Use the Lexology Navigator tool to compare the answers in this article with those from 20+ other jurisdictions.

The award

Requirements

What legal requirements are there for recognition of an award? Must reasons be given for the award? Does the award need to be reviewed by any other body?

Article 31 of the International Commercial Arbitration Law provides that the award must be made in writing and signed by the arbitrator or arbitrators. The award must state the date and place of arbitration as well as the reasons on which it is based, unless the parties have agreed that no reasons are to be given.

Timeframe for delivery

Are there any time limits on delivery of the award?

There are no time limits in the International Commercial Arbitration Law for the delivery of the award.

Article 13(1) of the Arbitration Law provides that the court may, on the application of any party to the arbitration, remove an arbitrator who fails to use all reasonable speed in commencing and proceeding with the arbitration and issuing an award.

Remedies

Does the law impose limits on the available remedies? Are some remedies not enforceable by the court?

An arbitral tribunal can award a wide range of remedies. Exceptions include:

  • orders for the winding up of a Cyprus company;
  • cases in which a remedy would affect the registration of rights over immovable property situated in Cyprus; and
  • cases in which other public policy reasons dictate that the requested remedy can be granted only by the court. 

What interim measures are available? Will local courts issue interim measures pending constitution of the tribunal?

Article 17 of the International Commercial Arbitration Law provides that unless otherwise agreed by the parties, the tribunal may, at the request of a party, order any party to take such interim measure of protection as the tribunal considers necessary.

The courts may also grant interim measures of protection in aid of arbitration, before or during arbitral proceedings, under Article 9 of the International Commercial Arbitration Law. Interim measures granted by the courts include freezing injunctions, the appointment of a receiver and generally the full range of injunctions and protective measures that courts may grant in civil proceedings.

Similar powers are given to the courts under the Arbitration Law.

Interest

Can interest be awarded?

The International Commercial Arbitration Law contains no provisions in relation to interest. However the parties may agree on the tribunal’s power to award interest.

Article 22 of the Arbitration Law provides that a sum directed to be paid by an award will, unless the award directs otherwise, carry interest as from the date of the award and at the same rate as a judgment debt.

At what rate?

The interest rate of a judgment debt which may be applicable under Article 22 of the Arbitration Law is currently 3.5% a year.

Finality

Is the award final and binding?

Subject to the provisions governing the court’s setting aside of an award, an award made by a tribunal pursuant to an arbitration agreement is final and binding.

What if there are any mistakes?

Article 33 of the International Commercial Arbitration Law provides that mistakes in computation or any clerical or typographical mistakes may be corrected by the tribunal either on its own initiative or following a request by a party, provided that such a request is made within 30 days of receipt of the award (unless a different timeframe has been agreed by the parties). Further, the tribunal may give an interpretation of a specific point or part of the award or issue an additional award as to claims included in the proceedings but omitted from the award.

Can the parties exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide?

The International Commercial Arbitration Law does not provide for a right of appeal. Article 34 of the law provides that recourse to a court against an arbitral award may be made only by an application to set aside the award.

Appeal

What is the procedure for challenging awards?

Under the International Commercial Arbitration Law, arbitral awards may be challenged only by an application to set aside the award, which must be filed within three months of the date on which the award was received by the parties. Similarly, an application to set aside is used to challenge awards under the Arbitration Law. 

On what grounds can parties appeal an award?

Under Article 34 of the International Commercial Arbitration Law, the court may set aside an award where:

  • a party to the arbitration agreement was under some incapacity or the agreement is not valid under the law to which the parties have subjected it (or, failing any indication thereon, under the law of Cyprus);
  • the party seeking to set aside the award was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings, or was otherwise unable to present its 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;
  • the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement conflicted with a provision of the International Commercial Arbitration Law from which the parties cannot derogate or, failing such agreement, was not in accordance with the International Commercial Arbitration Law;
  • the subject of the dispute is not capable of settlement by arbitration under the law of Cyprus; or
  • the award conflicts with the public policy of Cyprus.

Article 20 of the Arbitration Law provides that the court may set aside an award where an arbitrator has misconducted himself or herself or the proceedings, or where an arbitration or award has been procured improperly.

Enforcement

What steps can be taken to enforce the award if there is a failure to comply?

Under Article 35 of the International Commercial Arbitration Law, an award – irrespective of the country in which it was issued – will be recognised as binding. The successful party may apply to the court for an order for the execution of the award. The measures of execution that are available for judgments in civil proceedings are available for the enforcement of the award.

Can awards be enforced in local courts?

Yes, both domestic and foreign awards can be enforced in the courts of Cyprus.

How enforceable is the award internationally?

Awards issued in Cyprus are enforceable internationally under the New York Convention. Whether an award will be enforceable in a country which is not a party to the New York Convention will depend on the domestic law of that country.

To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?

The principle of state immunity is recognised and applied by Cypriot courts. The assets of a foreign state enjoy immunity from enforcement in Cyprus. Exceptions include cases in which immunity is waived and possibly enforcement against commercial assets.

Are there any other bases on which an award may be challenged, and if so, by what?

The courts may refuse to enforce an arbitration award under Article V of the New York Convention or Article 36 of the International Commercial Arbitration Law. 

How enforceable are foreign arbitral awards in your jurisdiction?

Cypriot courts are arbitration friendly and foreign arbitral awards are enforceable under the New York Convention. The Foreign Court Judgments (Recognition, Registration and Enforcement) Law 2000 (Law 121(I)/2000) provides the procedural steps to be followed by a party wishing to have a foreign award recognised and enforced in Cyprus. The successful party in the arbitration may apply to the court for an order for the execution of the award. If the court grants the requested order, the measures of execution that are available for judgments in civil proceedings will be available for the enforcement of the award. 

Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction?

Article 36 of the International Commercial Arbitration Law provides that recognition or enforcement of a foreign arbitral award may be refused if the award has been set aside by a court in the country in which it was made or under the law of such country. This issue has not yet been tested in the courts of Cyprus.

Click here to view the full article.