[Myanmar] Enforcement of Foreign Arbitral Awards in Myanmar

Khin Nyein Chan Aye; Nwe Mon Mon Oo; Edited by Bob Tseng

Myanmar has been on the path of establishing a platform for the improvement of arbitration in the country since it’s accession to the New York Convention in 2013. The new Myanmar Arbitration Law (“MAL”) was enacted in 2016 abolishing the old Arbitration Act of 1944. This new law incorporates most of the UNICITRAL Model Law and the New York Convention’s Article IV and V regarding the recognition and enforcement of foreign arbitral awards.

Requirements to Enforce the Foreign Arbitral Award

Under Section 46 of the MAL to “presume and enforce a foreign arbitral award as if it were a decree of the court”. Here, the District Court, High Court of the Region, or High Court of the State has original civil jurisdiction to decide questions relating to arbitration as the subject matter of a suit. As for the procedural requirement, as the first step, the award holding party can apply to the court for the enforcement of a foreign arbitral award with the English translation of the following evidence attached:

1) the original award or duly certified copy thereof, duly authenticated in the manner required by the law of the country in which it was made;

2) the original arbitration agreement or duly certified copy thereof;

3) the evidence as may be necessary to prove that the arbitral ward is a foreign arbitral award.

In practice, the official language used in the Courts is Myanmar language and all the documents are to be translated into the same.

Secondly, if the court recognizes and is satisfied with the arbitral award, the party must apply for the Execution of the Decree under Order XXI, Rule 10 of the Civil Procedural Code of Myanmar also known as “Zar Yi” Suit, at the relevant Court of competent jurisdiction. In this regard, it is notable that the jurisdiction of the Court is designated based on the area the suit occurs and the value of the subject matter. Such application is to be made in writing, signed and verified for the execution of the decree by specifying the particulars, including but not limited to the amount awarded, and the mode in which the assistance of the court is required. Execution may be made by way of delivery of any property specially decreed, by attachment and sale or sale without attachment of any property, by arrest and detention in person; by appointing a receiver; or in such other manner as the nature of the relief granted may require.

Section 46 provides grounds for the refusal of the recognition and enforcement of foreign arbitral awards. These grounds are mutatis mutandis to Article V of the New York Convention. However, significantly, MAL allows an appeal against the decision of the Court for setting aside or refusing to set aside the award under Section 46. This right to appeal is a double-edged sword which may either compensate for the inexperienced court or prolong the already lengthy enforcement procedure. In practice, due to lengthy procedural requirements and workflow of Myanmar courts, the whole process of enforcement may take as long as a few years subject to the parties’ decision to appeal.

A Landmark Case

Despite the procedural difficulties, one count of successful enforcement of a foreign arbitral award administered by the Singapore International Arbitration Centre (“SIAC”) enlightens the potential of Myanmar arbitration. Per the facts of the case, the dispute arose from the Pipeline Profit Contract between a Thailand company, a Myanmar company, and an affiliate Singapore company. The case was administered by the SIAC and the tribunal has given the award to the Thailand Company. The same award was successfully enforced before the Singapore High Court. In 2019, the application for recognition and enforcement of the same award was made before the Western Yangon District Court (“Court”) under MAL. During its proceedings, the Court has taken into consideration of several factors in rendering the decision. Significantly, the Court interpreted that -

1) Only sections 10, 11, 30, 31 and Chapter X are concerned with the foreign arbitral award and therefore, the limitation to the retrospective effect of the law should not apply to the foreign arbitral proceedings;

2) Section 46(b)(1) of the Law mirrors Article V 1(a) of the New York Convention and therefore, the Court may refer to International Council for Commercial Arbitration (ICCA) Guide to the Interpretation of the 1958 New York Convention which is available in Myanmar language.

3) The term “incapacity to act” is only concerned with the capacity of the parties at the time of entering the contract; and

4) Involvement of bribery and corruption of Government Agencies in the case does not constitute going against “National Interests”.

In this decision, the sophisticated and comprehensive interpretation of MAL is evident and the Court proved its impartiality despite the involvement of a Myanmar party.

Conclusion

Arbitration in Myanmar is still a work in progress. Nonetheless, its accession to the New York Convention and the implementation of MAL proves the country’s dedication to arbitration friendliness. That said, the lack of clear guidelines, precedents and experience of the courts, lengthy proceedings and complicated procedures still impose difficulties in the enforcement of foreign arbitral awards in Myanmar.