Setting aside and enforcement of commercial arbitration awards and their legal implications in Egypt

Abstract

Arbitration is an alternative dispute resolution for seeking justice in settling commercial disputes out of court. Although the Egypt Arbitration Law of 1994 marked a significant evolution in commercial arbitration in the Arab Republic of Egypt, the current position of setting aside an arbitral award may result in its enforcement with the presence of substantial reasons affecting the justice between the disputants due to the limitation of the grounds for setting it aside. In addition, enforcement of the arbitral award is subject to its consistency with the national public policy of Egypt. This is seen as legal restrictions for foreign arbitral awards, and it amounts to difficulties in seeking their enforcement. Furthermore, the decision to accept or refuse the enforcement of the arbitral award is based on the 'ijtihād (independent reasoning) of the enforcing judge. Hill, Jonathan, found in their study that not all the situations that result in setting aside the arbitral award were included in the grounds for setting aside. The arbitral award seeking enforcement may be refused because of its conflict with Shariah, although there are other judgments of Islamic jurisprudence that consider this award to be consistent with Shariah. This study, therefore, analyses the rules concerning the process of setting aside and enforcing the arbitral award. For this purpose, the methodology adopted in this study comprises non-empirical qualitative and empirical qualitative research. The black letter laws were also employed to evaluate the current situation of the problem by examining the relevant legal rules along with public policy. This study finds that the grounds for setting aside did not include all the situations that result in setting aside the arbitral award. Thus, the study suggests some necessary amendments to the Egypt Arbitration Law 1994 in order to achieve the desired justice for parties in commercial arbitration. One of the objectives of this study is to analyse the effect of the current position of setting aside an arbitral award in Egypt jurisdiction.