Iraq’s reservations to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards
The Law Office of Ali Barakat in Baghdad sets out what Law No. 14 of 2021 provides on the accession of the Republic of Iraq to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958), the three reservations in that law, and the limits those reservations place on a person who relies on an award issued outside Iraq. The law was published in the Official Gazette, issue 4633 of 31/5/2021. The President of the Republic ordered its issuance on 6/4/2021, and it enters into force on the date of its publication in the Official Gazette, under article 2. The page presents the accession text as it appears in the Iraqi Legislation Database.
What does the accession law do?
Article 1 provides that the Republic of Iraq accedes to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958), which entered into force on 7 June 1959, with the reservations that follow. Iraq thereby becomes a party to the Convention from the date its domestic law enters into force, subject to the limits it recorded in the instrument of accession. The Convention itself is an international instrument, separate from the Civil Procedure Law and from the Law on the Enforcement of Foreign Court Judgments No. 30 of 1928. Mixing these paths changes the text that applies: an award issued in Iraq is ratified under articles 251 to 276 of Civil Procedure Law No. 83 of 1969 before the Court of First Instance that would hear the dispute. A judgment issued by a court constituted outside Iraq is the subject of a decision of enforcement under Law No. 30 of 1928. A foreign arbitral award that falls within the Convention after the reservations is the subject of a request for recognition and enforcement within the framework of the Convention as Iraq acceded to it.
Law 14 of 2021 does not replace the arbitration book of the Civil Procedure Law, and it does not create a free-standing Iraqi statute titled an “arbitration law” that dispenses with that book. Domestic arbitration remains governed by articles 251 and following: writing is required; the court may stay the case if an arbitration agreement is in place; arbitration is confined to matters in which conciliation (صلح) is permitted; the award is deposited; and it is not enforced until the Court of First Instance that would hear the dispute ratifies it. That path is set out on the arbitration and enforcement of awards practice page.
The three reservations as they appear in article 1
The first reservation is that the provisions of the Convention shall not apply, as against the Republic of Iraq, to arbitral awards issued before this law entered into force. An award issued before 31/5/2021, the date of publication and entry into force, is not to be recognised or enforced on the basis of the Convention as against Iraq. The law does not open a retrospective path for awards that pre-date its entry into force. Any other path that may be raised in respect of an earlier award is read in its own text, not as an application of the Convention after accession.
The second reservation is that the Convention shall be applied, in respect of the recognition and enforcement of awards issued in the territory of another Contracting State, only on the basis of reciprocity. Recognition and enforcement under the Convention are therefore tied to the award having been issued in the territory of a Contracting State, and to reciprocity. The statement of motives for the law confirms the same purpose: the Republic of Iraq’s recognition and enforcement of foreign arbitral awards issued in the territory of another State party to the Convention, on the basis of reciprocity. The treatment of a State is read from the accession and the reservations in force.
The third reservation is that the Republic of Iraq shall apply the Convention only to disputes arising from contractual legal relationships that are commercial under Iraqi law. The subject-matter scope is therefore double: the relationship must be contractual, and it must be commercial under Iraqi law, not merely under a description one of the parties gives it. A dispute arising from a non-contractual relationship, or from a relationship that Iraqi law does not treat as commercial, falls outside Iraq’s application of the Convention under this reservation, even if a foreign award was issued on it. Whether the relationship is commercial under Iraqi law is decided when the application is examined, in the light of the Iraqi provisions that govern commercial activity.
These reservations are part of the accession law, not side notes. A person who relies on the Convention in Iraq reads the award against all three limits together: the date it was issued; the place of issue, the Contracting State and reciprocity; and the nature of the relationship from which the dispute arose.
What should not be read into the accession law?
Law 14 of 2021 is a short accession statute: an article on accession and the reservations, an article on entry into force, and a statement of motives. Its text does not lay down detailed procedure before an Iraqi court that would replace a reading of the Convention as Iraq acceded to it, or of any Iraqi procedural provision that applies when an application is filed. A court, a time-limit or a fee is taken from the accession statute and from the Convention as they stand. The text of accession is what the Iraqi law records with the reservations, and the international text of the Convention is read from its official source.
The arbitration book of the Civil Procedure Law remains in place alongside the accession. Writing is required under article 252. The court may stay the case if an arbitration agreement is in place, under article 253. Arbitration is valid only in matters in which conciliation is permitted, under article 254. An award by arbitrators is not enforced until the Court of First Instance that would hear the dispute issues a decision ratifying it, under article 272. Those provisions govern a domestic award. They are not simply transferred to a foreign award that falls within the Convention after the reservations, and the reservations in Law 14 of 2021 are not treated as limits on the ratification of an award issued in Iraq.
Accession does not mean that every arbitral award issued outside Iraq is automatically enforced in Iraq. The three reservations narrow the scope. An award may remain outside the Convention if it was issued before the law entered into force, or was issued in a territory with which reciprocity does not stand in the way the reservation requires, or related to a dispute that falls outside contractual commercial relationships under Iraqi law. In any event, compulsory enforcement after recognition, if a decision to that effect is issued, is a later path before the Enforcement Officer under Enforcement Law No. 45 of 1980, and is separate from the application for recognition itself.
Legal basis and sources
- Law No. 14 of 2021 on the accession of the Republic of Iraq to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958) (Official Gazette No. 4633 of 31/5/2021)
- Civil Procedure Law No. 83 of 1969, articles 251–276
- Law on the Enforcement of Foreign Court Judgments in Iraq No. 30 of 1928
Frequently asked questions
When did Iraq’s accession take effect?
The law enters into force on the date of its publication in the Official Gazette, under article 2. It was published in the Official Gazette, issue 4633 of 31/5/2021. Internationally, the Convention entered into force on 7 June 1959, as article 1 of the accession law records.
Does the accession apply to an award issued before 31/5/2021?
The first reservation prevents the provisions of the Convention from applying, as against the Republic of Iraq, to arbitral awards issued before the law entered into force.
Is every foreign arbitral award treated as a foreign court judgment?
No. A foreign court judgment has its own statute, Law No. 30 of 1928. A foreign arbitral award that falls within the Convention is read within the framework of Law 14 of 2021 and the reservations. A domestic award is ratified under the Civil Procedure Law.
Does the third reservation cover every commercial dispute?
Only if the dispute arises from a contractual legal relationship that is commercial under Iraqi law. Both conditions appear together in the text of the reservation.