Parties in an arbitration should have the freedom to waive their right to bring annulment actions against arbitral awards. When the waiver does not offend a statute, courts should respect the parties’ bargain to waive challenges. Parties inferably understand their rights when they unequivocally agree to remove disputes to arbitration or to give up recourse for the annulment of an award. Given the freedom to designate the seat and to establish the arbitral procedure, parties in principle also have the freedom to remove direct recourse against the awards.
The confirmation and annulment procedures created by national judicial systems function to test award validity, and annulment waivers serve to shield that validity. The ex-ante annulment waiver can be thought of as the parties’ manifested intent of ensuring that the validity of the arbitral awards interse is autonomous from the national judicial system. The theory of an autonomous arbitral system denotes the idea that the validity of arbitral awards does not derive from national judicial systems—national procedures only come into play when deciding whether to recognize the autonomous validity of arbitral awards.
When direct challenges cannot be raised against an award in the primary jurisdiction, however, the award and the validity question are essentially removed to the autonomous arbitral system because award validity is no longer defeasible. Annulment waivers in this sense remove awards to the autonomous arbitral sphere, transcending the national sphere. In the international setting, when the annulment recourse is waived, an aggrieved party can only resort to resisting the recognition of the validity of the award in conformity with the international arbitral regime.