1TITLE Abstract Acknowledgements Abbreviations (if applicable) Table of Cases (All case law – specify jurisdiction if applicable) Table of Statutes (Legislation - specify international agreements if applicable)
2TITLE CHAPTER 1 – INTRODUCTION 1.Background of the study International arbitration is considered to be a process relating to resolution of disputes or issues. With the help and assistance of the process of international arbitration, disputes and issues are settled.Theprimary purposeand objective in relation to international arbitration is the provision of a neutral and unbiased forum to the involved parties for theresolution of disputes or issues. The process of arbitration is considered to be an alternative process or a substitute process for dispute resolution. The aforementioned process is utilized for solving disputes in lieu of the process of litigation. An arbitration might be optional, however, it must be mentioned that presently, the contracts that are established in the business world, contain a mandatory clause relating to arbitration. It means that in relation to any disputes that may arise, the process of arbitration shall be utilized in order to settle such disputes1. This dissertation discusses the growth and expansion regarding international arbitration in the country of Pakistan. It also forwards a discussion in relation to the challenges regarding the implementation of the process of arbitration and arbitral awards in the nation of Pakistan. 2.Problem statement The reason why this research is conducted is to know the importance of the process relating to arbitration. Regarding such process relating to arbitration, the parties that are involved must choose and agree upon any particular individual as an arbitrator. The arbitrator shall hear the forwarding of the involved parties and give effect to a decision accordingly. The parties that will be involved in the dispute resolution process of arbitration, shall be bound to adhere to the decision that may be forwarded by the arbitrator. As the globalization in relation to business and 1Cole, Tony, and Pietro Ortolani.Understanding International Arbitration. Routledge, 2019.
3TITLE trade have increased to a great extent after the World War II, the need or requirement regarding the process of arbitration has also been noticed. An emergence of a process relating to arbitration that may be utilized in order to settle and resolve disputes was noticed among several business houses in various nations of the world. In the year of 1959, a treaty was given effect to by certain nations in relation to arbitration purposes for the business world. The name of the treaty was ‘New York Arbitration Convention’.2The aforementioned Convention had been accepted and agreed upon by a quantum of one hundred and fifty four nations, who are also members to the United Nations. A quantum of more than sixty five nations have participated in the decisions that have been forwarded through the process of arbitration3. The principal benefit and advantage in relation to international arbitration is the enforceability of the process and its decision. The enforceability of litigation or the court cases in relation to the business organizations in different nations is not guaranteed. It must be mentioned that a particular process of arbitration is systematized on the basis of the consent of the involved parties and the consequence regarding a particular process of arbitration is kept private and secret in all the cases of arbitration. Other benefits or advantages regarding the process of arbitration include speedy and swift process, time management and less expensive than court cases or litigation processes. Hence, the process of arbitration is considered to be beneficial as compared to the litigationprocessesinanyparticularnation4.Therefore,thefocusofthisstudyisthe international arbitration and the challenges that are faced relating to such international arbitration in Pakistan. 2New York Arbitration Convention, 1959. 3Yamashita, Kenshiro, Tatsuya Emoto, and Kazuki Watanabe. "Sovereignty Immunity on International Arbitral AwardsinAsia:BasedonNewYorkConventionandDomesticLawinAsiaonSovereign Immunity."ALSA(2017): 150. 4Wessel, J., and B. Pilbrow. "The Roles of Psychology in International Arbitration-A Review."Transnational Dispute Management (TDM)15.1 (2018).
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4TITLE 3.Research aims The aim of this research report is to evaluate the challenges that are being faced by the populace of Pakistan. This report aims to discuss the complexities regarding the implementation of the arbitral awards in connection to the process of arbitration in the aforementioned nation. 4.Research Objectives Objectives of the research are as follows:- To understand the process of arbitration in the nation of Pakistan. To analyse the process of arbitration in Pakistan. To find the challenges in relation to the process of arbitration in the nation mentioned above. To provide recommendations regarding the challenges in relation to the process of arbitration in the abovementioned nation. 5.Research Questions The research questions designed for the studies are as follows:- What is the process of arbitration in the nation of Pakistan? How the process of arbitration is given effect to in Pakistan? What may be the challenges in relation to the process of arbitration in Pakistan? What may be the recommendations regarding the challenges that may be forwarded in relation to the process of arbitration conducted in Pakistan? 6.Research Rationale The domain of international arbitration is considered to be a popular practice in the field of legal structure.Thereareseveralconcernsinrelationtothefunctionalityoftheprocessof international arbitration. For instance, a dispute has arisen between two business organizations
5TITLE belonging to two distinct nations. In such a situation, concerns and issues arise in relation to the jurisdiction of the court and the selection of the law. Both the nations may demand that the matter should be settled in their own respective court and their own respective law should be followed. Hence, the presence of a process that provides a neutral forum that may be accepted and agreed upon by the involved parties, helps to settle and resolve the dispute between the involved parties in a peaceful manner and without any kind of difficulty.5 In Pakistan, process relating to arbitration have also been followed by various business houses. The Arbitration Act of the year 1940 is considered to be the only Act in Pakistan that deals with every kind of arbitration processes, which takes place on relation to the nation.6 However, it must be mentioned that the aforementioned Act does not deal with the process relating to the acknowledgment and the enforcement of international arbitral awards in Pakistan. The ‘New York Convention’ of the year 1958 is implemented in Pakistan, with the help of the Recognition and Enforcement Act of the year 2011. This particular Act contains provision in connection to process relating to the acknowledgement and the implementation of ‘international arbitral awards’ in the nation of Pakistan. The focus of this study is the international arbitration and the challenges that are faced relating to such international arbitration in the aforementioned country.7 7.Format of the Study The format that the report will be following has been mentioned below:- 5Lanoszka,Anna."Multinationals,internationalarbitration,andtheworldtradesystem:confrontingthe inconvenient issues in the WTO."International Journal of Business and Economic Development (IJBED)5.1 (2017). 6Arbitration Act, 1940. 7Anwar, Shaista. "International and Domestic Arbitration in Pakistan: Law and Practice: A Book Review." (2018): 146.
6TITLE 1.Introduction:The introduction in the form of a chapter will particularly emphasize on the aim of the research and the backgrounds regarding the report. It will stress upon the motive and purpose for conducting the research. 2.Literature review:The literature review will demonstrate the several principles and simulations relating to international arbitration. On the basis of this, the report shall recognize the challenges of arbitration faced in Pakistan and the possible solutions to such challenges. 3.Research methodology: The research methodology in the form of a chapter inclines to emphasize on the research procedures that have been made applicable in relation to the study for proving the hypothesis attaining the objectives of the research. 4.Findings and Analysis:This chapter shall forward a discussion regarding the findings in relation to collection of data and advance the discussion in connection to challenges of arbitration procedures in Pakistan and the probable recommendations. 5.Conclusion and recommendations: The conclusive chapter shall forward a study and examination regarding the findings and deliver recommendations in relation to the same.
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7TITLE CHAPTER 2 – LITERATURE REVIEW OVERVIEW This project shall be considered to be an expository literature, which forwards a discussion in relation to the foundation and advancement of international arbitration in the countryofPakistan.Thevarieddiscussionregardingtheaforementionedtopicincludes importance of arbitration globally, the progress of arbitration in the aforementioned nation and the challenges or difficulties that are faced by Pakistan in connection to the implementation of the process of arbitration in the country. INTERNATIONAL ARBITRATION According toSamuel P. Baumgartner, international commercial or financial arbitration shall be considered to be an advocacy focused endeavor8. In this particular endeavor or process, the parties that are involved, hire and engage specific lawyers or advocates having skills and expertise regarding international commercial and financial matters. The parties that are involved in this particular process, put their faith and belief in the lawyers or advocates hired by them. The parties genuinely believe that the odds and likelihoods in relation to their success shall upsurge consistently because of the experience, skills and expertise regarding their advocates. According to Philip D. O’Neill, it may be said that clients are not the only individuals who contemplates such kind of perception in relation to the lawyers and the advocates. Even the lawyers and the arbitrators themselves have indicated that a good lawyer or advocate in the process of arbitration proves to be material element in making a difference in connection to the result of the dispute. 8Alavi, Hamed. "Arbitration and LC Fraud Disputes: a Comparative Approach."Russian Journal of Comparative Law2 (2016): 59-72.
8TITLE According to Arif Hyder Ali and Henry G. Burnett, it may be stated that unlike a process oflitigation,aprocessrelatingtoaninternationalarbitrationreliesondetailedand comprehensive written advocacy instead of oral representations and demonstrations at the hearings9. According to Frédéric Gilles Sourgens, it may be said that lawyers or advocates in any particular proceeding relating to international arbitration, repeatedly deliver to the arbitral panel, numerous series of written arguments before the hearings begin10. The lawyers also submit statements of the witnesses in written format, which covers the maximum portion of the testimony, if not the complete direct testimony. However, it must be mentioned that a good advocacy or argument in a written manner may not be only a matter relating to style, it may also be considered to be essentially a matter relating to substance grounded on research and investigation, and which is both intense and wide-ranging. According to Lew, a primary significance in relation to international arbitration is the element that international arbitration is reasonably free from any kind of control, partiality, biasness or prejudice that may exist in the laws of the various nations11. INTERNATIONAL ARBITRATION IN ASIAN COUNTRIES For the past several years, it has been witnessed by the world community that there has been an upsurge in the quantum of cross-border investments and transactions in the continent of Asia. Such upsurge has resulted in an increase in the disputes in relation to the cross-border businesses. The parties that are involved in such dispute related transactions, are more inclined 9de Cossío, Francisco González. "International Arbitration: Past, Present and Future: Tribute to Bernardo Cremades and Yves Derains (Arbitraje Internacional: Pasado, Presente y Futuro: Homenaje a Bernardo Cremades e Yves Derains), by Carlos Alberto Soto Coaguila and Delia Revolledo Marsano de Mur (Editors)." (2016): 551-555. 10Sourgens, Frédéric Gilles, Kabir Duggal, and Ian A. Laird.Evidence in International Investment Arbitration. Oxford University Press, 2018. 11Lew, Julian DM. "Increasing Influence of Asia in International Arbitration."Asian Dispute Review16.1 (2014): 4- 9.
9TITLE towards a process of international commercial arbitration in order to find a resolution to their disputes.Theprocessinrespectofinternationalfinancialarbitrationdemandsaspecific infrastructure for the process. It may also be said that the process of arbitration is influenced by the involvement of the judiciary in connection to the place where the process of arbitration is being held. It must be mentioned that the nations of the Asian continenthave responded and retorted in connection to the aforementioned demands in an effective manner. The Asian countries have by advanced theirinfrastructure in relation to the process of arbitration coupled. The countries have made an effort in order to update and modernize their own laws relating to arbitration12. According to SimonGreenberg, the unparalleled development and progress of the nations of the Asian Continent, led to an outpouringof investments and tradeintheAsian region. A particularlypredictableandunavoidableconsequenceinrelationto suchcommercialundertakingsor activities was the increase in the cross-borderdisputes, and suchdisputesinvolvedmultinationalorganizationsorcorporationsofvariousnations.The internationalbusinesscommunityoftheAsianContinentneverexhibitedanykindof unwillingness or hesitancy in the acceptance and the implementation of international arbitration as a practicable and feasible mechanism for resolution of disputes, unlike the nations of the Western world at the beginning of the 20thcentury.Hence, it may be said thatthe process relating tointernational financialarbitrationhas materializedasthe mechanism, which is most preferredforthe resolution ofdisputesrelating to investments and trade inthe continent of Asia, inthis21stcentury13.However,itmaybementionedthatthereispresence 12Powell,Richard."Perceptual,culturalandlinguisticchallengesfacingJapanasasiteofinternational arbitration."International Arbitration Discourse and Practices in Asia. Routledge, 2017. 106-121. 13Hayward, Benjamin. "Submission to the Public Consultation on Proposed Amendments to the 2013 HKIAC Administered Arbitration Rules."Available at SSRN 3044218(2017).
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10TITLE oflittledoubtthattheestablishmentofwell-advancedarbitral organizations or institutions will provide the involved parties an improved possibility or opportunity for a structured and an organized process of arbitration. According to Yang and Chew, the chances and the prospects in relation to the progress and advancement of the process relating to international arbitration in nations of Asia are conditioned by the manner regarding the alterations and variations in the outlines of the international or global economy. The functions relating to the process of arbitration are given more importance, consideration, attention and thoughtfulness by the governments of the nations of the continent of Asia14. However, it must be mentioned that the influence and impact of the arbitrations is considered to be enthusiastically extended by the organizations in relation to arbitration processes that exist in the specific areas or regions. The authors have also discussed the aspects, which limit or constrain the advancements and progresses of international arbitration in the continent of Asia15. INTERNATIONAL ARBITRATION IN PAKISTAN In Pakistan, the only legislation dealing with all kinds processes regarding arbitration, is the Arbitration Act of the year 194016. The ‘New York Convention’ of the year 195817is implemented in the country of Pakistan, with the help of the ‘Recognition and Enforcement Act’ of the year 2011 and itpertains tothe acknowledgement and implementation of the process relating to ‘International Arbitral Awards’18. 14Yang, L. S., and L. Chew.International commercial arbitration in Asia. JurisNet, New York, 2013. 15Yang, L. S., and L. Chew.International commercial arbitration in Asia. JurisNet, New York, 2013. 16Arbitration Act, 1940. 17New York Convention, 1958. 18Recognition and Enforcement Act, 2011.
11TITLE According to Tilmann and Shinwari, in the nation of Pakistan the individuals generally solve and seek resolutions in relation to their disputes and disagreements outside the premises of the court. In the rural regions regarding the ‘Administered Tribal Areas’, Punjab, Sind and Baluchistan such alternate methods for resolving disputes are considered to be customary practices.The individuals of the aforementioned regions adhere to the traditions and customs that have been forwarded by their ancestors, and these individuals do not adhere to the laws relating to arbitration that exist in the present days of Pakistan19.However, it may be mentioned that alternate methods regarding the resolution of disputes and disagreements in the urban regions of the nation of Pakistan are not utilized as commonly as in the rural regions20. In the urban regions of the nation, the arbitrators adhere to the laws of the present days. The arbitrators submit a particular award in any particular court for the purposes of the implementation of the award. The court having the jurisdiction regarding such matters forwards a ruling in relation to the decision that has been delivered by any arbitrator, in case no involved parties raise any kind of objection within the time period that has been stated in the Limitation Act of the year 190821. Pakistan accepted and adopted the ‘Convention on the Recognition and Enforcement of Foreign Arbitral Awards’ [Convention] of the year 195822, on the 14thday of the month of July in the year of 2005. It adopted the Conventionthrough the ‘Recognitionand Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Ordinance’ in the year of 200523. The Ordinance was ultimately implemented and enacted in the year of 2011. The primary purpose and objective regarding the Act of 2011 was the acceptance and the adoption of the Convention though the acknowledgement and implementation of the ‘foreign arbitral awards’ and ‘foreign 19Mukhtar, Sohaib. "Settlement of Disputes by Way of Arbitration in Pakistan."World3.4 (2016). 20Ibid 21Limitation Act, 1908. 22Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958. 23Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Ordinance, 2005.
12TITLE arbitrationagreements’24.Therelevantsectionsofthe2011Act,inrelationtosuch acknowledgement and implementation, are section 3, section 4, section 6 and section 725. Therefore, the 2011 Act restricted the judicial discretion in connection to courts of Pakistan and revoked the Arbitration (Protocol and Convention) Act of the year 193726. After the 2011 Act wasenacted,thecreditorsforinternationalawardfiledapplicationsinrelationtothe acknowledgment and implementation of the foreign awards and grants on the ground that the fresh and new legislation was more clear and unambiguous and also on the ground that the new legislation had minimal possibility of judicial involvement or interference27. As per the 2011 Act, the Courts shall not be able to refuse or decline any kind of application in connection to acknowledgement and implementation of the foreign award. The courts shall be able to refuse applications only when the applications would be in contradiction to the provisions that are provided in Article V as stated in the Convention mentioned above28. However, in practicality, the courts of Pakistanwere unable to adapt and familiarize themselves in relation to the drastic modification transformation of the law, and hence, there was delay in the acknowledgement and implementation in connection to the foreign awards, which made the awards incompetent and redundant, and unreliable or varying judgments were delivered in contradiction to the proposed and recognized principles relating to arbitration. The case ofTaisei Corporation versus A.M. Construction Company (Private) Limited, PLD 2012 Lahore 45529shall be considered to be a relevant case in this regard. In this case, after the interpretation of section 14 as provided in the Arbitration Act of the year 194030, the High Court of Lahore mentioned that the powers and 24Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011. 25Ibid 26Arbitration (Protocol and Convention) Act, 1937. 27Menaker, Andrea.International Arbitration and the Rule of Law: Contribution and Conformity. Kluwer Law International BV, 2017. 28Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011. 29Taisei Corporation versus A.M. Construction Company (Private) Limited, PLD 2012 Lahore 455. 30Arbitration Act, 1940.
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13TITLE authorities relating to the Court in connection to the acknowledgement and implementation of a foreign award as per the 2011 Act31, are restricted. Hence, the common solution to seek and pursue acknowledgement and implementation, as per section 14 as provided in the Act of 1940, would continue to be available. However, afterwards such ruling was considered to be incorrect because the application of the Act of 1940 can only be made in relation to domestic awards. The Act of 1940 cannot be applied in connection to the foreign awards. Another significant case in this regard is the case ofAbdullah versus CNAN Group Spa, PLD 2014 Sindh 34932. In this case, it was held that an award debtor shall not have the opportunity to invalidate a foreign award with the help and assistance of a civil suit, which may be filed in contradiction to such award, as per the provisions given in Article V relating to the Convention33. It was held by the Court that an award debtor shall be able to refer to the points stated in Article V, only in defense in relation to any particular proceeding, which may be commenced or instigated by the award creditor for the purposes of the acknowledgement and the implementation regarding the foreign award34. CHALLENGES FACED BY THE PAKISTAN There are several issues in connection to the international arbitration in the nation of Pakistan.The chief problem or issue in Pakistan is that most of the processes relating to arbitration are not exercised or conducted, as per the provisions regarding the laws relating to arbitration, they are generally conducted and exercised, as per the usages and customs of the civilization and the society that are not provided in the Arbitration Act of the year 1940. In order 31Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011. 32Abdullah versus CNAN Group Spa, PLD 2014 Sindh 349. 33New York Convention, 1958. 34Abdullah versus CNAN Group Spa, PLD 2014 Sindh 349.
14TITLE to provide resolution for the disputes relating to the implementation, Panchayat and private Jirga exist35. Several cases may be discussed in connection to the situation mentioned above. The case ofRossmere International Limited v Sea Lion International Shipping Inc., PLD 2017 Baluchistan 2936can be considered to be an important case in this regard. This case is known for the unique viewpoint of the judgment of the case. In the case, the High Court of Quetta acknowledged a foreign award, however, disallowed the enforceability of the foreign award on the ground or understanding that the award debtor did not possess or own any bank accounts or any assets within the limits of the territorial jurisdiction in relation to the Court. It must be mentioned that the procedural issue discussed in the aforementioned case, has directed the courts of Pakistan off course in the preceding century. Such issues also crushed the objective and perseverance of international arbitrations.Another case may be discussed in which the issue of delay had been forwarded. The case ofLouis Dreyfus SA Commodities v Acro Textile Limited, Civil Original No.649of 201237shall be considered to be a relevant vase in this regard. In this case, the respective judges did not pass any ruling regarding the matter, and hence, inordinate delay has been suffered. According to Mayer, the main purpose in relation to private international law shall be considered to be the harmony and congruence regarding the solutions. Many tools exist in the private international law in order to avert the conflicts38. 35Wilske, Stephan. "International Arbitration and Its Dark Sides, in Particular Corruption: What Arbitral Institutions Could and Should Do to Tackle Such Unwelcome Issues."Particular Corruption: What Arbitral Institutions Could andShouldDotoTackleSuchUnwelcomeIssues(November29,2019).ContemporaryAsiaArbitration Journal12.2 (2019): 147-176. 36Rossmere International Limited v Sea Lion International Shipping Inc., PLD 2017 Baluchistan 29. 37Louis Dreyfus SA Commodities v Acro Textile Limited, Civil Original No.649of 2012. 38Mayer, Pierre. "Conflicting decisions in international commercial arbitration."Journal of International Dispute Settlement4.2 (2013): 407-419.
15TITLE SUMMARY This chapter has forwarded discussion in relation to the international arbitration in the country of Pakistan. It has provided an overview regarding the topic. The chapter of literature review has provided the ideas and thoughts of several authors in relation to the principles of international arbitration, international arbitration in the nation of Pakistan and the challenges that the nation has been facing regarding the implementation of arbitral awards and foreign awards.
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17TITLE BIBLIOGRAPHY Abdullah versus CNAN Group Spa, PLD 2014 Sindh 349. Alavi, Hamed. "Arbitration and LC Fraud Disputes: a Comparative Approach."Russian Journal of Comparative Law2 (2016): 59-72. Anwar, Shaista. "International and Domestic Arbitration in Pakistan: Law and Practice: A Book Review." (2018): 146. Arbitration (Protocol and Convention) Act, 1937. Arbitration Act, 1940. Cole, Tony, and Pietro Ortolani.Understanding International Arbitration. Routledge, 2019. de Cossío, Francisco González. "International Arbitration: Past, Present and Future: Tribute to Bernardo Cremades and Yves Derains (Arbitraje Internacional: Pasado, Presente y Futuro: Homenaje a Bernardo Cremades e Yves Derains), by Carlos Alberto Soto Coaguila and Delia Revolledo Marsano de Mur (Editors)." (2016): 551-555. Hayward, Benjamin. "Submission to the Public Consultation on Proposed Amendments to the 2013 HKIAC Administered Arbitration Rules."Available at SSRN 3044218(2017). Lanoszka,Anna."Multinationals,internationalarbitration,andtheworldtradesystem: confrontingtheinconvenientissuesintheWTO."InternationalJournalofBusinessand Economic Development (IJBED)5.1 (2017). Lew, Julian DM. "Increasing Influence of Asia in International Arbitration."Asian Dispute Review16.1 (2014): 4-9.
18TITLE Limitation Act, 1908. Louis Dreyfus SA Commodities v Acro Textile Limited, Civil Original No.649of 2012. Mayer,Pierre."Conflictingdecisionsininternationalcommercialarbitration."Journalof International Dispute Settlement4.2 (2013): 407-419. Menaker, Andrea.International Arbitration and the Rule of Law: Contribution and Conformity. Kluwer Law International BV, 2017. Mukhtar, Sohaib. "Settlement of Disputes by Way of Arbitration in Pakistan."World3.4 (2016). New York Arbitration Convention, 1959. Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Ordnance, 2005. Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011. Rossmere International Limited v Sea Lion International Shipping Inc., PLD 2017 Baluchistan 29. Sourgens, Frédéric Gilles, Kabir Duggal, and Ian A. Laird.Evidence in International Investment Arbitration. Oxford University Press, 2018. Taisei Corporation versus A.M. Construction Company (Private) Limited, PLD 2012 Lahore 455. Wessel,J.,andB.Pilbrow."TheRolesofPsychologyinInternationalArbitration-A Review."Transnational Dispute Management (TDM)15.1 (2018).
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19TITLE Wilske, Stephan. "International Arbitration and Its Dark Sides, in Particular Corruption: What Arbitral Institutions Could and Should Do to Tackle Such Unwelcome Issues."Particular Corruption: What Arbitral Institutions Could and Should Do to Tackle Such Unwelcome Issues (November 29, 2019). Contemporary Asia Arbitration Journal12.2 (2019): 147-176. Yamashita,Kenshiro,TatsuyaEmoto,andKazukiWatanabe."SovereigntyImmunityon International Arbitral Awards in Asia: Based on New York Convention and Domestic Law in Asia on Sovereign Immunity."ALSA(2017): 150. Yang, L. S., and L. Chew.International commercial arbitration in Asia. JurisNet, New York, 2013.