Cairn Energy has filed a case in the USA District Court under the New York Convention to enforce a US$1.2 billion arbitration award won in a tax dispute with India.
♦ The Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the “New York Arbitration Convention” or the “New York Convention”, is one of the important instruments in international arbitration.
♦ Arbitration is a procedure in which the parties agree to submit a dispute to one or more arbitrators (independent person/body) who make a binding decision on the dispute.
♦ It applies to the recognition and enforcement of foreign arbitral awards, as well as referral to arbitration by the court.
♦ After a diplomatic conference was held at the United Nations Headquarters in New York in May and June 1958, the United Nations adopted the convention and entered into force on June 7, 1959.
♦ Aim: The main purpose of the Convention is that the courts that require enforcement should not distinguish between foreign and non-domestic arbitral awards.
♦ Parties to Convention: The Convention has 166 state parties (Countries). India is a party to the Convention.