On 24 February 2014, the United Kingdom notified the United Nations that the territorial application of the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards (better known as the "New York Convention") will be extended to the British Virgin Islands. The notification will take effect for the BVI on 25 May 2014.
Only recently, on 23 January 2014, a new Arbitration Act was published in the Official Gazette of the BVI. The new Arbitration Act will come into force on a date to be announced.
The new Arbitration Act is based on the latest version of UNCITRAL Model Law on International Commercial Arbitration (as amended in 2006) and envisages the creation of a BVI International Arbitration Centre as part of the BVI's plans to establish itself as a seat of arbitration. Accordingly, one of the key aims of the new Arbitration Act is to modernise enforcement of foreign arbitration awards in the BVI. This aim cannot be achieved without application of the New York Convention to the BVI in general and in particular to awards rendered in the BVI. It is therefore not surprising that the BVI requested the UK, which has retained responsibility for the BVI's international relations, to extend the application of the New York Convention to its territory.
The New York Convention seeks to provide common legislative standards for the recognition of arbitration agreements and court recognition and enforcement of foreign and non-domestic arbitral awards. The Convention's principal aim is that foreign and non-domestic arbitral awards will not be discriminated against and it obliges parties to the Convention to ensure such awards are recognized and generally capable of enforcement in their jurisdiction in the same way as domestic awards. The New York Convention is considered as a cornerstone of international commercial arbitration.