Ecuadorian Bill for the Enforcement of Awards and Judgments: will recent developments give the bill further impetus?

The Bill for the Enforcement of Awards and Judgments was introduced into the National Assembly of Ecuador in December 2013, against the backdrop of the ongoing dispute between Chevron and Ecuador which is playing out in a number of fora. Recent developments in this matter, as well as the US Supreme Court’s decision in the case of BG v Argentina, in which Ecuador had submitted an amicus curiae brief in support of Argentina, may give¬†Ecuador further will to bring the Bill into law.

The Bill seeks to amend various pieces of legislation, including Ecuador’s Arbitration Law (the “Ley de Arbitraje y Mediaci√≥n”), with the objective of strengthening the mechanisms of protection of public resources and services. The Bill attempts to achieve its purpose by two broad means, firstly, by amending provisions relating to the enforcement of foreign awards and other measures issued by arbitral tribunals and secondly, by amending laws to bolster the protection given to State assets and resources.

According to the Explanatory Memorandum of the Bill, existing mechanisms have proven insufficient to preserve the integrity of public resources from “illegitimate” enforcements, attachments and other measures taken against State property in the satisfaction of judgments and arbitral awards against the State, an experience expressly stated as one similarly shared by Ecuador’s sister republics, and specifically, the Republic of Argentina. The Explanatory Memorandum also highlights the need for the creation of rules to regulate the performance and compliance of the Ecuadorian State with rulings adverse to its interests.

Whilst Ecuador has signed the New York Convention on Recognition and Enforcement of Foreign Arbitral Awards, if passed into law, the Bill will have the effect of making enforcement of foreign awards more onerous and enforcement against state assets more difficult.

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