When are foreign arbitral awards contrary to public policy?

Article 5.2(b) of the UN’s Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention) specifies that if the recognition or enforcement of an award would be contrary to the public policy of that country, recognition and enforcement of that arbitral award can be refused. However, the New York Convention does not provide a precise explanation of the term “public policy”, and Chinese laws and regulations are also silent on the issue. Determining whether a foreign arbitral award is contrary to public policy has long been an issue of concern to foreign rights holders.

The authors have carried out a rough summary of relevant cases in recent years (as shown in the table).

Based on the listed cases, we can see that a foreign arbitral award violating mandatory provisions of Chinese laws, administrative statutes or ministerial rules or regulations does not necessarily constitute a violation of the public policy of China (cases 1 and 2). This perspective has also been implemented in the trial activities of lower level courts, e.g. in the Fujian Across Express Information Technology et al v China Media Express Holdings agreement dispute case (2014).