Arbitration

Last verified on Friday 16th March 2018

Costa Rica

Andrea Hulbert
Hulbert Volio Montero

    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 New York Convention on the Recognition and enforcement of Foreign Arbitral Awards governs the enforcement of international commercial arbitration awards. It was adopted by Costa Rica in Law No. 6157, enacted on 26 October 1987.

    Arbitral agreements and international commercial arbitration proceedings are regulated by the Law on International Commercial Arbitration based on the UNCITRAL Model Law (Law No 8937 from 27 April 2011), referred in this document as the Law. Costa Rica has a dual arbitration system, which sets forth different rules for domestic arbitration and international arbitration.

  3. 2.

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

  4. Yes, Costa Rica adopted the UNCITRAL Model Law, with the following variations:

    • When defining terms, the law provides a rather broad definition as to what should be considered as a commercial dispute. According to article 2(g), the concept “commercial dispute” includes exchange of goods and services, distribution, commercial representation, credit transfers, factoring, leasing transactions, banking and insurance operations, construction of real-estate projects, mergers and acquisitions, consulting services, transportation of goods and, in general, any form of commercial cooperation. 
    • The law does not include Option II, article 7 of the UNCITRAL Model Law about the definition of the arbitration agreement.
    • It includes two additional articles in relation with matters subject to arbitration and confidentiality. On one hand, article 37 provides that all matters subject to the free will of the parties according to civil and commercial dispositions are arbitrable. On the other hand, in relation with confidentiality, article 38 provides that the arbitral proceeding is confidential. The arbitral award is public unless the parties decide otherwise.

    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. Yes, Costa Rica is a party to the following conventions: 

    • Code of Private International Law (Law No. 50, 6 February 1930);
    • New York Convention on the Recognition and enforcement of Foreign Arbitral Awards (Law No. 6157, 26 October 1987);
    • Inter-American Convention on international commercial arbitration, 1975 (also known as the Panama Convention) (Law 6165, 2 December 1977);
    • The General Agreement on Tariffs and Trade (GATT) covers international trade in goods (Law No. 7475, 26 December 1994).

    It is important to highlight that article 7 of our Political Constitution states that: “Public treaties, international agreements and those agreed upon, duly approved by the Legislature, shall have, since their promulgation or from the day they designate superior authority to the laws.” (free translation).

  7. 4.

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

  8. The Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the ICSID Convention) was signed by Costa Rica on 29 September 1981. Law No 7332 of 30 March 1993 ratified it and the Convention entered into force on 27 May 1993. Costa Rica has not taken any steps to withdraw from ICSID.

  9. 5.

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

  10. No.

    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. No, that was an old discussion in Costa Rica; we can enforce the arbitration at any time and the “compromise” or post-dispute is not needed. The right to arbitrate is regulated in article 43 of the Constitution, we have absolute respect for party autonomy to waive the national jurisdiction at any time.

  13. 7.

    What are the requirements for an enforceable arbitral agreement? 

  14. Article 7 of the UNCITRAL Model Law in Costa Rica, clearly defines the requirements for an enforceable arbitral agreement: 

    “ARTICLE 7. Definition and form of the arbitration agreement

    1) The "arbitration agreement" is an agreement by which the parties decide to submit to arbitration all disputes or certain disputes that have arisen or may arise between them with respect to a certain legal, contractual or non-contractual relationship. The arbitration agreement may take the form of an arbitration clause included in a contract or the form of an independent agreement.

    2) The arbitration agreement must be in writing.

    3) It will be understood that the arbitration agreement is written when there is evidence of its content in any form, whether the arbitration agreement or contract has been concluded verbally, by the execution of certain acts or by any other means.

    4) The requirement that an arbitration agreement be recorded in writing shall be fulfilled with an electronic communication, if the information entered in it is accessible for further consultation. "Electronic communication" means any communication that the parties make through data messages. "Data message" means information generated, sent, received or archived by electronic, magnetic, optical or similar means, such as, among others, electronic data exchange, electronic mail, telegram, telex or the telefax.

    5) It will be understood that the arbitration agreement is written when it is consigned in an exchange of writs of claim and answer, in which the existence of an agreement is affirmed by one party without being denied by the other.

    6) The reference made in a contract to a document containing an arbitration clause constitutes a written arbitration agreement, provided that such reference implies that that clause forms part of the contract.”

    As we can see, the arbitral agreement for an international commercial arbitration in our jurisdiction can be in any form as long as it is written and signed or agreed upon by both parties. It can also be in electronic form as long as it is easily noticeable that both parties wanted to go to arbitration. It can also be part of an underlying contract or independent document. 

  15. 8.

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

  16. By definition international business transaction are subject to arbitration. Nevertheless, the difference between arbitrable and non-arbitrable disputes is defined in the light of public policy considerations, meaning sensitive matter of public interest. Article 2 of the Law on International Commercial Arbitration states that all relationships of commercial nature are arbitrable, including but not limited to:

    …any trade transaction for the supply or exchange of goods or services, distribution agreement, commercial representation or agency, credit transfer for collection ("factoring"), leasing goods-purchase (leasing), construction of works, consulting, engineering, licensing, investment, finance, banking, insurance, agreement or exploitation concession, joint ventures and other forms of industrial or commercial cooperation, transport of goods or passengers by air, sea, rail or road and real estate transactions in general...

    According to the First Chamber of the Supreme Court of Justice of Costa Rica, all disposable economic rights can be subject matter of a possible arbitration; everything that is not against the public policy (or mandatory law), also known as public order.

  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. It is the responsibility of the Minister of the Branch to sign the administrative contracts that concern his Ministry in accordance with the provisions of article 28, paragraph h) of the General Law of Public Administration, and contracts may include arbitration as a mechanism for settlement of property disputes.

    Autonomous institutions only required the agreement of the board of directors and the signature of Executive President. 

    The usual arbitration clause with the government or any of its institutions usually have, for example, a text similar to the following:

    Disputes or claims that may arise from this Contract, or the business and the matter to which it refers concerning  differences of economic order based on rights with respect to which the parties have full disposition and is possible to exclude the common jurisdiction under the terms of article 18 of Law No.7727 "Law on Alternative Resolution of Conflicts and Promotion of Social Peace", will be submitted to arbitration. The arbitration will be under law. The arbitration will be administered by XXX, to whose rules the parties submit voluntarily and unconditionally. The place of arbitration will be the XXX. The conflict will be resolved in accordance with the substantive law of Costa Rica.

  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. Yes, article 28 states that the tribunal will decide in equity only if the parties expressly authorize a decision in equity; so, vice versa unless otherwise agreed by the parties’ arbitration will be under law.

  21. 11.

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

  22. There are no limits in the law to party autonomy; they are free to choose all the terms and conditions for the resolution of a possible conflict: language, law, institution, seat, etc.  

  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. The law does not address the issue, but our case law had; it is possible in our jurisdiction to include a non-signatory party in a domestic or international arbitration according to the case law of the First Chamber of the Supreme Court:        

    • If the arbitration clause is in a macro agreement it will be valid and applicable for every conflict raised during the execution of the business described in the document, even for new parties that intervene in the business after the agreement, unless otherwise agreed by the parties (FCSCJ, Resolution No. 475-01, 27 June 2001, 746-C-2007, 19 October 2007).   
    • If the arbitration agreement was contained in a letter of intent, a pre-contractual agreement or preparatory documents for the final contract and it was not revoked in the final agreement (FCSCJ, Resolution 703-00, 22 September 2000).   
    • When in the preliminary agreement the participation of a third party related to one of the signatories is mentioned, for example a subsidiary (FCSCJ, Resolution 703-A-00, 22 September 2000).   
    • If a third party assumes the role of one of the original parties in the contract (FCSCJ, Resolution 200-A, 7 April 2006).   
    • If the third party is part of the “economic group” or “group of economic interest” of one of the signatories (FCSCJ, 1565-A-S1-2000, 23 December 2010, 759-C-S1-2008, 11 November 2008).   
    • If the third party has an important relation in the business (FCSCJ), 490-F-S1-2008, 24 July 2008).
  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. See the answer to question 12. 

  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. The non-signatory party that fulfills the characteristics explained in answer to question 12, may claim the defense of lack of jurisdiction, alleging the existence of the arbitration clause and the relationship with the signatory party. We must make clear there is no record of a situation like this in our jurisdiction.

  29. 15.

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

  30. Yes, in both.

    Consumers have the Promotion of Competition and Effective Consumer Protection Law, that regulates the possibility of an arbitration in article: “…At any time by mutual agreement, the parties may submit their dispute, definitively, before an arbitrator or arbitral tribunal, they must cover the expenses incurred…”.

    Employees have Law No. 9343, enacted 25 January 2016, applicable since 25 July 2017; and the rules set in the Decree No. 40875 MTSS-JJ of  20 February 2018. Both regulations are new, stipulate the arbitrability of labor conflicts and are very restrictive in term of what requisites for the arbitral institution and the arbitrators. The institution needs to be approved by the government and the arbitrators need to be approved and register at the Labour Ministry after demonstrating their knowledge in that area of the law.

  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. No.

  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. The Law does not contain an express provision regulating the matter. Additionally, there are no reported cases on this issue.

  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. The Law does not contain an express provision regulating the matter. Additionally, there are no reported cases on this issue.

  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. The Law does not contain an express provision regulating the matter; but, foreign institutions are authorised to administer international arbitrations seated in Costa Rica, without any licence under local law, as long as it’s for one specific case and not an institution regularly working here, or with an open office in the country.

    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. No, an award can be challenged for the reasons determined in the Law, but not because of the institution that was chosen by the parties to administer the procedure.

  41. 21.

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

  42. No, article 11 of the law states that nationality is not an obstacle to be appointed as an arbitrator, unless otherwise agreed by the parties. Therefore, in Costa Rica foreigners can serve as international arbitrators.

  43. 22.

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

  44. The Law does not require the arbitrators to be lawyers; this should be addressed by the parties in their arbitration agreement or in the rules of the chosen arbitral institution.

  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. The Law does not contain an express provision regulating the matter, and we don’t find any immunity that could be applicable to an arbitrator.

  47. 24.

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

  48. The answer to this question may vary upon the circumstances and each case will have to be studied separately. Costa Rica does not have a global rent system; pursuant to our Tax Law the services rendered in the country are subject to the income tax, but it is a very broad term. For example, if we have a foreign arbitrator who comes to Costa Rica to attend oral hearings in a hotel or a hearing room of an arbitration centre and the rest of his or her services are performed out of the country, with no Costa Rican parties involved, his or her service here is not subject to taxation (articles 1, 23 and 59 of the Tax Law and application of the territorial principle); if the arbitration takes place in Costa Rica and under the administration of a Costa Rican centre the services will be subject, as a general rule, to income tax. 

  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. Yes, pursuant to article 12 of the Law, international arbitrators must be independent and impartial; they shall disclose any circumstances likely to give rise to justifiable doubts as to his impartiality or independence. These are the main grounds to challenge an arbitrator.

    The standards for disclosure and disqualification are high.

  51. 26.

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

  52. Yes. The proceeding to disqualify an arbitrator is set in article 13 of the Law, a literal copy of the UNCITRAL Model Law. Article 13.3 expressly permits the party to request the Court to decide on the challenge:

     “… (3) If a challenge under any procedure agreed upon by the parties or under the procedure of paragraph (2) of this article is not successful, the challenging party may request, within thirty days after having received notice of the decision rejecting the challenge, the court or other authority specified in article 6 to decide on the challenge, which decision shall be subject to no appeal; while such a request is pending, the arbitral tribunal, including the challenged arbitrator, may continue the arbitral proceedings and make an award…”

    Arbitral proceedings

  53. 27.

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

  54. No, the parties are free to determine the language of the proceedings (article 22 of the Law).

  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. Yes, foreign lawyers can serve as advocates in arbitral proceedings. A local lawyer does not need to serve as co-counsel in such cases.

  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 answer to question 24.

  59. 30.

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

  60. In international arbitration, the parties are free to agree to the consolidation of multiple arbitral proceedings. Our local law will request the existence of a common cause.

  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. Costa Rica has a civil law system and we do not have discovery as understood under common law. The general rule will be that arbitrators will respect the agreement of the parties regarding the production of documents. Our country has applied the principle of the availability of the evidence to compel the other party to produce documents. Nevertheless, it is common that the parties agree to use the IBA Rules on the Taking of Evidence.

  63. 32.

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

  64. Yes, article 38 of the Law states the confidentiality of the international arbitration process. This confidentiality is mandatory for both arbitrators and counsels. When the arbitration file needs to go to court, only the parties and their counsels will have access to it. Unless otherwise agreed by the parties, the final award will be public, the names of the arbitrators and lawyers will be published, but the parties can only be identified with their initials.

  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. The Law does not contain an express provision regulating the matter. Additionally, there are no reported cases on this issue.

  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. No. Costa Rica does not have a set of mandatory national rules of professional ethics that apply to counselors in international arbitration; the applicable rules will be the ethic regulations from the arbitral institution, or from the IBA if agreed by the parties; and if there is none, and the arbitration is held here, we have the Code of Ethics of the Costa Rican Bar association.

  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. In Costa Rica witnesses and experts are required to take an oath prior to their deposition, but this is not applicable for international arbitration; unless the tribunal decides to apply article 27 of the Law and request the assistance of a national court in taking evidence, in this case national rules will be applicable.

  71. 36.

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

  72. No. The applicable rules to interview witnesses are normally issued by the arbitral institution in charge of the international arbitration. Costa Rica does not have restrictions, in fact the regulation from the Arbitration Centre of The Costa Rican Chamber of Commerce, article 27, specifically regulates the written testimony. 

    Court support for arbitration

  73. 37.

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

  74. Yes. Article 16 of the Law addresses the issue of the competence of the arbitral tribunal to rule on its jurisdiction. This principle is also followed by the courts in domestic and international arbitration.

  75. 38.

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

  76. Yes. Article 7 of the Law regulates the arbitration clause and our courts have repeatedly ruled on the separability of the arbitration cause.

  77. 39.

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

  78. Yes. The arbitrators may grant interim relief according to articles 9 and 17 of the Law, and they may request the assistance of the national courts to enforce them.

  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. The law does not give such enforcement powers to the Arbitral Tribunal, but the Tribunal may request assistance with the taking of evidence to a national court; in which case the court may execute the request within its competence and according to its rules on taking evidence. The judge has the power to compel a third-party witness to appear before them or order the production of documents (article 27 of the Law).

  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. Yes. Article 27 of the Law allows the assistance of the Court on the taking of evidence, but according to the national rules.

  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. Yes, a party can request an interim or provisional relief from the court in Costa Rica, as well as preparatory evidence, as long as the court has jurisdiction over the parties and according to the norms of the Civil Procedure Code; for example, a preventive lien on a property or account (see, for example, articles 241, 242, 244, 272, 273, 282 of the Civil Procedure Code).

  85. 43.

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

  86. There are no reported cases on this matter and it does not happen in domestic arbitration.

  87. 44.

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

  88. Yes, it is possible under Costa Rican law. If the award provides the interest rate the Court will apply that; if not, in Costa Rica every debt has a “legal interest”, which is determined by the commercial law in article 497. “When the parties have not expressly convened upon an interest rate, they will apply the legal interest rate, which is the same as the basic rate of the Central Costa Rican Bank in case the transaction is in colones, and the prime rate when it is in dollars…”.

  89. 45.

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

  90. Yes, the tribunal is empowered to grant the attorneys’ fees, unless otherwise agreed by the parties. In the case of interim or provisional measures, article 17.g of the law expressly estates that possibility.

  91. 46.

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

  92. That will depend on the substantive applicable law, the contract and the parties’ agreement. The Costa Rican civil and commercial law does not allow punitive or exemplary damages, only compensatory. In either case the tribunal can award interest.

    Awards - content

  93. 47.

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

  94. The grounds for annulment are set forth in article 34 of the law (equal to article 34 of the UNCITRAL Model Law): The judicial authority may set aside an award by request of one of the parties or by its own initiative:     

    (A) At the request of a party, 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 Costa Rican law; or   
    • 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; or   
    • 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, provided that, 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 section from which the parties cannot derogate, or, failing such agreement, was not in accordance with this section.      

    (B) By its own initiative, when the court finds that:       

    • The subject-matter of the dispute is not capable of settlement by arbitration under Costa Rican law; or    
    • The award is in conflict with the international public policy of Costa Rica.      

    Costa Rican courts have shown great deference for international arbitral awards. 

  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, "lack of reasonableness", manifest disregard or a mistake in the application of the substantive law to the dispute of an international award are not grounds to vacate the award. The list of causes contained in article 34 of the Law is limited.

  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. No. We have annulments of domestic awards but not any record of an international ward been vacated.

    See the definition of public order in answer to question number 58.

  99. 50.

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

  100. The law, in article 34.3, states that an application for setting aside may no longer be made after three months.

  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. The Costa Rican Court has demonstrated a pro-arbitration attitude; the most recent case was an annulment action against an arbitration brought by SV SA against an ICC award rendered on 27 May 2014. The court denied the annulment action on 5 March 2015, Resolution No. 000280-F-S1-2015, in which a vast analysis of the law was made highlighting that the pillars of such law are liberty and party autonomy; it also makes reference to the importance in international arbitration of informality and flexibility, good faith, legal security, the waiver of the right to object as a manifestation of good faith. Concluding that the control from the court is limited to the examination of the arbitrability of the controversy and if the award is against the Costa Rican public order.

  103. 52.

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

  104. The Law does not contain an express provision regulating the matter. Additionally, there are no reported cases on this issue. Articles 36 provides that the Court may not enforce a foreign award if it goes against our public order. Article 35 makes express recognition of the enforceability of a foreign award.

    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. No.

  107. 54.

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

  108. Recognition of arbitral awards rendered in another jurisdiction must be submitted before the First Chamber of the Supreme Court of Justice. The requesting party should present the original award or a copy and the translation to Spanish when needed. An audience for 10 days will be given to the other party, after that the Chamber will move to resolve and there is no recourse against that resolution (articles 705 to 708 of the Civil Procedure Code). If approved, enforcement proceedings may be commenced under the provisions of the Code.

  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. The enforcement of the award in the first instance can take from 12 to 18 months. The entire enforcement process can take from two to four years. 

  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. It is approximately the same time frame, because it follows a similar procedure in court.

  113. 57.

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

  114. Generally, one could say that awards have been successfully enforced. Tribunals are very respectful of arbitral procedures and once the exequatur is approved they move towards the enforcement in the Civil Tribunal.

  115. 58.

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

  116. There are no reported cases on the matter, but the court has annulled several domestic arbitral awards under the grounds of a violation of public policy.

    The juridical concept of Public Policy is undetermined, flexible, dynamic and of difficult definition. Nevertheless, it can be understood as the set of principles underlying a legal system that reflects the core values of a society at a given time… 

    (..) …violation of the public order will occur when a non-arbitrable matter was know in an arbitration, because of its juridical nature as not disposable rights subject, but also when the action against the award is based on a subject matter excluded from the legislator…

    (free translation/ First Chamber of the Supreme Court of Justice, No. 76, 19 January 2001, also No. 766-F-01, 26 September 2001, No. 685-F-05, 22 September 2005; No. 690-F-2006, 27 September 2006)).

    The outlook

  117. 59.

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

  118. There are no reported cases on the matter. 

  119. 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.

  120. No.

  121. 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?

  122. The future of international arbitration in Costa Rica is very bright; we have the Law on International Commercial Arbitration based on the UNCITRAL model law, we have the New York Convention and an arbitration-friendly judicial system. Costa Rica has the three requisites to be the perfect place for international arbitration.

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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