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Copyright © International Chamber of Commerce (ICC). All rights reserved.
( Source of the document: ICC Digital Library )
A. The Contracting State and the New York Convention
1. Name of Contracting State (also specify jurisdiction(s), if relevant)
Republic of Panama.
2. Date of entry into force of the New York Convention
8 January 1985.
The Republic of Panama approved the New York Convention by means of Law No. 5 of 25 Oct. 1983.
3. Has any reservation been made under Art. I(3) of the New York Convention regarding:
(b) commercial relationships?
4. In addition to arbitral awards made in the territory of another State, the New York Convention (Art. I(1)) also applies to arbitral awards not considered as domestic awards in the State where recognition and enforcement are sought. Are there any awards rendered in your country that are not considered as domestic awards such that the New York Convention and the answers to this Questionnaire are applicable to them?
Arbitration is regulated in Panama by Decree Law No. 5 of 8 July 1999. This Decree Law distinguishes between domestic commercial arbitration and international commercial arbitration. According to the terms of the Decree Law, a commercial arbitration shall be deemed international when its object contains foreign elements of a factual or legal nature, or foreign connections sufficiently important to characterize it as international, or when it should be classified as international under the conflict of laws rules of the forum. An arbitration is also deemed to be an international commercial arbitration where any of the following apply:
(i) When entering into the arbitration agreement, the parties had their places of business or offices in different countries.
(ii) The seat of the arbitration as determined in or pursuant to the arbitration agreement is located outside the country in which the parties have their places of business.
(iii) The place of performance of the obligations arising out of the legal relationship between the parties is outside the country in which the parties have their places of business.
(iv) The place with which the dispute is most closely connected is outside the country in which the parties have their places of business.
(v) The subject matter of the arbitration is of an international civil or commercial nature, and/or is connected with more than one country, and/or involves the provision of services or transfer of property or capital with cross-border or extraterritorial effect.
If a party has more than one place of business, the place most closely connected with the arbitration shall be used. If a party has no place of business, consideration will be given to the party's place of residence if the party is a natural person or the domicile of the party's legal representative in the case of a legal entity.
B. National sources of law
5. What specific sources of law are applicable to recognition and enforcement of foreign awards (e.g. statutes, regulations, codes, directives, other legal instruments)?
(i) Inter-American Convention on International Commercial Arbitration, approved by Law 11 of 23 Oct. 1975 (Panama Convention);
(ii) Convention on the Recognition and Enforcement of Foreign Arbitral Awards, approved by Law No. 5 of 25 Oct. 1983 (New York Convention);
(iii) Convention on the Settlement of Investment Disputes between States and Nationals of Other States, approved by Law No. 13 of 1996 (CIRDI);
(iv) Decree Law No. 5 of 8 July 1999 establishing Panama's arbitration, conciliation and mediation regime (based on the UNCITRAL Model Law on International Commercial Arbitration and the New York Convention);
(v) bilateral investment treaties.
The Constitution of the Republic of Panama specifically states that arbitral tribunals may administer justice as judicial tribunals do.
(Source: National Constitution, Art. 202.)
C. Limitation periods (time limits)
(a) Is there a limitation period (time limit) applicable to the commencement of legal proceedings for recognition and enforcement of foreign awards?
There is no specific limitation period for the commencement of recognition proceedings under Panamanian law. However, applicants should consider that the general Panamanian limitation period may be invoked against the recognition and enforcement of foreign arbitral awards.
(b) If yes, what is the applicable limitation period (time limit) and when does it start running?
The applicable limitation period would be that set forth in Art. 1701 of the Civil Code, according to which actions in personam not having a specific limitation period will be subject to a limitation period of seven (7) years. Art. 1709 of the Civil Code states that, for obligations recognized by a judgment (by a court or an arbitral tribunal), the limitation period runs from the date on which the judgment became firm as res judicata.
D. National courts and court proceedings
7. What authority or court has jurisdiction over recognition and enforcement of foreign awards?
Jurisdiction over the recognition and execution of international arbitral awards lies with the Fourth Chamber of General Affairs of the Supreme Court of Justice of Panama.
(Source Decree Law No. 5 of 1999, Art. 42.)
8. What requirements, if any, must be met for the authority or court to accept jurisdiction over recognition and enforcement of foreign awards (e.g. domicile or assets of respondent in the jurisdiction, etc.)?
Decree Law No. 5 of 1999 does not specifically require any pre-conditions to be met for the Supreme Court of Panama to accept jurisdiction over the recognition and enforcement of a foreign arbitral award. However, it is implicit that an application would be purposeless if the applicant fails to request that enforcement be carried out through execution against assets that the respondent party may possess in Panama.
9. Is the first decision granting or denying recognition and enforcement obtained through ex parte or inter partes proceedings?
Panamanian law allows for both possibilities to the extent that the party against whom the award is invoked may ask for recognition and enforcement to be refused on grounds corresponding to those listed in Art. V(1) of the New York Convention, while the court may, of its own motion and without needing to serve the enforcement application on the respondent party, refuse recognition and enforcement if the dispute is not arbitrable pursuant to Decree Law No. 5 of 1999 or recognition and enforcement would be contrary to Panamanian international public policy. It may be inferred that a dual procedure operates, the respondent party being given the opportunity to be heard in the first case, but this not being necessary in the second case.
(a) Is the first decision granting or denying recognition and enforcement subject to any form of appeal or recourse?
The law does not allow for any recourse against the first decision granting or denying recognition and execution of an arbitral award.
(b) How many levels of appeal or recourse are available against this decision?
11. What is the earliest stage in legal proceedings for enforcement of foreign arbitral awards at which a party can obtain execution against assets (i.e. party actually obtains possession of assets as opposed to simply freezing assets)?
A party can obtain actual execution against the assets of the other party only when the process of recognition and enforcement has been completed, i.e. when the decision issued by the Fourth Chamber of the Supreme Court granting recognition of the award has become firm and a circuit court in the civil branch has issued an attachment order against the assets.
(Source: Decree Law No. 5 of 1999, Art. 42)
E. Evidence required
(a) What evidence must be supplied for recognition and enforcement of foreign awards (e.g. arbitral award, contract containing arbitration clause, affidavits, witness statements, etc.)?
(i) a duly authenticated original or a certified copy of the arbitral award;
(ii) a duly authenticated original or a certified copy of the arbitration agreement;
(iii) an official translation if the language of the arbitration was not Spanish.
(Source: Decree Law No. 5 of 1999, Art. 42.)
(b) Is it necessary to provide the entire document or only certain parts (e.g. entire contract or only arbitration clause)?
The applicant must provide a complete original or certified copy of the arbitral award and a duly authenticated original or certified copy of the arbitration agreement.
(c) Are originals or duly certified copies required?
The applicant must provide originals or certified copies of the award and the arbitration agreement.
(d) How many originals or duly certified copies are required?
The applicant must provide one set of original or certified copies of the award and the arbitration agreement.
(e) Does the authority or court keep the originals that are filed?
Yes, unless the party that provided the originals requests that they be returned and replaced in the judicial docket with a set of certified copies.
(Source: Judicial Code, Art. 869.)
(a) Is it necessary to provide a translation of the documents supplied?
(Source: New York Convention, Art. IV(2); Decree Law No. 5 of 1999, Art. 42.)
(b) If yes, into what language?
Spanish. The official language of the Republic of Panama is Spanish.
(Source: National Constitution, Art. 7.)
(c) Is it necessary for the translations to be certified and, if yes, by whom (official or sworn translator, diplomatic or consular agent (of which country?) or some other person)?
Yes. The applicant must provide translations done by an official or publicly sworn translator in Panama.
(Source: New York Convention, Art. IV(2); Decree Law No. 5 of 8 July 1999, Art. 42.)
(d) Is it necessary to provide a full translation of the documents or only a translation of certain parts (e.g. entire award or only part setting forth the decisions; entire contract or only arbitration clause)?
The applicant must provide a full translation of the award and the arbitration agreement. Thus the contract containing the arbitration clause must be translated in full.
F. Stay of enforcement
(a) Can the authority or court stay legal proceedings for recognition and enforcement pending the outcome of an application to set aside or suspend the foreign award before the competent authority referred to in Art. V(1)(e) of the New York Convention?
If a court has been asked to set aside the award pursuant to applicable law, the Panamanian court with which the application for recognition and enforcement has been filed may defer its decision, if it considers it appropriate to do so.
(Source: Decree Law No.5 of 1999, Art. 41.)
(b) On what other grounds, if any, can the authority or court stay legal proceedings for recognition and enforcement (e.g. forum non conveniens)?
(c) Is the granting of a stay of legal proceedings for recognition and enforcement conditional on the provision of security?
At the request of the party seeking recognition and enforcement, the court may order the other party to provide appropriate and adequate guarantees.
(a) Do the documents filed in legal proceedings for recognition and enforcement form part of the public record? If yes, can any steps be taken to preserve the confidentiality of such documents?
Yes, as a general rule. The award and the arbitration clause form part of public records. Article 495 of the Judicial Code allows judicial dockets to be consulted by law students and any other person at the discretion of the judge. Thus, the judge may, at the request of the interested party or of his or her own accord, order that access to the proceedings docket be limited only to the parties.
(b) If there are hearings on recognition and enforcement, are such hearings confidential? If not, can steps be taken to maintain the confidentiality of the legal proceedings?
Panamanian law does not provide for a hearing in proceedings for either recognition or enforcement of awards.
(c) Are judgments on recognition and enforcement published? If yes, can steps be taken to remove the names of the parties or avoid publication of confidential information (such as business or State secrets)?
Judgments on recognition and enforcement are publicly available in the court dockets and on the website of Panama's Judicial Branch.
H. Other issues
16. When, if ever, can a party obtain recognition and enforcement of interim or partial foreign awards?
Panamanian law requires that the award whose recognition is sought be final and binding, i.e. has already become res judicata. Interim awards cannot be recognized by Panamanian courts as they are not final decisions.
17. When, if ever, can a party obtain recognition and enforcement of non-monetary relief in foreign arbitral awards (e.g. order requiring a party to deliver up share certificates or other property)?
Panamanian law does not distinguish between awards granting monetary relief and other kinds of relief for purposes of recognition.
18. When, if ever, can a party obtain recognition and enforcement of only part of the relief granted in foreign awards?
According to the principle of party autonomy, it is possible for the party in whose favour an award has been issued to apply for recognition of only part of such award.
19. When, if ever, can a party obtain recognition and enforcement of foreign awards which have been set aside by the competent authority referred to in Art. V(1)(e) of the New York Convention?
Art. 41 of Decree Law No. 5 of 1999 gives the Fourth Chamber of the Supreme Court-the competent Panamanian authority-the possibility of denying recognition and enforcement of a foreign arbitral award if the award has been set aside by a court in the country where or under whose law it was made, but it does not require the Supreme Court to do so. The wording of the provision would seem to leave open the possibility of granting recognition and authorizing enforcement of an annulled foreign award. At the time of writing, there is no precedent on this issue.
20. Are there any other procedural or practical requirements relating to recognition and enforcement of foreign awards which are worth mentioning (e.g. unusually high court costs, filing fees, stamp duties, obligation to post security as a condition for seeking recognition and enforcement, obligation to identify the assets that will be the object of enforcement, etc.)?
No. Art. 201 of the Constitution of Panama provides that the administration of justice shall be gratis.
Esteban Lopez Moreno, Jorge Federico Lee