Jesús Remón, Álvaro López de Argumedo, Jesús Saracho and Atenea Martínez, Uría Menéndez
This is an extract from the first edition of GAR’s The Guide to Challenging and Enforcing Arbitration Awards. The whole publication is available here.
Applicable requirements as to the form of arbitral awards
Applicable legislation as to the form of awards
1 Must an award take any particular form (e.g., in writing, signed, dated, place, the need for reasons, delivery)?
Article 37 of Law 60/2003, of 23 December, on Arbitration (the Arbitration Law) establishes the requirements regarding the form of an arbitration award, which are that the award must:
- be in written form, which shall be deemed to be the case if its content and the signatures of the arbitrators are recorded and accessible so as to be usable for subsequent consultation in electronic, optical or other format;
- be signed by the arbitrator, or, when there is more than one arbitrator, it may be signed by the majority of the arbitrators or by the president of the arbitral tribunal, provided that the reasons why the other signatures are missing are stated in the award;
- be reasoned, unless it consists of an award issued to record an agreement reached by the parties in the arbitration proceedings pursuant to Article 36 of the Arbitration Law;
- state the date and place of arbitration, where the award is to be considered issued;
- the award must contain the decision by the arbitrators on costs in accordance with the agreement of the parties; and
- be rendered by the arbitrators, unless otherwise agreed by the parties, within six months of the submission of the statement of defence (the arbitrators may order a two-month extension unless otherwise agreed by the parties).
These requirements apply to any kind of award, including final, partial and interim awards and awards to correct, supplement, clarify or rectify a previous one.
The Arbitration Law also establishes that failure to issue an arbitral award within the aforementioned term would not affect the effectiveness of the arbitration agreement or the validity of the award, unless otherwise agreed by the parties.
Applicable procedural law for recourse against an award
Applicable legislation governing recourse against an award
2 Are there provisions governing modification, clarification or correction of an award?
Article 39 of the Arbitration Law provides that an award can be (1) corrected regarding any miscalculation, typographical error, error in the copies made or similar; (2) clarified with respect to a particular part of the award; (3) supplemented in connection with claims made by the parties and not decided in the award; and (4) rectified when the award rules on matters that were not submitted to the decision of the arbitrators or on subjects that are not arbitrable.
The parties may request the correction, clarification, supplementation or rectification of an award within 10 days (one month in the case of an international arbitration) of notification of the award (unless another period is agreed). This request will be notified to the other parties, who will be heard before a decision is reached. The arbitrators will decide on requests for correction and clarification within 10 days (one month in the case of an international arbitration) of submission of the relevant petition. Requests for supplementation and rectification will be attended to in the 20 days (two months in the case of an international arbitration) following submission of the relevant petition.
Correction of the award may be decided on their own initiative by the arbitrators within 10 days of rendering the arbitral award (one month in the case of an international arbitration).
Appeals from an award
3 May an award be appealed to or set aside by the courts? If so, on what grounds and what procedures? What are the differences between appeals and applications for set-aside?
According to the Arbitration Law (Articles 40 and 43), an award may be set aside by the High Court of Justice of the Spanish autonomous region in which the award is issued (Article 8(5), Arbitration Law; Article 73(1)(c) of the Organic Law 6/1985, of 1 July, of the Judiciary (the Organic Law of the Judiciary)).
The grounds to set aside an award are limited to the following (Article 41, Arbitration Law):
- the arbitration agreement does not exist or is not valid;
- a party was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his or her case;
- the arbitrators have decided on questions not submitted to their decision;
- the appointment of the arbitrators or the arbitral procedure was not in accordance with the agreement of the parties, unless that agreement was in conflict with a mandatory provision of this law, or, failing any such agreement, was not in accordance with this law;
- the arbitrators have decided on questions that cannot be settled by arbitration; and
- the award is in conflict with public policy.
An application to set aside an award may be submitted to the relevant High Court of Justice in the two months following notification of the award, or, following notification of a decision to correct, clarify, supplement or rectify the award, on expiry of the term to make the decision, if said decision has been requested (Article 41(4), Arbitration Law).
The request must meet the same requirements applicable to ordinary claims before the Spanish courts (Article 399, Law on Civil Procedure) and the proceedings include the submission of a statement of defence by the counterparty within 20 days and a hearing, if so requested by the parties and deemed necessary. The judgment deciding on the request for set-aside cannot be appealed (Article 42, Arbitration Law).
Applicable procedural law for recognition and enforcement of arbitral awards
Applicable legislation for recognition and enforcement
4 What is the applicable procedural law for recognition and enforcement of an arbitral award in your jurisdiction? Is your jurisdiction party to treaties facilitating recognition and enforcement of arbitral awards?
The Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention or the Convention) (ratified by Spain without reservation in 1977) is the cornerstone of the Spanish system for the recognition and enforcement of foreign awards, without prejudice to the provisions of other, more favourable, international conventions (Article VII(1), New York Convention; Article 46(2), Arbitration Law).
Besides the New York Convention, the two most significant multilateral arbitral treaties are the European Convention on International Commercial Arbitration (the Geneva Convention) (ratified by Spain in 1975) and the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the ICSID Convention) (ratified by Spain in 1994).
Spain is also a party to a number of bilateral treaties dealing with the recognition and enforcement of arbitral awards with other countries, including Switzerland (1896), France (1969), Italy (1973), the Czech Republic (1987), Slovakia (1987), Uruguay (1987), Brazil (1989), Mexico (1989), China (1992), Bulgaria (1993) and Morocco (1997).
The set of rules governing the procedure for recognition and enforcement of foreign arbitral awards in Spain is contained in Law 29/2015, of 30 July, on International Judicial Cooperation on Civil Matters (the Law on International Judicial Cooperation) as set out in Article 46(2) of the Arbitration Law.
The New York Convention
5 Is the state a party to the 1958 New York Convention? If yes, what is the date of entry into force of the Convention? Was there any reservation made under Article I(3) of the Convention?
The New York Convention was ratified by Spain on 12 May 1977 and entered into force on 10 August 1977. Since Spain made no reservation under Article I(3) of the Convention, its scope of application is not narrowed by either the ‘reciprocity reservation’ or the ‘commercial reservation’. As a result, the Convention applies to all foreign awards irrespective of the country where they were made, and regardless of the nature – commercial or otherwise – of the legal relationship from which the dispute arose, provided that it can be settled by arbitration.
6 Which court has jurisdiction over an application for recognition and enforcement of arbitral awards?
Jurisdiction over applications for recognition of foreign awards lies with the High Court of Justice of the corresponding Spanish autonomous region (Tribunal Superior de Justicia) pursuant to Article 73(1)(c) of the Organic Law of the Judiciary and Article 8(6) of the Arbitration Law, whereas the subsequent enforcement proceedings must be brought before the appropriate court of first instance in accordance with Article 85(5) of the Organic Law of the Judiciary and Article 8(6) of the Arbitration Law.
Jurisdiction for enforcement of domestic awards lies with the courts of first instance of the place where the award was rendered in accordance with Article 545(2) of the Law on Civil Procedure and Article 8(4) of the Arbitration Law.
Notwithstanding the above, note that the courts of first instance have jurisdiction over applications for the recognition and enforcement of foreign awards rendered in the following specific countries with which Spain has signed bilateral treaties: Uruguay (1987), Brazil (1989), China (1992), Bulgaria (1993) and Morocco (1997) (see, for example, the Judgment of the High Court of Justice of Navarra of 30 May 2012).
7 What are the requirements for the court to have jurisdiction over an application for recognition and enforcement of arbitral awards? Must the applicant identify assets within the jurisdiction of the court that will be the subject of enforcement for the purpose of recognition proceedings?
From a territorial standpoint, pursuant to Article 8(6) of the Arbitration Law, jurisdiction over recognition applications of foreign arbitral awards is vested in the high court of justice of the autonomous region of the domicile or place of residence of the party against whom recognition is sought, or the domicile or residence of the person affected by the award. Subsidiarily, the territorial competence of the court will be determined by the place where the award must produce effects.
The courts of first instance will have territorial jurisdiction to enforce previously recognised awards according to the same criteria set out in the preceding paragraph, in accordance with Article 8(6) of the Arbitration Law. However, if the foreign award has its origin in Uruguay, Brazil, China, Morocco or Bulgaria, pursuant to the bilateral treaties signed between these countries and Spain (referred to in question 3), the courts of first instance of the domicile or place of residence of the party against whom recognition is sought, or the domicile or residence of the person affected by the award, will have jurisdiction to both recognise and enforce it. Subsidiarily, as in the previous case, the territorial competence of the court of first instance will be determined by the place where the award must produce effects.
An applicant must include in its claim a description of all the debtor’s assets that, to its knowledge, could be subject to enforcement pursuant to Article 549(1)3 of the Law on Civil Procedure. This may be relevant in determining jurisdiction if the territorial jurisdiction of the court is exclusively based on the existence of assets within its boundaries.
The court of first instance of the place where the award was rendered is competent to enforce domestic awards in accordance with Article 545(2) of the Law on Civil Procedure; Article 8(4) of the Arbitration Law.
Form of the recognition proceedings
8 Are the recognition proceedings in your jurisdiction adversarial or ex parte?
Recognition proceedings in Spain are adversarial pursuant to Article 54 of the Law on International Judicial Cooperation. Once an application for recognition has been filed, the court grants the party against whom recognition is sought 30 days to raise objections and to submit any supporting documents (Article 54(5), Law on International Judicial Cooperation). The court must then render its ruling within 10 days of the objections being submitted or of expiry of the time limit to submit them, as established by Article 54(7) of the Law on International Judicial Cooperation.
Form of application and required documentation
9 What documentation is required to obtain the recognition of an arbitral award?
Applications for recognition of foreign awards must be drawn up in the form of a complaint and must therefore clearly set out the factual and legal allegations on which the application is based, as well as a statement of the relief sought, as established by Article 54 of the Law on International Judicial Cooperation; Article 399 of the Law on Civil Procedure.
The New York Convention establishes that the following documents must be submitted with an application for recognition of an arbitral award:
- the arbitral award, specifically ‘the duly authenticated original award or a duly certified copy thereof’ (Article IV(1)(a));
- the arbitration agreement, specifically ‘the original agreement referred to in Article II or a duly certified copy thereof’ (Article IV(1)(b)). This requirement is construed broadly by the Supreme Court and can be met, in the absence of an agreement in writing, by evidencing the parties’ intent to submit to arbitration, including written communications and their conduct throughout the arbitral proceedings, among other means; and
- the corresponding translations (see question 10).
In addition to the above, in relation to default awards, Article 54(4)(b) of the Law on International Judicial Cooperation requires that the applicant submit evidence that the parties have been notified of the award.
Translation of required documentation
10 If the required documentation is drafted in a language other than the official language of your jurisdiction, is it necessary to submit a translation with an application to obtain recognition of an arbitral award? If yes, in what form must the translation be?
If the required documents referred to in question 9 are drafted in a language other than Spanish (or, as the case may be, the official language of the relevant autonomous region), the party seeking recognition must submit a translation of the documents (Article IV(2), New York Convention; Article 54(4)(d), Law on International Judicial Cooperation).
It is advisable that the translations of the arbitral award and the arbitration agreement be certified by either a sworn translator or a diplomatic or consular officer (Article IV(2), New York Convention), although Article 144 of the Law on Civil Procedure does not specifically require it.
Other practical requirements
11 What are the other practical requirements relating to recognition and enforcement of arbitral awards?
Pursuant to Article 54(1) of the Law on International Judicial Cooperation, applicants must be advised by a lawyer and represented by a court representative. The court representative is an independent legal professional acting as an intermediary between the party and the court, filing the briefs that the party’s lawyer prepares and notifying the party of the resolutions issued by the court.
With respect to litigation costs, which include but are not limited to the lawyers’ and court representatives’ fees, the general rule is that they must be borne by the unsuccessful party (Article 394(1), Law on Civil Procedure). In the event of partial success, each party will bear its own costs; exceptionally, however, a single party may be ordered to bear all costs if the court finds that the party’s actions in court were ill-intentioned (Article 394(2), Law on Civil Procedure).
Recognition of interim or partial awards
12 Do courts recognise and enforce partial or interim awards?
Partial and interim awards are generally recognised and enforced by Spanish courts provided that they contain an order that is both binding on the parties and enforceable outside the arbitral proceedings (Article 23(2), Arbitration Law).
By contrast, procedural orders, directions or decisions dealing with the conduct of the procedure and evidentiary measures are not recognisable or enforceable in Spain.
Grounds for refusing recognition of an award
13 What are the grounds on which an award may be refused recognition? Are the grounds applied by the courts different from the ones provided under Article V of the Convention?
Under Spanish law, recognition of a foreign arbitral award may only be refused on the grounds listed in Article V of the New York Convention, namely:
- incapacity of the parties or invalid arbitration agreement;
- lack of due process, including no proper notice of the appointment of the arbitrators or of the proceedings;
- jurisdictional issues;
- irregularity in the composition of the arbitral tribunal or arbitral procedure;
- award not binding, suspended or set aside;
- arbitrability issues; and
- public policy issues.
According to consolidated case law, the merits of the dispute are not subject to review in recognition proceedings. Rather, the scope of these proceedings is strictly limited to examining whether the recognition requirements under the New York Convention are met. Therefore, the court will be exclusively concerned with confirming the existence of both the award and the arbitration agreement (Article IV, New York Convention) and considering the specific grounds for refusal of recognition upon which the party against whom recognition is sought may rely (Article V, New York Convention).
Note that Spanish courts tend to favour the recognition and enforcement of awards unless there is a flagrant reason affecting the validity of the award that cannot be overlooked by the court. In this respect, it is well-established in case law that there is a presumption of legality of the award, which derives from Articles II and V of the New York Convention. As a consequence, there is a restriction on the causes that can be alleged to challenge the recognition of an award, and the burden of proof is on the party opposing recognition (see the judgments of the High Court of Justice of the Community of Valencia of 8 June 2012 and of the High Court of Justice of the Basque Region of 19 April 2012).
Effect of a decision recognising an award
14 What is the effect of a decision recognising an award in your jurisdiction? Is it immediately enforceable? What challenges are available against a decision recognising an arbitral award in your jurisdiction?
Upon recognition in Spain, a foreign award can produce the same legal force and effect as in the country where it was rendered (Article 44(3), Law on International Judicial Cooperation). As a result, the award may be relied on to assert its res judicata effect or to raise a set-off defence in any legal proceedings. In addition, the award may be enforced by Spanish courts in substantially the same way as a domestic award (Article 50, Law on International Judicial Cooperation).
The rulings granting recognition of a foreign arbitral award rendered by the corresponding high court of justice – the competent tribunal in most of the cases – are final and cannot be appealed. Nevertheless, those judgments issued by courts of first instance granting recognition of awards rendered in Uruguay, Brazil, China, Bulgaria or Morocco may be appealed before the provincial courts (Article 55(1), Law on International Judicial Cooperation; Article 455 of the Law on Civil Procedure). These provincial courts’ rulings granting recognition of a foreign award could be appealed before the Supreme Court pursuant to legal scholars’ interpretation of Article 55(2), Law on International Judicial Cooperation.
Decisions refusing to recognise an award
15 What challenges are available against a decision refusing to recognise an arbitral award in your jurisdiction?
A ruling refusing recognition of a foreign arbitral award rendered by a high court of justice is final and cannot be appealed. Nevertheless, decisions refusing to recognise awards originating in Uruguay, Brazil, China, Bulgaria and Morocco issued by courts of first instance may be appealed before the provincial courts (Article 55(1), Law on International Judicial Cooperation; Article 455, Law on Civil Procedure). Decisions by provincial courts could be appealed before the Supreme Court pursuant to legal scholars’ interpretation of Article 55(2) of the Law on International Judicial Cooperation.
Stay of recognition or enforcement proceedings pending annulment proceedings
16 Will the courts adjourn the recognition or enforcement proceedings pending the outcome of annulment proceedings at the seat of the arbitration? What trends, if any, are suggested by recent decisions? What are the factors considered by courts to adjourn recognition or enforcement?
Recognition proceedings in Spain may be stayed pending annulment proceedings, pursuant to Article VI of the New York Convention.
In the view of Spanish courts, Article VI of the Convention does not provide for an automatic stay of the recognition proceedings merely because an application to set aside an award is pending in the courts of the place where the award was made (see, for example, the judgment of the High Court of Justice of Catalonia of 15 December 2016).
According to a landmark decision on this subject ( judgment of the Court of First Instance of Rubí, Barcelona, of 11 June 2007), courts should only stay recognition proceedings in limited circumstances after weighing up whether the challenge of the award is based on sound grounds or is simply a delaying tactic with the aim of avoiding the immediate enforcement of an award.
Enforcement proceedings in Spain may also be stayed pending annulment proceedings, pursuant to Article 45 of the Arbitration Law. This provision enables the party against whom enforcement is sought to request the stay of the enforcement proceedings if it offers security. Once the request to stay has been filed, the court, after hearing the applicant seeking enforcement, will decide – according to Article 45(1) in fine of the Arbitration Law – on the amount of security to be furnished. However, both case law and scholars question whether Article 45(1) of the Arbitration Law confers a right to automatically stay enforcement proceedings solely on the basis of offering security and argue that courts ultimately have discretion to reject the stay of enforcement proceedings when this measure is not justified.
17 If the courts adjourn the recognition or enforcement proceedings pending the annulment proceedings, will the defendant to the recognition or enforcement proceedings be ordered to post security? What are the factors considered by courts to order security? Based on recent case law, what are the form and amount of the security to be posted by the party resisting enforcement?
Recognition and enforcement proceedings will not be effectively stayed by the competent court until security has been duly posted (Article 45(1), Arbitration Law).
Security may be provided in cash, by an indefinite joint bank guarantee payable on first demand issued by a credit institution or a mutual guarantee company (e.g., bank bond), or by any other method that, in the opinion of the court, ensures the immediate availability, as the case may be, of the relevant amounts (Article 45(1), Arbitration Law; Article 529(3), Law on Civil Procedure).
Security must be posted in the amount awarded plus any damages that could arise from delays in enforcing the award, which, in our experience, courts generally set at around 30 per cent of the amount awarded.
Recognition or enforcement of an award set aside at the seat
18 Is it possible to obtain the recognition and enforcement of an award that has been fully or partly set aside at the seat of the arbitration? If an award is set aside after the decision recognising the award has been issued, what challenges are available against this decision?
Awards fully or partially set aside at the place of arbitration are not generally recognised in Spain, pursuant to Article V(1)(e) of the New York Convention. Case law and scholars note, however, that a foreign award set aside in the country of origin may exceptionally be recognised in Spain, thus suggesting a certain degree of discretion in the application of Article V(1)(e). That solution rests, at least partially, on the Geneva Convention rule that awards may still be recognised if they have been set aside for reasons other than those established in Article IX, namely:
- invalidity of the arbitration agreement;
- violation of due process;
- excess of powers by the arbitrators; or
- irregularities in the arbitral procedure.
Spain is one of 31 state parties to the Geneva Convention; therefore, it is applicable in Spain to the recognition of awards falling under its scope and may, in any event, be relied on as a more favourable international convention, pursuant to Article VII(1) of the New York Convention and Article 46(2) of the Arbitration Law. Notwithstanding the foregoing, note that the scope of application of the Geneva Convention is more limited than that of the New York Convention.
First, the Geneva Convention (Article I(1)(a)) requires that the parties be connected with two or more different signatory states. This means that the Geneva Convention does not apply if parties come from different territorial units of the same contracting state or from one country that is not a party to the Geneva Convention.
Second, the Geneva Convention only applies to disputes that are international and commercial in nature (Article I(1)(a)).
According to legal scholars, if the award is vacated in the country of origin after recognition has been granted in Spain, the party defending an attempt to enforce the award in Spain might be able to submit a motion to the corresponding high court of justice seeking the revocation of its decision to grant recognition based on the fact that the award has been set aside (although this procedure is not specifically regulated under Spanish law).
Service in your jurisdiction
19 What is the applicable procedure for service of extrajudicial and judicial documents to a defendant in your jurisdiction?
Service of process to a defendant in Spain is essentially governed by three regulations, depending on the state in which the documents originate, as follows:
- if the documents originate in another Member State of the European Union, service of process is governed by Council Regulation (EC) No. 1393/2007 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters (the EU Service Regulation);
- if the documents originate outside the European Union but in a state that is a party to the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters of 1965 (the Hague Service Convention), service of process is governed by the set of rules of this convention; and
- beyond the scope of the EU Service Regulation and the Hague Service Convention, service of process is governed by the Law on International Judicial Cooperation.
The aforementioned regulations are analysed further in question 20, which deals with the service of process outside Spain, as that is the kind of service relevant to recognition and enforcement proceedings brought in Spain. Note here, however, that direct service by registered mail with acknowledgement of receipt or equivalent proof of delivery is admitted as a valid means to serve extrajudicial and judicial documents to a defendant in Spain pursuant to Article 22 of the Law on International Judicial Cooperation. In addition, the documents to be served must be translated into Spanish (or, as the case may be, the official language of the relevant autonomous region), unless they are drafted in a language that the addressee understands, pursuant to Article 25 of the Law on International Judicial Cooperation.
Service out of your jurisdiction
20 What is the applicable procedure for service of extrajudicial and judicial documents to a defendant out of your jurisdiction?
Service of process out of Spain is essentially governed by three sets of regulations, depending on the state in which the documents must be served.
Within the European Union, service of process is governed by the EU Service Regulation, which provides for the service of process through, inter alia, direct communication between the agencies designated by the Member States (rather than the usual method of transmitting notifications through central authorities), which are referred to as transmitting and receiving agencies.
The transmitting agency – in Spain, the court clerk – will transmit the documents directly and as soon as possible to the receiving agency by any appropriate means, provided that the content of the documents is true and faithful and that all the information in it is clearly legible (Article 4, EU Service Regulation).
The documents to be served must be translated into a language that the addressee understands or into the official language of the Member State where service is to be effected (Article 8(1), EU Service Regulation). The documents are exempt from legalisation or any equivalent formality (Article 4(4), EU Service Regulation).
The receiving agency should either serve the document itself or have it served within one month of receipt in accordance with the law of the Member State addressed, or by a particular method if so requested by the transmitting agency, unless that method does not conform to the national law of that Member State (Article 7, EU Service Regulation).
If a defendant resides outside the European Union but in a state that is a party to the Hague Service Convention, service of process is governed by the set of rules of that Convention, under which the main channel for transmitting requests for service of process is through the central authorities designated by the contracting states. In Spain, the central authority is the International Legal Cooperation Department of the Ministry of Justice. Requests for service of process must conform to the model provided by the Hague Service Convention and enclose the documents to be served, without any further requirement of legalisation or other equivalent formality (Article 3, Hague Service Convention).
Beyond the scope of the EU Service Regulation and the Hague Service Convention, service of process is governed by the Law on International Judicial Cooperation. This piece of legislation provides for service of process through a variety of procedures, including direct communication between agencies competent for the transmission of judicial and extrajudicial documents, transmission through central authorities – in Spain, the Ministry of Justice – service through diplomatic or consular agents, and direct service by registered mail with acknowledgement of receipt or an equivalent proof of delivery, provided the direct service is not contrary to the law of state addressed.
Identification of assets
21 Are there any databases or publicly available registers allowing the identification of an award debtor’s assets within your jurisdiction?
The major sources of publicly available information allowing the identification of award debtor’s assets in Spain are the Commercial Registry for companies, the Land Registry for immovable property, the Registry of Movable Goods, the Intellectual Property Registry, the Spanish Patent and Trademark Office, and the European Union Intellectual Property Office.
Information available through judicial proceedings
22 Are there any proceedings allowing for the disclosure of information about an award debtor within your jurisdiction?
Enforcement proceedings specifically provide for the disclosure of information about award debtors’ assets in Spain held by third parties, such as banking information (Articles 590 and 591, Law on Civil Procedure). In particular, Spanish courts have access to a specific tool (Punto Neutro Judicial ), which allows them to locate specific assets of the debtor.
Availability of interim measures
23 Are interim measures against assets available in your jurisdiction? May award creditors apply such interim measures against assets owned by a sovereign state?
Spain is considered a particularly effective jurisdiction for obtaining and enforcing interim measures in support of arbitral proceedings, regardless of the place of the arbitration. Spanish law confers ample powers upon arbitrators and courts alike to order interim measures, provided there is a comprehensive yet flexible procedural framework under which interim relief applications are handled with efficiency and certainty.
Unless otherwise agreed by the parties, arbitrators sitting in Spain are vested with the broadest powers to grant, at the request of any party, any interim relief that they may consider necessary to safeguard the effectiveness of the future award on the merits (Article 23, Arbitration Law). Interim relief decisions are immediately enforceable when the arbitrators are sitting in Spain; otherwise, prior recognition is necessary.
However, Spanish courts are expressly empowered to grant interim relief in support of arbitration, irrespective of the place of arbitration and regardless of the stage of the arbitral proceedings (Article 11(3), Arbitration Law).
The Law on Civil Procedure does not list or in any other way restrict the range of interim measures available to Spanish courts, so the petitioner may call for the adoption of any interim measure appropriate for securing the future enforcement of the award. Article 727 of the Law on Civil Procedure provides a sample list of interim measures, summarised as follows:
- provisional attachment of assets, which is particularly appropriate to secure the enforcement of monetary awards;
- court control or administration of productive assets;
- deposit of movable property;
- inventory of defendant’s assets;
- cautionary notice of arbitration or judicial proceedings at the land registry and other public registries, which pre-empts subsequent third-party rights to the property that is the subject of arbitration proceedings;
- other registry entries if registry publication is useful to ensure adequate enforcement;
- court order to refrain from conducting certain activities;
- intervention and deposit of income obtained through an activity considered unlawful and of which prohibition or cessation is sought;
- temporary deposit of the works or objects allegedly produced contrary to the rules on intellectual and industrial property; and
- stay of resolutions adopted by either a general meeting of a company or its board of directors.
An application for a judicial interim measure pursuant to Article 726 of the Law on Civil Procedure will be successful if the court is satisfied that:
- the party seeking interim relief is likely to succeed on the merits (fumus boni iuris);
- the effectiveness of any redress that may eventually be granted in the relevant arbitral or judicial proceedings would be jeopardised should the interim measure be denied (periculum in mora);
- the requested measure is proportional to, and consistent with, the main action; and
- the applicant has offered (and will provide) security sufficient to compensate any damage resulting from the adoption of the interim measure.
Property of a foreign state is immune from interim measures unless the state has consented, either expressly or impliedly, to the taking of such measures. Express consent must be given by international agreement, by a written contract, or by a declaration before the court, or by a written communication in a specific procedure. Implied consent is only deemed fulfilled upon allocation by the foreign state of property for the satisfaction of the claim that is the subject of the relevant proceeding (see question 34).
Procedure for interim measures
24 What is the procedure to apply interim measures against assets in your jurisdiction? Is it a requirement to obtain prior court authorisation before applying interim measures? If yes, are such proceedings ex parte?
An interim measure may be requested from a court, even before arbitration or judicial proceedings are brought, as long as the applicant proves the existence of urgent and exceptional circumstances (Article 11(3), Arbitration Law). This preliminary measure will nevertheless expire if a request for arbitration is not lodged within 20 days of the date on which the interim measure was ordered.
Interim measures are not generally granted before the party against whom the measures are sought has been afforded an opportunity to be heard. The traditional reluctance of Spanish courts to order ex parte measures may be overcome, however, if there are reasons of extreme urgency or if hearing the party against whom interim relief is sought before ruling on the issue may jeopardise the effectiveness of the measure requested (Article 733(2), Law on Civil Procedure). In these cases, any parties not heard before the interim measure was ordered will subsequently have an opportunity to challenge the measure, and eventually have it lifted or replaced with alternative security (Articles 739, 740 and 741, Law on Civil Procedure).
The ruling on an application for interim measures is subject to appeal (Articles 735(2), 736(1) and 741(3), Law on Civil Procedure). However, should the measure be granted, the filing of the appeal will not prevent the measure from being enforced (Articles 735(2) and 741(3), Law on Civil Procedure).
Interim measures against immovable property
25 What is the procedure for interim measures against immovable property within your jurisdiction?
There are no specific rules dealing with interim measures against immovable property other than those outlined in questions 23 and 24.
Interim measures against movable property
26 What is the procedure for interim measures against movable property within your jurisdiction?
There are no specific regulations governing the procedure for interim measures against moveable property other than those outlined in questions 23 and 24.
Interim measures against intangible property
27 What is the procedure for interim measures against intangible property within your jurisdiction?
There are no specific regulations governing the procedure for interim measures against intangible property other than those outlined in questions 23 and 24.
28 What is the procedure to attach assets in your jurisdiction? Is it a requirement to obtain prior court authorisation before attaching assets? If yes, are such proceedings ex parte?
Attachment proceedings are triggered by enforcement applications. Courts of first instance have jurisdiction over both applications for enforcement of previously recognised awards and domestic awards (Article 8(4) and (6), Arbitration Law; Article 545(2), Law on Civil Procedure; Article 85(5), Organic Law of the Judiciary).
Enforcement is granted by the court by means of an order (orden general de ejecución) provided that the enforcement application meets the procedural requirements and conforms with the nature and content of the award upon which enforcement is sought (Article 551(1), Law on Civil Procedure).
No appeal may be brought against the order granting the enforcement, although the enforcement debtor may raise objections within 10 days of the date the enforcement order was notified (Article 551(4), Law on Civil Procedure). Enforcement may only be objected to on very limited grounds, such as expiry of the enforcement action (Article 518, Law on Civil Procedure; Article 50(2), Law on International Judicial Cooperation), and payment or settlement recorded in a public document (Articles 1156 and 1819, Spanish Civil Code). However, enforcement proceedings will not be stayed as a result of any of these objections being raised (Article 556(2), Law on Civil Procedure).
The court clerk responsible for the enforcement proceedings will, on the same day or on the day following the granting of enforcement by the court, issue a ruling ordering, inter alia, the attachment of assets indicated in the application for enforcement or, as the case may be, the measures aimed at locating assets available for attachment (Article 551(3), Law on Civil Procedure). Specifically, the court clerk may order financial institutions, public entities, public registries, companies and individuals to disclose information about any assets and rights owned by the enforcement debtor that they may be aware of (Articles 590 and 591, Law on Civil Procedure).
Unless otherwise agreed by the parties, the court clerk responsible for the enforcement proceedings will attach the enforcement debtor’s assets, taking into account their greater liquidity or ease of realisation (Article 592(1), Law on Civil Procedure).
Attachment against immovable property
29 What is the procedure for enforcement measures against immovable property within your jurisdiction?
Should the attached assets be real estate property or any other assets or rights subject to registration, the court clerk responsible for the enforcement will, at the request of the party seeking enforcement, order that a cautionary notice of attachment be recorded at the land registry or an equivalent notice at the registry in question to pre-empt any subsequent third-party rights to the attached assets (Article 629, Law on Civil Procedure).
Attachment against movable property
30 What is the procedure for enforcement measures against movable property within your jurisdiction?
If bank accounts are attached, the court clerk responsible for the enforcement will issue a withholding order against the bank for the specific amounts attached. The bank must fulfil the order as soon as it has been served, issuing a receipt setting out the amounts the party subject to enforcement owns at that specific moment (Article 621(2), Law on Civil Procedure).
Should the assets attached be securities or other financial instruments, a notice of attachment will be given to whomever may be obliged to pay them or to the issuing institution, as the case may be (Article 623(1), Law on Civil Procedure).
Should titles, securities or particularly valuable objects or anything needing special conservation be attached, these may be deposited in the most suitable public or private establishment (Article 626(1), Law on Civil Procedure).
Attachment against intangible property
31 What is the procedure for enforcement measures against intangible property within your jurisdiction?
There are no specific regulations governing the procedure for enforcement measures against intangible property other than those outlined in question 28.
Enforcement against foreign states
32 Are there any rules in your jurisdiction that specifically govern recognition and enforcement of arbitral awards against foreign states?
Article 16 of the Organic Law 16/2015, of 27 October, on the privileges and immunity of foreign states, international organisations with headquarters or branches in Spain and international conferences and meetings held in Spain (Law on the Privileges and Immunity of Foreign States) specifically provides that foreign states are prevented from asserting immunity against proceedings for the recognition of foreign arbitral awards before Spanish courts.
Service of documents to a foreign state
33 What is the applicable procedure for service of extrajudicial and judicial documents to a foreign state?
As a general rule, service of extrajudicial and judicial documents to a foreign state will be transmitted through diplomatic channels or by any other means accepted by the state concerned (see question 20).
Immunity from enforcement
34 Are assets belonging to a foreign state immune from enforcement in your jurisdiction? If yes, are there exceptions to such immunity?
According to Article 17 of the Law on the Privileges and Immunity of Foreign States, property of a foreign state is immune from enforcement measures unless the state has consented, either expressly or implicitly, to the taking of such measures, or it has been established that the property is specifically in use or intended for use by the state for other than government non-commercial purposes, provided that the property is within Spanish territory and has a connection with the foreign state against which the proceedings were brought, even if it is destined for an activity other than that which gave rise to the dispute.
Pursuant to Article 18(1) of the Law on the Privileges and Immunity of Foreign States, express consent must be given by an international agreement, a written contract, a declaration before the court or a written communication in a specific procedure. Implied consent is only considered to be fulfilled upon allocation by the foreign state of property for the satisfaction of the claim that is the subject of the relevant proceeding as set out in Article 18(2) of the Law on the Privileges and Immunity of Foreign States.
The following properties will be deemed specifically in use or intended for use by foreign states for government non-commercial purposes (Article 20, Law on the Privileges and Immunity of Foreign States):
- property, including bank accounts, that is used or intended for use in the performance of the functions of the diplomatic mission of the state or its consular posts;
- military property;
- property of the central bank or other monetary authority of the state;
- property forming part of the cultural heritage of the state or part of its archives or part of an exhibition of objects of scientific, cultural or historical interest, provided that they are not placed or intended to be placed on sale; and
- the foreign state’s vessels and aircraft.
Waiver of immunity from enforcement
35 Is it possible for a foreign state to waive immunity from enforcement in your jurisdiction? If yes, what are the requirements of such waiver?
Article 17(1) of the Law on the Privileges and Immunity of Foreign States provides that a foreign state may waive immunity from enforcement in Spain. Requirements for such a waiver are contained in Article 18(1) of the Law on the Privileges and Immunity of Foreign States (see requirements in question 34).
Subscribe here for related content, breaking news and market analysis from Global Arbitration Review.
Covering commercial and investment arbitration, Global Arbitration Review is the unofficial broadcaster for members of the international arbitration community, keeping them feeling up to date and informed.