Lawrence W. Newman and David Zaslowsky are members of the Litigation Department of the New York office of Baker & McKenzie LLP. They are co-authors of Litigating International Commercial Disputes (West Group)
Should one’s ability to remove a case to federal court to enforce/challenge an international arbitration award under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958 ( the “Convention”)1 depend on whether one is seeking to confirm or vacate the award? In some courts it does and in others it does not.
First, some details on the statutes through which the Convention has been implemented. Section 2022 provides generally that an arbitral award arising out of a commercial relationship “falls under the Convention” unless (1) the relationship is entirely between citizens of the United States and (2) does not involve property located abroad or envisages performance or enforcement abroad. Under Section 203, an action falling under the Convention shall be deemed to arise under the laws and treaties of the United States and the district courts shall have original jurisdiction. Section 205 states: “Where the subject matter of an action or proceeding pending in a State court relates to an arbitration agreement or award falling under the Convention,” the defendant can remove the case to federal court. And, finally, under Section 207, within three years of an award:
Any party to the arbitration may apply to any court having jurisdiction under this chapter for an order confirming the award as against any other party to the arbitration. The court shall confirm the award unless it finds one of the grounds for refusal or deferral of recognition or enforcement of the award specified in the said Convention.