Monday, October 26, 2009

Enforcement of Court Judgments and Arbitral Awards

There is often a lot of confusion about the effects of Oman Court judgments and Oman arbitral awards rendered in Oman. This post should provide some clarity.

First, there is a distinction between court judgments and arbitral awards.

A final, non-appealable Oman Court judgment should be automatically enforced in any of the other GCC states, by virtue of the 1996 Treaty for the Enforcement of Judgments, Judicial Delegation, and Courts Summons between the Arab Gulf Countries Cooperative Council (AGCC).

Outside the GCC, it is unlikely that a final Omani court judgment would be automatically enforceable. Almost certainly, the case would have to be heard again by the courts of that country.

Second, there are two relevant types of arbitral awards in Oman. The first type is an arbitral award rendered in Oman. This award should be automatically enforced in any country which, like Oman, has signed the 1958 New York Convention on the Enforcement of Foreign Arbitral Awards (the “NY Convention”). Under the requirements of the NY Convention, any country that is a member of the convention is required to give effect to private agreements to arbitrate disputes. In addition, member countries are required to recognize and enforce arbitration awards made in another contracting country. Oman signed the NY Convention in 1999 and currently there are 144 member countries worldwide.

A second type of arbitral award involves those awards rendered in a fellow member state of the NY Convention. If the respondent to the claim fails to pay the award, the claimant may seek to enforce the award in an Omani court.

This particular scenario has not yet been tested in Omani courts, but the terms of the NY Convention would require the Omani court to enforce the arbitral award, just as the courts of all signatories to the NY Convention.