Use of interim measures (Section 9) as an aid to enforcement of Foreign Awards

Use of interim measures (Section 9) as an aid to enforcement of Foreign Awards.

The use of interim measures under Section 9 of the Arbitration and Conciliation Act, 1996 (Act) can be an auxiliary tool in the enforcement of foreign awards, but it is important to understand its limitations and complexities.

Here’s a breakdown:

What are Interim Measures (Section 9)?

Section 9 empowers courts to grant temporary orders like attachments, injunctions, or other reliefs in support of ongoing or concluded arbitration proceedings. This can be sought before, during, or after the award is issued, but before its enforcement.

How can Section 9 aid in enforcing foreign awards?

• Preserving assets: If a party fears the losing party might dissipate assets before the award is enforced, Section 9 allows seeking orders to freeze or preserve those assets.
• Maintaining the status quo: Interim measures can prevent actions that could undermine the potential enforcement of the award, such as transferring ownership of disputed property.

Limitations and complexities:

• Discretionary power: Courts have discretion to grant or deny the request under Section 9, considering factors like urgency, potential harm, and likelihood of success in the arbitration.
• Limited scope: Interim measures are temporary and cannot be used to directly enforce the award itself. They only aim to preserve the situation until the award is issued and potentially enforced.
• Jurisdictional complexities: Enforcing foreign awards often involves navigating different legal systems. While Section 9 applies domestically, enforcing a foreign award granted interim measures might require further proceedings in the foreign court that issued the award.

Additional points:

• The applicability of Section 9 to foreign awards depends on the specific provisions of the relevant arbitration agreement and the specific foreign award.
• Recent Indian court decisions have clarified the use of Section 9 in relation to foreign awards, but some uncertainties remain.

Conclusion: While Section 9 can be a valuable tool in supporting the enforcement of foreign awards, it’s crucial to consult with legal professionals to understand its specific application and potential limitations in each case.