(1)  Types of awards–Article 32(1)

Article 32(1) entitles the arbitral tribunal to make final awards as well as (p. 792) interim, interlocutory, and partial awards.⁴ According to the travaux préparatoires, these three additional types of awards can be made “whenever justified under the circumstances of the particular dispute” and “at any time during the arbitral proceedings.”⁵ Professor Sanders, the principal drafter of the UNCITRAL Rules, explained that the purpose of including these types of awards was “to give the arbitrators as much freedom as possible in order to ensure maximum efficiency” in case management.⁶ Interim, interlocutory, and partial awards are thus added as a form of decision–making to facilitate the efficient and expedient resolution of distinct components of the parties' dispute before the final award is rendered.

The terms “interim award,” “interlocutory award,” and “partial award” were used broadly and even interchangeably during the negotiation of the Rules.⁷ In Committee discussions, Sanders spoke in general terms regarding the meaning of interim and partial awards. The former “helped to bring a case closer to a solution,” while the latter “related to part of a case which could be settled immediately.”⁸ He later commented that in practice whether the arbitrators used the name “interim” or “interlocutory” is really of “no importance,” since they are entitled to make “any kind of award they deem appropriate for the conduct of the arbitration.”⁹ Indeed, the flexible nomenclature envisioned by the drafters was meant to promote efficiency, (p. 793) effectiveness, and expediency in the tribunal's decision–making process by avoiding overly technical and unnecessarily time–consuming disputes about the appellation of a particular decision.¹⁰

True to the drafters' expectations, interim, interlocutory and partial awards have been utilized in a varied and flexible manner to facilitate and improve case management, although the Iran-US Claims Tribunal came to develop a practice as to when each appellation was to be used. Partial awards, for example, were employed by the Tribunal when one claim or a group of claims could be separated out for early resolution, while the development of the remainder of the case required additional time and resources.¹¹ Partial awards, however, have also been employed by the Tribunal and other tribunals in order to separate large or complex cases into discrete phases, such as jurisdiction,¹² liability,¹³ damages,¹⁴ and costs.¹⁵ Another suggested use for partial awards is to decide specific legal questions such as the law applicable to the merits.¹⁶

Other tribunals similarly have issued “interim” awards for piecemeal (p. 794) resolution of separable issues.¹⁷ For example, in the Himpurna arbitration, the tribunal set forth its decision on whether the respondent party had defaulted on its obligation to submit a statement of defence in a document entitled an “interim award.”¹⁸ The Iran-US Claims Tribunal tended to limit the use of the phrase “interim award” to awards issued in connection with a party's request for interim measures of relief pursuant to Article 26 of the Rules. A number of such awards issued by the Tribunal addressed either a party's claims that its rights in property were in imminent danger and thus required immediate protection,¹⁹ or a party's request for a stay of proceedings in a forum other than the Tribunal, i.e., Iranian courts or another arbitral forum, pending the Tribunal's determination of its own jurisdiction.²⁰

Interlocutory awards have been useful in resolving preliminary or threshold legal questions bearing on the overall direction of the arbitration.²¹ The Iran-US Claims Tribunal has issued interlocutory awards on many occasions to determine whether a party is properly before the Tribunal,²² or whether a party's claim or counter–claim falls within the Tribunal's jurisdiction under the Algiers Accords.²³ Thus, in the practice of the Tribunal, the term “partial (p. 795) award” was assigned to an award that was final as to a distinct claim, while the “interlocutory award” was used to decide a substantive or procedural issue bearing on a claim. These preliminary rulings have no doubt saved the parties substantial time and money by narrowing the scope of the dispute at an early stage of arbitration. In other cases, the Tribunal has used the interlocutory award to deal with procedural matters, such as evidentiary matters,²⁴ the appointment of experts,²⁵ requests to amend a party's claims,²⁶ and issues of general case management.²⁷

Regardless of their function, interim, interlocutory, and partial awards are “awards” within the meaning of the Rules and thus must be made in accordance with the relevant procedural and technical requirements.²⁸ As described in the following sections of this Chapter, awards must be in writin; be signed by the arbitrators or, if one of three arbitrators fails to sign, include an explanation for the absence of the signature; contain reasons for the award, unless otherwise agreed; and include the date and place where the award was made.

The types of awards must be understood not only as each differs from the other, but also as they all differ from procedural orders. There are three principal reasons for rendering a decision as an award rather than an order: (1) awards can have external significance in terms of recognition and enforcement; (2) the mandatory provisions of the place of arbitration may require an award for certain decisions as evidence of a higher level of (p. 796) deliberation, an attribute that may avoid annulment; and (3) a partial or interlocutory award can, as discussed further within, close discussion within the arbitration on a claim or issue presented, thus allowing the tribunal to move on to new matters.

Compliance with the Article 32 requirements described above cannot alone guarantee the external validity and enforceability of a decision by the arbitral tribunal, even if termed an “award.” In most cases, the legal effect of such a decision depends on the norms of the applicable arbitration law, which may stipulate specific criteria for defining an “award.” While an extensive examination of this subject is beyond the scope of this Commentary, it suffices to note the work of UNCITRAL in the context of Model Law negotiations. The Commission considered, but never adopted, the following proposed definition of the term “award”:

An award means a final award which disposes of all issues submitted to the arbitral tribunal and any other decision of the tribunal which finally determine[s] any question of substance or the question of its competence or any other question of procedure but, in the latter case, only if the arbitral tribunal terms its decision an award.²⁹

The first portion of the text, including the phrase “questions of substance,” drew wide support from Model Law negotiators; the remainder was seriously criticized, particularly with respect to the inclusion of questions of procedure in the definition of award.³⁰

Albeit incomplete, the work of the Commission highlights areas of consensus regarding the meaning of the term “award.” It appears namely that an “award” covers decisions on substantive issues of fact or law that are material to the resolution of the arbitral dispute.³¹ Nevertheless, there is disagreement as to whether less substantive decisions on procedural matters, such as those relating to case management, constitute “awards.”³² Consequently, some (p. 797) decisions by the arbitral tribunal–notably those labeled “interim,” “interlocutory,” or “partial”–ultimately may not be treated as awards per se on the enforcement end in some jurisdictions. Moreover, certain awards, for example those that decide an issue rather than a claim, are not amenable to enforcement in any case, but rather serve primarily to finalize a specific point within the arbitration. To avoid overestimating the legal effect of its decisions, especially when rendering interim, interlocutory, and partial awards, it is incumbent upon the arbitral tribunal to investigate carefully the relevant provisions of the governing arbitration law. When in doubt as to how to categorize a decision, an arbitral tribunal is well advised to err on the side of caution and issue the decision in accordance with all the technical requirements associated with an award.³³ Indeed it is better to have created some false expectations among the parties, than to ignore a key criterion of the governing arbitration law, such as decision–making by majority rule, which may render the decision invalid.

(2)  The award is “final and binding” and the parties must “carry out the award without delay”–Article 32(2)

That the award is “final and binding” merely restates the established principle that an award rendered by an international tribunal is res judicata.³⁴ A decision rendered in the form of a valid award is “final,” meaning that the parties may not raise their claims against one another again while the award remains in force.³⁵ Such an award is also “binding,” meaning it imposes on the parties mandatory legal obligations, which are potentially cognizable in jurisdictions where enforcement is sought.³⁶

The available travaux préparatoire is virtually devoid of commentary on the meaning of the phrase “final and binding.”³⁷ The Committee did not appear (p. 798) initially to favor inclusion of both aspects of the principle of res judicata in Article 32(2) of the UNCITRAL Rules. Early drafts of the Rules provided only that an award is “binding” on the parties.³⁸ However, at the urging of the US representative,³⁹ the Committee agreed to insert the word “final” into the text of the rule.⁴⁰ Thus, at a minimum one reasonably can conclude that inclusion of the word “final” in Article 32(2) denotes that the terms “final” and “binding” have separate meaning. This Section seeks to clarify the meaning of those terms as they relate to the UNCITRAL arbitration process.

“Final.” Finality exists when the ability of the parties to bring direct and collateral challenges against the award ceases. The specifics of finality are contextual. In arbitration, an award is final when it is no longer capable of revision by the arbitral tribunal.⁴¹ Under many national arbitration regimes, finality results when the arbitral award is no longer susceptible to invalidation by a reviewing court.

In arbitration under the UNCITRAL Rules, finality attaches when the arbitral tribunal's decision becomes irrevocable. A strong indication of finality is that all the technical requirements for making an award have been satisfied, i.e., the award is made in writing by a majority of the tribunal's members, includes reasons, unless otherwise agreed, and the date and place where the award was made, and is signed by at least two of the three arbitrators.⁴² Upon satisfaction of these requirements, the tribunal's decision is locked in and the opportunity for further modification no longer exists.⁴³ Practically speaking, at this point in time the award is all but final. However, most agree that the parties are entitled to know the terms of the award before permanently losing their right to influence the arbitral tribunal. Principles of (p. 799) fairness therefore dictate that an award is not final under the Rules until its transmission to the parties pursuant to Article 32(6).⁴⁴

Finality also means that under the Rules there is no appeal from or recourse against an award, either before the presiding tribunal or a second–tier tribunal.⁴⁵ This fact has been confirmed frequently at the Iran-US Claims Tribunal, where Iran, when unhappy with the outcome of a case, has requested revision of the award in its favor. In most instances, Iran has sought to reopen a case by requesting correction, interpretation, or amendment of the award, pursuant to Articles 35, 36, and 37 of the Rules, respectively, or by invoking the Tribunal's exceptional powers of revision. In virtually every case, however, Iran's request has been rejected because it not only fell outside the limited scope of the Rules or the Tribunal's revision power, but also because it violated the rule of finality contained in Article 32(2).⁴⁶

Are all UNCITRAL awards final? The rule of finality in Article 32(2) does not distinguish between the various types of awards (final, interim, interlocutory, and partial) identified in Article 32(1).⁴⁷ In practice, however, interim, interlocutory, or partial awards require special consideration. To be sure, final awards are definitive not only because they dispose of all of the parties' claims, but also because the rendering of a final award terminates the tribunal's mandate under many national arbitration laws.⁴⁸ By contrast, interim, interlocutory, and partial awards often resolve discrete claims or issues without severing the tribunal's powers. One commentator suggests this continuing role of the tribunal leaves open the possibility that the tribunal might amend its decision.⁴⁹ We disagree as to interlocutory and partial awards, as those terms have been used by the Iran-US Claims Tribunal to indicate decisions on discrete issues or a portion of a group of claims. In these cases, the Tribunal consistently has ruled that such awards were final and (p. 800) could not be reopened.⁵⁰ A NAFTA Chapter Eleven tribunal reached the same conclusion with respect to a previously rendered partial award.⁵¹ In contrast, interim awards on interim measures of relief are made in response to a set of contemporaneous circumstances, and while such rulings may not be revisited, they may be replaced by subsequent interim awards issued in response to a new request for interim measures made on the basis of changed circumstances.

In another context, outside the arbitral proceedings, finality means more broadly that the award is no longer capable of being overturned under the national arbitration law. In most jurisdictions, an arbitral party is entitled to challenge the award in “set aside” proceedings.⁵² The most common grounds for setting aside an award are that the arbitration agreement was invalid; a party received improper notice of an arbitrator's appointment or was unable to present its case fully; the award exceeds the scope of the arbitral mandate; the tribunal was improperly composed; or the dispute was not arbitrable under the public policy of the forum state.⁵³ If a party's set aside action prevails, the award is rendered invalid and, in some cases, the arbitral proceedings must start anew.⁵⁴ An award therefore may not be “final” under the national arbitration law until the exhaustion of all available judicial recourse or the expiration of the statute of limitations for such challenges.⁵⁵ This broader sense of finality arises in the national law, while the narrower sense of “finality” arises within the arbitration by virtue of the Rules.

“Binding.” The notion that an award is “binding,” as opposed to “final,” relates to the legal force of an award that obliges the parties to execute its (p. 801) terms domestically or internationally. Whether an award is binding is of particular importance with respect to the enforcement of the award in a foreign jurisdiction.⁵⁶ Under the 1927 Geneva Convention, since superseded by the 1958 New York Convention, an award was “final” and thus enforceable abroad when all available post–award judicial proceedings were exhausted.⁵⁷ This requirement, however, gave rise to the cumbersome system of “double exequatur,” whereby a winning party often was required to move successfully to enforce the award in the awarding jurisdiction and then again in the foreign jurisdiction.⁵⁸ Thus, as a prerequisite, the New York Convention requires that the award be “binding,”⁵⁹ instead of “final,” in order to clarify that “no leave for enforcement from the court of the country in which the award was made was needed.”⁶⁰ An award therefore can be enforceable under the New York Convention before all challenges to the award have been resolved in the awarding jurisdiction.

The criteria for a “binding” award are often determined by the arbitration law of the awarding jurisdiction, which may set forth specific temporal or procedural requirements.⁶¹ As to temporal requirements, the Commission's negotiations on the Model Law illustrate the wide divergence in state practice (p. 802) as to when an award binds the parties. The Commission entertained three different proposed dates: the date when the tribunal makes the award, the date when the parties receive the award,⁶² and the date when the period for setting aside the award expires.⁶³ Unable to reach consensus, the Commission was forced to defer the matter for resolution by the courts of the jurisdiction where the award is made.⁶⁴ Consequently, seeking enforcement of an award under the New York Convention requires careful consideration of the meaning of the term “binding” under the arbitration law of the awarding jurisdiction.

The statement that the award is “binding on the parties” has an obvious connection to the exhortation on the parties “to carry out the award without delay.”⁶⁵ As some Committee negotiators maintained, the latter is simply a restatement of the former and thus need not be included in the text of the Rules on grounds of redundancy.⁶⁶ Other delegates, however, were in favor of a provision that introduced an express note of urgency (“without delay”) with respect to the execution of the award.⁶⁷

In practice, the real utility of an express commitment of compliance may be its potential to function as a waiver of a losing party's rights to contest the award in some instances. The decision by the French Supreme Court in Creighton v. Qatar is illustrative.⁶⁸ In Creighton, the court interpreted the meaning of the Government of Qatar's agreement to Article 24 of the 1975 ICC Arbitration Rules, which provided in relevant part: “By submitting the dispute to arbitration by the International Chamber of Commerce, the parties shall be deemed to have undertaken to carry out the resulting award without delay and to have waived their right to any form of appeal insofar as (p. 803) such waiver can validly be made.”⁶⁹ The court ruled that by consenting to Article 24 of the ICC Rules, Qatar waived its right of sovereign immunity from jurisdiction and enforcement. While Article 24 of the 1975 ICC Rules is similar to Article 32(2) of the UNCITRAL Rules, the former–but not the latter–contains an express waiver of appeal. However, the court did not emphasize the waiver provision in the ICC Rules, but rather the fact that Qatar had expressly agreed to execute the award promptly. Thus, the Creighton decision suggests that in France, and perhaps in other jurisdictions, that Article 32(2) of the UNCITRAL Rules might be interpreted similarly as a waiver of state immunity.⁷⁰

In addition to obliging compliance with the terms of the award, Article 32(2) arguably imposes a separate duty on the arbitral tribunal to ensure that any award rendered is valid and enforceable. Although the UNCITRAL Rules contain no express provision to this effect,⁷¹ the rule that the award is “final and binding on the parties” arguably requires that the arbitrators apply their best efforts to produce a valid and enforceable award. The scope of the arbitrators' duty will depend on the specific circumstances of an arbitration. At a minimum, however, this duty would encompass the making of an award that is legally effective in the awarding jurisdiction and in any foreign jurisdiction where a party most likely would seek additional enforcement.

(3)  Written award and designation of the date and place of the award's making–Articles 32(2) and 32(4)

The UNCITRAL Rules contain three technical requirements that for purposes of convenience may be treated together: the award must be in writing and must include the date and place of the award's making.⁷² The requirement of a written award contained in Article 32(2) is an obvious necessity of arbitration. No doubt the arbitrators will express the terms of the award and their underlying reasoning more clearly and precisely in written form, especially where the dispute involves complex issues. Likewise, the parties will better understand their rights and obligations under the award when they are memorialized in a written product. Moreover, a written award is a common (p. 804) prerequisite for enforcement of the award in court proceedings, where it can serve as the primary record of the arbitral proceedings.⁷³ Because of the obvious practical need for a written award, there was little discussion of this aspect of Article 32(2) during Committee negotiations.

Article 32(4) requires that the date and place of the award appear in the text of the award as these are “matters of great importance for the enforcement of the award.”⁷⁴ In some jurisdictions, the limitations period for filing or registration of the award or for challenge of the award runs from the date of the award.⁷⁵ As discussed above, the “binding” effect of an award, that is, whether an award is enforceable domestically or internationally, also may be determined by the date of the award in some jurisdictions.⁷⁶ The significance of the place of arbitration is discussed in detail in Chapter 2.⁷⁷ Suffice it to say here that inclusion in the award of the place where the award was made, for example, London, Paris, New York, etc., is an important indicator that the arbitral proceedings were “conducted in conformity with the mandatory rules of the law applicable at the place of arbitration” and that the award was “made at the place of arbitration” in accordance with Article 16(4).⁷⁸

The arbitral tribunal is free to include information regarding the date and place of the award in any manner it chooses. It has been the practice of the Iran-US Claims Tribunal to include the words “Dated, The Hague” followed by the date of the award immediately before the signatures of the arbitrators. For examples of how awards may be formatted from the practice of international tribunals, see below sections C(2) and D(2).

(4)  Obligation to sign and failure to sign the award–Article 32(4)

(5)  Statement of reasons for the award and dissenting opinions–Article 32(3)

Statement of reasons for the award. Article 32(3) starts from the mandatory premise that the arbitral tribunal “shall” include reasons in the award.¹¹⁶ When the Rules were drafted, this approach “reflect[ed] the law in many jurisdictions, particularly countries with a civil law system, to require that arbitral awards incorporate the reasons for the decision reached by the arbitrators.”¹¹⁷ It is thus not surprising that many Committee negotiators from the civil law countries supported the rule as drafted.¹¹⁸ The representatives from the United Kingdom and the United States, two common law nations, (p. 812) were of a different view, however.¹¹⁹ At the time, the prevailing practice in those countries did not require a statement of reasons in the award; a tribunal's reasons typically were stated separately in an attachment that did not form part of the award or were not stated at all.¹²⁰ Consequently, the British representative proposed that the rule be made permissive rather than mandatory (“may” instead of “shall”), leaving the arbitrators “free to incorporate the reasons in the award or to state them separately, depending on the traditions in their country.”¹²¹ The British proposal did not prevail ultimately,¹²² but prompted discussions that led the Commission to alter the rule to accommodate other practices.

Every draft of Article 32(3) had contained a narrow exception to stating the reasons for the award when “both parties have expressly agreed that no reasons are to be given.”¹²³ Some negotiators doubted the necessity of such an exception given that the parties could modify any rule pursuant to Article 1 of the Rules.¹²⁴ There appeared, however, to be consensus on the point that “[r]ules that are destined for world–wide use, like the UNCITRAL Arbitration Rules, must contain the possibility of an exception to the general principle that reasons should be given.”¹²⁵ The exception, particularly the word (p. 813) “expressly” became a focal point for compromise between the civil law and common law positions.

To alleviate the concerns of the common law negotiators, the Commission adopted a proposal to broaden the exception by omitting the word “expressly” from its text.¹²⁶ According to the travaux préparatoires, the deletion permits the parties to agree not to include reasons in the award either expressly in writing or “by implication,” for example, when the parties have “selected as the place of arbitration a country under whose national law reasons were not generally given in arbitral awards.”¹²⁷ If the parties wish that the award contain reasons, but the arbitration is in a “no–reasons” jurisdiction, then they may wish to inform the arbitral tribunal of their preferences regarding reasons expressly in writing.¹²⁸

The Rules provide no direction regarding the substance and form of the arbitral tribunal's statement of reasons for the award.¹²⁹ Obviously, the arbitral tribunal should craft the reasons for an award as carefully and precisely as possible,¹³⁰ not only to inform the disputing parties of their rights and obligations, but also, if the award is published, to offer useful precedent for future tribunals.¹³¹ The form of the reasons is not set in stone. While it is common practice that the statement of reasons precedes the dispositif of the award, it may also be appended to the award as a separate attachment (p. 814) immediately following the dispositif.¹³² In the case of administered arbitration, the arbitral institution may require adherence to additional criteria with respect to form or style.

Dissenting and separate opinions. The Preliminary Draft of the Rules provided that the award “shall not include any dissenting opinion.”¹³³ This prohibition was ultimately removed from the text of the Rules for two reasons. As explained above, Committee negotiators expressed concern that disallowing dissenting opinions would leave an arbitrator who disagreed with the majority opinion no choice but to express his dissent by refusing to sign the award.¹³⁴ The other reason was the plain fact that the majority of negotiators favored dissenting opinions.¹³⁵ Accordingly, the prohibition was removed from the Rules and “the question of whether an arbitrator may add his dissenting opinion to the award is left for decision to the law applicable at the place of arbitration.”¹³⁶ The Iran-US Claims Tribunal modified the UNCITRAL Rules to authorize dissenting opinions.¹³⁷

Even if entitled to dissent, an arbitrator may wish to consider the benefits and drawbacks of exercising that right. On the one hand, a dissenting opinion can enhance the award–making process in two important ways. First, “[b]y raising the most difficult problems with the majority's reasoning, (p. 815) dissent can ensure that the arbitral award is well–reasoned.”¹³⁸ Of course, to achieve this important benefit, the dissenting member must circulate the dissenting opinion for review by the majority before the award is rendered.¹³⁹ Second, “[t]he dissenting opinion can enhance the legitimacy of the process by showing the losing party that alternative arguments were considered, even if ultimately rejected.”¹⁴⁰ Indeed, if a losing party knows that its position was presented and debated fully and fairly, it arguably may be more inclined to carry out the terms of the award voluntarily.¹⁴¹

Dissenting opinions also have potential drawbacks. Just as a dissenting opinion may improve the quality of the award by providing critical feedback, it also may expose fatal flaws in the award. This was the case in the Avco arbitration before the Iran-US Claims Tribunal.¹⁴² There, in an effort to minimize excessive documentation, the Tribunal granted Avco permission to summarize, with the assistance of a certified accountant, the numerous and voluminous invoices on which a portion of its case relied. After the presiding Chairman resigned and was replaced, the Tribunal rendered its award, which held both parties liable for damages. Notably, the award rejected the claims by Avco based on the summarized evidence, finding that “the Tribunal cannot grant Avco's claim solely on the basis of an affidavit and a list of invoices, even if the existence of the invoices was certified by an independent audit.”¹⁴³ Judge Brower wrote a concurring and dissenting opinion in which he outlined in detail the Tribunal's reversal in position. He concluded:

[T]he Tribunal has misled the Claimant, however unwittingly, regarding the evidence it was required to submit, thereby depriving the Claimant, to that extent, of the ability to present its case…. Since Claimant did exactly what it previously was told to do by the Tribunal the denial (p. 816) in the present Award of any of those invoice claims on the ground that more evidence should have been submitted constitutes a denial to Claimant of the ability to present its case to the Tribunal.¹⁴⁴

Attempts by Iran Aircraft Industries to enforce the portion of the award in its favor were denied in US district court. Citing heavily from Judge Brower's opinion, the US Court of Appeals for the Second Circuit affirmed on the basis that Avco was “unable to present [its] case.”¹⁴⁵

A dissenting opinion also may inappropriately disclose the secret deliberations of the arbitral tribunal. Demonstrating a difference of opinion is the very reason an arbitrator dissents and in itself is not cause for alarm. However, when a dissent reveals the substance of the arbitral tribunal's deliberations, e.g. who said what and for what reason, the rule of confidentiality is compromised. This was the case in Case A/28 before the Iran-US Claims Tribunal in which Judge Broms filed a concurring and dissenting opinion that was said to reveal the views expressed in deliberations by some of his colleagues.¹⁴⁶

Finally, dissenting opinions increase the costs of arbitration both in terms of time and money. In most cases, the dissenting arbitrator will bill the party that appoints him or the parties collectively, if he is the presiding arbitrator, for his additional services. In addition, dissenting opinions drag out the arbitral proceedings, sometimes unnecessarily. In Granger Associates, to cite an extreme example, the Iranian judge's dissenting opinion, which alleged procedural misconduct by the majority, was delivered after the award was rendered and resulted in several rounds of rancorous correspondence by the arbitrators.¹⁴⁷

(p. 817) In addition to dissenting opinions, the arbitrators on the Iran-US Claims Tribunal have made extensive use of separate opinions. As discussed earlier, separate opinions have facilitated Tribunal decision–making pursuant to Article 31 of the Rules, which requires the arbitrators to negotiate the terms of the award until a majority opinion is formed.¹⁴⁸ By rendering a separate opinion an arbitrator is able to consent to the award, thus forming the necessary majority, while distancing himself or herself, if desired, from the award's reasoning or determination of damages.

(6)  Publication of the award–Article 32(5)

Article 32(5) establishes the presumption that the award is confidential, unless the parties agree to make it public.¹⁴⁹ This presumption comes as no surprise since it is widely recognized that confidentiality is a principal attraction of international arbitration over litigation in a public forum–especially where the parties' dispute involves business, trade, or military secrets, or other sensitive information.¹⁵⁰ The rule of confidentiality contained in Article 32(5) applies only to the publication of the award and not to any other aspect of the arbitral proceedings, such as the hearing or the deliberations of the arbitral tribunal.¹⁵¹

Notwithstanding the benefits of secrecy, there are compelling reasons to publish an award.¹⁵² Publication enhances transparency in international (p. 818) arbitration with great benefit to practitioners and scholars. Publication offers important historical information regarding the identity, expertise, and views of arbitrators and experts, as well as the comparative utility of arbitral forms (for example, ad hoc versus administered arbitration) and institutions (e.g. ICC versus AAA). Publication develops a corpus of arbitration case law, which provides invaluable examples on substantive and procedural matters. Publication also fosters critical feedback by scholars and commentators on all aspects of the field, which serves to improve the system of international arbitration generally.

The jurisprudence of most awards, even those containing sensitive information, can be made public, often with the approval of the parties, by applying simple precautionary measures. Specific information, such as the names of the parties or the amount of the award, can be redacted from the text of the award before publication.¹⁵³ In addition, the publication of extracts from the award can avoid revealing the parts of the award that are case specific or too sensitive in the view of the parties.¹⁵⁴

Yet even when one or more parties wish to keep the award secret, there are limits to the rule of confidentiality that are beyond their control. There is always the real possibility that the award will become public when a party seeks to enforce it in public proceedings.¹⁵⁵ There also may be mandatory laws and regulations in force that require disclosure of information in the award by a corporate party to its shareholders or by a state party to the public.¹⁵⁶

When international arbitration involves a party that is state, and thus (p. 819) issues of public interest, the practice has tended towards reversing the presumption of confidentiality in favor of publication of the award.¹⁵⁷ The Iran-US Claims Tribunal, for example, modified Article 32(5) to provide:

All awards and other decisions shall be made public, except that upon the request of one or more arbitrating parties, the arbitral tribunal may determine that it will not make the entire award or other decision public, but will make public only portions thereof from which the identity of the parties, other identifying facts and trade or military secrets have been deleted.¹⁵⁸

Similarly, the NAFTA Parties have agreed:

That nothing in the relevant arbitral rules imposes a general duty of confidentiality or precludes the Parties from providing public access to documents submitted to, or issued by, Chapter Eleven tribunals, apart from the limited specific exceptions set forth expressly in those rules.¹⁵⁹

This trend is further evident from the practice of other international arbitral tribunals.¹⁶⁰

(7)  Copies of the award to the parties–Article 32(6)

Once the award is rendered, the arbitral tribunal must transmit a final, signed copy to the parties. This communication serves three primary purposes. First, it notifies the parties of their rights and obligations under the award, enabling them to “carry out the award without delay.”¹⁶¹ Second, it initiates the 30–day period for requesting post–award proceedings under Articles 35 (interpretation), 36 (correction), and 37 (additional award).¹⁶² Third, it furnishes to the parties the requisite documentation for enforcement of the award in national court proceedings.¹⁶³ As a matter of practice, (p. 820) transmission of a copy of the award should be via a delivery method that guarantees receipt.

The duty to transmit a copy of the award to the parties ultimately falls upon the presiding arbitrator. This rule is clear from the travaux préparatoires. Early drafts of Article 32(6) required that the award be communicated by the “arbitrators.”¹⁶⁴ The representative of Belgium commented that “the award should be communicated to the parties only by the presiding arbitrator, since the parties would not need three copies of the award.”¹⁶⁵ The representative of Nigeria agreed and proposed replacing the word “arbitrators” with the word “arbitral tribunal.”¹⁶⁶ The proposal was adopted in order to clarify that the presiding arbitrator is responsible for distributing at least one copy of the award to each party.¹⁶⁷

The Committee negotiators also considered designating a time period for communication of the award. A number of delegates believed that an express time limit of a given number of days would bring certainty to the rule.¹⁶⁸ Others felt that an express time limit was too rigid and proposed alternatively to qualify the duty to communicate the award with phrases like “without delay”¹⁶⁹ or “without unnecessary delay.”¹⁷⁰ The Soviet delegate opposed these proposals, arguing that such language might cause the award to be invalidated solely on grounds that the arbitrators failed to act in a timely fashion.¹⁷¹ In the end, Article 32(6) contains no temporal qualifications on the duty to communicate the award, although it is clear that the rule is “designed to ensure that both parties will promptly receive copies of the award.”¹⁷² In some jurisdictions, the national arbitration law may establish the time limit for communication of the award.¹⁷³

(p. 821) Can an arbitral tribunal withhold the award in the event the parties have failed to provide adequate monetary deposits to cover the fees and expenses of arbitration?¹⁷⁴ Such a practice appears to be accepted in a system of dispute resolution that typically is funded solely by the parties. In the absence of an express prohibition against such measures in the Rules and in light of the prevailing practice of international tribunals, arbitrators likely will continue, subject to any restrictions under the governing arbitration law, to postpone communication of the award until the parties satisfy their financial obligations.¹⁷⁵

Perhaps even more important than the time it takes the arbitral tribunal to communicate the award is the time it takes to make the award–that is, the period from closure of the hearing until communication of the award.¹⁷⁶ Unlike most arbitral rules, the UNCITRAL Rules do not contain an express time limit for the latter task.¹⁷⁷ To ensure that the award is timely rendered, the parties may wish to consider modifying the Rules to establish a reasonable time limit that, depending on the difficulty and complexity of the arbitration, is in the range of three to six months after closure of the hearing.

(8)  Filing and registration of the award–Article 32(7)

Filing or registration of the award (also referred to as the deposit of the award) with local authorities is required in some jurisdictions.¹⁷⁸ Article 32(7) imposes a duty on the arbitral tribunal to file or register the award (p. 822) where the governing arbitration law requires such action. The scope of this duty was debated by the Committee. As initially drafted, the provision stated: “[i]f the arbitration law of the country where the award is rendered requires that the award be filed or registered, the arbitrators shall comply with this requirement within the time required by law.”¹⁷⁹ Two revisions to the text of the rule are noteworthy. First, the duty to file or register the award was narrowed to encompass only those situations where the governing law specifically assigned this task to the arbitral tribunal.¹⁸⁰ The effect of this change is dubious, however, given the tribunal's general obligation to ensure that the award is “final and binding,” which arguably includes making arrangements for the proper filing or registration of the award.¹⁸¹ Second, the word “arbitrators” was replaced by the phrase “arbitral tribunal” to indicate that the responsibility for filing or registration of the award in accordance with the governing law ultimately resides with the presiding arbitrator.¹⁸²

(1)  Tribunal Rules, Article 32(1)–Types of awards

The Tribunal has, by virtue of Article 32, Paragraph 1, of the Tribunal Rules, decided to issue a Partial Award on the sole question of liability for the draft amounts claimed, and retains jurisdiction to resolve the issues of interest and costs.

Granite States Machine Co., Inc. and The Islamic Republic of Iran et al., Partial Award No. 9–30–3 (29 Jul 1982), reprinted in 1 Iran-US CTR 185, 187–88 (1981–82).

(p. 823)

The Tribunal has, by virtue of Article 32, paragraph 1, of the Tribunal Rules, decided to issue a partial award covering Ultrasystems' claims with the exceptions indicated at III B 1 and 2 below, and also covering the Respondents' counterclaims.

Ultrasystems Inc. and The Islamic Republic of Iran et al., Partial Award No. 27–84–3 (4 Mar 1983), reprinted in 2 Iran-US CTR 100, 101 (1983–I).

With regard to the acceptance of the Claimant's Second Amendment to Statement of Claim filed on 2 May 1983 and naming MSA as a Respondent in the Sixth and Seventh Claims, the Tribunal, having reviewed the parties' evidence and arguments on this issue, has determined that further deliberation is required on that issue as well as on other jurisdictional and substantive issues relating to those claims. Pending such deliberation the Tribunal will issue a Partial Award on Claims One to Five and Claim Eight. An Award on Claims Six and Seven shall be rendered subsequently.

Harnischfeger Corp. and Ministry of Roads and Transportation et al., Partial Award No. 144–180–3 (31 Jul 1984), reprinted in 7 Iran-US CTR 90, 97–98 (1984–III).

No majority has yet been formed within the Tribunal on the question of whether interest on any principal amount awarded Claimant should be calculated from a date prior to the filing of the Statement of Claim. This issue, which may involve a considerable amount of money, needs further research and consideration, inter alia, on points of law. The Tribunal, therefore, by virtue of Article 32, paragraph 1 of the Tribunal Rules, decides to render a Partial Award on all other issues raised in this case, and to retain jurisdiction over a portion of Claimant's claim for interest. A related issue also to be resolved in the final award will be the allocation between the Parties of arbitration costs relating to the interest issue over which jurisdiction is retained.

RJ Reynolds Tobacco Co. and Iranian Tobacco Co., Partial Award No. 145–35–3 (31 Jul 1984), reprinted in 7 Iran-US CTR 181, 183 (1984–III).

(2)  Tribunal Rules, Article 32(2)–Final and binding award

1. b.  … Award No. 586–A27–FT … is a “final and binding” Award of the Tribunal, pursuant to Article IV, paragraph 1, of the Claims Settlement Declaration, and must be carried out “without delay,” in accordance with Article 32, paragraph 2, of the Tribunal Rules. (p. 824) While the United States asserts that payment of the amount awarded by that Award into the Security Account would constitute compliance with the Award because Iran is “obviously and clearly in breach of its own obligation under the [Algiers] Declarations to replenish the Security Account,” that is, of course, the principal legal issue in Case No. A28, and the Tribunal cannot properly prejudge its future decisions in that Case. Consequently, the Tribunal cannot accept the Claimants' request that the United States be allowed to satisfy its obligations pursuant to Award No. 586–A27–FT by payment of the amount awarded in para 83(b) thereof into the Security Account. The Tribunal expects that the United States will pay that amount promptly and directly to Iran….

The United States of America et al. and The Islamic Republic of Iran et al., Case No. A/28, Order of 5 Aug 1998, at 2.

(3)  Tribunal Rules, Articles 32(3) and 32(4)–Date, place, and signature

Aram Sabet et al. and The Islamic Republic of Iran et al., Partial Award, Award No. 593–815/816/817–2 (30 Jun 1999).

(p. 825) (4)  Tribunal Rules, Article 32(3)–Reasons for the award

Unnecessarily large parts of the Interlocutory Award are devoted to descriptions of the contentions of the parties. These are flawed in ways which reflect adversely on the quality of the work of the Tribunal.

One problem is that it is difficult to identify which statements are findings of the Tribunal and which are only contentions of a party. Many statements which might appear to be findings of the Tribunal are identified as party contentions only in short prefatory clauses which sometimes appear several sentences, paragraphs–or even pages–earlier. Adding to the confusion, not all such contentions are confined to the section headed “Facts and Contentions”; many appear elsewhere in the text.

The Interlocutory Award often fails to indicate which contentions are supported by evidence and which are not. Further, certain statements presented as contentions are, in my view, amendations of, or additions to, the record before us.

The Tribunal Rules require that the Tribunal “state the reasons upon which the award is based.” Article 32, paragraph 3. That calls for an explanation of the Tribunal's views, but it is not a requirement that an award regurgitate every unsupported allegation in every pleading and argument. The purpose of an award is to express and explain the decision of the Tribunal, not to serve as a vehicle for the polemics of any party.

Starrett Housing Corporation et al. and The Government of the Islamic Republic of Iran, Award No. ITL 32–24–1 (19 Dec 1983), Concurring Opinion of Howard M Holtzmann (20 Dec 1983), reprinted in 4 Iran-US CTR 159, 179–80 (1983–III).

I also write separately to call attention to the Tribunal's growing tendency to write Awards that are overly long and excessively detailed–a tendency that, regrettably, this Award exemplifies.

A plea for brevity must, in principle, be brief.

The lengthy Award in this Case invites reconsideration of the Tribunal's practices in preparing its decisions. I write not in criticism of the draftsmen of this particular Award, but rather to point out a tendency that is growing throughout the Tribunal to prepare Awards that are overly long and unnecessarily detailed.

The issue is not a choice of literary style. At stake is the efficient use of (p. 826) the Tribunal's limited time, funds and facilities–resources which are, in my view, endangered by present practices in drafting awards. Also at stake is the usefulness of the Tribunal's Awards to readers generally, for too often the main points are obscured by a mass of needless detail. The Tribunal Rules–which in this respect are identical to the UNCITRAL Arbitration Rules–require only that “[t]he arbitral tribunal shall state the reasons upon which the award is based….” Article 32, para 3. There is no requirement in the Rules, or elsewhere, that Awards include a description of every step in the arbitral proceedings. Nor is there any requirement to summarize virtually every submission of the parties on issues of fact and law. Although I am aware that judicial practice in some fora favors such practices, I find no need for a profusion of detail in the arbitral process of a tribunal such as this.

I respectfully suggest that it is entirely possible–and preferable–in most Tribunal Awards to (i) shorten the description of the procedural history of the Case to include only the key events, and (ii) concentrate the description of the facts and contentions on matters that form the basis of the reasons for the decision. These steps would not only conserve the resources of the Tribunal, but also would help readers to focus on the essential elements of the case.

Mohsen Asgari Nazari and Islamic Republic of Iran, Award No. 559–221–1 (24 Aug 1994), Dissenting and Concurring Opinion of Howard M Holtzmann (24 Aug 1994), reprinted in 30 Iran-US CTR 163, 163, 168–69 (1994) (footnotes omitted).

(5)  Tribunal Rules, Article 32(4)–Failure to Sign the Award

(6)  Tribunal Rules, Article 32(5)–Publication of the award

In the joint request the Parties have requested that the Settlement Agreement shall be kept confidential and not published as a part of the Award.

The Tribunal determines in accordance with the request of the Parties and pursuant to Article 32, paragraph 5, of the Tribunal Rules that the Settlement Agreement shall not be made public.

Chevron Research Company and National Iranian Oil Company, Award on Agreed Terms No. 48–18–1 (1 Jun 1983), reprinted in 2 Iran-US CTR 364, 364–65 (1983–I).

I write separately in this case in order to call attention to what I consider to be a disturbing tendency of the Chamber routinely to grant requests that Settlement Agreements annexed to Awards be kept secret. In this case, such secrecy has been permitted by the Award, which states:

The Tribunal determines in accordance with the request of the Parties and pursuant to Article 32, paragraph 5, of the Tribunal Rules that the Settlement Agreement shall not be made public.

Article 32, paragraph 5 does not permit indiscriminate grants of secrecy. Quite to the contrary, this provision expresses the vital principle that “[a]ll awards and other decisions shall be made available to the public,” subject only to one sharply limited proviso. (Emphasis added). The proviso states that

Upon the request of one or more arbitrating parties, the arbitral tribunal may determine that it will not make the entire award or other decision public, but will make public only portions thereof from (p. 840) which the identity of the parties, other identifying facts and trade or military secrets have been deleted. (Emphasis added).

Two points are to be observed with respect to this exception to the general rule that all awards are to be made public. First, the arbitral tribunal has full discretion to determine whether or not to grant secrecy. Second, if secret treatment is permitted it is only by way of deletion of “the identity of the parties, other identifying facts and trade or military secrets.” Thus, the arbitral tribunal is only authorized to delete certain carefully defined information; it is not authorized to suppress the entire text.

It must also be emphasized that Article 32, paragraph 5 relates to “all awards and decisions.” It covers Awards on Agreed Terms and the annexes which are an indispensable part of such awards just as much as it relates to any other award or decision. That is a wise and proper policy. A primary purpose of Settlement Agreements is to provide for payment of settlements from the Security Account established by the Algiers Declarations. Any withdrawals from the Security Account affect the interest of parties in all cases. It is therefore highly inappropriate that a Settlement Agreement annexed to an Award which triggers such a withdrawal of funds should be cloaked in secrecy. At most, any military and trade secrets can be deleted from the text made public.¹

In this case, the Tribunal has granted secrecy to a very simple Settlement Agreement which contains nothing which even remotely resembles a trade or military secret. I regret that the decision of the Tribunal to grant secrecy to the entire text prevents my illustrating that fact further.

Concurring Opinions in Case Nos. 19 (Chevron) and 387 (Carrier Corp.) and Dissenting Opinion in Case No. 15 (VSI), attached to Chevron Research Company and National Iranian Oil Company, Award on Agreed Terms No. 48–18–1 (1 Jun 1983), reprinted in 3 Iran-US CTR 78, 79–80 (1983–II) (some footnotes omitted).

(p. 841)

In the Joint Request the Parties request that the Settlement be kept confidential until the obligations contained in the Settlement Agreement have been fulfilled.

The Tribunal determines in accordance with the request of the Parties and pursuant to Article 32, paragraph 5 of the Tribunal Rules that the Settlement Agreement shall not be made public until the obligations contained in the Settlement Agreement have been fulfilled.

E–Systems, Inc. and The Islamic Republic of Iran, Award on Agreed Terms 94–388–1 (19 Dec 1983), reprinted in 4 Iran-US CTR 197, 197–98 (1983–III).

The Parties to the Joint Motion request that the contents of the Settlement Agreement and the Memorandum of Understanding be kept strictly confidential.

The Tribunal determines in accordance with the request of the Parties and pursuant to Article 32, paragraph 5 of the Tribunal Rules that the Settlement Agreement and Memorandum of Understanding shall not be made public.

Pan American World Airways, Inc. et al. and The Government of the Islamic Republic of Iran et al., Award on Agreed Terms No. 96–488–1 (19 Dec 1983), reprinted in 4 Iran-US CTR 205, 205–06 (1983–II).

As I have written in an earlier opinion, the requirement of the Tribunal Rules that Awards on Agreed Terms, together with all annexed documents which are integral parts of them, be made public “is a wise and proper policy”:

A primary purpose of Settlement Agreements is to provide for payment of settlements from the Security Account established by the Algiers Declarations. Any withdrawals from the Security Account affect the interest of parties in all cases. It is therefore highly inappropriate that a Settlement Agreement annexed to an Award which triggers such a withdrawal of funds should be cloaked in secrecy. Opinions of Howard M Holtzmann re Three Awards on Agreed Terms; Concurring as to Case Nos. 19 and 387; Dissenting as to Case No. 15 (part I) (filed 20 June 1983).

For the reasons explained above, I am disappointed that the parties have presented to us a settlement in this form. I am dismayed that the (p. 842) Tribunal has approved it, and that the settlement has been shrouded in secrecy. Therefore, I dissent from the Award on Agreed Terms.

Pan American World Airways, Inc., et al. and The Government of the Islamic Republic of Iran et al., Award on Agreed Terms No. 96–488–1 (19 Dec 1983), Dissenting Opinion of Howard M Holtzmann (9 Feb 1984), reprinted in 4 Iran-US CTR 206, 209 (1983–III).

In the Joint Request the Parties request that the terms of the Settlement Agreement and its exhibits be kept confidential. The Deputy Agent of The Government of the United States reserved its position as to this request.

The Tribunal determines pursuant to Article 32, paragraph of the Tribunal Rules, that the Settlement Agreement and its Exhibits shall not be made public.

The Government of the United States of America, on behalf and for the benefit of Shipside Packing Co., Inc. and The Islamic Republic of Iran, Award on Agreed Terms No. 102–11875–1 (12 Jan 1984), reprinted in 5 Iran-US CTR 80, 80–81 (1984–I).

I must dissent from the action of the majority of the Chamber in granting a request of the parties that the Award on Agreed Terms be kept secret. As I have pointed out in other cases, the Tribunal Rules permit confidential treatment only for military and trade secrets. Article 32, paragraph 5.

In this case, the Tribunal has mistakenly granted secrecy to a Settlement Agreement which contains nothing even remotely resembling a trade or military secret–and the parties have not pointed to any confidential material or otherwise offered any reason for secrecy.

Sound considerations of policy point to the desirability of making public this entire Award on Agreed Terms, including the Settlement Agreement which is included by reference as part of it. The example of the mechanisms agreed to by the parties might be helpful in structuring settlements in other cases. Here secrecy hides a good example, as it hides a bad one in the Pan American Award on Agreed Terms. I therefore dissent from the portion of the Award which provides that the Settlement Agreement be kept secret.

The Government of the United States of America, on behalf and for the benefit of Shipside Packing Co., Inc. and The Islamic Republic of Iran, Award on (p. 843) Agreed Terms No. 102–11875–1 (12 Jan 1984), Separate Opinion of Howard M Holtzmann (9 Feb 1984), reprinted in 5 Iran-US CTR 82, 84 (1984–I) (footnotes omitted).

The Parties in their Joint Request ask that the Tribunal treat the Settlement Agreement as confidential until the obligations of the Agreement have been completed. Since the Parties, however, have not invoked any special reasons which, in the light of Article 32, paragraph 5 of the Tribunal Rules, would justify the grant of such a request, the request is denied. Consequently, copies of the Joint Request, the MOU and the Escrow Agreement are attached hereto.

United Technologies International, Inc. et al. and The Iranian Air Force, Award on Agreed Terms No. 146–42–3 (8 Aug 1984), reprinted in 7 Iran-US CTR 209, 210 (1984–III).

The Joint Request contains a request that the contents of Appendices A and B to the Settlement Agreement be kept confidential on the grounds that they contain sensitive commercial information.

The Tribunal determines in accordance with the request of the Parties and pursuant to Article 32, paragraph 5 of the Tribunal Rules that Appendices A and B to the Settlement Agreement shall not be made public.

General Motors Corp. et al. and The Government of the Islamic Republic of Iran et al., Partial Award on Agreed Terms No. 147–94–1 (28 Aug 1984), reprinted in 7 Iran-US CTR 220, 221–22 (1984–III).

1. 4.  In the Joint Request the Parties ask the Tribunal to provide that this Award, the Joint Request and the Settlement Agreement remain confidential. However, pursuant to Article 32, paragraph 5, of the Tribunal Rules, it is within the discretion of the Tribunal to decide whether it will grant such request and delete portions of the Award from which the identity of the Parties, other identifying facts and trade or military secrets appear…. The Parties have not indicated any portions of the Settlement Agreement as containing sensitive information justifying confidentiality, and the Tribunal does not find any such sensitive information. Therefore, the request is denied. A copy of the Joint Request and the Settlement Agreement is annexed hereto.

(p. 844) Dora Sholeh Elghanayan et al. and The Islamic Republic of Iran, Award on Agreed Terms No. 576–800/801/802/803/804–3 (10 Dec 1996), reprinted in 32 Iran-US CTR 221, 222 (1996) (citations omitted).

(1)  Article 32(1)–Types of awards

1. [95]  The President of the Arbitral Tribunal made the following self–explanatory statement:

   …The Arbitral Tribunal announced its fully–deliberated decision to the effect that the Republic of Indonesia is in default by its letter of 7 September 1999. Under the UNCITRAL Rules, a decision under Art. 28 does not require articulation in a formal award. Nevertheless, the Republic of Indonesia, in its letter dated 20 September 1999 to the Secretary–General of ICSID, has taken the view that this decision is “more in the nature of an interim award than a mere procedural order, and, as such, requires signatures or indications of dissent of the entire tribunal.” The allegation that an indication of dissent is required is profoundly mistaken; it has no place in the UNCITRAL Rules. Nevertheless, the Arbitral Tribunal shall, ex abundante cautela, render an Interim Award on the subject of default, so that the Parties may satisfy themselves that their submissions were indeed taken into account.

Himpurna California Energy Ltd and Republic of Indonesia, Interim Award (Ad Hoc UNCITRAL Proceeding, 26 Sep 1999), reprinted in (2000) XXV YCA 109, 154, 157.

1. 6.4.  Following the delivery of the Tribunal's Procedural Order No. 3 the parties entered into Special Agreement No. 2 of 2 August 2000 and sought to raise a preliminary issue to be determined by the Tribunal in the following terms:

   Pursuant to Article 32(1) of the UNCITRAL Rules, the Parties request the Arbitral Tribunal to issue an Interlocutory Award, on the basis of the 1843 Anglo–Franco Proclamation of 28 November 1843 and the rules and principles of international law, verifying the continued existence of Hawaiian Statehood with the Hawaiian Kingdom as its government.

2. 6.5.  The Tribunal responded to the making of Special Agreement No. 2 with its Procedural Order No. 4 of 5 September 2000, which read as follows:

(p. 845)

3. 3.  The Tribunal set out in its Order No. 3 the questions which, in its view, are raised before it can proceed to the merits of the dispute. The issue identified in Article 1 of Special Agreement No. 2 is not one of these. Rather it appears to be a reformulation of the first substantive issue identified as being in dispute.

4. 4.  It is not open to the parties by way of an amendment to the Special Agreement to seek to redefine the essential issues, so as to convert them into “interim” or “interlocutory” issues. In accordance with Article 32 of the UNCITRAL Rules, and with the general principles of arbitral procedure, it is for the Tribunal to determine which issues need to be dealt with and in what order. For the reasons already given, the Tribunal cannot at this stage proceed to the merits of the dispute; these merits include the question sought to be raised as a preliminary issue by Article I. If the arbitration is to proceed it is first necessary that the preliminary issues identified in its Order No. 3 should have been dealt with.

5. 5.  If the parties are not content with the submission of the dispute to arbitration under the UNCITRAL Rules and under the auspices of the Permanent Court of Arbitration, they may no doubt, by agreement notified to the Permanent Court, terminate the arbitration. What they cannot do, in the Tribunal's view, is by agreement to change the essential basis on which the Tribunal itself is constituted, or require the Tribunal to act other than in accordance with the applicable law.

Lance Paul Larsen and The Hawaiian Kingdom, Award (Permanent Court of Arbitration, 5 Feb 2001), reprinted in (2001) 119 ILR 566, 579–80.

(2)  Article 32(2)–Final and binding

1. 425.  The Tribunal takes note of the Tribunal's explicit decision in para 624(4) of the Partial Award. This “Partial Award is final and binding in respect to the issues decided herein.” Further the Tribunal recalls to the terms of Art. 8(7) of the Treaty, according to which the Arbitral Award “shall be final and binding.” The UNCITRAL Rules, Art. 32(2)). Consistently with this rule, no provision of the Treaty of the UNCITRAL Rules provides any mechanism for appeal, re–hearing or revision of an arbitral award unless by way of interpretation or correction within a time period of 30 days or by appeal to the Swedish Courts within the bounds (p. 846) of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. The Tribunal itself is not authorized to reconsider its Partial Award and, in any event, the Tribunal finds no good reason for doing so.

CME Czech Republic BV and The Czech Republic, Final Award (Ad Hoc UNCITRAL Proceeding, 14 Mar 2003), at 98–99, reprinted in (2003) 15(4) WTAM 83, 180–181.

1. 27.  In the Tribunal's view, the first issue is whether, once a partial award is made by a tribunal, it is final and binding within Article 32(2) of the UNCITRAL Rules and, if so, whether the tribunal has any jurisdiction to re–consider such an award at a later stage of the same arbitration proceedings. As explained below, the Tribunal decides that its Partial Award was an award which was final and binding upon the Disputing Parties; and that, as such, the Tribunal has no jurisdiction to reconsider the Partial Award in the form sought by Methanex in its Second Request made in January 2004, i.e. admittedly more than thirty days after Methanex's receipt of the Partial Award in August 2002.

2. 28.  The Tribunal does not accept Methanex's contention that, in seeking reconsideration by its Second Request, it is seeking something other than a reversal of a significant decision in the Partial Award, namely that “certain allegations relating to the ‘intent’ underlying the US measures could potentially meet the requirements of Article 1101(1) NAFTA, thereby allowing part of Methanex's case to fall within the jurisdiction of the Tribunal” but that otherwise the Tribunal lacked jurisdiction over Methanex's claim. Methanex's Second Request seeks to reverse the core of the Partial Award.

3. 29.  The Tribunal's decision is not based on a mere technicality or semantic point under the UNCITRAL Rules. The application of these arbitration rules was triggered by Methanex's own choice in its 1999 Notice of Arbitration; and it should also be noted that, at the end of the jurisdictional hearing in July 2001, the Tribunal expressly asked the Disputing Parties whether the award that the Tribunal was intending to make should have any particular form, bearing in mind that the award might be subjected to challenge in a court of competent jurisdiction. It was then agreed by both Methanex and the USA that the award would be called a partial award (as, on any reading, it could not dispose of all matters potentially arising for decision by the Tribunal) and that the partial award would be final and enforceable. In the Tribunal's view, (p. 847) there was a common intention, expressly shared by Methanex at that time, that the partial award would be final and binding, within the meaning of Article 32 of the UNCITRAL Rules. It will be recalled that under Articles 32(1) and (2) of the UNCITRAL Rules, a “partial” award is expressly “final and binding on the parties”.

4. 30.  Further, it appears to have been Methanex's position subsequent to the making of the Partial Award that this award was indeed “final and binding”. In Methanex's first Request for Interpretation dated 28th August 2002, Methanex's “request that the arbitral tribunal give an interpretation of the award” was made pursuant to Article 35(1) of the UNCITRAL Rules. This request necessarily recognised the existence of an award that was final and binding on Methanex pursuant to Article 32(2) of the UNCITRAL Rules. Otherwise, Methanex could not have invoked Article 35 of the UNCITRAL Rules which applies only to an “award”. (As expressed in its letter of 25th September 2002, the Tribunal considered that Methanex's Request did not fall within the scope of Article 35 of the Rules because the Tribunal considered that what Methanex sought was not an interpretation, i.e. not because the Tribunal had not made an “award” within Article 32(2) of the Rules).

5. 31.  The Tribunal also rejects, for present purposes, any distinction between a partial award and a final award which leaves the arbitration tribunal functus officio. A partial award is a final and binding award within Article 32(2) of the UNCITRAL Rules in regard to the matter it decides, although it does not leave the tribunal functus officio. It is presented as an award; and as an award it disposes finally of certain issues in the arbitration proceedings. No question here arises as to the distinction between a tribunal's decision, ruling or order and an award (whether partial or final), such as confronted the French Court in Brasoil (1999) or the US Court in Publicis (2000)¹⁷: Methanex's arguments rest only upon the difference between a “partial” award and a “final” award.

6. 32.  The Tribunal therefore rejects Methanex's contention that the Partial Award is not a final and binding award under Article 32(2) of the UNCITRAL Rules and the contention that Article 32(2) concerns only final awards, not partial awards. That contention runs counter to the ordinary meaning of the Articles 32(1) and (2) as a matter of the English language. In the Tribunal's view, no weight is to be placed on the fact that “award” is not further defined in (p. 848) Article 32(2) expressly to include (inter alia) a partial award. It follows that, where reference is made to an award under Article 32(2), that is intended to include a partial award made under Article 32(1) of the UNCITRAL Rules.

Methanex Corp. and The United States of America, Award (NAFTA Chapter Eleven, 3 Aug 2005), at 16–19 (Part II, Chapter E), available at http://www.state.gov/s/l/c3439.htm (some footnotes omitted).

(3)  Articles 32(2) and 32(4)–Date, place, and signature

ON THE BASIS OF THE FOREGOING, THE ARBITRAL TRIBUNAL FINDS AND DECIDES AS FOLLOWS:

[Text of dispositif omitted]
Made in Geneva, on September 30, 1999
[signed] Prof.Piero BERNARDINI	[signed] Prof. Ahmed S El KOSHERI
[signed] Me Yves DERAINS

Karaha Bodas Company LLC and Perusahaan Pertabangan Minyak Dan Gas Bumi Negara and PT PLN (Persero), Final Award (Ad Hoc UNCITRAL Proceeding, 18 Dec 2000).

CHAPTER XII

CONCLUSIONS AND DISPOSITIVE PROVISIONS OF THE AWARD

[Test of dispositif omitted]
Made at the City of Toronto, Ontario, Canada.
SIGNED: [signed] _______ Brian P. Schwartz	[signed] _______ Edward C Chiasson, Q.C. [signed] _______ J. Martin Hunter November 13, 2000

(p. 850) SD Myers, Inc. and Government of Canada, Partial Award (NAFTA Chapter Eleven, 13 Nov 2000), reprinted in (2003) 15(1) WTAM 184, 266.

(4)  Article 32(4)–Failure to sign the award

J. Decision

1. 624.  The Tribunal decides as follows:

[text of dispositif omitted]

K. Statement in accordance with Article 32(4) UNCITRAL Arbitration Rules related to Dr. Hándl's failure to sign the Partial Award

1. 625.  By letter dated September 11, 2001, Dr. Hándl requested the Chairman to attach to the Award (whose issuance he delayed) an explanation of his failure to sign the Award, as well as a dissenting opinion. Dr. Hándl refused to sign the Award with the following remark:

   “Partial Award not signed by Dr. Hándl as expression of his protest and dissenting from this Award–dissenting opinion enclosed, date: 11.9.2001, signature Dr. Hándl”

   The Chairman of the Tribunal, on his behalf and that of Judge Schwebel, pointed out to Dr. Hándl that his failure to sign would be in breach of his obligations as arbitrator. In the event, it is also a breach of his repeated recent assurances to the Chairman, in writing, that he “will sign” the Award.

   The UNCITRAL Rules that govern this arbitration provide, in Article 32 (4), that: “An award shall be signed by the arbitrators …” (emphasis supplied). The Tribunal is confirmed in the conclusion that an arbitrator's failure to sign the award is a violation of the arbitrator's professional responsibilities by its examination of the rules and practice of the principal arbitral institutions as well as the papers and proceedings of the Stockholm and Paris Congresses of the International Council on Commercial Arbitration. Dr. Hándl's failure to perform his responsibilities as arbitrator is matched by the intemperance and inaccuracy of his dissent. He makes charges about the conduct of the hearings and the deliberations that are groundless. His position on the merits of the dispute speaks for itself.

Stockholm, 13 September 2001

CME Czech Republic BV and The Czech Republic, Partial Award (Ad Hoc UNCITRAL Proceeding, 13 Sep 2001), reprinted in (2003) 14(3) WTAM 109, 287.

(5)  Article 32(7)–Filing and registration of an award

1. 102.  Article 634 of the Indonesian Code of Civil Procedure provides that the award shall be deposited by the arbitrators at the Registry of the District Court in the District where it was rendered within 14 days. Although the applicability of this Article, or indeed of the other provisions of the Code of Civil Procedure concerning arbitration, appears to be uncertain (such codifications inherited from the Netherlands are often referred to as pedoman, or “guidelines,” rather than as positive and binding law), the Parties have agreed that the Award shall be registered in the manner indicated in paragraph 505.

2. 103.  In light of the above, it is clear that the registration of the Award is in compliance with Article 32(7) of the UNCITRAL Rules and the agreement of the Parties….

3. 504.  The Arbitral Tribunal makes an original version of this Final Award, certified as such below by a manuscript notation of the President, available this day in Jakarta to Dr. Adnan Buyung Nasution SH and Ms Pia Akbar Nasution SH, on behalf of PLN, and to Mr. Andy Kelana SH or Mr. Joni Aries Bangun SH, on behalf of the Claimant.

4. 505.  In the course of the hearings on the merits, the Parties agreed that the Arbitral Tribunal would authorize counsel to one of them, in place of the Arbitral Tribunal, to deposit the Final Award at the office of the Registrar of the District Court of Jakarta, pursuant to Article 32(7) of the UNCITRAL Rules and for purposes of satisfying such formalities of Articles 634 and 635 of the Indonesian Code of Civil Procedure as may apply. The Parties also agreed that the particular person so authorized should be counsel to the Party which is awarded a net monetary recovery (Transcript 1271). In accordance with this agreement, authorization to deposit the Final Award is given by a letter from the President dated this day.

(p. 851) Patuha Power Ltd and PT (Persero) Perusahaan Listruik Negara (Indonesia), Final Award (Ad Hoc UNCITRAL Proceeding, 4 May 1999), reprinted in (1999) 14(12) MIAR B–12, B41.

VII.  Deposit of the Award

1. [201]  The Arbitral Tribunal communicates an original version of this Interim Award, certified as such below by a manuscript notation of its President, to Messrs Latham & Watkins and Karim Sani.

2. [202]  As indicated under point 3 of its Procedural Order of 7 September 1999, the Arbitral Tribunal has rejected the claimant's request to change the legal seat of the arbitration, which accordingly remains Jakarta.

3. [203]  Paragraph 5(h) of the Terms of Appointment contemplates that the Arbitral Tribunal “shall deposit the award with the Central District Court of Jakarta.” The Parties have not agreed how this deposit should be effected. The claimant has indicated that it wishes to preserve the option of depositing the award by means of an authorisation to that effect from the Arbitral Tribunal; the Republic of Indonesia in default has contributed nothing to the Arbitral Tribunal's understanding of how this step might be achieved.

4. [204]  Authorisation to deposit the Interim Award is therefore given by letters from the President dated this day to counsel for both Parties.

Himpurna California Energy Ltd and Republic of Indonesia, Interim Award (Ad Hoc UNCITRAL Proceeding, 26 Sep 1999), reprinted in (2000) XXV YCA 109, 185–86.(p. 852)