Welcome back to the second video of this model on the validity and enforcement of international arbitral awards. In this video, we will focus on the annulment of international arbitral awards. We will discuss first the procedure to set aside an award under the New York Convention, and secondly, annulment proceedings under the ICSID Convention. What are the formalities to set aside an award, or to bring a claimant annulment of an ICSID award? What are the grounds for annulment? These are the two main questions we will discuss today. When an arbitral award has been rendered, it may occur that one party, mostly the unsuccessful party, believes that the award or the procedure is tainted by some flaw or defect. It can then file a claim in annulment of the arbitral award or a claim to set aside or vacate the award. The terminology used differs from state to state, but denotes very similar procedures. Annulment, or setting aside proceedings, are very different in nature from an appeal. An award generally is rendered in first and last instance, and it is final and binding. This means that awards are not in principle subject to appeal. Annulment or setting aside can only be based on the way in which the procedure was conducted. It does not cover disagreement by either party with the merits, the substantive outcome of the dispute. This also implies that if the original award is annulled, it is invalidated, and considered non-existent. When the originale award has been annulled, the concerned party will have to resubmit the dispute to a new tribunal, which will then deliver a new award. For international arbitral awards and mixed arbitrations that are not rendered under the ICSID Convention, the grounds and procedure to set aside or anull an award are usually regulated by the arbitration laws of the state where the seat of the arbitration is. This is the case not only for non-ICSID investment arbitrations, but also for international commercial arbitration involving a state, or between two private parties. Setting aside proceedings should be brought before the domestic courts of the seat of arbitration. There are, however, some similarities in the various domestic laws. Many states have adopted the UNCITRAL Model Law on international commercial arbitration. Article 34 of the UNCITRAL Model Law limits the grounds to set aside an arbitral award to the following. Invalidity of the arbitration agreement, no proper notice of the appointment of the arbitrator or of the arbitration proceedings, excess of authority by the tribunal, composition of the tribunal not in accordance with the agreement of the parties. The dispute was inarbitrable under the laws of the state of the seat of the arbitration. Recognition or enforcement is contrary to the public policy of the state of the seat of arbitration. These grounds, as you will have noticed, are limited to procedural flaws and defects and do not concern the merits of the decision. It must be added, however, that there are some countries which do allow for an appeal, limited or not, of certain arbitral awards. Under the ICSID Convention, the annulment of an award is regulated in Article 52. ICSID arbitration, as you will remember, is a form of arbitration which is completely detached from the domestic courts. As a consequence, the law of the seat of arbitration is irrelevant for ICSID arbitrations. ICSID awards are not subject to the jurisdiction of the domestic court where the seat of arbitration is situated. Instead, ICSID Convention has its own system. An ad hoc committee composed for each claim and comprised of three individuals appointed by the Chairman of the ICSID Administrative Council will decide on the claim and annulment of an ICSID award. All parties to the dispute can file and request an annulment to the Chairman of the ICSID Administrative Council. The restrictive and exhaustive grounds on which an ICSID award can be annulled are listed in Article 52 of the ICSID Convention. First, the tribunal was not properly constituted. Secondly, the tribunal has manifestly exceeded its powers. Thirdly, corruption on the part of a member of the tribunal. Fourthly, a serious departure from a fundamental rule of procedure. And finally, the award has failed to state the reasons on which it is based. As you will have noticed, these grounds are somewhat similar to those contained in the UNCITRAL Model Law. Yet there is one notable absent in the ICSID list. Annulment cannot be sought because the award is contrary to public policy. This is logic, since ICSID arbitration and annulment is detached from domestic law and is a fully international procedure. Public policies of states are irrelevant. We will now look into the most invoked ground of setting aside an award, excess of authority. This will occur when a tribunal goes beyond what has been agreed by the parties. The powers of the tribunal are limited to what the parties have agreed on, and they cannot decide on issues beyond the agreement of the parties. Also, an arbitral tribunal may not apply any other laws than the ones that have been agreed upon by the parties to the dispute. If a tribunal does so, it may be considered as an excess of authority and may constitute a valid ground for annulment. In case of awards in relation to disputes between two states, none of the previously mentioned procedures apply. It is possible to annul an arbitral award in such disputes, but a procedure can only be brought before an international court or tribunal, and it requires the consent of both parties. The grounds that can be invoked are very similar to those of the ICSID Convention, which are considered to reflect international customary law. In this video, you have learned the conditions a claimant annulment of arbitrary awards can be filed under. You have also learned the main differences between ICSID and non-ICSID awards. In the next video, we will continue our journey into the post awards phase, and see how a successful party can enforce an arbitral award.