"ARBITRATION - PAKISTANAn award declared in a foreign country is mainly considered to be a foreign awardelsewhere but in Pakistan it can be considered as a domestic award even if it isdeclared outside Pakistan under any other law apart from AA such as the ICC rules onthe condition that law governing the main agreement containing the arbitration clauseis Pakistan law. This rule is applicable even to those situations where the parties havenot clearly specified in the arbitration agreement but have agreed upon the fact that49 the law governing their arbitration clause would be this nation?s law.Once this award has satisfied the above rule and is declared as domestic award it canbe set aside only if it satisfies the provisions of Section 30 of AA such as:o There has been misconduct on part of the arbitrator or umpire on himself orduring the proceedings,o The award has been declared after it has become invalid as per the provisionsof section 30 of AA or has been made after the order from the court,o Improper or invalid procurement of the award,50 Based on the above provisions SCP declared in the President of Pakistan Case thatin case of dealing with domestic award it is essential to note that any awardconsidered as a domestic award can be challenged only as per the provision undersection 30 as stated above. Thus, from the above two points it can be preciselyunderstood that under the concept of execution of different awards that have beenimposed under the Pakistan law it is clear that the foreign award requires to satisfy alot of conditions in comparison to domestic award. It can also be treated that thedomestic award that has been declared within the boundaries of the nation with bothparties from Pakistan is completely different from the foreign award that has beenconsidered as domestic award under the Pakistan law. An award that is the result of49Same as note 2850President of Islamic Republic of Pakistan v. Syed Tasneem Hussain Naqvi and Others (2004 SCMR 590) Page 26 ARBITRATION - PAKISTANforeign arbitration is treated as domestic award under the quizzical law of Pakistancan still be treated as foreign award in Pakistan mainly at the time of execution andcan be made unenforceable under the provisions of section 7 of APC.51 C. Award that has resulted due to the agreement that has been concluded in Pakistan: Under this condition it is essential to note that an award even though it is neitherconsidered as a foreign award under the provisions of APC nor domestic awardbecause of the governing law is not the Pakistan law is still enforceable in Pakistan ifthe main agreement of this arbitration is made in Pakistan. SCP remarked this52 suggestion in the Yangtze case stating that any award that has been laid down by theforeign courts even before the execution of the Arbitration (Protocol and Convention)Act, 1937 is to be enforced in Pakistan on the condition that the parties wouldapproach the courts of local jurisdiction in case of any commercial disputes.The principle observed in this case has been observed in all those cases that dealt withexecution of an award that neither satisfied the requirement of provisions under APC53 nor under AA in the China National Machinery Case by the SHC whichdetermined the maintainability of the suit that has been filed by the Chinese partyagainst Pakistan party. The court declared that based on the dicta stated in theYangtze case declared that the award declared in this case is enforceable as thearbitration contract was signed in Pakistan and the defendant is residing and doingbusiness in Pakistan and also that even though the award is enforceable neither underAPC nor under AA it is still enforceable under the provisions of Section 151 of CPC.The situation in this case has clearly and precisely described the distinction in thePakistan law while dealing with the enforcement of the foreign award in the nation51Messrs Yangtze (London) Ltd v. Messrs Barlas Bros. (Karachi) (1961 PLD Supreme Court 573)52Same as note 3553China National Machinery Import and Export Corporation v. Tufail Chemical Industries ltd. (2005 CLD Karachi 1577) Page 27 ARBITRATION - PAKISTANunder the three different situations. It is clear from this section that if the foreignaward satisfies any one of the above stated conditions it is enforceable in Pakistan.Thus, after a detailed discussion on the arbitration process in Pakistan the dissertationwould further explain in detail the implementation of NY convention in Pakistan.CHAPTER II: IMPLEMENTATION OF THE NEW YORK CONVENTION –THE ELEMENT OF A SOUND LEGAL FRAMEWORKAfter a detailed discussion on evolution and current position of arbitration process in Pakistanwith the help of case study, we continue further by understanding the sound legal frameworkin Pakistan with the implementation of the NY convention. Before understanding thedevelopment in Pakistan?s approach in enforcement of the foreign award it is essential to firstunderstand the arbitration process and enforcement of foreign award in Pakistan before theimplementation of the NY convention.II.I COMMERCIAL DISPUTE RESOLUTION BEFORE THE NEW YORKCONVENTIONThe mechanism of arbitration before the commencement of the NY convention was governedby AA and APC in Pakistan with provisions by the Geneva Protocol; even though Pakistanwas one of the first signatories of the NY convention in 1958 it did not completely ratify thisconvention till the recent period.With the growth of commerce and trade after the First World War there has been a need foran organized system for resolving the commercial disputes internationally, thus came intoforce the Geneva Convention on Arbitral clause of 1923 and the Geneva Convention for the Page 28 ARBITRATION - PAKISTANexecution of the arbitral foreign award in 1927. These were some of the important laws that54 have been governing the arbitration process in Pakistan.Being part of the sub-continent prior to independence in 1947, Pakistan along with Indiaratified the protocol in 1937 that led to the implementation and enactment of APC of 193755 that continued to be in force till the nation ratified the NY convention in 2005.Therefore, the most important laws that have been governing the arbitration process inPakistan are the AA and APC that have governed the regime of arbitration in Pakistan over aperiod of 60 years. These two acts prevailed in the nation before the partition and continuedto rule the arbitration mechanism till the recent times. APC was promulgated in the year 1937in Pakistan with main aim to support the Geneva Convention and protocol, that is theProtocol on Arbitration clauses (the Geneva Protocol) in the year 1923 and the Conventionon the Execution of Foreign Arbitral Award (the Geneva Convention) in the year 1927. Thus,APC was mainly implemented for the propagating the foreign arbitration procedure andenactment of the foreign award.AA on the other hand mainly concentrated on the enforcement of the domestic award. Thisact mainly dealt in resolving disputes within the boundaries of the nation. The scope of thisact is limited in comparison to APC. The APC act was implemented mainly with the aim togive support to the above stated international agreements of the Geneva protocol andconvention and it can be observed that even after independence the nation continued to ruletheir foreign arbitration proceedings under the provisions of this arbitration act. It continuedimplementing these provisions till the recent times where it had implemented the NYconvention.54Same as note 1655ibid Page 29 ARBITRATION - PAKISTANThus, the arbitration law in Pakistan has exclusively been governed by the 1937 and to acertain extent the 1940 Acts. As we have a brief note on the laws that govern the arbitrationalprocedure in Pakistan it is essential to understand the background behind the implementationof these acts and also certain important clauses under these acts.56 ? The Arbitration (Protocol and Convention) Act, 1937:th The act came into force on 4 March 1937 under Act IV was enacted with the aim todeal with provisions related to the process of arbitration in Pakistan. The mainpurpose of implementing this act had been to implement and give effect to theprotocol and conventions relating to the foreign arbitral award and to make theconvention and protocol operative in Pakistan. The act is applicable to whole ofPakistan and all those parties that opt to resolve their commercial differences throughthe process of arbitration are bound by the provisions of this Act.As stated in the previous chapter this act governs the enforcement of foreign award inPakistan and subject to the provisions of this act the foreign award is enforced or onthe presumptions that the award had been declared in a manner that is referred to theprocess of arbitration in Pakistan.Under section 5 of this act the parties to the contract have the authority to apply to theCourt for filing of the foreign award, and under the provisions of section 6 the partieshave the authority to request the court for enforcement of the foreign award and thecourt shall ratify this request only on the grounds that the foreign award declared bythe court in the given case is enforceable under this act or satisfies the conditions ofAPC. The provisions of the 1937 act state the terms under which the litigation process hasto be continued in Pakistan contain two important provisions, the first provision deals56Source: http://jamilandjamil.com/wp-content/uploads/2010/11/papericc.pdf Page 30 "