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Arbitration proceedings are becoming increasingly complex.[1] Pleadings are getting longer. Written evidence and the taking of evidence in general are becoming more extensive. 100,000 pages of documentary evidence in a single arbitration proceeding? This is no longer uncommon.

But does this mean that awards in arbitration must also become increasingly comprehensive? It is a nearly universal principle that, unless otherwise agreed, international arbitral awards must set forth the reasons for the tribunal’s decision.[2] The requirement for a reasoned award is reflected in international arbitration conventions, national arbitration laws and institutional arbitration rules. But how far does the obligation to give reasons for an arbitration award go? The rules and regulations are usually silent on the exact scope. Yet, especially against the background of the increasing complexity and scope of arbitration proceedings, this is a legitimate question. Are there minimum requirements for reasons in an arbitral award? Does the arbitral tribunal have to consider all the evidence presented individually and comprehensively in its reasons? Is there a difference between arbitration awards and the reasons for state court judgments? These and further questions were the subject of a recent decision by the Higher Regional Court (Oberlandesgericht, OLG) of Frankfurt am Main, Germany. In the proceedings, the applicant sought declaration of enforceability of an ICC award rendered in Italy (OLG Frankfurt am Main, decision dated 1 December 2022, Case No. 26 Sch 4/22).

Factual Background

The OLG Frankfurt’s decision was based on the following facts:

The applicants were shareholders of the Italian company C – a company in the Chemistry sector. The applicants had sold their shares in the company to the defendant via an SPA concluded in 2008. The sale was fully executed.

Ten years later, in 2018, the buyer/defendant initiated ICC arbitration proceedings against the sellers in which it sought a declaration that the SPA and the share transfer were invalid on the grounds of fraudulent behavior of the sellers. The buyer/defendant argued that the sellers had concealed a serious environmental pollution on C’s site. The sellers, in turn, invoked the statute of limitations. The sellers argued that more than five years had elapsed since the time when the facts on the basis of which the fraudulent behavior was claimed became known. In such case, Italian Law excludes the right of a fraudulently deceived party to obtain voidance of a contract.

The arbitral tribunal sided with the sellers and rejected the buyer’s/defendant’s arguments. The arbitral tribunal ruled that, contrary to the buyer’s assertion, the buyer was able to identify what it claimed was fraud as early as 2009. Consequently, the arbitral tribunal dismissed the buyer’s claims on the grounds that they were time-barred. The tribunal ordered the buyer to reimburse the sellers for their legal fees.

The buyer, not happy with the decision, filed an application in Italy to annul the arbitral award. The sellers, on the other hand, applied to the OLG Frankfurt for a declaration of enforceability of the arbitral award regarding the legal fees awarded to them (Section 1064 German Code of Civil Procedure).

Arguments of buyer/defendant in OLG proceedings

The buyer/defendant was of the opinion that recognition and enforcement of the award would be in violation of ordre public and as such in violation of Art. V (2) (b) of the New York Convention.

The buyer/defendant argued that

  • the assessment of evidence carried out by the arbitral tribunal in connection with the circumstantial evidence was “contradictory, unclear and incomplete“;
  • it remained completely open how the circumstantial evidence taken as a basis by the arbitral tribunal allows the conclusion to be drawn as to the concrete knowledge of the buyer of the environmental pollution;
  • the train of thoughts contained the error of reasoning “petitio prinicipii” because the arbitral tribunal assumed circumstantial evidence as proven even though this information was in itself in need of proof.

The buyer requested that the arbitral award not be declared enforceable or, alternatively, that the outcome of the annulment proceedings in Italy be awaited. 

The OLG Frankfurt’s Ruling

The OLG Frankfurt ruled in favour of the sellers and declared the arbitral award enforceable. The OLG Frankfurt left no doubt that the reasons put forward by the buyer did not suffice for an ordre public violation. The OLG found the reasons given by the arbitral tribunal for the award to be sufficient. 

(1) Ordre public threshold

At the outset, the OLG Frankfurt set out the extremely high requirements for an ordre public violation. A foreign arbitral award can only be refused recognition and enforcement on the basis of procedural ordre public if the arbitral proceedings suffer from a serious defect affecting the foundations of state and economic life in Germany. Accordingly, an arbitral award is to be denied recognition, for example, if it was obtained by procedural fraud.

The OLG Frankfurt further emphasizes the principle of “no révision au fond“. A state court is generally prohibited from replacing the arbitral tribunal’s assessment of the evidence with its own assessment of the evidence. The fact that the state court might have assessed the evidence differently is therefore not in itself a ground for denial of recognition. 

(2) Minimum requirements

The OLG Frankfurt rules that it is generally accepted that the standards applied to the drafting and reasoning of arbitral awards are not the same as those applied to judgments of state courts. This is, among others, due to the fact that the reasons for an arbitral award are not intended to ensure its – in any case limited – review by a state court, but are done in the interest of the parties. Unless the parties agree otherwise, the reasoning of an arbitral award only has to meet certain minimum requirements. The OLG Frankfurt explained what these “certain minimum requirements” are, namely:

  • It is sufficient if the arbitral tribunal provides a brief summary of the considerations supporting the award in its reasoning;
  • The arbitral tribunal must address the issues which, in the view of the arbitral tribunal, are central to the outcome of the arbitral proceedings;
  • The arbitral tribunal must comment on the merits of the parties’ main defences, but need not address every point of the parties’ submissions.

(3) No nit-picky approach to the assessment of evidence

The OLG Frankfurt finds that the buyer/defendant was considerably overstretching the requirements for the evaluation of circumstantial evidence. The OLG Frankfurt states:

A violation of the procedural ordre public international cannot be justified by the fact that an arbitral tribunal, when evaluating evidence, does not specify in detail what concrete evidentiary value it has attributed to individual pieces of evidence [….]. Moreover, the defendants fail to recognize that the point of circumstantial evidence is precisely to evaluate all the circumstantial evidence within the framework of an overall view.

Arbitral tribunals do not have to mention in detail what specific evidentiary value they attach to individual pieces of circumstantial evidence. Arbitral tribunals also do not have to give so-called initial probabilities in percentages in the context of the assessment of evidence and then make calculations with these (that fits the saying “judex non calculat“).

Our Assessment: Watch out arbitrators! Or maybe not?

Arbitrators do not have to worry. The OLG Frankfurt means well for arbitrators and sets only minimum requirements for the reasons for arbitral awards. Also, the decision of the OLG Frankfurt does not stand alone, but confirms national and international practice. According to international scholars, awards must be legitimate, reasonable, categorical, comprehensible, unconditional and unambiguous.[3] Awards should therefore be written in a way that allows “an outsider top the case to understand the award and how the arbitrator reached his decision“.[4] Awards should address “all matters in issue; and no more“.[5]

[1] For a very vivid illustration of this phenomenon: J. Risse, An inconvenient truth: the complexity problem and limits to justice, Arbitration International, Vol. 35, Issue 3, 2019, pages 291 – 307.

[2] G. Born, International Commercial Arbitration (Third Edition), 2022, introduction to Chapter 23.03.

[3] Kurochkin, Arbitration Awards: Substantive Requirements, Legal Effects and Optimal Means of Recourse, pp. 115 et seq., paras. 6.14 et seqq.; cf. Keong, The Arbitration Award, p. 7.

[4] Keong, The Arbitration Award, p. 8.

[5] Keong, The Arbitration Award, p. 9.


Dr. Max Oehm, LL.M. is an Associate in the Dispute Resolution team at Baker McKenzie in Frankfurt. Max advises on international arbitration and commercial litigation matters. He represents clients in cases focusing on large industrial projects such as power plant construction and gas storage facilities. Max teaches at the University of Mannheim, Germany. Max can be reached at and +49 69 29908334.


David Weiss is a member of the Dispute Resolution team at Baker McKenzie in Frankfurt. David advises on (international) arbitration and commercial litigation matters. He represents clients in cases focusing on pharmaceutical disputes, advisor liability and IT litigation. David can be reached at and +49 69 299080.