Does the law impose limits on the available remedies? Are some remedies not enforceable by the local courts?

International Arbitration (4th edition)

Argentina Small Flag Argentina

There is no statutory provision in Argentine law containing the remedies that an arbitral tribunal can award. Nevertheless, punitive damages are only established under the Argentine Consumer Protection Act (Law No. 24,240) and thus, matters under this law are non-arbitrable pursuant to Art. 1651 of the NCCC.

Austria Small Flag Austria

Austrian arbitration law does not contain any explicit provisions on the types of remedies that an arbitral tribunal may award. Punitive damages are not foreseen under Austrian law and it is likely that the Austrian courts would consider the award of punitive damages contrary to public policy.

Bulgaria Small Flag Bulgaria

An anti-suit injunction and security for costs are not allowed under Bulgarian law. In addition, Bulgarian law does not provide punitive damages and such remedies would not be enforceable.

United States Small Flag United States

The FAA does not limit available remedies. However, certain states may do so. For example, in New York, arbitrators may not award punitive damages. See Garrity v. Lyle Stuart, Inc., 353 N.E.2d 793 (1976). Where the FAA governs the arbitration, however, such limitations are not applicable. See Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 59 (1995) (finding that New York-seated arbitration governed by the FAA is not restricted and that punitive damages could be awarded); see also FLA. STAT. § 682.11(1) (allowing punitive damages “if such an award is authorized by law in a civil action involving the same claim and the evidence produced at the hearing justifies the award under the legal standards otherwise applicable to the claim”).

In certain circumstances, courts have refused to enforce remedies in international arbitral awards that violate U.S. public policy. For example, in Laminoirs-Trefileries-Cableries de Lens, S. A. v. Southwire Co., 484 F. Supp. 1063, 1068 (N.D. Ga. 1980), a federal district court refused to recognize an interest rate increase awarded in a French arbitration as violating U.S. public policy. The court found that the increase was penal rather than compensatory, and bore no reasonable relation to any damage resulting from delay in recovery of the sums awarded, and instead recognized only the base interest rate. Additionally, in Hardy Expl. & Prod. (India), Inc. v. Gov’t of India, Ministry of Petroleum & Nat. Gas, 314 F. Supp. 3d 95, 113 (D.D.C. 2018), a federal district court refused to recognize an award that ordered specific performance in India, finding that doing so would violate U.S. public policy recognizing states’ sovereignty and the right to control their lands and natural resources.

Canada Small Flag Canada

The legislation does not impose limitations on remedies. Canadian courts have held that all remedies are enforceable by local courts, though there is a limitation on certain forms of injunctive relief in the province of Quebec.

Cyprus Small Flag Cyprus

The Arbitration Law (Cap. 4), imposes no limits to the types of remedies that the Tribunal can award. Annex I, section 8 is the only reference made in the Law regarding remedies. It provides that, an arbitrator shall have the same authority as courts to order the specific execution of any contract except for a contract relating to land or any interest in land. Punitive Damages is an example of remedy that must be examined by the Tribunal based on each jurisdiction. The tribunal must examine whether punitive damages can be awarded under the law applicable to the substance of the dispute and the provisions of the arbitration agreement. It is prudent for a Tribunal to ensure that a punitive remedy is severable in the event of refusal to enforce the arbitral award on a claim that it contradicts the public policy of the country which does not itself recognise punitive remedies. Cypriot case-law emphasises that punitive damages are prohibited in contractual actions.

Singapore Small Flag Singapore

S 12(5) of the IAA provides that ‘[w]ithout prejudice to the application of Article 28 of the Model Law [which addresses “Rules applicable to substance of dispute”], an arbitral tribunal, in deciding the dispute that is the subject of the arbitral proceedings —

(a) may award any remedy or relief that could have been ordered by the High Court if the dispute had been the subject of civil proceedings in that Court;…’.

South Korea Small Flag South Korea

The Arbitration Act does not speak to any limit on available remedies. However, courts are prohibited from recognizing a final judgment or award granting damages which would considerably contravene the basic order under the laws of Korea or treaties to which Korea is a party (Article 217-2 of the Code of Civil Procedure). In this regard, the Supreme Court has explained that Article 217-2 of the Code of Civil Procedure was introduced to “limit the scope of recognition to an appropriate extent with respect to final judgments of foreign courts such as judgment ordering payment of damages exceeding compensation for damages, such as punitive damages” (Supreme Court 2015Da207747, 28 January 2018).

Germany Small Flag Germany

The types and range of remedies that can be awarded by the arbitral tribunal depend on the substantive law of the dispute. Arbitration law does not impose limitations on these available remedies per se.

In addition, the parties of the arbitration may afford further competence to arbitral tribunal and empower the arbitral tribunal to render a decision ex aequo et bono.

Limitations to the available remedies and also limitation to the arbitral tribunal's discretion where it has been afforded ex aequo et bono competence are based in the superseding German public policy. I.e. remedies that violate public policy may be awarded by the arbitral tribunals but are not enforceable. Most notably, the Federal High Court (Bundesgerichtshof) held that punitive damages are considered a violation of such public policy.

India Small Flag India

As per Section 34(3) of the Arbitration Act, an application to set aside an arbitral award must be made within three months of receipt of the award or, if a request has been made for correction or interpretation of the award, from the date on which that request is disposed of by the tribunal. This three-month period may be extended by a further 30 days if the court is satisfied that the applicant was prevented by sufficient cause from making the application within the stipulated timeframe.

Indonesia Small Flag Indonesia

The Arbitration Law does not prescribe the remedies a tribunal can impose in an award. If the Indonesian civil code governs the contract in dispute, the available remedies for a breach of contract will include costs, damages and interest. Declaratory relief may not be enforceable.

Liechtenstein Small Flag Liechtenstein

The type of remedy available in arbitral proceedings depends on the arbitrability of the subject matter of the underlying dispute and on the remedies available under the substantive law applicable to the issues at hand.

For example, family law matters and claims under apprenticeship contracts pursuant to the Law on Vocational Training are not arbitrable under the Liechtenstein law on arbitration. Furthermore, only the Liechtenstein ordinary courts have jurisdiction in cases which as a matter of mandatory law can only be instigated upon application by the foundation supervisory authority or ex officio. The jurisdiction of the ordinary courts may not be excluded in favor of arbitration. Hence, claims that are directed towards the initiation of supervisory proceedings are not arbitrable. If the remedy sought is the removal of a member of the Foundation Council of a Liechtenstein Foundation, such remedy cannot be achieved by way of arbitration. Similar considerations apply in case the remedy is the invalidation of a resolution of the Foundation Council of a Liechtenstein Foundation.

With respect to damages claims, those are arbitrable as a matter of principle; under Liechtenstein substantive law, punitive damages are not an available remedy.

Malaysia Small Flag Malaysia

The Arbitration Act does not provide any limitations in relation to the types of remedies available in arbitration.

France Small Flag France

Arbitrators are free to order a wide range of remedies such as payment of damages or injunctions. Once ordered by an arbitral tribunal, these remedies can be enforced by domestic courts. There are no restrictions in French law on the types of remedies that can be awarded. However, the damages awarded by the arbitral tribunal must not be contrary to French (international or domestic) public policy. The Court of Cassation does not consider punitive damages as contrary to international public policy unless they are “disproportionate in light of the loss sustained and the contractual breach” (French Court of Cassation, First Civil Chamber, 1 December 2010, No. 09-13.303).

Egypt Small Flag Egypt

There are no specific limits imposed on remedies, other than issues related to public policy. Generally, an arbitral tribunal enjoys a broad authority and power to order any declaratory relief, monetary compensation, specific performance, interest, and costs. However, an arbitral tribunal is not generally entitled to award punitive damages.

Czech Republic Small Flag Czech Republic

There are no limits on the claimed and enforced remedies, and all monetary remedies are enforceable. Otherwise, standard rules concerning public policy, etc., apply.

Chile Small Flag Chile

Chilean contract law does not prevent parties from agreeing on specific remedies nor to modify any default feature of the legal remedies either. Actually, parties may waive any remedy for breach of contract in advance.

Every available legal remedy is enforceable by law without limits, including specific performance. Particular remedies created by contract are enforceable also unless they are against the law, public policy or buenas costumbres –which is a legal concept that limits freedom of contract when the exercise thereof is against basic standards of decency in the content of contractual arrangements.

Taiwan Small Flag Taiwan

As mentioned in Question 31, a court may refuse to enforce any award which orders a party to engage in an act that is prohibited by law.

Switzerland Small Flag Switzerland

In principle, Swiss procedural law does not impose any limits on the final remedies available to an arbitral tribunal with its seat in Switzerland. The available remedies are depending on the law applicable to the substance of the dispute. If the dispute is governed by Swiss law, the following main categories of final remedies exist:

  • Performance
  • Specific performance;
  • damages, if specific performance is no longer possible (no punitive damages are available);
  • abstaining from or tolerating certain acts or a situation; and
  • issuing a declaration of will
  • Creation, modification, or termination of a legal relationship; and
  • Declaratory Relief

In accordance with art. V para 2(b) of the New York Convention, Swiss courts are not enforcing remedies that are considered to be contrary to Swiss public policy. In this regard, in particular treble and punitive damages are critical. According to the Swiss Federal Tribunal, such damages might infringe Swiss public policy, depending on the particular circumstances of the case.

Greece Small Flag Greece

No such limitation is imposed. The question is dealt with in the context of arbitrability. Public order considerations are also obviously applicable.

Turkey Small Flag Turkey

With the exception of limited instances such as punitive damages, anti-suit or anti-arbitration injunctions, which are not allowed under Turkish Law, there are no limits imposed on the available remedies.

UAE Small Flag UAE

UAE – Federal
There are no specific limits on the remedies that an Arbitral Tribunal in an On-Shore arbitration may award.

UAE - Common Law Jurisdictions
Neither the DIFC Court nor the ADGM Court impose any specific limit, nor expressly classify any remedies as unenforceable.

However, an award may not be enforced upon public or private property owned by an Emirate or government body as set out in Article 247 of the UAE CPC

Updated: November 14, 2019