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Arbitration Awards: Insights on the Outcome & Implications

First published on 05 October 2023 – on the BBaC Website

An arbitration award is the final decision made by an arbitrator or arbitration panel, marking the conclusion of the arbitration process. It addresses and resolves the disputes presented, detailing the rights and obligations of the parties involved. This award is legally binding and can be enforced domestically and internationally, much like a court judgment.

Recognising the significance of the arbitral award is vital for businesses and individuals as it signifies the resolution of a dispute and outlines the consequences for the involved parties. It equips them with the knowledge needed to adhere to the award’s terms, address any challenges, and seek enforcement if necessary. This understanding ensures preparedness and enables effective management of post-award scenarios, thereby alleviating potential uncertainties and conflicts.

This piece, part of our “Understanding Arbitration: A Guide for Businesses” series, gives a comprehensive insight into the arbitration award, shedding light on its components, types, legal implications, and practical considerations, enabling readers to navigate post-arbitration scenarios clearly and confidently.

Components of An Arbitration Award

An arbitration award has several components, each contributing distinctively to clarify and substantiate the document’s legality. Firstly, the award must identify the parties involved and the arbitrator(s) responsible for the decision, offering immediate context to the dispute and those affected by the resolution.

The second component is the procedural history, which chronologically recounts the events, submissions, and hearings that occurred during the arbitration process. This detailed account promotes transparency and fairness, aiding the parties’ comprehension of the context in which decisions were made.

The next segment explains the factual background, offering an overview of the material facts and circumstances surrounding the dispute. It lays the foundation for the arbitrator’s analysis, supplying the necessary context for the rationale and conclusions that follow.

The award articulates the arbitrator’s analysis and decision after the factual background. This section is crucial as it reveals the arbitrator’s interpretation of the law, evaluation of facts, and the reasoning behind the final decision, establishing the parties’ legal positions and obligations.

The next component addresses cost allocation, showing the distribution of arbitration costs and legal fees among the parties, thereby clarifying the financial responsibilities emanating from the arbitration.

The award of relief is then specified, detailing the remedies accorded to the prevailing party, which may comprise monetary compensation, specific performance, or declaratory relief. This element is critical as it activates the obligations and demarcates the immediate implications of the award.

In addition to these components, adherence to legal stipulations, such as those outlined in Article 31 of the UNCITRAL Model Law, is imperative for the award’s validity. The Model Law mandates the award to be in writing and signed by the arbitrators. In arbitral proceedings with more than one arbitrator, the signatures of the majority of the arbitral tribunal members shall suffice, provided that the reason for any omitted signature is stated. The award must explicitly state the reasons upon which it is based unless the parties agree otherwise. Additionally, it must specify its date and the place of arbitration, deeming it to have been made at that location, and a signed copy must be delivered to each party.

Types of Arbitration Awards

Arbitration awards take several forms, each serving distinctive purposes and addressing varied aspects of a dispute. Monetary awards are prevalent, requiring the losing party to compensate the prevailing party with a specific monetary amount. This type of award is quantifiable and aims to redress the financial loss or damage incurred.

Non-monetary awards, on the other hand, offer remedies that do not involve financial compensation. These may encompass specific performance, injunctions, or declaratory relief, directing a party to undertake or refrain from particular actions or clarifying the rights and obligations of the parties involved. Understanding the implications of non-monetary awards is essential for formulating effective strategies and managing outcomes.

A distinction also exists between final and partial awards. A final award resolves all the claims and issues, concluding the arbitration process. Conversely, a partial award settles select claims or issues with finality but leaves room for continued arbitration on the remaining matters. This type of award is especially useful in complex arbitrations involving multiple claims or questions, as it allows for the resolution of certain aspects of the case without having to wait for the entirety of the proceedings to conclude.

Interim awards, designed to address specific issues or grant temporary relief pending the final resolution of the dispute, can be controversial due to the principle that awards should be final and binding. These awards aim to maintain the status quo, preserve assets, or safeguard the subject matter of the dispute during the arbitration process. The controversy stems from their provisional nature, as they do not resolve the entire dispute or an aspect of it and thus are not “final” in a traditional sense. The enforceability of interim awards can vary depending on the applicable arbitration law, the arbitration agreement, and the arbitral institution’s rules, leading to challenges, especially in jurisdictions emphasising the finality of arbitral awards.

Consent awards efficiently bridge the parties’ agreement and the formal arbitration process. When parties find common ground during arbitration, they might settle their dispute amicably. The arbitral tribunal can then record the consensus as a consent award, which essentially captures the terms agreed upon by the parties. This fosters a sense of autonomy and control among the disputing parties and promotes efficiency, saving both time and resources. Importantly, under some jurisdictions, the arbitral tribunal has discretion on whether to accept and incorporate the parties’ agreed terms as a consent award. This discretion ensures that the terms do not contradict public policy or the agreed arbitral process.

Legal Implications of Arbitration Awards

Arbitral awards, once rendered, carry significant legal implications, primarily concerning their enforceability and avenues available for challenges.

1. Enforceability

a. Domestic Enforcement: In the context of domestic enforcement, an arbitral award generally enjoys a strong presumption of enforceability. Parties can enforce awards through national courts, which typically review them under a limited set of criteria, focusing on procedural fairness and compliance with public policy.

b. International Enforcement: The New York Convention is central to international enforcement. The Convention, with 172 state parties as of the time of writing, facilitates the recognition and enforcement of foreign arbitral awards. It creates an obligation on contracting states to recognise and enforce awards made in other signatory states, subject only to specific exceptions. This global instrument significantly enhances the enforceability of arbitral awards across borders, making arbitration an attractive dispute resolution mechanism for cross-border transactions.

2. Challenges

a. Grounds for Challenging an Award: While arbitral awards are subject to challenges, the scope for such challenges remains limited. Grounds for challenging an award often include procedural irregularities, apparent bias on the arbitrator’s part, and decisions beyond the scope of the arbitration agreement. Furthermore, an award may be challenged at the seat of arbitration if it conflicts with the public policy of that jurisdiction or deals with a subject matter deemed non-arbitrable under its law.

b. Procedure for Challenging an Award: Initiating a challenge involves submitting an application to a competent court at the seat of arbitration, articulating compelling arguments, and presenting evidence to support the challenge. While parties may agree on certain procedural aspects, their agreement is subject to and can be overridden by the mandatory provisions of the applicable arbitration law. For instance, Article 34 of the UNCITRAL Model Law stipulates the exclusive grounds and procedure for setting aside an award. The court at the seat assesses any potential conflict with its public policy or the arbitrability of the subject matter. A successful challenge could result in the award being vacated, modified, or potentially leading to re-arbitration, depending on the applicable law and the nature of the irregularities found.

Practical Considerations and Problem-Solving Strategies

1. Ensuring Compliance with the Award

Ensuring compliance with the award is a foundational step in the post-arbitration phase. Parties are encouraged to maintain open and transparent communication, clarifying the obligations and timelines stipulated in the award. Such engagement fosters mutual understanding and sets the stage for voluntary compliance. Simultaneously, it is prudent for the prevailing party to research the jurisdictional specifics of where the losing party’s assets are located, positioning themselves for potential enforcement actions.

2. Effective Strategies for Enforcement

A strategic approach is paramount for successfully enforcing an arbitration award. The initial task involves locating the jurisdictions holding the losing party’s assets. Armed with this knowledge, the prevailing party must act swiftly to gain recognition of the award in these territories. Familiarity with local enforcement mechanisms and potential obstacles is essential. Securing the assistance of knowledgeable local counsel can prove invaluable, especially in regions with nuanced legal environments.

3. Managing Costs and Legal Fees Efficiently

Astute management of costs and legal fees is indispensable. Parties are advised to assess budgets diligently, allocate resources to crucial legal tasks, and consider flexible fee arrangements with their counsel. Maintaining transparent communication regarding billing expectations and expenditures can forestall unexpected costs. Employing cost-management tools and conducting periodic expense reviews can help maintain fiscal discipline without compromising the quality of legal representation.

4. Addressing and Navigating Refusal of Enforcement

Addressing the possible refusal of enforcement requires a well-informed and adaptable strategy. Parties should acquaint themselves with the specific grounds upon which enforcement might be refused in the relevant jurisdiction and prepare to address such challenges effectively. Examining relevant precedents and consulting experienced local counsel can offer strategic insights and a competitive edge. Should enforcement be refused, evaluating alternative jurisdictions or considering negotiation and settlement with the opposing party are advisable.

Conclusion and Final Thoughts

1. Summary of Key Insights

We have discussed the nuanced nature of interim and final arbitration awards, focusing on their enforceability and the challenges they may encounter. We have outlined practical strategies for ensuring compliance with the award and efficiently managing costs and legal fees, providing guidance for those dealing with post-award scenarios.

 2. The Importance of Proactivity and Informed Decision-Making

Being proactive and making informed decisions are crucial in managing the consequences of arbitral awards. Armed with the proper knowledge and foresight, parties can effectively anticipate and address challenges, handle refusals of enforcement, and make decisions that align with their interests, considering the specificities of the involved jurisdictions.

3. Final Reflections on Managing Post-Award Situations

Managing post-award situations requires a thoughtful approach that balances assertiveness with cooperation. It is vital for parties to stay vigilant, adapt to changes in the legal environment, and employ insights and strategies to secure favourable results while upholding the principles of the arbitration process.


1. Can Arbitral Awards be Challenged?

Yes, parties can challenge arbitral awards, but the grounds for doing so are usually limited and strictly defined by the applicable arbitration law. Common grounds include procedural irregularities, the award dealing with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or the award conflicting with public policy.

2. How Long Does Enforcement Typically Take?

The duration for enforcing an arbitral award varies widely depending on the jurisdiction, the complexity of the case, and the level of cooperation from the losing party. In general, enforcement can take several months to several years, with more cooperative parties and straightforward cases resulting in quicker enforcement.

3. What are the Consequences if the Losing Party Refuses to Comply?

If the losing party refuses to comply with the award, the winning party can seek enforcement through national courts in the jurisdiction where the losing party’s assets are located. The courts may grant various enforcement measures such as asset seizure, garnishment, or other remedies to ensure compliance with the award. Non-compliance can also damage the losing party’s reputation and standing in the business community.


The insights presented in this blog post aim to furnish readers with a broad understanding of arbitration within the context of global business. This material does not purport to provide legal advice, but rather serves as an informative resource. Specific decisions concerning arbitration and its relevance should always be made in consultation with qualified legal experts. Given the intricate variations and legal implications of arbitration across different jurisdictions, it is paramount to collaborate with legal professionals well-acquainted with the precise legal framework pertinent to your circumstances.

If you find this content valuable and have further questions, or if you require guidance on the detailed aspects of arbitration, please feel free to reach out to our dedicated team at [email protected]. We stand ready to guide you through these processes and address any areas of concern.

Previous Articles:

The Process and Grounds for Removing an Arbitrator

Combatting Delays in Arbitration: Expediting the Process

Managing Recalcitrant Parties in Arbitration

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