Arbitration

Last verified on Tuesday 13th March 2018

Mexico

Guillermo Aldana
Basham Ringe y Correa

    Legislation

  1. 1.

    Which legislation governs the enforcement of international commercial arbitration awards and arbitral agreements in international business contracts, and international commercial arbitration proceedings?

  2. The arbitration statute is provided in Book V, Title IV of the Code of Commerce (articles 1415 to 1480). It applies to both domestic and international arbitration, when the seat of the arbitration is Mexico. Notwithstanding, it shall apply even if the place of arbitration is outside of Mexico, to the court assistance to refer the parties to arbitration, the issuance and enforcement of interim measures and the recognition and enforcement of arbitral awards. The law was enacted in 1890 and several amendments have suffered, including modifications made in arbitral provisional as stated hereunder.

    Due to a constitutional amendment regarding Alternative Dispute Resolutions, there is a proposal in the legislature to include within the Mexican Commerce Code, a chapter related to commercial mediation and conciliation.

    Said amendment was based on the UNCITRAL Model Law on International Commercial Conciliation.

  3. 2.

    Has the UNCITRAL model arbitration law been adopted in your jurisdiction? 

  4. Mexico is a Model Law Country. In 1993, it adopted the UNCITRAL Model Law on International Commercial Arbitration (UNICTRAL Model Law), with minor modifications: (i) Unlike article 8 of the Model Law, there was no time limit established for the parties to request the referral to arbitration; and (ii) If the parties have not agreed on the number of arbitrators, there should be one; whereas article 10 of the Model Law provides for three arbitrators.

    Afterwards, in 2011, various procedural dispositions were incorporated to the arbitration statute. The purpose of this amendment was to clarify several procedural matters, such as the time limit for the parties to request the referral to arbitration. The provisions were inserted in a whole new chapter of the law, which is Chapter X, of Title IV, Book V of the Code of Commerce.

    The new provisions do not alter the existing provisions adopted from the Model Law, but provide a better interpretation of the existing ones, featuring procedural aspects that improve the application of the Mexican arbitration law. 

    The amended procedural aspects regulating the court intervention are the following:

    • the procedure whereby the recognition and enforcement, and setting-aside of the arbitral award is requested;
    • the referral to arbitration;
    • the enforcement of interim measures ordered by the arbitral tribunal;
    • the appointment and challenge of arbitrators;
    • the consultation on the arbitrator’s fees;
    • the assistance in taking of evidence; and
    • the enforcement of interim measures ordered by the arbitral tribunal.

    Conventions

  5. 3.

    Is your jurisdiction a party to both the New York Convention and the Panama Convention? Is it a party to any other conventions or treaties governing international commercial arbitration agreements, awards or proceedings? 

  6. Since 1971, Mexico ratified the United Nations Convention on the Recognition and Enforcement of Judgements and Arbitral Awards of 1958 (New York Convention), with no declarations or reservations. Likewise, in 1978, it ratified the Inter-American Convention on Commercial Arbitration (Panama Convention), and in 1987, the Inter-American Convention of Extraterritorial Validity of Foreign Judgements and Arbitral Awards (Montevideo Convention).

    With regard to bilateral agreements, in 1992 Mexico entered the Convention for the recognition and Enforcement of Judgements and Arbitral Awards and Civil and Commercial Matters with the Kingdom of Spain. In addition, it has entered into different free trade and investment agreements, which generally include international arbitration as the means of solving disputes, as it is the case of Chapter 11 of the North American Free Trade Agreement.

  7. 4.

    Is your jurisdiction a party to the ICSID Convention? Have steps been taken to renounce the Convention or withdraw from ICSID? 

  8. On 11 January 2018, Mexico signed the Convention on the Settlement of Investment Disputes between States and Nationals of Other States. Mexico still has to ratify the Convention and Mexican Senate should ratify the Convention as well.

  9. 5.

    Is your jurisdiction a party to other conventions that directly affect the enforceability of arbitration agreements, rights or awards?

  10. Mexico is a party of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), the Inter-American Convention on International Commercial Arbitration (Panama Convention) and the Inter-American Convention on Extraterritorial Validity of Foreign Judgments and Arbitral Awards (Montevideo Convention).

    Commercial arbitral agreements and arbitrability

  11. 6.

    Some jurisdictions have permitted parties to compel resolution of a dispute by means of arbitration only if the agreement to arbitrate was entered into after a dispute has arisen. Is a pre-dispute arbitration clause to resolve international commercial disputes by arbitration enforceable?

  12. According to the arbitral procedure contemplated in the Mexican Law, which is based on the UNCITRAL Arbitration Rules, parties of an arbitration can agree either pre or post-dispute, to compel the resolution of a dispute by means of arbitration. If the agreement is post-dispute, it is allowed as long as the dispute has not been resolved by a judicial authority.

  13. 7.

    What are the requirements for an enforceable arbitral agreement? 

  14. The arbitration agreement shall be in writing, and be contained in a document signed by the parties or in an exchange of letters, telex, telegrams, facsimile or other means of telecommunication that provide a record of the agreement, or in an exchange of statements of claim and defence in which the existence of an agreement is alleged by one party and not denied by another.    

    The reference in a contract to a document containing an arbitration clause constitutes an arbitration agreement provided that such contract is in writing and the reference is such as to make that clause part of the contract.

  15. 8.

    Is there subject matter that is not legally subject to arbitration in the context of an international business transaction?

  16. The arbitration agreement shall be in writing, and be contained in a document signed by the parties or in an exchange of letters, telex, telegrams, facsimile or other means of telecommunication which provide a record of the agreement, or in an exchange of statements of claim and defense in which the existence of an agreement is alleged by one party and not denied by another.

    The reference in a contract to a document containing an arbitration clause constitutes an arbitration agreement provided that such contract is in writing and the reference is such as to make that clause part of the contract.

  17. 9.

    Are there any limits to the ability of a state or an instrumentality of the state to enter into an agreement to arbitrate in your jurisdiction? If so, under what circumstances may the state or its instrumentalities enter into such an agreement? Please describe the requirements that must be met for the state to enter into a binding arbitration agreement.

  18. The Mexican state and its instrumentalities have the right to exercise their statutory authority for the administrative termination of a contract; such subject matter cannot be subject to an arbitration agreement, unless for its economic consequences.    

    In the renowned COMMISA case, the Eleventh Collegiate Court on Civil Matters in the Federal District revoked an appealed judgment for considering that under Mexican law, the administrative termination of a contract by an authority is a non-arbitrable matter. 

  19. 10.

    Does the law specify whether an arbitration will be in equity or under law if the parties do not expressly specify the nature of the arbitration in the agreement?

  20. The parties have freedom to define the terms of the arbitration. However, the rule of gold is that they shall be treated with equality and each of them shall be given full opportunity to present its case.

  21. 11.

    How does the law limit party autonomy with respect to the terms of an arbitral agreement? 

  22. The arbitral tribunal shall decide the dispute in accordance with such rules of law as are chosen by the parties. Any designation of the law or legal system of a country shall be construed, unless otherwise expressed, as directly referring to the substantive law of that country and not to its conflict-of-laws rules.

    Failing any such designation by the parties, the arbitral tribunal shall determine the applicable law taking into account the characteristics and connections of the case.  

    The arbitral tribunal shall decide ex aequo et bono or as amiable compositeur only if the parties have expressly authorised it to do so.

    In all cases, the arbitral tribunal shall decide in accordance with the terms of the contract and shall take into account the usage of the trade applicable to the transaction.

    According with the arbitral procedure contemplated in the Mexican Law, specifically in the Commerce Code, the parties have plenty autonomy regarding the terms of an arbitral agreement (ie, number of arbitrators, how the arbitrators are selected, arbitral institution and arbitration rules). The only limitation the parties have, is that the subject matter of the dispute must be arbitrable and that the recognition and/or enforcement of the award is not contrary to Mexican public policy.

  23. 12.

    Under what circumstances does the law allow a non-signatory to an arbitral agreement to pursue a claim in an international arbitration against a party that signed the arbitral agreement?

  24. N/A

  25. 13.

    Under what circumstances does the law allow a signatory to an arbitral agreement to pursue a claim in an international arbitration against a party that did not sign the arbitral agreement?

  26. N/A

  27. 14.

    Under what circumstances may a non-signatory to an arbitral agreement compel arbitration of a claim asserted against it in a court of law by a signatory of the arbitral agreement?

  28. N/A

  29. 15.

    Is there any law in your jurisdiction specifically governing the arbitrability of consumer or labour disputes?

  30. Consumer dispute. The Mexican Consumers Protection Law contemplates an Arbitration Procedure before the Consumer Protection Agency, where the parties can designate the Consumer Protection Agency as a sole arbitrator or any other Arbitrator registered before the Consumer Protection Agency.

    Labour dispute. The current Federal Labour Law contemplates an arbitration procedure before the federal or local conciliation and arbitration board. It is important to mention that, due to a legislative amendment, said procedure and authority will cease to exist from November 2018.

  31. 16.

    Does your jurisdiction provide for class-action arbitration or group arbitration? If so, are there any limitations to the arbitrability of such claims or requirements that must be met before such claims may be arbitrated? 

  32. N/A

  33. 17.

    Are contractual waivers precluding arbitration of claims on a class-wide basis enforceable? Under what circumstances have such waivers been upheld or set aside by the courts?

  34. Beside the above-mentioned case, there has been no other experience in regard to class-action arbitration. 

  35. 18.

    If the parties’ contract is silent on the issue of class-action arbitration, is class-action arbitration allowed under the law of your jurisdiction?

  36. As above.

  37. 19.

    Are foreign arbitral institutions without a physical presence in your jurisdiction authorised to administer arbitrations in your jurisdiction? Does the law require that a foreign institution be licensed under local law in order to administer an arbitration seated there?

  38. There is no restriction for foreign arbitral institutions without physical presence to administer arbitrations. What is more, under Mexican law they do not require a licence to administer an arbitration having its seat in Mexico. 

    Arbitral institutions and arbitrators

  39. 20.

    Is an arbitral award issued in an arbitration seated in your jurisdiction under the auspices of a foreign institution (such as the ICC, ICDR, LCIA or similar institutions) vulnerable to challenge because it was issued under the auspices of a foreign institution?

  40. Under Mexican law all arbitral awards, no matter what the arbitral institution, may be challenged. However, there are limited grounds for setting aside or refusing its recognition and enforcement, and none of them include reviewing the merits of the award. 

  41. 21.

    Does the law require that arbitrators in international arbitrations be citizens or residents of your jurisdiction?

  42. In Mexico, there is no such requisite that arbitrators in international arbitrations should be Mexican nationals; there is no special requirement applicable to international arbitrators. 

  43. 22.

    Does your law require that arbitrators in international cases be lawyers? 

  44. Any person may act as arbitrator, as long as he or she is independent from the parties and impartial. Mexican law does not provide for any requirements applicable to arbitrators. However, the parties may agree on any qualifications for the arbitrators to meet.

  45. 23.

    Does your jurisdiction provide immunity to arbitrators serving in an arbitration with its legal seat in your jurisdiction? Under what circumstances does such immunity apply or not apply? 

  46. There is no specific provision that provides immunity to arbitrators with legal seat in Mexico.

  47. 24.

    Are the fees of foreign arbitrators serving in an arbitration seated in your jurisdiction subject to taxation?

  48. If services are rendered in Mexico, VAT of 16 per cent should apply.

  49. 25.

    Must arbitrators in international arbitrations be independent and impartial? What is the legal standard governing conflicts of interest and disclosure by arbitrators in international arbitrations?

  50. N/A

  51. 26.

    Will courts entertain requests to disqualify an arbitrator before the conclusion of an award? 

  52. The arbitration statute provides that every arbitrator shall be independent and impartial. That applies both to domestic and international arbitrations, are there is no distinction made.

    When a person is approached in connection with his or her possible appointment as an arbitrator, he or she shall disclose any circumstances likely to give rise to justifiable doubts as to his or her impartiality or independence. An arbitrator, from the time of his appointment and throughout the arbitral proceedings, shall without delay disclose any such circumstances to the parties unless they have already been informed of them by him or her.

    The IBA standards for disclosure and disqualification may serve as mere reference for parties and arbitrators. 

    Arbitral proceedings

  53. 27.

    Does the law require that arbitral proceedings seated in your jurisdiction be held in a specific language? 

  54. The parties are free to agree on the language or languages to be used in the arbitral proceedings. Failing such agreement, the arbitral tribunal shall determine the language or languages to be used in the proceedings. This agreement or determination, unless otherwise agreed, shall apply to any written statement by a party, any hearing and any award, decision or other communication by the arbitral tribunal.    

    The arbitral tribunal may order that any documentary evidence shall be accompanied by a translation into a language agreed upon by the parties or determined by the arbitral tribunal. 

  55. 28.

    Can foreign lawyers serve as advocates in arbitral proceedings in your jurisdiction? If so, can they do so alone or must a local lawyer serve as co-counsel? 

  56. There is no restriction in Mexico on foreign lawyers serving as advocates in international arbitral proceedings.

  57. 29.

    Are the fees of foreign lawyers earned for services rendered in connection with an arbitration seated in your jurisdiction subject to local taxation?

  58. See above.

  59. 30.

    In what circumstances, if any, does your law allow the consolidation of multiple arbitral proceedings into a single proceeding?

  60. Mexican arbitration law does not provide for the consolidation of multiple arbitral proceedings.

  61. 31.

    Please describe common practice and usage in international arbitrations seated in your jurisdiction with respect to a party’s right to require an opposing party to produce documents pertinent to the dispute. 

  62. Being a civil law country, the production of documents is not a common practice in Mexico. However, it is often used in arbitration proceedings, based on the arbitral tribunal’s power to conduct the procedure.    

    The arbitration statute provides that the parties are free to agree on the procedure to be followed by the arbitral tribunal in conducting the proceedings; failing such agreement, the arbitral tribunal may, subject to the provisions of the statute, conduct the arbitration in such manner as it considers appropriate. The power conferred upon the arbitral tribunal includes the power to determine the admissibility, relevance, materiality and weight of any evidence.

  63. 32.

    Does the law impose a duty of confidentiality in arbitration? If so, on whom? 

  64. There is no duty of confidentiality under the arbitration law.    

    The Arbitration Rules of the Mexico City National Chamber of Commerce provide that unless otherwise expressly agreed by the parties, the arbitration proceedings shall be confidential. Confidentiality shall not be deemed breached when there is recourse to the public courts to request the acknowledgment or the enforcement of an award or in any other case foreseen by the Rules or by a norm of public order.

  65. 33.

    Does the law authorise third-party funding for international arbitration? Are there any ethical limitations imposed upon counsel to the parties that restricts the use of such funding?

  66. Third-party funding is not customary in Mexico. Hence, there are no applicable provisions.

  67. 34.

    Are there any mandatory national rules of professional ethics that apply to counsel in an international arbitration in your jurisdiction? If so, are those rules applicable to counsel from another jurisdiction participating in an arbitration in your jurisdiction? 

  68. In Mexico there are no mandatory rules of professional ethics.    

    Professional organisations such as the Mexican Bar have a Code of Ethics, although membership to a professional association is not mandatory. 

  69. 35.

    Are there any mandatory rules on oath or affirmation for witnesses testifying in an arbitration in your jurisdiction that have to be administered prior to their testimony? If so, what are they? 

  70. There are no mandatory rules on oath or affirmation applicable to witnesses testifying in an arbitration proceeding.     

    Arbitrators are considered as private parties and have no special powers beside those conferred by the parties. When receiving a witness statement, the arbitral tribunal would invite the witness to respond with the truth. 

  71. 36.

    Are there restrictions in your jurisdiction on the interviewing of witnesses in anticipation of hearings or giving of testimony?

  72. According to the Mexican Commerce Code and the Federal Civil Procedure Code, there are some pre-trial procedures that the parties can file to secure evidence or satisfy formalities necessaries to file a complaint. As long as the witnesses whose testimony is going to be obtained complies with the requirements set forth in such codes, witnesses can be interviewed in anticipation of hearings (ie, elderly people, people whose live is in danger, people about to leave the country).

    Court support for arbitration

  73. 37.

    Can arbitrators decide on their own jurisdiction? Is the principle of ‘Kompentenz-Kompetenz’ followed in the courts?

  74. As provided by the Mexican arbitration statute, the arbitral tribunal may rule on its own jurisdiction.   

    A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence. A party is not precluded from raising such a plea by the fact that he has appointed, or participated in the appointment of, an arbitrator. A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings. The arbitral tribunal may, in either case, admit a later plea if it considers the delay justified.

    The arbitral tribunal may rule on a plea referred to in the preceding paragraph either as a preliminary question or in an award on the merits. If the arbitral tribunal rules as a preliminary question that it has jurisdiction, any party may request, within 30 days after having received notice of that ruling, the court to decide the matter, whose decision shall be subject to no appeal. While such a request is pending, the arbitral tribunal may continue the arbitral proceedings and make an award.

    When a party requests the referral to arbitration, the following is observed:

    • The request must be made in the first brief on the merits of the matter submitted by the requesting party.
    • The court, granting to the other parties their right to be heard, shall resolve immediately.
    • If the court orders the referral to arbitration, shall in addition order to suspend the proceeding.
    • Once the matter has been finally solved in the arbitration, by request of any of the parties, the court shall give the proceeding as terminated.
    • If the setting-aside of the arbitration agreement is determined, the lack of jurisdiction of the Arbitral Tribunal or otherwise the matter is not concluded, totally or partially, in the arbitration, by request of any of the parties, and granting the right to be heard of all those interested previously, the suspension referred to in section III of this article shall be ended.
    • Against the decision on the referral to arbitration no appeal shall proceed.
  75. 38.

    Do the courts follow the principle of the independence and separability of the arbitration clause? 

  76. As said above, the arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement. For that purpose, an arbitration clause that forms part of a contract shall be treated as an agreement independent of the other terms of the contract.    

    A decision by an arbitral tribunal that the contract is null and void shall not entail ipso jure the invalidity of the arbitration clause.

  77. 39.

    Are arbitral tribunals empowered to grant interim relief? If so, how is that relief enforced in the courts? 

  78. Unless otherwise agreed by the parties, the arbitral tribunal may, at the request of a party, order any party to take such interim measure of protection as is necessary in respect of the subject matter of the dispute. The arbitral tribunal may require any party to provide appropriate security in connection with such measure.    

    Interim measures issued by an arbitral tribunal are enforced by means of a special trial, as follows:       

    • The claiming party shall file a statement of claim requesting the enforcement. Once the statement is admitted, the court will serve the defendant, who shall file its statement of defence within 15 days.   
    • Once the term to reply the statement of defence, with no need of a default motion, if the parties did not file evidence nor the court deem them necessary, within the following three days, the hearings for oral argument will take place with the attendance or not by the parties.   
    • If evidence may be filed or the court may deem it necessary prior to the hearing to be held, the 15-day period to produce evidence will take place.   
    • Once the hearing has been held, the court shall call the parties to hear judgment. The intermediate decisions issued in this special trial and the judgment solving it will be subject to no appeal.     

    The judge shall have full discretion upon taking the interim measures.    

    Any interim measure ordered by an arbitral tribunal shall be recognised as binding and, except that the arbitral tribunal provides for otherwise, it shall be enforced upon request of the above by the competent court, regardless of the state where it has been ordered.    

    The party requesting or having obtained the recognition and enforcement of an interim measure shall promptly inform the court about any revocation, suspension or amendment to be ordered in connection with said measures.    

    The person before whom the recognition or enforcement of an interim measure is requested, may if he or she deems it convenient, demand from the requesting party to furnish appropriate security, when the arbitral tribunal has not established said security yet or when said security may be necessary to protect the rights of third parties.    

    Recognition or enforcement of an interim measure may be refused only:    

    If, upon acting at the request of the party affected by the measure, it is evident for the court that:        

    • said refusal is justified by any of the reasons set forth by law,   
    • the decision by the arbitral tribunal on the furnishing of the security corresponding to the interim measure granted by the arbitral tribunal has not been fulfilled, or   
    • the interim measure has been revoked or suspended by the arbitral tribunal or, if empowered to do so, by a tribunal of the state where the arbitration proceeding is being processed or in accordance with the law of which said measure was granted, or     

    If the court decides that:       

    • the interim measure is inconsistent with the powers granted, unless the same court decides to redefine the measure to adapt it to its own powers and proceedings to be able to enforce it without modifying its content; or     
    • any of the reasons for refusal listed by law is applicable to the recognition or to the enforcement of the interim measure.     

    Any decision reached by the court regarding any reason established by law is only applicable for the purposes of the request for recognition and enforcement of the interim measure. The court to which the recognition or the enforcement is requested may not carry out, upon performing said duty, a review of the contents of the interim measure.    

    The party requesting any interim measure is responsible for same, as well as the arbitral tribunal issuing it, therefore, the damages and losses to be caused correspond to same. 

  79. 40.

    Can arbitrators issue orders, subpoenas or use other legal processes to compel the production of evidence by a third party or compel a third-party witness to appear before them? If so, will a court lend its aid in enforcing such an order against a recalcitrant third party? Also, if arbitrators can issue orders, subpoenas or use other legal processes to compel the production of evidence by a third party or compel a third-party witness to appear before them, are there any limitations to their doing so? 

  80. As mentioned above, arbitrators are considered as private parties and as such they lack imperium or power to enforce their decisions. Thus, an arbitral tribunal can issue an order for the production of evidence, but it would not be able to compel to a party or a third party to comply with it.    

    The arbitral tribunal or a party with the approval of the arbitral tribunal may request from a court its assistance in taking evidence. 

  81. 41.

    Can a party to an arbitration seek relief from the court to obtain evidence in aid of an international arbitration? What is the scope of such relief?

  82. Mexico is party of some international treaties, for example: (i) The Hague Convention on Taking of Evidence Abroad in Civil or Commercial Matters and the (ii) Inter-American Convention on Letters Rogatory.

    The scope of the first one aims to obtain evidence, or to perform some other judicial act in a foreign country and the request may include any special method or procedure to be followed and the scope of the second one aims to obtain evidence and/or information abroad, unless a reservation is made in this respect.

    It is important to mention that the requests based on such treaties, must comply with the requirements and conditions set forth in the same.

  83. 42.

    Can a party in an international commercial arbitration seek interim or provisional relief from a court without first seeking relief from the arbitral tribunal?

  84. Even if there is an existing arbitration agreement, the parties may, before or during arbitral proceedings, request a court to take an interim measure of protection.

  85. 43.

    Have the courts issued injunctions enjoining arbitral proceedings from going forward? 

  86. Not applicable.

  87. 44.

    Does the law provide that post-award interest accrues on an unpaid arbitral award? 

  88. There is no specific provision in regard to post-award interest. If requested by the parties, the arbitral tribunal should expressly grant it in the award. 

  89. 45.

    Is an arbitral tribunal empowered to award attorneys’ fees to the prevailing party or is that power reserved to the courts?

  90. By means of the arbitration agreement, the arbitral tribunal shall fix the costs of arbitration in its award. The courts could not do so. 

  91. 46.

    Is an arbitral tribunal empowered to award punitive or exemplary damages? Is the arbitral tribunal empowered to award interest? 

  92. The arbitral tribunal should award interest in accordance with the applicable provisions. Nevertheless, punitive damages are not allowed under Mexican law. 

    Awards - content

  93. 47.

    What are the grounds for challenging or vacating an international award issued in an arbitration seated in your jurisdiction? 

  94. An arbitral award may be set aside by the competent court only if:       

    • The party making the application furnishes proof that:    
    • A party to the arbitration agreement was under some incapacity; or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under Mexican law;    
    • The party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case;   
    • The award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or contains decisions on matters beyond the scope of the submission to arbitration. However, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside; or   
    • The composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this title from which the parties cannot derogate, or, failing such agreement, was not in accordance with this title; or   
    • The court finds that, under Mexican law, the subject-matter of the dispute is not capable of settlement by arbitration, or the award is in conflict with the public policy.
  95. 48.

    Is “lack of reasonableness”, manifest disregard or a mistake in the application of the substantive law to the dispute of an international award grounds to vacate it? 

  96. No, not under Mexican law. The grounds for vacating an arbitral award are limited to those referred above, none of which refer to the merits of the dispute.

  97. 49.

    Have international awards rendered in your jurisdiction been vacated on the grounds of "public policy"? If so, how has the "public policy" ground for vacating an award been interpreted in your jurisdiction?

  98. There have been various cases where the losing party attempts to vacate the award on the grounds of public policy. However, we are not aware of any cases where such argument prospered.

    The concept of ‘public policy’ has been interpreted in a case-by-case basis. In CFE v. Party X, Supreme Court of Justice of Mexico (30 November 2011, A contribution by the ITA Board of Reporters, Kluwer Law International), the First Chamber of the Mexican Supreme Court of Justice attempted to define “public policy” under Mexican law, in a case between an international private company and a Mexican government-owned company, on the setting aside proceeding of an arbitral award. It ruled that for purposes of arbitration, public policy concerns matters available to the parties, which can be gave in, settled or compromised.

  99. 50.

    What is the period of time a party has to challenge such an award after its issuance?

  100. An application for setting-aside shall be made within three months from the date on which the party making that application received notice of the award or, in case of a request to correct, interpret or issue an addition award, from the date on which that request had been disposed of by the arbitral tribunal.

  101. 51.

    Please describe any recent significant experiences or cases that illustrate the attitude of your courts towards the annulment of international awards rendered in your jurisdiction.

  102. Experience shows that in general terms, the Mexican courts have adopted a pro arbitration policy and “scare” stories are rare. This is more palpable when it comes to international awards.

    The caseload of arbitration matters where the court’s assistance is required is steadily increasing. This has triggered the call for judges to understand arbitration and perform in consequence; they are becoming more familiar with arbitration to the point that one can speak today of an almost general acquaintance of the institution.

    In recent cases, the courts have uphold the parties’ agreement to arbitrate their dispute and the arbitral award without reviewing the merits of the dispute.  

  103. 52.

    Do the courts consider themselves empowered to vacate an arbitral award rendered in another jurisdiction?

  104. See above.

    Awards enforcement

  105. 53.

    May parties waive all court review of an arbitral award rendered in your jurisdiction (or restrict or expand the scope of that court review)?

  106. In accordance with the arbitration statute, the courts cannot review the merits of the dispute.

    A parties’ agreement to restrict or expand the scope of the court’s review of the award is unusual and it could even be considered against public policy.

  107. 54.

    Please describe the process for enforcing an arbitral award rendered in another jurisdiction.

  108. An arbitral award, irrespective of the country in which it was made, shall be recognised as binding and, upon application in writing before the Mexican courts.

    The party relying on an award or applying for its enforcement shall supply the duly authenticated original award or a duly certified copy thereof, and the original arbitration agreement or a duly certified copy thereof.

    If the award or agreement is not made in Spanish, the party shall supply a translation by an official expert.

  109. 55.

    Assuming that the award is covered by a convention applicable in your jurisdiction, how long does it take to obtain an order of enforcement in the first instance? How long does it take for the enforcement process to run its full course through to the last instance? 

  110. An order of enforcement, in the first instance, may take six to 10 months.    

    An amparo proceeding may be filed against the court decision ruling on the enforcement of the arbitral award. Such amparo may take eight to 10 months.  

  111. 56.

    Please compare how long it takes to enforce an arbitral award rendered abroad with how long it takes to domesticate a foreign judgment.

  112. As per the New York Convention it might be easier to enforce an arbitral award than a court decision rendered abroad. 

  113. 57.

    Please describe some significant recent experiences with the enforcement of foreign arbitral awards.

    • The Twenty-Third Civil Court in the Federal District referred the parties to arbitration, in a pre-trial proceeding, in accordance with their agreement to arbitrate, as provided in articles 1415, 1424, 1432, 1464, 1465 of the Mexican Arbitration Law.     
    • The new Amparo Law introduced a revised concept of “responsible authority”, under which arbitrators could be considered as authorities for amparo claim purposes. However, the Eight Collegiate Court clarified this when ruling case (queja) 195/2014, it ruled arbitrators are not considered as authorities for amparo claim purposes, as its powers come from the arbitration agreement.
    • The Mexican Supreme Court of Justice ruled on collective actions when parties have agreed to submit disputes to arbitration. Previously, the Third District Judge noticed the existence of an arbitration agreement in the Membership Agreement, hence it ruled that it had no jurisdiction. 
  114. 58.

    To what degree has “public policy” been a ground to refuse enforcement of an international award rendered abroad? 

  115. Public policy is a recurrent ground alleged by defeated parties applying for the refusal of the enforcement of an international arbitral award. 

    The outlook

  116. 59.

    Can a foreign arbitral award be enforced if the award has been set aside by the courts at the seat of the arbitration? 

  117. There has not been a case of a foreign arbitral award set aside in the courts at the seat of the arbitration, which enforcement is requested before the Mexican courts. 

  118. 60.

    Has your jurisdiction refused to honour an international arbitral award issued against the state or an instrumentality of the state in your jurisdiction? If so, please provide a brief explanation.

  119. There is no specific background of refusal to honour an international arbitral award issied against the state.

  120. 61.

    What is your view of the future of international arbitration and is the trend positive in your jurisdiction? What advice do you have with respect to dispute resolution for a foreign lawyer advising a foreign client contemplating entering into a business deal with a company from your jurisdiction?

  121. Formerly in Mexico, arbitration was reserved for international or very complex disputes. However, over the last years, arbitration has become available to a vast variety of sectors and a wide range of disputes, due to the overwhelming development of the arbitral institutions, appropriate assistance by the courts in arbitration matters, and the appearance of arbitration proceedings for small claims.

    Likewise, as a result of the advantages offered by arbitration vs the courts, it is common that parties to an agreement request the inclusion of an arbitration clause, not only in their international contracts, but also in those contracts involving only Mexican parties, either of a higher or lesser amount.

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Questions

    Legislation

  1. 1.

    Which legislation governs the enforcement of international commercial arbitration awards and arbitral agreements in international business contracts, and international commercial arbitration proceedings?


  2. 2.

    Has the UNCITRAL model arbitration law been adopted in your jurisdiction? 


  3. Conventions

  4. 3.

    Is your jurisdiction a party to both the New York Convention and the Panama Convention? Is it a party to any other conventions or treaties governing international commercial arbitration agreements, awards or proceedings? 


  5. 4.

    Is your jurisdiction a party to the ICSID Convention? Have steps been taken to renounce the Convention or withdraw from ICSID? 


  6. 5.

    Is your jurisdiction a party to other conventions that directly affect the enforceability of arbitration agreements, rights or awards?


  7. Commercial arbitral agreements and arbitrability

  8. 6.

    Some jurisdictions have permitted parties to compel resolution of a dispute by means of arbitration only if the agreement to arbitrate was entered into after a dispute has arisen. Is a pre-dispute arbitration clause to resolve international commercial disputes by arbitration enforceable?


  9. 7.

    What are the requirements for an enforceable arbitral agreement? 


  10. 8.

    Is there subject matter that is not legally subject to arbitration in the context of an international business transaction?


  11. 9.

    Are there any limits to the ability of a state or an instrumentality of the state to enter into an agreement to arbitrate in your jurisdiction? If so, under what circumstances may the state or its instrumentalities enter into such an agreement? Please describe the requirements that must be met for the state to enter into a binding arbitration agreement.


  12. 10.

    Does the law specify whether an arbitration will be in equity or under law if the parties do not expressly specify the nature of the arbitration in the agreement?


  13. 11.

    How does the law limit party autonomy with respect to the terms of an arbitral agreement? 


  14. 12.

    Under what circumstances does the law allow a non-signatory to an arbitral agreement to pursue a claim in an international arbitration against a party that signed the arbitral agreement?


  15. 13.

    Under what circumstances does the law allow a signatory to an arbitral agreement to pursue a claim in an international arbitration against a party that did not sign the arbitral agreement?


  16. 14.

    Under what circumstances may a non-signatory to an arbitral agreement compel arbitration of a claim asserted against it in a court of law by a signatory of the arbitral agreement?


  17. 15.

    Is there any law in your jurisdiction specifically governing the arbitrability of consumer or labour disputes?


  18. 16.

    Does your jurisdiction provide for class-action arbitration or group arbitration? If so, are there any limitations to the arbitrability of such claims or requirements that must be met before such claims may be arbitrated? 


  19. 17.

    Are contractual waivers precluding arbitration of claims on a class-wide basis enforceable? Under what circumstances have such waivers been upheld or set aside by the courts?


  20. 18.

    If the parties’ contract is silent on the issue of class-action arbitration, is class-action arbitration allowed under the law of your jurisdiction?


  21. 19.

    Are foreign arbitral institutions without a physical presence in your jurisdiction authorised to administer arbitrations in your jurisdiction? Does the law require that a foreign institution be licensed under local law in order to administer an arbitration seated there?


  22. Arbitral institutions and arbitrators

  23. 20.

    Is an arbitral award issued in an arbitration seated in your jurisdiction under the auspices of a foreign institution (such as the ICC, ICDR, LCIA or similar institutions) vulnerable to challenge because it was issued under the auspices of a foreign institution?


  24. 21.

    Does the law require that arbitrators in international arbitrations be citizens or residents of your jurisdiction?


  25. 22.

    Does your law require that arbitrators in international cases be lawyers? 


  26. 23.

    Does your jurisdiction provide immunity to arbitrators serving in an arbitration with its legal seat in your jurisdiction? Under what circumstances does such immunity apply or not apply? 


  27. 24.

    Are the fees of foreign arbitrators serving in an arbitration seated in your jurisdiction subject to taxation?


  28. 25.

    Must arbitrators in international arbitrations be independent and impartial? What is the legal standard governing conflicts of interest and disclosure by arbitrators in international arbitrations?


  29. 26.

    Will courts entertain requests to disqualify an arbitrator before the conclusion of an award? 


  30. Arbitral proceedings

  31. 27.

    Does the law require that arbitral proceedings seated in your jurisdiction be held in a specific language? 


  32. 28.

    Can foreign lawyers serve as advocates in arbitral proceedings in your jurisdiction? If so, can they do so alone or must a local lawyer serve as co-counsel? 


  33. 29.

    Are the fees of foreign lawyers earned for services rendered in connection with an arbitration seated in your jurisdiction subject to local taxation?


  34. 30.

    In what circumstances, if any, does your law allow the consolidation of multiple arbitral proceedings into a single proceeding?


  35. 31.

    Please describe common practice and usage in international arbitrations seated in your jurisdiction with respect to a party’s right to require an opposing party to produce documents pertinent to the dispute. 


  36. 32.

    Does the law impose a duty of confidentiality in arbitration? If so, on whom? 


  37. 33.

    Does the law authorise third-party funding for international arbitration? Are there any ethical limitations imposed upon counsel to the parties that restricts the use of such funding?


  38. 34.

    Are there any mandatory national rules of professional ethics that apply to counsel in an international arbitration in your jurisdiction? If so, are those rules applicable to counsel from another jurisdiction participating in an arbitration in your jurisdiction? 


  39. 35.

    Are there any mandatory rules on oath or affirmation for witnesses testifying in an arbitration in your jurisdiction that have to be administered prior to their testimony? If so, what are they? 


  40. 36.

    Are there restrictions in your jurisdiction on the interviewing of witnesses in anticipation of hearings or giving of testimony?


  41. Court support for arbitration

  42. 37.

    Can arbitrators decide on their own jurisdiction? Is the principle of ‘Kompentenz-Kompetenz’ followed in the courts?


  43. 38.

    Do the courts follow the principle of the independence and separability of the arbitration clause? 


  44. 39.

    Are arbitral tribunals empowered to grant interim relief? If so, how is that relief enforced in the courts? 


  45. 40.

    Can arbitrators issue orders, subpoenas or use other legal processes to compel the production of evidence by a third party or compel a third-party witness to appear before them? If so, will a court lend its aid in enforcing such an order against a recalcitrant third party? Also, if arbitrators can issue orders, subpoenas or use other legal processes to compel the production of evidence by a third party or compel a third-party witness to appear before them, are there any limitations to their doing so? 


  46. 41.

    Can a party to an arbitration seek relief from the court to obtain evidence in aid of an international arbitration? What is the scope of such relief?


  47. 42.

    Can a party in an international commercial arbitration seek interim or provisional relief from a court without first seeking relief from the arbitral tribunal?


  48. 43.

    Have the courts issued injunctions enjoining arbitral proceedings from going forward? 


  49. 44.

    Does the law provide that post-award interest accrues on an unpaid arbitral award? 


  50. 45.

    Is an arbitral tribunal empowered to award attorneys’ fees to the prevailing party or is that power reserved to the courts?


  51. 46.

    Is an arbitral tribunal empowered to award punitive or exemplary damages? Is the arbitral tribunal empowered to award interest? 


  52. Awards - content

  53. 47.

    What are the grounds for challenging or vacating an international award issued in an arbitration seated in your jurisdiction? 


  54. 48.

    Is “lack of reasonableness”, manifest disregard or a mistake in the application of the substantive law to the dispute of an international award grounds to vacate it? 


  55. 49.

    Have international awards rendered in your jurisdiction been vacated on the grounds of "public policy"? If so, how has the "public policy" ground for vacating an award been interpreted in your jurisdiction?


  56. 50.

    What is the period of time a party has to challenge such an award after its issuance?


  57. 51.

    Please describe any recent significant experiences or cases that illustrate the attitude of your courts towards the annulment of international awards rendered in your jurisdiction.


  58. 52.

    Do the courts consider themselves empowered to vacate an arbitral award rendered in another jurisdiction?


  59. Awards enforcement

  60. 53.

    May parties waive all court review of an arbitral award rendered in your jurisdiction (or restrict or expand the scope of that court review)?


  61. 54.

    Please describe the process for enforcing an arbitral award rendered in another jurisdiction.


  62. 55.

    Assuming that the award is covered by a convention applicable in your jurisdiction, how long does it take to obtain an order of enforcement in the first instance? How long does it take for the enforcement process to run its full course through to the last instance? 


  63. 56.

    Please compare how long it takes to enforce an arbitral award rendered abroad with how long it takes to domesticate a foreign judgment.


  64. 57.

    Please describe some significant recent experiences with the enforcement of foreign arbitral awards.


  65. 58.

    To what degree has “public policy” been a ground to refuse enforcement of an international award rendered abroad? 


  66. The outlook

  67. 59.

    Can a foreign arbitral award be enforced if the award has been set aside by the courts at the seat of the arbitration? 


  68. 60.

    Has your jurisdiction refused to honour an international arbitral award issued against the state or an instrumentality of the state in your jurisdiction? If so, please provide a brief explanation.


  69. 61.

    What is your view of the future of international arbitration and is the trend positive in your jurisdiction? What advice do you have with respect to dispute resolution for a foreign lawyer advising a foreign client contemplating entering into a business deal with a company from your jurisdiction?


Other chapters in Arbitration