Sovereigns Rule Again: Recent Challenges to Enforcement and Execution of Arbitral Awards Against Sovereigns - WAMR 2015 Vol. 9, No. 1

Author(s):

Jaroslav Kudrna

Page Count:

50 pages

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Published:

July, 2015

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I. INTRODUCTION

The last two decades have been marked by a sharp increase in

international arbitral proceedings brought by private parties

against states.1 The ability to bring disputes against states to

international fora is, however, only a partial victory for investors.2

Unlike international dispute resolution mechanisms, the

execution of arbitral awards remains in the realm of national

laws. State immunity from execution, “the last fortress, the last

bastion of State immunity,”3 seems to be on the rise rather than in

retreat, judging from the recent decisions from prominent

jurisdictions such as the U.K.,4 France,5 Belgium6 and Hong Kong.7

The reinforcement of state immunity8 can seem to be

surprising because the scholarly writing from the last decade

constantly claimed that the restrictive approach9 to state

immunity is taking over the absolutist approach.10 The symbol of

the victory of the restrictive approach is its consecration in the

United Nations Convention on Jurisdictional Immunities of States

and Their Property (UNCSI), adopted in 2004.11

Nevertheless, almost a decade later, the UNCSI has still not

come into force,12 and it is uncertain when it will, if ever, enter

into force. Therefore, the law on state immunity remains mainly

fragmented and governed by different national laws. Two recent

decisions, one from Hong Kong and one from Sweden, which are

diametrically opposite, illustrate well this fragmentation. The

Hong Kong Final Court of Appeal decided that Hong Kong, like

China, adheres to the absolutist approach to the state immunity.13