Proceedings subsequent to issuance of award

Interpretation and correction of awards

Does the arbitral tribunal have the power to correct or interpret an award on its own or at the parties’ initiative? What time limits apply?

The arbitral tribunal may correct an award on its own initiative or upon request by a party (Arbitration Act, article 41; article 68(1) of the JCAA Rules). The arbitral tribunal may also interpret an award upon request by a party (Arbitration Act, article 42; article 69 of the JCAA Rules). If a party requests the correction or interpretation of an award, the request must generally be made within 30 days (Arbitration Act, articles 41(2) or 42(3)) or four weeks (articles 68(2) and 69 of the JCAA Rules) of the receipt of notice of the arbitral award. However, there is no time limit for an award corrected upon the initiative of the tribunal, which distinguishes the Arbitration Act from the 1985 Model Law.

Challenge of awards

How and on what grounds can awards be challenged and set aside?

If an arbitral award is rendered with the place of arbitration being within the territory of Japan, such an award may be challenged and set aside under the Arbitration Act (articles 3(1) and 44). There are limited grounds on which to set aside or challenge arbitral awards, which include:

  • an invalid arbitration agreement;
  • required notice to appoint arbitrators was not given to a party;
  • a party was unable to present its case;
  • the award relates to matters beyond the scope of the arbitration agreement or claims of the arbitration;
  • the composition of the tribunal or proceeding was not in accordance with the parties’ agreement;
  • the award was based on a dispute not qualifying as a subject for arbitration; or
  • the award is in conflict with public policy (article 44(1)).

These grounds are substantially identical to those stipulated by article 34(2) of the 1985 Model Law. A challenge may not be made if more than three months has elapsed from the date on which the challenging party received notice of the award or after an enforcement decision (article 46) has become final and conclusive (article 44(2)).

Levels of appeal

How many levels of appeal are there? How long does it generally take until a challenge is decided at each level? Approximately what costs are incurred at each level? How are costs apportioned among the parties?

As a general rule, a court decision on a petition for setting aside or challenging arbitral awards can be appealed only once (Arbitration Act, article 44(8)). Such an appeal must be filed within two weeks of receipt of the decision (article 7). The challenge proceedings at the first instance usually take six months to one year, and the appeal proceedings usually take up to six months. Court fees for these processes are nominal (in many cases less than US$100) and shall be paid by the parties (as a general rule by a losing party). The parties also have to bear their respective attorneys’ fees.

Recognition and enforcement

What requirements exist for recognition and enforcement of domestic and foreign awards, what grounds exist for refusing recognition and enforcement, and what is the procedure?

Domestic and foreign awards have the same effect as a final judgment (Arbitration Act, article 45) and are enforced in a Japanese court (article 46). A party seeking enforcement based on the arbitral award should apply to a court for an enforcement decision. The grounds for refusing to recognise or enforce domestic and foreign awards are the same as those of article 36(1) of the 1985 Model Law or article V of the New York Convention. Even if an award is granted in a state that has not signed or ratified the Convention, these recognition and enforcement rules apply. In that sense, the location of the arbitration is not an issue in the recognition or enforcement of awards. It is generally considered that Japanese courts look favourably upon recognising and enforcing awards.

Time limits for enforcement of arbitral awards

Is there a limitation period for the enforcement of arbitral awards?

The Arbitration Act does not provide for a limitation period for the enforcement of arbitral awards.

Enforcement of foreign awards

What is the attitude of domestic courts to the enforcement of foreign awards set aside by the courts at the place of arbitration?

The language employed in the relevant provisions in the Arbitration Act seem to be inconsistent. Article 45 seems to stipulate that foreign awards set aside by the courts at the place of arbitration shall not be recognised or enforced (article 45(1) and (2)(vii)). However, article 46 seems to stipulate that an enforcement decision may be issued for such foreign awards at the discretion of the courts (article 46(8)). Government officers in charge of drafting these provisions have explained that the provisions should be interpreted to mean that courts shall have discretion as to whether such awards will be recognised and enforced, regardless of the language in the provisions. Accordingly, one can say that Japanese courts have discretion to recognise and enforce foreign awards set aside by the courts at the place of arbitration. There has been no court precedent that discusses this issue under the Arbitration Act as yet.

Enforcement of orders by emergency arbitrators

Does your domestic arbitration legislation, case law or the rules of domestic arbitration institutions provide for the enforcement of orders by emergency arbitrators?

The Arbitration Act does not provide for the enforcement of orders by emergency arbitrators. No case law seems to have been established for this issue. Under the JCAA Rules, parties shall be bound by, and carry out, the emergency measures ordered by emergency arbitrators, which shall be deemed to be interim measures granted by the arbitral tribunal when it is constituted (article 77(5)). However, no determination on emergency measures shall be binding on the arbitral tribunal and the arbitral tribunal may approve, modify, suspend or terminate the emergency measures in whole or in part (article 78). Neither the interim measures granted by the arbitral tribunal nor the emergency measures ordered by emergency arbitrators may be enforced with an enforcement decision granted by a Japanese court.

Cost of enforcement

What costs are incurred in enforcing awards?

To enforce an award that has been granted by an arbitral tribunal, but has not been performed voluntarily, a party generally must file a petition for the enforcement decision with the court. The enforcement decision once rendered can be used for compulsory enforcement with the assistance of a judicial authority. The costs required for these procedures are generally borne by the party seeking enforcement of the award.

Law stated date

Correct on:

Give the date on which the information above is accurate.

13 November 2020