Enforcing arbitral awards in Lebanon


ArbitrationDispute Resolution

Enforcing arbitral awards in Lebanon

4 May 2022

Rafic El Hassan is a Lebanese-qualified lawyer. He obtained a Bachelor’s degree in law as well as a Master’s certificate in private law at the Saint Joseph University in Beirut, where he studied both Lebanese and French law. Before moving to Berlin for his LL.M. in 2021, Rafic worked as an associate at a major law firm in North Lebanon.

INTRODUCTION

From its Mediterranean coastline, the first commercial ships had roamed the world. From its cities, the first alphabets were adopted all over Europe. “Of the great law schools of Rome, Constantinople, and Berytus”, the law school of Berytus stood “pre-eminent”.[1] Reaching a worldwide recognition, Beirut has been called in Latin “Berytus Nutrix Legum”, or “Beirut the Mother of Laws / Feeder of Law”.

Being a crosswalk between East and West, with the scent of a prominent historical and cultural background as well as with a touch of the French Legal system, Lebanon is one of the friendliest countries for arbitration in the region. The Q&A below demonstrates this, containing answers to some of the fundamental questions regarding the enforcement of arbitral awards in Lebanon.


[1] Samuel Parson Scott, The Civil Law, Including the Twelve Tables: The Institutes of Gaius, the Rules of Ulpian, the Opinions of Paulus, the Enactments of Justinian, and the Constitutions of Leo, Band 6 (1973).

Legal framework

What is the applicable procedural law/arbitration act for recognition and enforcement of an arbitral award in your jurisdiction and which is the relevant section?

The Lebanese Code of Civil Procedure (decree n90 dated 01/09/1983; hereinafter “LCCP”) contains a chapter dedicated to arbitration. The first part governs domestic arbitration (and domestic awards) from articles 762 to 808, and the second part governs international arbitration (and international awards) from articles 809 to 826.

 

The LCCP differentiates between domestic awards and “international awards”. According to article 809 of LCCP, “[i]f the operation that is the subject matter of the dispute is linked to more than one country, the arbitration is international”.[1] In other words, pursuant to article 809 LCCP, an arbitration is considered international when it involves the interests of “international commerce”. An international award could thus technically be rendered both inside Lebanon (with the place of arbitration in Lebanon) or outside Lebanon (with a foreign place of arbitration), as long as it involves an interest of international commerce.

[1] Prof. Nayla Comair-Obeid, Lebanon in The Middle Eastern and African Arbitration Review 2022, Global Arbitration Review (April 2022).

Is your jurisdiction party to the 1958 New York Convention? If yes, what is the date of entry into force of the Convention? Was any reservation made under Article I (3) (reciprocity reservation) of the Convention?

Yes, Lebanon is a party to the New York Convention of 1958 (NY Convention).  Lebanon ratified the NY Convention on 9 November 1998. However, it made a reservation under article 3 (based on reciprocity).

Jurisdiction & procedure before court

Which national court has jurisdiction over an application for recognition and enforcement of arbitral awards?

The competent authority to grant recognition and enforcement of awards differs between domestic awards, international awards rendered in Lebanon and international awards rendered outside Lebanon.

 

In respect of international awards rendered outside Lebanon, the competent authority is the President of the first instance court in Beirut. If the international award is rendered inside Lebanon, the competent authority is the President of the first instance court where the award is made.[1]

 

In respect of domestic awards, the competent authority is the first instance court in the region of the agreed seat of arbitration. If the parties have not chosen the seat of arbitration, the competent authority is the first instance court in Beirut.

[1] Prof. Nayla Comair-Obeid, Lebanon in Arbitration Guide of IBA Arbitration Committee (February 2012).

How does one initiate court proceedings for the enforcement of an award in your home jurisdiction?

The relevant articles for the commencement of the enforcement proceeding are articles 815 in conjunction with articles 793 to 797 of the LCCP. The award-creditor must submit a request for enforcement with the original award or a certified copy thereof alongside an original or certified copy of the arbitration agreement to the competent court (see question #3).

Are there any requirements for the court to have jurisdiction over an application for recognition and enforcement of arbitral awards? If yes, what are they? Must the applicant identify assets within the jurisdiction of the court?

No, there are no additional requirements besides the rules set out in question #3.

How high are the court fees that must be paid? What kind of criteria is used to determine their amount? Amount in dispute? Or are there also other criteria?

Generally, in Lebanon the legal fees are determined based on the amount in dispute. However, article 13 of the Lebanese Judicial Legal Fees Law (hereinafter “Judicial Fees Law”) contains an exclusive enumeration of types of disputes where the legal fees are not determined based on the amount in dispute but according to a fixed rate. This includes the fees for the enforcement proceedings of both domestic and international awards, which amount to a fixed rate of 25.000 Lebanese Lira (equivalent to 15 euro as per the exchange rate as of 6 April 2022).

Are the proceedings in your jurisdiction adversarial or ex parte?

The proceedings for the recognition and enforcement of arbitral awards are ex parte.

Formal and practical requirements

What documentation is required to obtain recognition of an arbitral award? For instance, must the award be submitted in original or a certified copy? Does the original Arbitration Agreement have to be submitted?

According to article 793 of the LCCP, the domestic or international award must be submitted as an original or certified copy alongside an original or certified copy of the arbitration agreement.

If the required documentation is drafted in a language other than the official language of your jurisdiction, is it necessary to submit a translation together with an application to obtain recognition of an arbitral award? If yes, in what form is the translation required to be?

Yes, documents in a foreign language must be translated into Arabic and authenticated by a sworn translator.

What are the other practical requirements relating to recognition and enforcement of arbitral awards? For instance, do you need to be represented by a lawyer from the particular jurisdiction?

According to article 378 of the LCCP, each party must be represented by a lawyer admitted in Lebanon if the value in dispute is more than 1 million Lebanese Lira (roughly 590,00 euros according to the exchange rate as of 6 April 2022). If the amount in dispute is below 1 million Lebanese Lira, a party can represent itself.

When is service of judicial and extrajudicial documents deemed to be affected in your home jurisdiction and what does the procedure and legal framework look like?

The notification of all documents must be done by a civil servant, who is specifically appointed for judicial notification duties. Usually, the place of notification is the habitual residence of the relevant party in Lebanon.

Are there any differences in the procedure of the enforcement of domestic and foreign arbitral awards?

There is no difference in Lebanese law in the procedure for the enforcement of domestic and international arbitral awards.

Substantial requirements

Do courts recognize and enforce partial or interim awards or only final awards?

Both final awards and partial or interim awards that finally settle a matter in dispute can be enforced in Lebanon.

What are the grounds based on which an award may be refused recognition? Do the relevant provisions differentiate between domestic and foreign arbitral awards? If yes, what are the differences in their requirements?

Lebanese courts will not refuse recognition and enforcement unless one of the grounds of annulment are applicable.[1]

 

The grounds applicable for annulment of international awards are set out under article 819 LCCP as follows:

 

  • The award is rendered without an arbitration agreement or with an agreement which is null or void due the expiration of the time limit to render the award;
  • The award is rendered by arbitrators who were not appointed in accordance with the law;
  • The award rendered has exceeded the mandate conferred on the arbitrators;
  • The award was rendered in violation of the parties’ due process rights;
  • The award violated an international public policy rule.

Article 800 LCCP, on the other hand, specifies the grounds for annulment of domestic awards:

  • The award is rendered without an arbitration agreement or with an agreement which is null or void due to the expiration of the time limit to render the award;
  • The award is rendered by arbitrators who were not appointed in accordance with the law;
  • The award rendered has exceeded the mandate conferred on the arbitrators;
  • The award was rendered in violation of the parties’ due process rights;
  • The award does not contain the mandatory elements of an award, which are: (i) the relief sought by the parties, along with the grounds and means of substantiating such relief; (ii) the names of the arbitrators; (iii) the legal reasoning; (iv) the relief granted; (v) the date of the award; and (vi) the signatures of the arbitrators;

The award violated a public policy rule.

[1] Marwan Karkabi, Civil procedural principles and arbitration, Sader, 2nd volume.

How does your home jurisdiction interpret and construe the public policy violation defence?

The public order concept in Lebanon is not a fixed concept, but a vague, undefined notion. The Lebanese Court of Cassation has defined public order as a set of mandatory rules that protect the highest interests of the Lebanese society.[1]

[1] Fady Nammour, Droit et Pratique de l’Arbitrage Interne et International, Bruylant Delta LDJ, 3rd edition (2009).

Effects, remedies & procedural requests

What is the effect of a decision recognizing the award in your jurisdiction? Is it immediately enforceable?

The decision recognizing the award is enforceable once 30 days have passed from the date of notification to the opposing party.

Are any remedies available against a decision recognizing an arbitral award in your jurisdiction and, if yes, what are they?

According to articles 805 and 819 of the LCCP, no remedies are available against a court decision recognizing an arbitral award.

What remedies, if any, are available against a decision refusing to recognize an arbitral award in your jurisdiction?

According to articles 806 and 816 of the LCCP, a court decision denying recognition or enforcement of an arbitral award is subject to appeal within a deadline of 30 days starting from the date the decision was notified to the parties.

Are any additional defences such as a set-off claim possible in enforcement proceedings?

The legislator has not expressly addressed set off claims in the chapter related to arbitration. However, under the LCCP more generally, set off claims are possible.

Is it possible to obtain the recognition and enforcement of an award that has been fully or partly set aside at the seat of the arbitration? In case the award is set aside after the decision recognizing the award has been issued, what remedies, if any, are available against this decision?

The LCCP does not contain any provisions prohibiting the court to recognize or enforce an award that has been set aside at the seat of arbitration. However, the award must not violate international public policy.

22. Are interim measures against assets in your jurisdiction available? And if yes, what kind of measures are they?

Yes, the court can take interim measure to freeze the assets of the award-debtor.

In which cases may a security for costs be requested?

The LCCP does not contain any rules regarding security for costs. However, such decisions are taken at times,[1] but publicly available jurisprudence on this is scarce.

[1] Mohamed Alem, Mazen Ghosn and Rana Kahwagi (Alem & Associates), Lebanon in International Arbitration 2021 of Chambers – Global Practice Guides.

 






About the author

Rafic El Hassan

Rafic El Hassan is a Lebanese-qualified lawyer. He obtained a Bachelor’s degree in law as well as a Master’s certificate in private law at the Saint Joseph University in Beirut, where he studied both Lebanese and French law. Before moving to Berlin for his LL.M. in 2021, Rafic worked as an associate at a major law firm in North Lebanon.


About Wagner Arbitration

The law firm WAGNER Arbitration has its offices in Berlin and specializes in dispute resolution with a focus on arbitration. In addition, the firm offers comprehensive counseling services related to domestic and international business disputes and transactions.

Disclaimer

This Journal and its contents serve informational purposes only and do not replace individual legal advice. Please contact us, should you have any inquiries or comments.

The answers provided in this questionnaire are as of April 2017. Please note that the relevant legal provisions may be subject to amendments.