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19 February 2021 / news

Luxembourg Court of appeal issues key decision on the recognition and enforcement of ICSID awards

The Court of appeal's decision brings a final answer to the debate. While the Luxembourg courts have clarified on numerous occasions the modalities surrounding the 1958 New York Convention, case law relating to the 1965 Washington Convention remained scarce.

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The Court of appeal has in its 11 February 2021 decision clearly reaffirmed the specific nature of the ICSID Convention and its autonomous recognition regime. Any requirements under national law which may lead to the refusal of an exequatur request of an ICSID award do not apply. Where an exequatur request of an ICSID award is submitted, in compliance with the provisions of the 1965 Convention, the exequatur has to be granted and no further control of the award may be exercised by the national court.

Rejection of any reference to the requirements under the New Code of Civil Procedure (NCCP)

The Court of appeal has clearly rejected the application of any provisions of the NCCP which could warrant a refusal of an exequatur request of an ICSID award.

While the conclusion may seem self-evident, the Luxembourg courts have not yet stated this fact clearly for awards under the 1965 ICSID Convention.

Indeed, various decisions have already confirmed that where the 1958 New York Convention is applicable, only the grounds for refusal of the exequatur set out in such convention apply and any national requirements do not enter into consideration.

Given that the Washington Convention foresees an autonomous recognition mechanism and does not even provide for grounds of refusal by national courts, the Court of appeal’s decision had to follow this reasoning and extend the same refusal of national requirements to the recognition of ICSID awards.

Clear limitation of the national judge’s role

Pursuant to the provisions of the 1965 Washington Convention, the Court of appeal has clarified that a judge presented with an exequatur request for an ICSID award may only proceed to the verification of the existence of the award as such.

The Court of appeal thereby gives full effect to article 54(2) of the ICSID Convention which only requires a party seeking recognition or enforcement in a contracting state to furnish to the competent court a copy of the award certified by the Secretary-General.

A domestic judge may not exercise any further control and has to grant the exequatur if the requirements of the ICSID Convention are fulfilled.

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