Published: January 2009
Review on the Merits
Description: Under French law, the rules applicable to judicial review of arbitral awards are provided by statute in Articles 1481 to 1507 of the French Code of Civil Procedure (the “CPC”). France, like Switzerland, has a dualist legal system (i.e. a system in which domestic and international arbitrations are submitted to different rules). As a result, the grounds for challenge of awards are different depending on whether the award subject to review is domestic or international.
Article 1492 of the CPC defines an international arbitration as one that “affects international trade.” This definition has been further articulated by the French courts as follows:
[Article 1492] refers, irrespective of the nationality of the parties, of the law applicable to the merits of the arbitration, or of the seat of the arbitration, to an exclusively economic definition of international arbitration pursuant to which it is sufficient that the dispute submitted to the arbitrators be related to a transaction that does not economically unfold in a single State.
As distinct from Swiss law, internationality is thus defined under French law according to a purely economic understanding of the international character of the underlying dispute. In the above-quoted decision of the Paris Court of Appeal, for example, the arbitration was defined as international on the basis of the currency of the payment (the U.S. dollar) in spite of the fact that the contract had been entered into by two French parties…