In France, a foreign arbitral award is recognized through the exequatur procedure if it complies with international public policy. The court with jurisdiction for the exequatur of an arbitral award depends on the country in which it was rendered.
An international arbitral award is defined under French law, specifically by the case law of the Court of Cassation, as an international judicial decision that is not attached to any State legal order and whose regularity is assessed with regard to French law.
The procedure for the exequatur of arbitral awards
The court with jurisdiction to grant exequatur for an arbitral award depends on the country in which it was rendered. It is necessary to distinguish whether the arbitral award is domestic (French), international rendered in France, or international rendered abroad. The exequatur of a domestic arbitral award is granted by an order of the Tribunal de Grande Instance in whose jurisdiction it was rendered. The same applies to the exequatur of an international arbitral award rendered in France. Thus, an arbitral award rendered by an arbitral tribunal located in Paris will receive exequatur from the Tribunal de Grande Instance of Paris. An international arbitral award rendered abroad must, for its part, necessarily receive exequatur by an order from the Tribunal de Grande Instance of Paris.
The rules for the exequatur of international arbitral awards: The New York Convention and French case law
On November 25, 1958, France signed the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958, known as the “New York Convention”.
Each contracting State of the New York Convention recognizes the authority of an arbitral award and grants it enforcement in accordance with the procedural rules followed in the territory where the award is invoked.
In France, a foreign arbitral award is recognized through the exequatur procedure if it complies with international public policy.
French jurisdictions may refuse exequatur to an arbitral award that would be contrary to international public policy.
For example, in a ruling on May 6, 2009, International Company For Commercial Exchanges, the Court of Cassation refused exequatur for an arbitral award rendered under the aegis of the Refined Sugar Association because the award had condemned a party in disregard of the rule regarding the suspension of individual proceedings (insolvency proceedings).
In a ruling on March 9, 2011, Société Chantiers de l’Atlantique / Société Gaz Transport et Tecnigaz, the Court of Cassation decided that the review of an arbitral award’s compatibility with international public policy is limited to the flagrant, effective, and concrete nature of the alleged violation.
Thus, an arbitral award can only be granted exequatur on the condition that it was rendered by an arbitral tribunal. Seized of a dispute between a French wood industry company and a Chinese company, the Court of Cassation in 2012 refused exequatur for an award rendered by the China International Economic and Trade Arbitration Commission. Indeed, it noted that it was not established that the award was rendered by an institution having the status of an arbitrator, which is contrary to international public policy (Cass. Civ. 1st, March 28, 2012, no. 11-10347, Séribo / Hainan Yangpu Xindadao Industriel).
The Paris Court of Appeal subsequently rendered a ruling refusing exequatur for an arbitral award obtained by fraud. In this case, an award rendered by a Swiss ad hoc arbitral tribunal had ordered a French company to pay an English company, as well as an Israeli company, a sum of more than $1,000,000, in performance of steel sales contracts. The Tribunal de Grande Instance of Paris had granted exequatur to the award. However, the Court of Appeal subsequently found that the Israeli company had actually been struck off the register for years, and was therefore non-existent, which constituted fraud in obtaining the arbitral award. It was therefore rendered in disregard of international public policy. The order was overturned: the arbitral award could not receive exequatur (Court of Appeal of Paris, June 25, 2013, RG no. 12/01461).
This case law highlights that it is essential to demonstrate to the competent tribunal de grande instance that the arbitral award complies with international public policy.
Thus, since the French law imposing the handwritten mention of a guarantee (cautionnement) is not a matter of international public policy, the exequatur of an arbitral award may be granted even if it gives effect to a guarantee subscribed without this mention (Court of Appeal of Paris, September 9, 2014, no. 13/01333).
The objective of the exequatur of an arbitral award: compulsory enforcement
The objective of the exequatur of an arbitral award is generally its compulsory enforcement in France.
The arbitral award, whether it be domestic, international rendered in France, or international rendered abroad, will, thanks to the exequatur, become an enforceable title throughout the French territory.
Equipped with this enforceable title, the creditor has an enhanced means of pressure on their debtor. Before the exequatur is obtained, the assets held in France by the debtor are in fact not really threatened.
The party having obtained the exequatur will therefore attempt to obtain payment in France by their adversary of the sums to which the latter was condemned by the award.
The strategy implemented to proceed with the compulsory enforcement of an arbitral award consists of the following steps, the order of which is to be determined on a case-by-case basis depending on the file: identification of the assets held in France by the debtor, the exequatur of the arbitral award, [and] seizures against these assets.
The firm of Maître David MOTTE-SURANITI intervenes on behalf of clients located both in France and in foreign countries in order to obtain exequatur orders for arbitral awards.
It proceeds with the exequatur of awards rendered by any arbitral tribunal, notably and in a non-exhaustive manner: the International Court of Arbitration of the International Chamber of Commerce (ICC), the International Centre for Settlement of Investment Disputes (ICSID), the Permanent Court of Arbitration (PCA), the Common Court of Justice and Arbitration (CCJA), as well as any foreign arbitral award.
The firm advises and assists creditors wishing to recover the debt that is due to them in execution of an arbitral award.