Debating the Proper Role of National Law under the New York Convention01 Jan 1998
One of the many consequences of the progressive development of globalization apparently has been to incite a vigorous debate among leading members of the international arbitral community about the role of national law in implementing the enforcement regime of the New York Arbitration Convention (Convention). The debate was provoked by federal court rulings in two recent cases: Chromalloy Aeroservices v. Arab Republic of Egypt (Chromalloy) and Alghanim & Sons v. Toys"R" Us (Toys "R" Us). Prior to these opinions, there appeared to have been an implicit consensus in the international community regarding the "anational"character of the Convention. Both cases involve the Convention's setting aside procedure and the interpretation of the role of national law in applying that procedure. In particular, the questions addressed are: in Chromalloy, whether U.S. domestic arbitration law should have the effect of sustaining the transborder enforceability of an international award that has been nullified under the national law of the place of rendition; and, in Toys "R"Us, whether U.S. domestic arbitration law should govern the enforceability of an international award rendered in the United States. Despite the similarities in the substantive dimension of the cases, the courts arrived at opposite assessments of the function of U.S. domestic law in the Convention's enforcement framework. The radical contrast in the gravamen of the opinions implies contradistinctive concepts of the importance of national law and of the function and standing of the Convention.