Arbitration agreements

What are the formal requirements for an enforceable arbitration agreement?

Parties may enter into an arbitration agreement both before and after a dispute has arisen. There is no in-writing requirement under the Arbitration Act; however, there might be lex specialis laws that require otherwise, such as the Merchant Shipping Act. Arbitration agreements are not valid in contracts with consumers.

Furthermore, under the New York Convention of 1958, there is an in-writing requirement. Arbitration agreements entered into in Denmark thus need to be in writing in order to be enforced under several other jurisdictions.

Arbitration agreements in the event of bankruptcy may raise the question under which circumstances the arbitrations agreement is valid, when a party goes bankrupt and the bankruptcy estate does not enter into the agreement containing the arbitration clause. Arbitration agreements that regulate bankruptcy, claw-back claims, retention of title and offsetting, are not considered valid against a bankruptcy estate.

In case law, the High Court has decided whether an arbitration agreement was binding on a bankruptcy estate that charged outstanding invoice claims without the estate having entered into an mutual agreement with the counterparty.

The High Court found that a bankruptcy estate is not bound by the arbitration agreement entered into prior to the bankruptcy if the dispute concerns claw-back claims, retention of title or offsetting. If, on the other hand, the dispute is independent of the bankruptcy because the claim is based on the rules on deficiencies, then an arbitration agreement entered into prior to the bankruptcy is binding on the bankruptcy estate regardless of whether the bankruptcy estate has not entered the agreement.

Arbitral procedure

Does the domestic law contain substantive requirements for the procedure to be followed?

Under the Arbitration Act, the only mandatory provisions in regard to the procedure are that each party shall be treated equally and that each party shall be given full opportunity to present its case (see section 18 of the Arbitration Act).


When and in what form must the award be delivered?

The award is to be made in writing and is to be signed by the arbitrator or the arbitrators (see section 31 of the Arbitration Act). Furthermore, it must state the date and the place of arbitration. Lastly, after the award has been made, a copy is to be signed by the arbitrators and delivered to each party.

The time limit for receiving the copy is primarily relevant with regard to section 33, concerning corrections of errors in computation, typographical errors, etc, within 30 days.

Moreover, each party may, unless otherwise agreed within 30 days after receiving the award, request that the tribunal issue additional awards regarding claims presented during the proceedings (see section 33, subsection 3).


On what grounds can an award be appealed to the court?

An arbitral award is final and cannot be appealed to the court. The national court enforces the award; however, pursuant to section 37 of the Arbitration Act, an award may be rendered unenforceable if certain conditions are met (for example, if the tribunal was not competent in accordance with the arbitration agreement). Section 37 of the Arbitration Act is, with few alterations, an adoption of article 34 of the UNCITRAL Model Law.

Additionally, an award may be set aside if a court finds that the subject matter of the dispute is not eligible for settlement by arbitration, or if the award is manifestly contrary to public policy in Denmark.


What procedures exist for enforcement of foreign and domestic awards?

Denmark is party to the New York Convention of 1958. The rules of enforcement of foreign awards have been adopted into the Arbitration Act and, pursuant to section 38, both Danish and foreign arbitration awards are enforceable in Denmark. Awards from states not party to the New York Convention of 1958 are also enforceable in Denmark (see section 38 of the Arbitration Act).

A request for enforcement shall be sent to the court governing the jurisdiction where the party in breach has his or her residence or place of business. The request shall be in writing and include a duly certified copy of the award and of the arbitration agreement, if it is in writing.

If the award is not in Danish, the court will require a duly certified Danish translation.

The bailiff’s court may refuse enforcement if one of the conditions mentioned in section 39 of the Arbitration Act is met; this section is based on article 36 of the UNCITRAL Model Law.

There are no changes in the options regarding enforcement.