Originally from Between East and West: Essays in Honour of Ulf Franke

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The ongoing controversy regarding the role of the courts of the seat of an international arbitration has primarily focused on whether judgments by such courts annulling arbitral awards should be given effect abroad. As is well known by now, the New York Convention allows—but does not require—contracting States to deny recognition and enforcement to an award that was annulled by the courts of the seat, but States in which the question has arisen have not answered it in a consistent manner: some give no effect whatsoever to annulment decisions made at the seat, while others are prepared to do so, at least where the annulment decision was made in an appropriate manner and was based on acceptable grounds.1

But a legal system’s stance on the proper role of those courts may have an impact on several other questions that are not without importance in practice. One, which has gained some attention in recent years, is whether international arbitrators should give effect to anti-suit injunctions issued by the courts of the seat.2 Another, which has been discussed less frequently, is whether judgments rendered at the seat which dismiss objections to an international award’s validity ought to have extraterritorial effects, and thus be taken by foreign courts as conclusive on the issues addressed therein.3 A related question, which is the focus of the present paper, is whether—in New York Convention-based proceedings seeking recognition and enforcement of an award—the unsuccessful party should be precluded from relying on grounds that it could have raised, but chose not to raise, in annulment proceedings before the courts of the seat. To put the question differently: when, if at all, should failure to challenge an award before those courts amount to a waiver of New York Convention defences available in the jurisdiction where recognition and enforcement are sought?