New York Convention

The 1958 United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which obligates the approximately 170 signatory states to recognize and enforce arbitral awards issued in other contracting states, subject to limited grounds for refusal. The New York Convention is the foundational instrument making international arbitration commercially viable as a dispute resolution mechanism, because it provides a predictable legal pathway for enforcing awards across borders without relitigating the merits. For litigation funders financing international arbitration claims, the Convention's broad enforcement network substantially de-risks the collection phase of funded proceedings compared to litigation in national courts. Funders assess the respondent's asset base in Convention states as a key component of post-award recovery analysis.

Because the Convention gives arbitral awards a far broader and more predictable enforcement path than most court judgments enjoy across borders, funders often prefer arbitration clauses over litigation forums when both are available in a cross-border commercial dispute, all else equal. Underwriting an international arbitration claim includes mapping the respondent's asset base against Convention signatory states, since that mapping is what actually determines whether a favorable award converts into real recovery.