Drafting History of Article V (2) (b) of the New York Convention - Chapter 3 - Public Policy Exception Under The New York Convention: History, Interpretation, and Application
Dr. Anton G. Maurer, LL.M. has been actively involved in international arbitration for more than 20 years, concentrating on commercial, post M&A, and corporate disputes, and the enforcement of foreign arbitral awards. He is also actively involved in international litigation and has been professionally involved in disputes in more than 55 countries and in over 80 jurisdictions. He graduated with a law degree as well as a PhD in public international law from the University of Tübingen, Germany, and a Master of Laws in U.S. and Global Business Law from Suffolk University, Boston, MA.
Anton Maurer has been a Partner with CMS Hasche Sigle since 1987. He started his career with Sigle Loose Schmidt Diemitz & Partners in Stuttgart, Germany and then worked as a foreign attorney with Johnson & Swanson in Dallas, Texas. He currently serves on the board of directors of the International Association of Defense Counsel; as Chair of the Advisory Board of The Southwestern Institute for International and Comparative Law; and, as a member of the Advisory Board of the Institute for Transnational Arbitration, and the Board of Trustees, all with the Center for American and International Law, Plano, Texas.
On June 10, 1958, the United Nations Conference on International Commercial Arbitration signed the Final Act which prepared and opened for signature the Convention on the Recognition and Enforcement of Foreign Arbitral Awards,1 and adopted a resolution on measures for increasing the effectiveness of arbitration.
This Convention has with respect to a public policy exception in Art. V (2) (b) the following wording:
Recognition and enforcement of an arbitral award may also be refused if the competent authority in the country where recognition and enforcement is sought finds that:
(b) The recognition or enforcement of the award would be contrary to the public policy of that country.2
When interpreting the New York Convention, it has to be considered that the Convention provides five equally authentic language versions (Art. XVI (1) of the Convention). The English term in Art. V (b) (2) "public policy" appears as "ordre public" in the French text, and as "ordine publico" in the Spanish text; generally the terms "public policy" and "ordre public" are considered as synonyms.3
The question is how this clause is to be interpreted. A literal interpretation of the term "public policy" does not lead to a full understanding of what content the parties to the Convention meant with this expression when they signed and ratified or acceded to the Convention. The term "public policy" could be interpreted narrowly or broadly. Therefore, the issue is what was the intent and the expectation of the parties to the Convention. What did the representatives of the States drafting the Convention consider, and what did they want to achieve? What did the representatives of the States which signed the Convention consider? Is there a meaningful difference? Was the wording of this clause changed during the negotiation process which led to the New York Convention? Are there conclusions to be drawn from the changes in the wording of the public policy clause during the different drafting stages? Are there new elements regarding the foreign policy exception in the New York Convention? For answering these questions, it is important to review the records and analyze what the participants preparing and drafting the Convention said, discussed, and rejected, and if there was a common understanding or consensus how to interpret the Convention and especially the public policy exception.
I. Geneva Convention on the Execution of Foreign Arbitral Awards 1927