Recognition and Enforcement of Arbitration Awards in Georgia: 5 Important Practical Tips
Introduction
Even after an arbitral award is obtained, debt collection does not occur automatically. In practice, it is precisely the stage of recognition and enforcement of the award that becomes critical: formal errors in documents, an improperly executed power of attorney, or failure to comply with procedural requirements can lead to delays in the proceedings or a refusal by the court.
Despite clear regulations in Georgian national legislation and international instruments, judicial practice shows that procedural details are of key importance. Ignoring them significantly increases the risks for the party interested in enforcing the award.
It should be noted that:
- the recognition and enforcement of arbitral awards rendered in Georgia are carried out by the Court of Appeals;
- the recognition and enforcement of arbitral awards rendered in a foreign state is handled by the Supreme Court.
Below are five practical aspects that should be considered when preparing an application.
1. The state fee must be paid from a local account
When initiating the procedure for the recognition and enforcement of an arbitral award, one of the first practical issues is the proper payment of the state fee.
It is important to note that:
- the state fee must be transferred from an account registered in Georgia;
- the payment is made to the state treasury;
- it is not possible to transfer funds from a foreign account.
Failure to comply with this requirement results in the need to make a repeat payment and delays the procedure.
2. The power of attorney must clearly define the representative’s authority
Properly drafting the power of attorney is essential to the process.
It is recommended that the document explicitly state:
- authority to file an application for recognition of the arbitral award;
- authority to enforce the award;
- the right to represent interests in the relevant court.
A general statement regarding representation may be deemed insufficient and raise additional procedural issues.
3. The original arbitration agreement must be submitted to the court
Among the documents to be submitted, the original arbitration agreement is of particular importance.
An “original” is defined as a document:
- signed by the parties in their own handwriting;
- properly executed.
The arbitration agreement confirms the parties’ intention to resolve the dispute through arbitration. The absence of the original may make it difficult to grant the petition.
4. A restriction on a party’s right to defense may serve as grounds for denial
Recognition and enforcement of an arbitral award are not automatic. The court may refuse if the party against whom the award was rendered proves that:
- it was not properly notified of the appointment of the arbitrator;
- it was not notified of the arbitration proceedings;
- it was not given the opportunity to present its case;
- its right to a defense was otherwise restricted.
This ground is related to the principles of fair trial and equality of the parties.
5. Documents in a foreign language must be translated into Georgian
When filing a claim, you must ensure that the documents are linguistically correct.
Requirements include:
- submission of a certified translation of the arbitral award into Georgian;
- translation of the arbitration agreement;
- no apostille or legalization required for awards from states party to the Minsk Convention.
Failure to comply with these requirements may result in delays in the processing of the application.
Conclusion
To increase the likelihood of recognition and enforcement of an arbitral award in Georgia, it is necessary to:\
- pay the state fee from a bank account in Georgia;
- execute a power of attorney with specific powers;
- submit the original arbitration agreement;
- confirm that the parties’ rights to defense have been observed;
- prepare certified translations of the documents into Georgian.
Before filing an application for the recognition and enforcement of an arbitral award, it is recommended to conduct a preliminary review of the procedural requirements and the set of documents. This helps reduce the risk of rejection and expedite the court proceedings. REVERA’s lawyers are ready to assist you with these matters.
Authors: Melano Svanidze, Oksana Yashagyan, Nino Zautashvili.
The lawyers at REVERA are ready to provide you with support on these matters. Please feel free to contact us!
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