, NCJanet Walker, Toronto, ON, CanadaSue Walker, Texas Court of Appeals,

Second District, Fort Worth, TXDon Wallace, Washington, DCNicholas J. Wallwork,

Ruckersville, VARhonda Wasserman, Pittsburgh, PA

William Arthur Webb, U.S. District Court, Eastern District of North Carolina, Raleigh, NC

Henry Weissmann, Los Angeles, CAJay L. Westbrook, Austin, TXRalph U. Whitten, Omaha, NEStephan Wilske, Stuttgart, GermanyDavid B. Wilson, Denver, COPeter Winship, Dallas, TX Nicholas J. Wittner, East Lansing, MITobias B. Wolff, Philadelphia, PA

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The bylaws of The American Law Institute provide that Pub-lication of any work as representing the Institutes position re-quires approval by both the membership and the Council. Each portion of an Institute project is submitted initially for review to the projects Consultants or Advisers as a Memorandum, Preliminary Draft, or Advisory Group Draft. As revised, it is then submitted to the Council of the Institute in the form of a Council Draft. After review by the Council, it is submitted as a Tentative Draft, Discussion Draft, or Proposed Final Draft for consideration by the membership at the Institutes Annual Meeting. At each stage of the reviewing process, a Draft may be referred back for revision and resubmission. The status of this Draft is indicated on the front cover and title page. The Council approved the start of this project in De cember 2007. Work has begun on topics of recognition and enforcement. The first Tentative Draft was approved at the 2010 Annual Meeting, but the material contained therein was not previously approved by the Council. Council Draft No. 2 was approved by the Council in October 2010, and thus that Draft represents the position of the Institute. Earlier versions of Chapter 1 can be found in Preliminary Draft No. 5 (2011), Pre limi nary Draft No. 4 (2010), Council Draft No. 2 (2010), and Tentative Draft No. 1 (2010). This version of Chapter 4 consolidates versions that had previously been desig-nated as Chapter 4 and Chapter 5. An earlier draft of this ver-sion of Chapter 4 is contained in Preliminary Draft No. 5 (2011). An earlier version of the previous Chapter 4 can be found in Preliminary Draft No. 4 (2010). Prior versions of Chapter 5 were contained in Council Draft No. 2 (2010), Tentative Draft No. 1 (2010), Preliminary Draft No. 3 (2010), and Council Draft No. 1 (2009). The projects Reporters may have been involved in other en-gagements on issues within the scope of the project; all Reporters are asked to disclose any conflicts of interest, or their appearance, in accord with the Policy Statement and Procedures on Conflicts of Interest with Respect to Institute Projects; and copies of Reporters written disclosures are available from the Institute upon request; however, only disclosures provided after July 1, 2010, will be made available and, for confidentiality reasons, parts of the disclosures may be redacted or withheld.

REPORTERS'MEMORANDUM

TO:

FROM:

DATE:

RE:

ALICouncil

GeorgeBermann,JackCoe,Jr.,ChrisDrahozal,andCatherineRogers

January2012

RestatementThird,TheU.S.LawofInternationalCommercialArbitration,No.3(2011)CouncilDraft

WearepleasedtopresentCouncilDraftNo.3oftheRestatementThirdoftheU.S.awofInternationalCommercialArbitration,Chapter4(PostAwardRelief). Thedraft isLprovidedinanticipationoftheCouncilMeetingscheduledforJanuary27,2012. ThisworkhasbenefitedfromexpertcritiquesprovidedsystematicallythroughtheALIpeerreviewprocess,beginningwithcommentsreceivedonPreliminaryDraftNo.1ataconference on February 23, 2009. Ongoing refinements were introduced throughsuccessiveDrafts,includingthosereflectedinCouncilDraftNo.2,whichwasapprovedbytheCouncil inOctober2010. FurtherworkledtoPreliminaryDraftNo.4,whichwastherincipalfocusofajointALIAdvisersandMembersConsultativeGroupmeetinginMalibu,alifornia, pC onJanuary 15,2011. At that joint meeting, the question of the vacatur grounds applicable to U.S.Conventionawardspromptedconsiderablecomment.Informedbythoseobservationsandour own further study of the issue, the Reporters restructured Chapters 4 and 5. As aconsequenceoftherestructuring,asingleconsolidatedChapter,titledPostAwardRelief,hasreplacedwhathadpreviouslybeentwoseparateChapters:Chapter4onVacaturandConfirmationandChapter5onRecognitionandEnforcement.Thatconsolidatedformathasbeen retained and refined in Council Draft No. 3, which also reflects editorial andsubstantiveadjustmentspromptedbydiscussionatmeetingsheldinSeptember2011withtheAdvisers andMembers ConsultativeGroup and through subsequent communicationswithmembersofthosetwogroups.

Theconsolidationwasundertakenforseveralconceptualandpragmaticreasons.A

principalobjectivewastoachievegreatersimplicityofpresentation,ashadbeensuggestedbycertainAdvisersattheMalibumeeting.Additionally,thedraftnowadoptsthepositionthatthegroundsforvacatingordenyingconfirmationofU.S.ConventionawardsarethosespecifiedintheConventions,notthegroundssetforthinFAASection10.ThisdevelopmentmadeitdifficulttojustifymaintainingtwoseparateChapters:vacaturandconfirmation,onthe one hand, and recognition and enforcement, on the other. A twochapter approachwould have involved significant repetition because the same principles and precedentsapplied to matters arising in both Chapters. Additionally, extensive crossreferencingwouldhavebeenrequiredtocoordinatethetwoChapters,makingthematerialdifficultto

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follow and, in some places, less conceptually clear. By contrast, the consolidated singlehapter, now Chapter 4 on postaward relief, contains minimal repetition and modestrossrCc eferencing,resultinginamuchshorterandsleekertextoverall.

We regard the structural reorganization reflected in new Chapter 4 as providinggreatadvantagesoverthepreviousarchitecture.Incontrasttothetwochapterstructure,thenewarrangementtreatsinasinglechaptercorrection,remand,vacatur,confirmation,recognition, and enforcement. It thus provides onestop shopping for all postawardrelief issues, which does not require a firm understanding of the differences betweenforeign Convention awards, U.S. Convention awards, and nonConvention awards beforedeterminingtheproperchapterunderwhichtoproceed.Totheextentthatconfirmation,vacatur,recognition,andenforcementarehandledsimilarly,Chapter4containsprovisionscommontoall.Totheextentthattheyarehandleddifferently,thedistinctionsareclearlydrawn. This consolidation results, we believe, in a draft that is more userfriendly,particularly forthosewhoarenot familiarwith internationalarbitration. Asanessentialaspect f the restructuring, FAA Section 10 grounds now only apply to nonConventionawards

o.Therestructuringwasdiscussedatlengthandreceivedfavorablyatthemeetingsof

heAdvt isersandMembersConsultativeGrouplastSeptember.

As before, the draft includes, as Chapter 1, definitions that are critical tounderstandingsubsequentChapters.ThosedefinitionsaresubstantiallythesameasthoseapprovedasCouncilDraftNo.2.They thusmaintain, forexample, the formerconceptualcategories and taxonomy of arbitral awards, distinguishing among international awards,domestic awards, and foreign awards; and among foreign Convention awards, nonConventionawards,andConventionawardsmadeintheUnitedStates.Theconsolidationf Chapters 4 and 5, however, has occasioned the introduction of three newdefinitions,rieflyob describedbelow.

A summary of the Sections contained in new Chapter 4 follows, arranged byRestatement topic and subtopic. Additionally,we attach as anAppendix a chart thatindicates the Sections in the previous draft that correspond to the sections in thecurrentdraft.

SummaryoftheDraft Chapter1Definitions.

Section11retainsthreedefinitionsintroducedinPreliminaryDraftNo.5.Twoof

these,setforthinparagraphs(x)and(y),provideshorthandtermsembracingtheseveralformsofactionsandreliefthatariseinthepostawardcontext.Apostawardactionisasummarycourtproceedingbroughttovacate,confirm,orenforceaninternationalaward,whereas postaward relief is a ruling by a court that vacates, confirms, recognizes, orenforcesaninternationalaward.Thesecollectivetermsareusedforconveniencewhenit

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isunnecessarytoreferindividuallytotheformsofactionandrelief.Section11(n)isthethird among the recentlyadded definitions. It defines final award and is intended tocontribute to a better understanding of certain other Sections, including Section 432(StatuteofLimitations). One noteworthy change in Section 1 concerns interimmeasures (Section 11(q)).Afterreceivingconsiderablepeercomment,theReportersmaintainedinCouncilDraftNo.3 theposition thatsuchmeasuresare inprinciplearbitralawardswithin themeaningofSection 11(a), but structured that classification as a rebuttable presumption. The Draftlso provides new Illustrations to explain the operation of that presumption and theircumstancesunderwhichitmightberebutted.acChapterFourPostAwardReliefStructure

TheconsolidationofformerChapters4and5resultsinanewdraftChapter4titledPostAward Relief. It comprises four topics: Topic 1General Provisions; Topic 2Grounds for PostAward Relief; Topic 3Conduct of PostAward Actions; Topic 4Modification,Correction,andRemandofAwards. Topic2contains threesubtopics:Aonvention Awards; BNonConvention Awards; CParty Modification and Waiver ofrounds.CGTopic1GeneralProvisionsSection41

Section 41 deals with postaward actions in general terms. This section isparticularly important following the consolidation of former Chapter 4 (vacatur andconfirmation)andChapter5(recognitionandenforcement).Itdefinesanddelineatestheeffect of vacatur, confirmation, and enforcement as distinct postaward actions, whiletreatingrecognitionasaformofpostawardrelief,withoutconstitutinganactionassuch.As in other Sections, it becomes critical to distinguish (a) between reliefwith respect toConventionandnonConventionawardsand(b)betweenreliefwithrespecttoConventionawards made abroad and thosemade in the U.S. The Section also sets out the generalcircum

stancesinwhichpartialpostawardreliefisappropriate.Foreaseofreference,theblackletteridentifies,foreachformofrelief,thesourceof

the grounds on which that relief may be granted or denied, as the case may be. Thecomments clarify that,while confirmation and vacatur are conceptually two sides of thesame coin, they remain distinct actions as a matter of procedure. Thus, defeat of aconfirmationactiondoesnotinitselfresultinvacaturoftheaward,anddefeatofavacaturactiondoesinitselfresultinconfirmationoftheaward.

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Section42Section42providesthataU.S.courtmaynotvacateanawardmadeabroad;itmay

atmostrecognizeorenforcesuchanawardbecause,ordinarily,onlycourtsatthearbitralseatmayvacateanaward rendered there. Theoneexception that allowsaU.S. court toentertainavacaturactionagainstaforeignawardariseswhenthepartieshaveexpresslyagreedtosubjectthearbitrationtothearbitrationlawoftheUnitedStates.Insuchacase,which isvery rare, thecourtsof theseatand thoseof theUnitedStateshaveconcurrentauthoritytovacate.Conversely,ifthepartiesdesignatedthearbitrationlawofaNewYorkConventionStateotherthantheUnitedStates,thesameprinciplewouldentitlethecourtsof the Statewhose arbitration lawwasnamed to exercise setaside jurisdiction over theaward;thoseauthoritieswouldenjoythatpowerconcurrentlywiththecourtsoftheseat.

Section43

Detaileddiscussionof the lawapplicable to formsofrelief is found inSection43,whiledetaileddiscussionof thegroundsavailable for theirgrantordenial isdeferred toSection411. Section43deals comprehensivelywith the lawapplicable to the formsofpostaward relief set forth in Section 41. It gives pride of place to the New York andPanamaConventions(asimplementedbyFAAChaptersTwoandThree)andChapterOneoftheFAAasthe lawapplicabletoConventionandnonConventionawards,respectively.However, it acknowledges the possibility that state law, to the extent not preempted bypplicablefederallaw,mighteventuallybeapplicable,asmightsomeotherbodyoffederalaw(suchasabilateraltreaty).alSection44

Section44 sets forth the formal requirementsgoverningpostaward relief inU.S.

courts. In a federal court action, the requirements (such as production of the originalagreementtoarbitrateandtheoriginalawardoranauthenticatedcopythereof)aredrawnfrom either the Conventions or FAA Chapter One, as applicable. Although the Sectionrecognizes that the agreement provided to the court must qualify as an agreement inwritingwithinthemeaningoftheapplicableConventionortheFAA, itdoesnotaddresswhatwritingssatisfythatrequirement.ThatissuewillbeaddressedinafutureChapterofthe Restatement. The content of the form requirements is largely the same as in priordrafts, except that thisdraft requiresparties seekingvacaturof anaward toprovide thearbitrationagreement(inadditiontotheaward)only ifoneof thebasesuponwhichthepartyseeksvacaturrequiresconsiderationofthearbitrationagreement.

Sections45and46

Section45addressesreciprocityasreflectedintheU.S.reciprocityreservationsto

theNewYorkandPanamaConventions.Exceptforslightwordingchanges,thisSectionisunchangedfromtheapprovedversioninChapter5.

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Section 46 describes the burden of proof applicable to international arbitralawards. This Section is likewiseunchanged frompriordrafts, except to addressvacaturandconfirmation,alongsiderecognitionandenforcement.

Section47

Section47,whichdealswiththestandardofreviewexercisedbycourtsingranting

ordenyingpostawardrelief,isanewSection.ItmaybeviewedasacompanionSectiontoSection 46 on burden of proof. The general principle is that courtsmake independentdeterminations as to the presence or absence of a ground for granting or denying postaward relief, and are neither bound by, nor to be substantially influenced by,determinations the arbitral tribunal may have made on those particular matters. TheComments, however, indicate those exceptional circumstances inwhich tribunal findingsonissu srelevanttothepresenceorabsenceofagroundmayaffectacourtsanalysisinapplyingtherelevantground.

e

Section48

Thisdraftrefinesandclarifiestheeffectonacourtshandlingofrequestsforpostaward relief of prior judicial decisions on common issues made in connection with thesame arbitration or award. Specific issues, such as the validity of the arbitral award ordefectsintheconstitutionofthearbitraltribunal,mayberaisedatseveraljuncturesinthelifecycleofadisputethatissubjecttoarbitrationandseveraldifferentcourtsmayruleonit.UnderthisSection,courtsapplyforumlawwithrespecttothepreclusiveeffectofsuchfindings. Itobservesthatgroundssuchasnonarbitrabilityandviolationofpublicpolicyare determined by reference to different bodies of substantive law, depending on themomentatwhich judicial recourse issought. One jurisdictions findingsonsuchmatterswill not therefore preclude their reexamination under another jurisdictions substantivelaw.

Section48,whichinpreviousdraftshadbeenframedingeneraltermsastheeffect

of prior judicial determinations, is now organized around the more clearly establishedoctrinesofclaimpreclusion,issuepreclusion,lawofthecase,andrecognitionofforeignudgments.djSections49and410

TheeffectsofpriorarbitraldeterminationsarenowtreatedintwonewSections:4(claim s n9 preclu ion)a d410(issuepreclusion).

Section 49s coverage is entirely new. Previous drafts had only discussedrecognition,effectivelyasanalternativeformofpostawardrelief.Section49examinesmorespecifically thecloserelationshipbetweenrecognitionandclaimpreclusion(orresjudicata)andestablishesthatrecognitionisapredicateforapplicationofclaimpreclusion.Accordingly, the Section clarifies thatcontrary to developed law in the context of

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domestic arbitration awardsthe common law of claim preclusion does not govern thegroundsforchallengingthefinalityorvalidityofaninternationalarbitralaward.Instead,courts consult the relevant arbitration law (Convention grounds for Convention awardsandFAASection10groundsfornonConventionawards)todeterminewhetheranawardis entitled to recognition and therefore the possibility of having claim preclusive effect.Under this approach, courts look to the applicable arbitration law to determine suchatters as whether the tribunal had jurisdiction or whether the proceedings werem

conductedfairly. Once a court has determined that an award is entitled to recognition, Section49directsittoapplygeneralforumlawtoresolveremainingissuesindeterminingwhethertograntclaimpreclusiveeffecttoanaward.Thesequestionsincludewhetherthesubsequentclaimisthesameasintheoriginalactionandinvolvesthesameparties.Ordinarily,thesameparties question turns on the scope and application of the arbitration agreementnd thuswillnot requireanalysis separate fromthatalreadyundertakenby thecourt inadeterminingundertherelevantconventionthattheawardisentitledtorecognition. ThisSectionalsoprovidesguidanceontheallocationoftheburdenofproofamongthe parties, aligning the burden for establishing recognition with the burdens allocatednder the Conventions and the FAA and imposing on the party seeking preclusion theurdenub ofprovingtheidentityofclaimsandparties,asrequiredbyforumlaw.

Section410alsorepresentsasignificantdevelopmentoverpreviousdrafts.Earlierdrafts had included issue preclusion (or collateral estoppel) as a subsection in theSectiondealingwithgoverninglaw.Advisersurgedthatwedevelopthemattermorefully,nd providemore specific guidance about how andwhen issuepreclusive effectmay beccordeaa dbyacourttoaninternationalarbitralaward.

Accordingly,Section410nowspecifiesthatanawardthatqualifiesforrecognitionunderthisChaptermayalsobeentitledtoissuepreclusiveeffect.TheSectionfollowsthesamebroadapproachtakeninregardtoclaimpreclusion(Section49).Itdirectscourtstoapply forum law to matters not governed by a convention, while providing generalguidance about how the international character of an award may affect application offorumlaw.Additionally,becausemanyforeignjurisdictionsdonotallowissuepreclusion,theSectiondevelopsspecificcriteriaforcourtstouseinevaluatingwhetheranawardthatightotherwisebeentitled to issuepreclusiveeffect shouldneverthelessbedenied thatffectbecauseitiscontrarytothepartiesagreementorreasonableexpectations.meTopic2GroundsforPostAwardReliefSection411

Section 411 addresses the grounds for vacating and denying confirmation,

recognition,orenforcementofU.S.Conventionawardsgenerally.ReflectingfeedbackfromAdvisersandMCGmembers, thedraftprovides that theapplicablegroundsare thoseset

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outinArticleVoftheNewYorkConvention,ratherthanFAASection10. Asaresult,thegroundsfordenyingrecognitionandenforcementofConventionawardshavealsobecomegroundsforvacatinganddenyingconfirmationofU.S.Conventionawards.

We believe that the frequency of successful vacatur actions is not likely to be

affectedbythischangebecausethedraftdefinestheFAASection10vacaturgroundsasinsubstance the same as the Article V grounds. The Section 10 grounds remain relevant,owever. Under Subtopic B of Topic 2, they provide the grounds upon which nononventionawardsmaybedeniedrecognitionandenforcement.hCTopic2,SubTopic(A)GroundsApplicabletoConventionAwards

Section412

Section412providesthatacourtmayvacateordenyconfirmation,recognition,orenforcementofaConventionawardonthegroundthatnoarbitrationagreementexistsorthat the arbitration agreement is invalid, asprovided inArticleV(1)(a) of theNewYorkConvention and Article 5(1)(a) of the Panama Convention. Other than extending thesegroundstovacaturandconfirmation,thisSectionislargelyunchangedfromtheapprovedversion in former Chapter 5. The one exception is the removal of blackletter languageprovidingthatthearbitratorshalldecideachallengetotheexistenceofthemaincontractwhen the challenge does not call into doubt the parties agreement to arbitrate. Thepossibility is still recognized in the Notes as a case inwhich the parties have agreed toarbitratetheexistenceofthemaincontract;thatissueisthusforthearbitratorstoresolve.hecircumstance,however,wasnotthoughttobesufficientlycommontojustifytreatmentntheblackletter.TiSection413

Section 413 addresses the ground set forth in Article V(1)(b) of the New York

Convention and 5(1)(b) of the Panama Convention. Under this ground, vacatur may begranted and confirmation, recognition, or enforcement may be denied when the awardresulted from an arbitral process that was rendered fundamentally unfair by a severeproceduraldefect.ThecontentofthisSectionremainssimilartotheparallelSectionintheformerChapter5.Oneimportantchangeisthat,inresponsetosuggestionsfromAdvisers,thefulldiscussionregardingthestandardforevidentpartialityofanarbitratorislocatedinthisSection,ratherthaninSections418(publicpolicy)or420(evidentpartialityinthecaseofnonConventionawards).WhiletheprovisionsofSection10oftheFAAprovidethestatutory basis for the evident partiality standard, the full discussion of it is moreappropriatelylocatedinthisSectionbecausethevastmajorityofawardsaddressedbytheRestatementareConventionawardsandbecausecertainaspectsofthedomesticstandardtakeonadifferentglosswhenappliedininternationalcontexts.Nevertheless,Sections43(onConventionawards)and420(onnonConventionawards)remaincloselyrelatedndlargelyoverlappinginsubstance.1a

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Section414Section414derives fromArticleV(1)(c)of theNewYorkConventionandArticle

5(1)(c) of the Panama Convention. Under that Section, a court may vacate or denyconfirmation,recognition,orenforcementofanawardtotheextent itdealswithmattersbeyondthesubmissiontoarbitration.AlthoughtheSectionislargelycongruentwithpriorversions, the treatment of one issue has been substantially revised: how to distinguishbetweencasesinwhichtheawardiscontrarytoanexpressrestrictiononthearbitratorsauthoritycontained inthearbitrationagreement, thus invitingcourtreview,andcases inwhich such reviewwould represent an impermissible judicial examinationof themerits.(ThisisaquestiontowhichsomemembersoftheCouncil,whilevotinginfavorofChapter5,specificallyaskedtheReporterstogivefurtherthought.)Basedonextensivediscussionand input from the Advisers and Members Consultative Group, the draft adopts arebuttable presumption that such a provision is a limitation on remedies rather than arestrictiononarbitratorauthority,butalsoidentifiesfactorsfordeterminingwhetherthepresumptionhasbeenrebutted.

Section415

Section415isbasedonArticlesV(1)(d)oftheNewYorkConventionand5(1)(d)ofthePanamaConvention.Itpermitsacourttograntordenypostawardrelief,asapplicable,if theprocedureof thearbitrationmateriallyviolatedeither thepartiesagreementor, intheabsenceofsuchagreement,thelawofthearbitralseat.TheConventionspurposefullyelevatepartyautonomyandtherebypromoteflexibilityinorganizingarbitralprocedures.There remain, however, delicate questions aboutwhat should happenwhen compliancewithprovisionsofpartiesarbitrationagreementviolateamandatoryruleoftheseat.Thedraftaffirmsthepreeminenceofthepartiesarbitrationagreementevenifthatagreementdepartsfromtheseatsmandatorylaw.Concurrently,however,theSectionacknowledgesthat arbitrators sometimes choose to follow the law of the seat rather than the partiesagreement inorder toreduce theriskof setaside. In those instances, thedraftallowsacourt to consider the tribunals reasons for not observing the parties agreement and toenforceanawarddespitethetribunalsnonadherencetothetermsofthatagreement.

A new Comment deals with the situation in which a tribunal impermissiblyadjudicates a dispute ex aequo et bono or applies a substantive law other than the oneselectedbytheparties.TheCommentdescribesinbothinstancesthesubstantialburdenofproofonapartychallenginganawardonthesebases.Section416

Section416derivesfromArticlesV(1)(e)oftheNewYorkConventionand5(1)(e)of the Panama Convention. It posits that a court may, but need not, defer a decisionwhether to grant postaward reliefwith respect to an award that is subject to setasideproceedings abroad. The Section also establishes as a ground for declining to confirm,recognize,orenforceanawardthattheawardhasbeensetasidebyacompetentauthority

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withinthemeaningofSection11(f).

Section416 is conceptually the sameas its counterpart in formerChapter5.Thetexthasbeenrevised,however,toaccountforthepossibilitythat,exceptionally,twoStatescourtsmayenjoyconcurrentsetasidejurisdictionasaresultofanexplicitdesignationbythe parties of an arbitration law other than that of the seat. The effects of such adesignation have been the subject of helpful peer discussion. According to this Section,whenthepartiesunambiguouslydesignateanarbitration lawotherthanthatof theseat,while the seat does not change, the courts of the jurisdictionwhose law is named enjoy(concurrently with the courts of the seat) the power to nullify the award. It follows,therefore,thatSection416governsboththeroutinesituationinwhichonlyonesystemsauthoritiespossesssetasidepowersandtheunusualcircumstanceinwhichauthoritiesintwojurisdictionsmayproperlybeseizedofasetasideactionaddressingthesameaward.Section417

Section417isdrawnfromArticlesV(2)(a)oftheNewYorkConventionand5(2)(a)ofthePanamaConvention.Theunderlyingprinciple,retainedfromearlierdrafts,isthatacourt may decline recognition and enforcement of an award that purports to decidematters that arenonarbitrableunderU.S. federal law.Under the consolidated format ofisChapter,aU.S.Conventionawardmayalsobevacatedordeclinedconfirmationonthemebasis.Arbitrabilitymayberaisedsuaspontebyacourt.

thsaSections418

Section 418 sets forth the public policy ground for vacatur and for denial ofconfirmation,recognition,andenforcement.Aswithallpreviousdrafts,thelanguageusedunderscoresthenarrownessof theground,whichwillrarelybe invokedwithsuccess.Aswithar itrability,however,publicpolicymayberaisedsuaspontebyacourt.Itmaynotbewaivedbyaparty.

b

Topic2,SubTopic(B)GroundsApplicabletoNonConventionAwardsSections419,420,and421

Sections419,420,and421dealwiththegroundsforchallengingagrantofpostawardrelieffornonConventionawardsfoundinSections10(a)(1),10(a)(2),and10(a)(3)oftheFAA. Section419providesagroundforchallenginganonConventionawardthatwas procured by fraud, corruption, or unduemeans. The Section defines each of theseterms,andprovidesguidanceabouttheevidencerequiredtosatisfytheburdenofprovingeachground.

Section420addressespotentialchallengestoawardswhenanarbitratorissubject

to bias or, in thewords of the FAA, evident partiality. Because the Conventionsmakeforum law applicable to challenges based on procedural fairness, the evidentpartiality

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standardappliesalsotoConventionawardsunderSection413.Inrecognitionofthefactthat the overwhelmingmajority of international arbitral awards are Convention awards,this Section limits its discussion of evident partiality to the core definition, and refersreaderstoSection413foranextendedanalysisofthetermanditsapplication.

Finally,Section421dealswitharbitratormisconductasagroundforchallenginga

nonConventionaward.Likeothersectionsinthisgroup,thisSectionanalyzesthemeaningof arbitratormisconduct andprovides guidance about theproof required to effectivelyinvokethisgroundtopreventrecognitionorenforcementofanonConventionaward.Section422

Section 422 sets out the ground for denying recognition or enforcement of nonConvention awards provided in FAA Section 10(a)(4), namely that the arbitratorsexceeded their powers. It lists five possible circumstances in which an awardmay bedenied recognition or enforcement on that ground, describing those circumstances asgenerallycongruentwithgroundsstatedinArticleVoftheNewYorkConvention:(1)thearbitration agreement does not exist or is invalid; (2) the award determines mattersbeyondthetermsofthesubmissiontoarbitration;(3)thearbitralprocedureiscontraryina material respect to the agreement of the parties; (4) the award decides a matter notapableofarbitraladjudication;and(5)recognitionof theawardwouldberepugnant toublicpcp olicy.

TheSectionrejectsmanifestdisregardofthelawdefinedastheknowingrefusaltoapplyclearlyapplicablelawasagroundfordenyingrecognitionorenforcementofanonConvention award. Instead, the draft adopts the Seventh Circuits narrower view thatmanifest disregard exists only when the tribunal orders a party to violate the law. Soefined,manifestdisregard isanapplicationof thepublicpolicygroundandprovidesnondependentbasisforrefusingrecognitionorenforcement.diTopic2,SubTopic(C)PartyModificationandWaiverofGrounds

Sections423,424,and425

Notwithstanding the consolidation of former Chapters 4 and 5, the substance ofthese three Sections remains largely unchanged. Together, these Sections deal with thepplicationof theSupremeCourtsdecision inHallStreetAssociates,L.L.C.v.Mattel,552aU.S.576(2008),tointernationalarbitralawardsandrelatedissuesofwaiver. Likepreviousdrafts,Section423providesthatpartiesmaynotcontracttoexpandthegroundsforpostawardreliefandSection424providesthatpartiesmaynotagreetoreduce or eliminate those grounds. Also similar to previous versions, these Sectionsprovidethatpartiesareprecludedfromachievingthesesameresultsbycontractingforthelawofaparticular stateorbyattempting torestrict theauthorityofarbitrators tomakelegal errors. In analyzing howwaivermay affect parties ability to challenge a grant of

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postawardrelief,Section425distinguishesbetweengrounds,whicharearticulated inthe applicable law and cannot be altered by party agreement, and the objections thatconstitutethefactualunderpinningsofanallegationthatgroundsexist.PartiescanwaivetheobjectionsunderthecircumstancesdescribedinthisSection,buttheycannotwaivethegroundsperse.Topic3ConductofPostAwardActionsSections426and427

Section426dealswithsubjectmatterjurisdictioninactionsforpostawardrelief.TheissuestreatedinSection426arenotfundamentallyalteredunderthenewdraft.TheConventionsandtheirimplementinglegislationcreatefederalsubjectmatter jurisdiction;consequently, actions for postaward relief brought under the Conventions (as regardsboth foreign and U.S. Convention awards) do not require an independent basis ofjurisdiction. At the suggestion of Advisers and the Members Consultative Group, a newCommentaddressesthequestionofremovalfromstatetofederalcourt,leavingitsdetailsas before to the Reporters Notes. As before, complex issues of venue are dealt withxclusivelyintheReportersNotes,ratherthanineithertheblackletterortheCommentsothisSet ection.

Section 427 addresses personal jurisdiction in postaward actions. The onlysignificant addition to the previous draft is the discussion of party autonomy and,moreparticularly,ofwhetherandtowhatextentthepartiessubjectthemselvestoconfirmationorvacaturactionsincourtsotherthanthoseofthearbitralseat.Theavailabilityofquasinremjurisdictioninpostawardactionsisreaffirmed,withadditionaldetailonthevaluefthejudgmentsresultingfromanexerciseofsuchjurisdiction.ioSections428and429

Section428 is devoted to sovereign immunity. Theplace of sovereign immunityand its exceptions (as well as the act of state and political question doctrines) is notfundamentally altered by the consolidation of former Chapters 4 and 5. It is a goodexampleofasubjectonwhichtheblackletter,Comments,andReportersNoteswouldhavebeen, forallpracticalpurposes,duplicatedifconfirmationandvacaturhadremainedinaseparateChapterfromrecognitionandenforcement.

TheRestatementpositionon forumnonconveniens,nowcovered inSection429,

remainsbasicallyunchangedfrompreviousdrafts.Forumnonconveniensisunavailableinactions for the recognition and enforcement of foreign Convention awards, thoughavailable in principle for nonConvention awards. With respect to vacatur andconfirmationofU.S.Conventionawards, thedoctrinealso remainsgreatly restricted. LispendensisaddressedforthefirsttimeintheCommentstoSection429,whichtreatitasunavailableinconnectionwithactionsforpostawardrelief.

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Section 30 31s4 and4

The next two Sections deal with the proper plaintiff (Section 430) and properdefendant(Section431) inapostawardaction. TheSectionsrecognize thatonlyunderlimited circumstances is a nonparty to the arbitration proceeding a proper plaintiff orproperdefendant.ThesubstanceoftheSectionsislargelythesameasinpriordrafts,withtwoexceptions:First,thedraftnowprovidesthatallpartiestothearbitrationproceedingareproperplaintiffsandproperdefendantsinapostawardaction.Second,theblackletternowexpresslycontemplatesthepossibilityofexparteawards(i.e.,awardsenteredintheabsenceofaparty).Inpriorversions,theCommentshadrecognizedsuchapossibility,buttheblackletterdidnot. Sections432,433,and434

Sections432,433,and434representaclustergoverningstatutesof limitations,

procedure,andappealsinconnectionwithpostawardactions.AllthreeSectionsconfrontthequestionof theextent towhichpostrelief actions in state courts follow the relevantstatelawproceduralruleortheruleprescribedbytheFAA.

Section432nowmakesclear thatactions toconfirmU.S.Conventionawardsand

actionstoenforceforeignConventionawardsaresubjecttoathreeyearlimitationsperiod,whileactionstovacateU.S.ConventionawardsremainsubjecttoFAAChapterOnesthreemonth uteof limitationsandactionstoenforcenonConventionawardsaresubjecttoFAACh t

statapterOneslimita ionsperiodofoneyear.Section432alsoaddressescertainmatters related to limitationsperiods that the

courts have not thus far clearly or consistently addressed. The limitations period inconnectionwith a partial award, as defined in the Restatement, begins to runwhen thepartial award is issued. However, a party is not required to seek postaward relief inconnectionwithapartialawardwithinthatlimitationsperiod.Postawardreliefregardingthecontentofapartialawardmayalsobesoughtwithinthe limitationsperiodfollowingissuanceofthefinalaward.TheRestatementtakesthefurtherpositionthat,whilevacaturmayonlybesoughtwithinFAAChapterOnesthreemonthperiod,vacaturgroundsmayberaisedtodefeatconfirmationaslongastheconfirmationactionitselfisstilltimely.

Section433affirmsthatpostawardproceedingsaregenerallysummaryinnature.

There i , accordingly, apresumptionagainstdiscoveryandevidentiaryhearings in thoseprocee

sdings.Section 434 is now the provision governing right of appeal from rulings on a

motion for postaward relief. Its content is essentially the same as that set forth in thecorrespondingSectionofformerChapter5.TheSectionechoestheFAAsgrantofarightofimmediateappealinpostawardactionsinfederalcourt,butprovidesthatrightsofappealinactionsinstatecourt,evenifbroughtundertheFAA,aregovernedbystatelaw.

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Topic4Modification,Correction,andRemandSections435and436derivefromSectionsfirstintroducedinformerChapter4.In

general, they recognize thatawards, inorder tobegiveneffect,may requireadjustment,repair, or clarification.Theyalso confirm that courts are limited inwhat theymaydo tomakeanawardmoreeffectual.

Section435describesa formofpostawardreliefprovidedfor inFAASection11.

Theblack letterstatesthatacourtmaymodifyorcorrectaU.S.Conventionawardtotheextent that the award contains amathematicalmiscalculation or amistakendescription,providedthedefectinquestionisevidentandmaterial.Acourtmayalsoacttocorrectormodify awards that have minor formal flaws or that purport to decide matters notsubmitted to the tribunal; theoverreaching that characterizes the latterdefectmayalsolead to vacatur or partial vacatur under Section 414, above. The Section cautionsthroughout that merits review and a courts corresponding imposition of substantivechanges in theawardarenot authorizedunder theguiseof correctionandmodification.Section 435 authorizes correction and modification with respect to U.S. Conventionwards and to foreign awards originating in proceedings that the parties explicitlyubjectas edtoU.S.arbitrationlaw.

Section436restatesaruleestablishedincaselaw,andfoundinstatutesoutsideofthe United States. In exceptional circumstances and when appropriate, a court mayremandaU.S.Conventionawardtothearbitraltribunalwithinstructionstocompletetheawardor toclarify itsmeaning.Theoptiontoremandcomplementsthecourtspowertocorrect andmodify awards.A courtmay remand to the tribunalwhen the existenceandcharacter of a correctable defect cannotwith confidence be ascertainedwithout furtherprocessingoftheawardbythetribunal;uponremand,thetribunal itselfmaycorrecttheflawsothatthecourtneednotdosounderSection435.Theprincipallimitplaceduponremandisthatatribunalmaynotrevisitthemeritsonmattersalreadydeterminedbyit.TheSectionauthorizesremandwithrespecttoU.S.ConventionawardsandforeignawardsriginatinginproceedingsmadeexplicitlysubjecttoU.S.arbitrationlawbytheparties.o

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APPENDIX

Chapter4POSTAWARDRELIEF(Crossreferencestopreviousdrafts)

REVISED OLD/COUNTERPART

TOPIC1.GENERALPROVISIONS

41.PostAwardActionsGenerally [41]

42.NoAuthoritytoVacateForeignAwards [43]

43.LawApplicabletoPostAwardRelief [44,53]

44.FormalRequirementsforPostAwardRelief [42,51]

45.Reciprocity [52]

46.BurdenofProofforPostAwardRelief [45,54]

47.StandardofReviewforGrantingPostAwardRelief [47(b),5 6(b)]

48.EffectofPriorJudicialDeterminationsinPostAwardActions [46,55]

49.ClaimPreclusion [new]

410.IssuePreclusion [43(f),53(f)]

TOPIC2.GROUNDSFORPOSTAWARDRELIEF

411.GroundsforPostAwardReliefGenerally [47,56,57]

SUBTOPIC(A).CONVENTIONAWARDS

412.ArbitrationAgreementDoesnotExistorIsInvalid [58]

413.DenialofNoticeorOpportunitytoPresentCase [59]

414.Award...BeyondTermsoftheSubmission [510]

415.Procedure/CompositionViolatesAgreementorLawofSeat [511] 416.AwardSetAsideorSubjecttoSetAsideProceedings [512]

417.AwardDecidesMattersNotCapableofArbitration [513]

418.GrantingorDenyingEffecttoAwardViolatesPublicPolicy[514] SUBTOPIC(B).NONCONVENTIONAWARDS

419.AwardProcuredbyCorruption,Fraud,orUndueMeans [48]

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420.EvidentPartialityorCorruptionbytheArbitrators [49]

421.ArbitratorMisconduct [410]

422.TribunalExceededItsPowers[411through411E]

SUBTOPIC(C).PARTYMODIFICATIONANDWAIVEROFGROUNDS

423.AgreementstoExpandGroundsforPostAwardRelief [412,515]

424.AgreementstoReduceorEliminateGroundsforRelief [413,516]

4.25.WaiverofObjections [414,517]

TOPIC3.CONDUCTOFPOSTAWARDACTIONS

426.SubjectMatterJurisdictioninPostAwardActions [415,518]

427.PersonalJurisdictioninPostAwardActions [416,519]

428.SovereignImmunityandActofStateinPostAwardActions [417,520]

429.ForumNonConveniensinPostAwardActions [418,521]

430.ProperPlaintiff [419,522]

431.ProperDefendant [420,523]

432.StatuteofLimitations [421,524]

433.ProceduralIssuesinPostAwardActions [422,525]

434.AppealinPostAwardAction [423,526]

TOPIC4.MODIFICATION,CORRECTION,ANDREMANDOFAWARDS

435.ModificationandCorrectionofaU.S.ConventionAward [424]

436.RemandtoTribunalofU.S.ConventionAward [425]

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RESTATEMENTOFTHELAWTHIRD

THEU.S.LAWOF

INTERNATIONALCOMMERCIALARBITRATION

COUNCILDRAFTNO.3

TABLEOFCONTENTS

SectionPage

ReportersMemorandum............................... .................................................................xi......................

Chapter1

DEFINITIONS

11.Definitions........................................................................................................................................1

Chapter4POSTAWARDRELIEF

TOPIC1.GENERALPROVISIONS

41.PostAwardActionsGenerally .........................................................................................4942.NoAuthoritytoVacateForeignAwards..........................................................................6343.LawApplicabletoPostAwardRelief................................................................................6844.FormalRequirementsforPostAwardRelief ................................................................9245.Reciprocity................................................................................................................................. 10146.BurdenofProofforPostAwardRelief.......................................................................... 10847.StandardofReviewforGrantingPostAwardRelief............................................... 11248.EffectofPriorJudicialDeterminationsontheGrantofPostAwardRelief.... 11749.ClaimPreclusion...................................................................................................................... 126410.IssuePreclusion.. .............. 146

....................................................................................................

TOPIC2.GROUNDSFORPOSTAWARDRELIEF

411.GroundsforPostAwardReliefGenerally ............................................................ 161

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Section Page

SUBTOPIC(A).CONVENTIONAWARDS

412.ArbitrationAgreementDoesnotExistorIsInvalid.............................................. 170.... 182413.DenialofNoticeorOpportunitytoPresentCase ...............................................

414.AwardonMattersBeyondtheTermsoftheSubmissiontoArbitration ..... 207415.ArbitralProcedureorCompositionofArbitralTribunalViolatesPartyAgreementorLawoftheArbitralSeat ....................................................................... 219416.AwardSetAsideorSubjecttoSetAsideProceedings ......................................... 238417.AwardDecidesMattersNotCapableofResolutionbyArbitration................ 249418.PostAwardRel ....................... 266

iefViolatesPublicPolicy............................................

SUBTOPIC(B).NONCONVENTIONAWARDS

419.AwardProcuredbyCorruption,Fraud,orUndueMeans................................... 281420.EvidentPartialitybytheArbitrators........................................................................... 287421.ArbitratorMisconduct ....................................................................................................... 294422.Arbi 302

tralTribunalExceededItsPowers ......................................................................

SUBTOPIC(C).PARTYMODIFICATIONANDWAIVEROFGROUNDS

e423.AgreementstoExpandGroundsforPostAwardRelief ....................................... 318424.AgreementstoReduc orEliminateGroundsforPostAwardRelief ........... 324425.WaiverofObje ..................... 330

ctions .....................................................................................

TOPIC3.CONDUCTOFPOSTAWARDACTIONS

426.SubjectMatterJurisdictioninPostAwardActions............................................... 338427.PersonalJurisdictioninPostAwardActions........................................................... 355428.SovereignImmunityandActofStateinPostAwardActions .......................... 363429.ForumNonConveniensinPostAwardActions ..................................................... 372430.ProperPlaintiff...................................................................................................................... 383431.ProperDefendant................................................................................................................. 387432.StatuteofLimitations ......................................................................................................... 392433.ProceduralIssuesinPostAwardActions ................................................................. 403434.App 408

ealinPostAwardAction..........................................................................................

MANDOFAWARDSTOPIC4.CORRECTION,MODIFICATION,ANDRE

435.CorrectionandModificationofConventionAwardsMadeintheUnitedStates. ................................................................................................ 413436.RemandtotheArbitralTribunalofConventionAwardsMadeintheUnitedStates........................................................................................................................... 422

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APPENDICES

nAppendixAConventionontheRecognitionandEnforcementofForeigArbitralAwards........................................................................................................ 427AppendixBInterAmericanConventiononInternationalCommercial

Arbitration.................................................................................................................. 434AppendixCFederalArbitrationAct ......................................................................................... 438AppendixDBlackLetterofCouncilDraftNo.3................................................................... 449

RestatementThird,InternationalCommercialArbitration 11CouncilDraftNo.3

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RESTATEMENTOFTHELAWTHIRD/THEU.S.LAWOF

INTERNATIONALCOMMERCIALARBITRATION

Chapter1

DEFINITIONS

11.Definitions

(a) An arbitral award is a decision in writing by an arbitral

tribunalthatsetsforththefinalandbindingdeterminationonthemerits

ofaclaim,defense,orissue,regardlessofwhetherthatdecisionresolves

theentirecontroversybeforethetribunal.Suchadecisionmayconsistof

agrantofinterimrelief.

(b) An arbitral tribunal is a body consisting of one or more

personsdesignateddirectlyor indirectlyby theparties toanarbitration

agreement and empowered by them to adjudicate a dispute that has

arisenbetweenoramongthem.

(c) Arbitration is a dispute resolution method in which the

disputingparties empower an arbitral tribunal todecide adispute in a

finalandbindingmanner.

(d)An arbitration agreement is an agreement bywhich parties

consenttosubmitoneormoreexistingorfuturedisputestoresolutionby

anarbitraltribunal.


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(e) Commercial matters or relationships are those matters or

relationships, whether contractual or not, that arise out of or in

connectionwithcommerce.

(f) A competent authority is a court or other body that is

empoweredtoentertainsetasideproceedingswithrespecttoaparticular

arbitralawardand that iseitherpartof the legal systemof thearbitral

seat or of a legal system whose arbitration law was designated

unambiguously by the parties to govern the arbitral proceedings that

producedtheaward.

(g) Confirmation is adetermination that reduces to judgment a

ConventionawardmadeintheUnitedStates.

(h)AConventionaward isanarbitralawardthat iseitheraNew

YorkConventionawardoraPanamaConventionaward. A Convention

awarddoesnotincludeanawardrenderedinanarbitrationgovernedby

theConventionontheSettlementofInvestmentDisputesbetweenStates

andNationalsofOtherStates(ICSIDConvention).

(i) A Convention award made in the United States (or U.S.

Convention award) is an international arbitral award rendered in the

United States that arises out of a legal relationship involving property

locatedabroad,envisagingperformanceorenforcementabroad,orhaving

someotherreasonablerelationwithoneormoreforeignStates.


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(j)AcourtisanycourtwithintheUnitedStates.

(k)Adomesticawardisanarbitralawardthathasnoreasonable

relationwithoneormoreforeignStates.

(l)Enforcementisthereductiontoajudgmentofaninternational

arbitralaward,otherthanaConventionawardmadeintheUnitedStates.

(m) Execution is the granting of relief provided in a judgment

throughmeasuresorderedbyorundertheauspicesofacourt.

(n)Thefinalawardmeansthelastawardthatthetribunalmakes

withrespecttotheparticulardisputebeforeit.

(o)Aforeignawardisaninternationalarbitralawardmadeinan

arbitrationseatedoutsidetheUnitedStates.

(p)AforeignStateisanentityotherthantheUnitedStatesthatis

recognizedasaStateunderinternationallaw.

(q)Aninterimmeasureisagrantoftemporaryrelieftopreserve

the status quo, help ensure the satisfaction of a subsequent award, or

otherwise protect the rights of one or more parties and promote the

efficacyofanarbitrationandtheresultingaward. Aninterimmeasureis

presumptivelytreatedasapartialaward.


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A competent court may also order interim relief in aid of

arbitration,whichisdistinguishablefrominterimmeasuresgrantedbyan

arbitraltribunalandwhichisreferredtoasprovisionalrelief.

(r)An internationalarbitralaward isanarbitralaward that,by

virtueof itsreasonablerelationwithoneormoreforeignStates, isnota

domestic award. The term includes Convention awards (both foreign

awards and Convention awards made in the United States) and non

Conventionawards.Aninternationalarbitralawarddoesnotincludean

awardrenderedinanarbitrationgovernedbytheICSIDConvention.

(s) An arbitral award is madewhen under the arbitration law

governing the proceedings that gave rise to the award it is deemed to

comeintoexistence.

(t) A New York Convention award is an arbitral award that is

subject to the provisions of the Convention on the Recognition and

EnforcementofForeignArbitralAwards(NewYorkConvention).

(u)AnonConventionaward isaforeignawardthat isnotaNew

YorkConventionawardorPanamaConventionaward.

(v) A Panama Convention award is an arbitral award that is

subject to the provisions of the InterAmerican Convention on

InternationalCommercialArbitration(PanamaConvention).


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(w)Apartialawardisanarbitralawardthatdisposesofsome,but

notall,oftheclaims,defenses,orissuesbeforethearbitraltribunal.A

partialawarddoesnotincludeanorderaddressingscheduling,

procedural,orevidentiarymatters.

(x)Apostawardactionisasummarycourtproceedingbroughtto

vacate,confirm,orenforceaninternationalaward.

(y)Postawardreliefisarulingbyacourtthatvacates,confirms,

recognizes,orenforcesaninternationalarbitralaward.

(z) Recognition is a determination by a court or other tribunal

that an international arbitral award is presumptively entitled to

preclusiveeffectwithrespecttooneormoremattersdeterminedtherein.

(aa)Theseat(orarbitralseat)isthejurisdictiondesignatedby

thepartiesorbyanentityempowered todosoon theirbehalf tobethe

juridical home of the arbitration.An arbitral proceeding is ordinarily

governed by the arbitration law of the jurisdiction in which it is

seated,andtheresultingawardisdeemedmadeinthatjurisdiction.

(bb) A setaside proceeding is a legal action bywhich a party

seekstohaveanarbitralawardannulledbyacompetentauthority.

(cc)Astate isacommonwealth,district,state,orterritoryofthe

UnitedStates.


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Bycontrast,agrantofinterimmeasuresbyanarbitraltribunalpresumptively

constitutes an award inasmuch as such measures set forth a final and binding

determination with respect to whether, on the facts presented to the tribunal, the

requesting party is entitled to temporary relief. Accordingly, an order of interim

measuresmustbetreatedasanawardandbesubjecttopostawardrelief,unlessthe

presumptionthatitisanawardisrebutted.SeeCommentsqandw.

(dd)The United States isall territoryandwaters subject to the

jurisdictionoftheUnitedStates.

Comments:

a.Arbitralaward.Anarbitralaward,forpurposesoftheRestatement,mustbe

in writing and contain a final and binding determination by an arbitral tribunal

regardingaclaim,defense,orissuetherein.Afinalandbindingdeterminationmaybe

anarbitralawardeventhoughitisonlyapartialaward,inthatitaddressesfewerthan

all of the claims,defenses,or issuespendingbefore thearbitral tribunal. Whethera

writing constitutesanarbitral award isnot controlledby the labelgiven to itby the

tribunal.

The term arbitral award does not include a determination or

recommendation,whetherbyanarbitrator,mediator,orotherthirdparty,thatisonly

advisory or otherwise nonbinding. It also does not include determinationsmade to

manage the arbitral process, such as scheduling orders and orders resolving

proceduralorevidentiaryquestions.


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b. Arbitraltribunal. Anarbitraltribunalisabodycomposedofoneormore

persons referred to as arbitrators (or collectively as the tribunal) empoweredby

thepartiestodecidewithfinalitydisputesentrustedtothem.Thetribunalderivesits

jurisdictionandremedialpowersfromtheagreementoftheparties. Membersofthe

tribunalareappointedbythepartiesorbyanentityorauthorityactingontheparties

behalf. Althougha tribunalwill inmost caseshavebeenconstituted foraparticular

dispute,itmayincludecertainsemipermanentadjudicativebodies.

Thedefinitionofarbitraltribunalisbroadenoughtoincludebodiesthatconsist

of an even number of arbitrators; that contain one ormore arbitratorswho are not

impartial; that are empowered to conduct, in addition to arbitration, nonarbitral

forms of dispute resolution; and that are authorized to act ex aequo et bono or

otherwisetodepartfromstrictapplicationoflegalprinciples.Abodydoesnotceaseto

be an arbitral tribunalmerely because one of itsmembers is unable or unwilling to

participateinthearbitralprocess.

c. Arbitration. Arbitration is an adjudicatory dispute resolution method in

whichthepartiessubmitadisputetooneormorearbitratorsfora finalandbinding

determination. Arbitratorsareappointeddirectlyor indirectlyby thepartiesand in

principle derive their authority from the consent of the parties. See Comment b.

Arbitrationdiffersfromcollaborativeformsofalternativedisputeresolution(ADR),

suchasmediation,inthatitleadstoafinalandbindingdetermination,intheformof

anarbitralaward,seeCommenta, thatenjoysres judicataeffectandmayqualify for


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internationalenforcementunderatreatysuchastheNewYorkConvention.Moreover,

onceconsent toarbitration isgiven, itmaynotbeunilaterallywithdrawnbyaparty.

The successful conclusion of arbitration does not depend in all instances on active

participation by the parties; arbitration, unlike collaborative ADR methods, may

produce a valid and enforceable award even though one of the parties refuses to

participate in the proceeding. Arbitration is managed through procedural orders,

rulings,andinstructionsissuedbythearbitratorswhoactpursuanttothearbitration

lawof thearbitral seat, thearbitrationagreement,andanyprocedural rules that the

partiesmayhaveadopted.

d.Arbitrationagreement.Anarbitrationagreementisaninstrumentbywhich

parties agree to submit one or more existing or future disputes to resolution by

arbitration.Agreementsbywhichpartiessubmitanexistingdisputetoarbitrationare

commonly called submission agreements. Agreements by which parties submit

futuredisputestoarbitrationareusuallycontainedinaclausewithinthecontractto

which the dispute relates or out of which it arose. As the source of an arbitral

tribunals jurisdiction, the arbitration agreement also delimits the matters that are

properlybeforethearbitrators.Whileanarbitrationagreementmaybeoralaswellas

written, the applicable lawof arbitrationmay condition judicial enforceability of the

agreementonitbeinginwriting.

e.Commercial.TheRestatementisconcernedwiththoseawards,anddisputes

givingrisetothem,thatarecommercialinnature.TheRestatementdefinestheterm


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commercial broadly but nonexhaustively. A matter or relationship may be

commercialeventhoughitdoesnotariseoutoforrelatetoacontract,solongasithas

a connection with commerce, whether or not that commerce has a nexus with the

UnitedStates.Adisputeorawardmaybecommercialeventhoughoneoftheparties

to it is a sovereign State or a notforprofit enterprise, or it relates to a consumer

transaction,employmentrelationship,ordonativetransfer.

f. Competentauthority. Both theNewYorkandPanamaConventionsuse the

termcompetentauthority torefer toanadjudicativebody that isauthorized to set

asideorsuspendaparticularaward. Thetermisrestrictive. Acourtisnotrendered

competent merely by virtue of such factors as the law governing the parties

substantive rightsandduties, the locationofproceedingsassociatedwith theaward,

the location of property affected by the award, or the place where the award was

physicallyprepared. Rather,subjecttoaveryrareexception,abodyiscompetentto

setasideorsuspendanawardonly if it ispartof the legalsystemestablishedat the

seatofthearbitration.

The infrequent circumstance in which setaside powers are shared by

authorities of the seat and another jurisdiction arises when the parties have

unambiguouslydesignatedthearbitrationlawofthatotherjurisdictiontogovernthe

arbitration. In that instance, the seat of arbitration does not change, but under the

conventions the seats authorities cease to have exclusive setaside powers. By

contrast, the extent to which the parties choice of arbitration law influences the


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arbitrationlawtobeappliedattheseatisgovernednotbytheconventionsbutbythe

seatschoiceoflawrules.

10

Vacatur, confirmation, recognition, and enforcement of international arbitral

awardswithintheUnitedStatesaremostoftenregulatedbytheNewYorkConvention.

ByvirtueofthelargenumberofStatesthathaveratifiedtheNewYorkConvention,it

g. Confirmation. The term confirmation is commonly used to denote the

reductiontojudgmentintheUnitedStates,ordinarilythroughasummaryprocedure,

of an awardmade in the United States. The resulting judgment acquires the same

status as any other judgment of the court. It is a cause of some confusion that the

federallegislationimplementingtheNewYorkandPanamaConventionsreferstothe

confirmationratherthantheenforcementofConventionawards,eventhoughonly

aminority of Convention awards are rendered in the territory of the United States.

AlthoughtherelevantchaptersoftheFederalArbitrationAct(FAA)governingsuch

awards use the term confirmation, even for foreign awards, this Chapter of the

Restatement uses the term enforcement when referring to foreign awards. It

reservesuseof the termconfirmation forConventionawards made in theUnited

Stateswithinthemeaningofparagraph(i).Whenthecontextallows,confirmationis

sometimesalsousedinconnectionwithproceedingsbeforeforeigncourts.

h. Convention award. Convention award refers only to an award that is

governed by either the New York or the Panama Convention. An ICSID Convention

awardisthusnotaConventionawardforpurposesofthisdefinition.


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applies more frequently than the Panama Convention. The applicability of the two

Conventions isdeterminedby the requirementsofeachConventionand therelevant

FAA provisions implementing them. Chapter Two of the FAA implements the New

YorkConvention,whileChapterThree implementsthePanamaConvention,andeach

of theChaptersappliesonlytoawardssubject to therelevantConvention. However,

theConventions and theFAAmustbe interpreted together. Inparticular, construed

together, FAA Sections 207 and 302, allow a party to seek vacatur or resist

confirmationbasedontherelevantConventionsgroundsfordenyingrecognitionand

enforcement. The relationship among the three chapters, in turn, is regulated by

Sections 208 and 307 of the FAA, under which the provisions of Chapter One

supplementChaptersTwoandThree,respectively,totheextenttheyarenotinconflict

withthem.

ForeitherConventionorthecorrespondingFAAChaptertoapply,thefollowing

conditionsmustbemet.First,theawardmustarisefromacommercialrelationship.

See paragraph (e). Second, the award must concern a defined legal relationship,

whethercontractualornot. Third, theawardmusteitherbe foreign,asdefined in

paragraph(o),ormadeintheUnitedStates,asdefinedinparagraph(i).Anawardis

aforeignawardifmadeoutsidetheUnitedStates,evenifbothpartiesarecitizensof

the United States. Fourth, if the award is a foreign award within themeaning of

paragraph(o),itmustalsosatisfyanyapplicablereciprocityrequirements.See45,

infra.Finally,anawardisconsideredaConventionawardonlyifitismadepursuantto


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applicationof19

an arbitration agreement that satisfies the writing requirements of the applicable

Convention.

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1

When these requirements are fulfilled, the relevant Convention supersedes

priorinconsistentfederallawandpreemptsconflictingstatelawregardingthevacatur,

confirmation,recognition,andenforcementofanaward.See43(a),infra.

TheNewYorkandPanamaConventionsaresubstantially similar,but the two

texts exhibit certain variationswhichmay give rise to differences in the obligations

theycreate.Insomecases,therequirementsforapplicationofboththeNewYorkand

Panama Conventions will be satisfied. In such cases, the applicable Convention is

determinedbyreferencetotheidentityofthepartiestothearbitrationagreement.Ifa

majorityofthepartiestothearbitrationagreementarecitizensofaStateorStatesthat

have ratified the Panama Convention or are Member States of the Organization of

American States, the Panama Convention applies. In all other cases, the New York

Conventionapplies.Forthesepurposes,referenceismadetotheidentityoftheparties

tothearbitrationagreement,notthepartiestothefinalaward.

Illustrations:

1. In an action to enforce an award rendered pursuant to an

arbitration agreement among A, B, and C, the requirements for

bothConventionsaresatisfied. IfAandBarecitizensof

1CrossreferencetoSectiontobedraftedonenforcingarbitrationagreements.


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2113

i. Conventionawardmade in theUnitedStates. AConventionawardmade in

theUnitedStatesdenotesanarbitralawardthatwasrenderedintheUnitedStates,as

defined in paragraph (i), but which arises out of a legal relationship that involves

propertylocatedabroad,envisagesperformanceorenforcementabroad,orhassome

States thathave ratified thePanamaConvention,butC is a citizenof a

State that has not ratified the Panama Convention, the Panama

Conventionapplies.

2. Same facts as Illustration 1, except that the arbitration is

broughtonlybyAagainstC. Bdoesnotparticipate in theproceedings

andisnototherwisedeemedtobeaparty.Byvirtueofthecitizenshipof

thepartiestothearbitrationagreement,thePanamaConventionapplies.

3. In an arbitration arising out of an arbitration agreement

betweenAandB, therequirementsforapplicationofbothConventions

are satisfied. A is a citizen of a State that has ratified the Panama

Convention,butBisacitizenofaStatethathasnotratifiedthePanama

Convention.TheNewYorkConventionapplies.

Theparties to an arbitration agreementmay, beforeor after a dispute arises,

agree that one Convention will apply to the exclusion of the other. For such an

agreement tobeeffective itmustbeexpressand therequirements forapplicationof

thedesignatedConventionmustbe fulfilled. When thepartieshave so agreed, their

choicesupplantsthecitizenshipbasedrulesofhierarchysetforthabove.


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otherreasonablerelationwithoneormore foreignStates. Anawardbearingsucha

relationshipconstitutesaConventionawardmadeintheUnitedStatesevenifallof

thepartiestoitareU.S.citizens.

14

4. AU.S. citizen seeks toenforceagainstanotherU.S. citizenan

arbitralawardthatwasmadeintheUnitedStates.Thepartiescontract

was tobeperformedoutside theUnited States, but is governedby the

law of a U.S. state. In confirmation proceedings, a court treats the

arbitral award as one governed by the New York Convention and its

implementing legislation. The limitation period is therefore that

establishedundertheconventionchaptersandthegroundsuponwhich

ConventionawardsmadeintheUnitedStatesarereferredto intheNewYork

Convention as awards that are not considered as domestic. Due to the confusion

often caused by that description, the Restatement avoids its use. However, for

convenience, the Restatement frequently refers to Convention awards made in the

UnitedStatessimplyasU.S.Conventionawards.

ConventionawardsmadeintheUnitedStatesareeitherNewYorkConvention

awardsorPanamaConventionawardswithinthemeaningofparagraphs(t)and(v)

oftheRestatement ApartyseekingtogiveeffecttoaConventionawardrenderedin

theUnited States thus requests confirmationunder the relevantConvention and the

FAAprovisionsimplementingit.See43(b),infra.

Illustration:


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l. Enforcement. Enforcement is a determinationby a court that reduces an

arbitralawardtojudgmentintheUnitedStates.Theresultingjudgmenthasthesame

status as any other judgment of the court. The term does not denote the coercive

effectuationorcarryingoutoftheaward;inreferringtothatactivity,theRestatement

uses instead the term execution, as defined in paragraph (m). In the absence of

voluntarycompliance,enforcementwillbenecessary,butnotnecessarilysufficient,in

a party may resist confirmation are those set forth in Sections 412

through418.

j. Court. The term court is defined as any court within the United States.

Through the reference to the United States, the term court includes territorial,

state, and federal courts, and subsidiary courts within such constituent units;

recognitionor enforcementof international arbitral awardsmaybe sought in anyof

thesecourtsystems,subjecttojurisdictionalandotherrequirements.Whennecessary,

the Restatement distinguishes between federal and nonfederal courts within the

UnitedStates,andbetweenallsuchdomesticcourtsandforeigncourts.

k.Domesticaward.Adomesticawardisanarbitralawardthatdoesnotbear

a reasonable relationshipwith one ormore foreign States. The term thus does not

include any form of international arbitral award. See paragraph (q). So defined,

domestic awards liebeyond theambitof thisRestatement, even though theywill be

governed by the FAA when the requisite connection with interstate commerce or

foreigncommerceispresent.


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order for the claimant tohave the relief awarded. Enforcementof anaward implies

recognitionoftheaward,withinthemeaningofparagraph(z),andisaprerequisite

toexecution.Enforcement,however,doesnotimplythattheawardmergesintothe

judgment.

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All awards by definition set forth a final and binding determination on the

merits of a claim, defense, or issue. There is, however, only one final award. The

issuanceofthefinalawardaffectstheapplicationofcertainlimitationperiods. Ifthe

m. Execution. Acourtsconfirmationorenforcementofanawardresults ina

judgmenthavingthesamestatusasanyotherjudgmentofthatcourt.Seeparagraphs

(g) and (l). The relief contained in the judgment,however, isnot selfimplementing.

Executionisthejudiciallysanctionedprocessthroughwhichthereliefgrantedinthe

awardandthejudgmentofenforcement,typicallymonetaryorinjunctiveincharacter,

ismadeavailable to theprevailingparty. Theprocess commonly involvesmeasures

takenagainstthepropertyofthejudgmentdebtorbyalawenforcementofficial,such

asasherifforaU.S.Marshal,actingpursuanttoawritofexecution.

n. Finalaward. Anawardthatresolvessuchissuesasmaybependingbefore

thetribunaliscommonlyreferredtoasthefinalaward.Theawardmaybethelastin

aseriesofpartialawardsanddecideasingleremainingissue,suchasthequestionof

costs. Alternatively, itmay be the only awardmade in the dispute because it deals

comprehensively with all issues in dispute. The definition applies both to U.S.

Conventionawardsandforeignawards.


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