FTAA – NEGOTIATING GROUP ON DISPUTE SETTLEMENT
1. International Agreements
Is the jurisdiction a party to the Convention on
the Recognition and Enforcement of Foreign Arbitral Awards, done at New York
on 10 June 1958 (New York Convention). If so, are there any reservations?
Name the domestic law that implements these commitments.
Costa Rica is a Party to the
Convention on the Recognition and Enforcement of Foreign Arbitral Awards
1958 (New York Convention). Said Convention was ratified by Law No. 6157 of
November 15, 1977. Costa Rica did not incorporate any reservations.
b. Is the jurisdiction a party to the Convention on the
Settlement of Investment Disputes Between States and Nationals of Other
States, done at Washington on 18 March 1965 (ICSID Convention)? Is there a
domestic implementing law? Is the jurisdiction a party to any bilateral
investment treaties providing for settlement of investment disputes between
a state and a national of another state?
Costa Rica is a party to the
Convention on the Settlement of Investment Disputes between States and
Nationals of other States, by which ICSID was established. This Convention
was ratified by Law No. 7332 of March 30, 1993.
Costa Rica also has current bilateral
treaties on the promotion and reciprocal protection of investments with the
following countries: Germany (Law No. 7695 of November 5, 1997); Canada (Law
No. 7870 of May 25, 1999); Chile (Law No. 7748 of March 23, 1998); Spain
(Law No. 7869 of April 13, 1999); France (Law No. 7691 of November 4, 1997);
the United Kingdom (Law No. 7715 of October 31, 1997); Switzerland (Law No.
3725 of August 12, 1966); Chinese Taipei (Law No. 7994 of February 21,
2000). A new agreement is also in the process of approval with Switzerland,
as well as agreements with the following countries: Argentina (Draft Law No.
13119 of June 11, 1998); the Netherlands (Draft Law No. 13713 of September
29, 1999); Paraguay (Draft Law No. 13138 of June 17, 1998); the Czech
Republic (Draft Law No. 13503 of March 23, 1999); the Republic of Korea
(Draft Law No. 14238); and Venezuela (Draft Law No. 3004 of November 10,
c. Is the jurisdiction a party to the Inter-American
Convention on International Commercial Arbitration, signed in Panama on 30
January 1975 (Panama Convention)? Is there a domestic implementing law?
Costa Rica is a Party to the
Inter-American Convention on Commercial Arbitration. This Convention was
ratified by Law No. 6165 of January 30, 1977.
The Conciliation and Arbitration
Center of the Chamber of Commerce of Costa Rica is the National Section of
the Inter-American Commercial Arbitration Commission (ICAC).
d. Is the jurisdiction a party to any other international
agreement related to international commercial arbitration?
No. Costa Rica is not a Party to other
international conventions on international commercial arbitration.
a. What is the source of law for
international commercial arbitration within your jurisdiction? Please cite.
The source of law for international
commercial arbitration would be comprised of the New York Convention, the
Inter-American Convention on Commercial Arbitration, to which Costa Rica is
a Party, as well as the corresponding provisions of domestic legislation
established in the Law on Alternate Conflict Resolution and the Promotion of
Social Peace (hereinafter, Law No. 7727).
b. Does the law contain different
rules for domestic and international arbitration?
There are no significant differences
between the law that regulates domestic and international arbitration.
c. Are there limitations on the types of disputes that
may be arbitrated?
Law No. 7727 establishes that only
economic disputes can be submitted to arbitration. Disputes may be present
or future, pending or not before courts. They should be based on fully
actionable rights of the parties and the subject matter capable of being
excluded from the jurisdiction of ordinary courts.
d. Does the law specify rules for arbitration or do the
parties have autonomy to set their rules?
The parties are fully free to
establish the rules of procedure governing the arbitration process and to
submit to the provisions contained in the rules of institutions dedicated to
administering arbitral proceedings. Law 7727 only governs if the parties
have not agreed to specific rules of procedures.
e. What is the role of the courts during an arbitration?
May courts intervene prior to or during the arbitration process?
Courts may intervene in the
arbitration process in the following conditions:
1. Handing down interim
relief before or during the process, without this constituting a
renouncing of the arbitration process (see Article 52 of Law No. 7727).
2. Jurisdiction of the
Tribunal: in Costa Rica, the arbitral tribunal has exclusive jurisdiction
to decide on objections relating to its own jurisdiction and on objections
with respect to the existence or validity of the arbitral agreement (see
Article 37 of Law No. 7727.
There is recourse to setting aside the
decision of the arbitral tribunal. Moreover, the dissenting party may file
directly before the arbitral tribunal within three days of the notification
and on reasoned grounds, an appeal that must be decided by the First Chamber
of the Supreme Court of Justice, see Article 38 of Law 7727.
Moreover, the Secretary General of the
Supreme Court of Justice, the Bar Association and institutions dedicated to
administering arbitration, may name arbitrators at the request of parties
(See Articles 26, 27, 29 of Law No. 7727).
Finally, it should be highlighted that
there exists an express prohibition in Article 25 of Law No. 7727 in the
sense that jurisdictional bodies may not serve as de jure or ex
aequo et bono arbitrators.
f. Can the courts grant interim relief pending the
outcome of an arbitration?
At any stage of the proceedings, the
competent judicial authorities may grant interim relief at the request of
the parties or the arbitral tribunal. Interim relief will not be considered
incompatible with the arbitral process, nor a renouncing or revoking of the
g. Does the law require citizenship or
a particular bar membership for participation in an arbitral proceeding, as
arbiter or representative of a party?
Pursuant to Article 19 of Law No.
7727, arbitration may be decided based on law or on equity.
An arbitrator may be any physical
person who can fully exercise his/her civil rights and who does not have any
ties whatsoever to the parties or their legal representatives and attorneys.
In cases of arbitration based on law, arbitrators shall always be attorneys
and they must be members of the Bar Association for at least five years. In
cases of arbitration based on equity, any person may be a member of the
tribunal without any requirements as to occupation or profession, with the
exception of those established by the parties for this purpose.
With regard to representation or
counsel of the parties, Law No. 7727 does not establish any restrictions
related to the nationality of the attorneys or representatives.
h. Does the law require that the proceedings be conducted
in a particular language?
Arbitration shall be conducted in
Spanish. Any writing or documentary evidence submitted in any other language
during the proceedings shall be accompanied by a translation.
i. Does the law have mandatory choice of law provisions?
No. There are no mandatory choice of
law provisions for arbitration.
j. Does the arbitration law prescribe rules for decision
making by the arbiters and the form of an award?
Costa Rican arbitration law does not
prescribe any substantive rules for resolving the merits of the dispute.
Article 22 of Law No. 7727 states:
Article 22.- Application of the Law
The arbitral tribunal shall apply
the substantive law that the parties have chosen. If the parties have not
done so, the arbitral tribunal shall apply Costa Rican law, including
conflict of law rules.
In all cases, the arbitral tribunal
shall decide in accordance with the stipulations of arbitration agreement
y and shall into account, moreover, usage and custom applicable to the
case, even on written rules, if appropriate.
Law No. 7727 stipulates that the
parties may establish the terms and conditions that shall govern the
arbitration among themselves if they so stated expressly. If no specific
rules are established, it shall be understood that the parties shall submit
themselves to the rules established by the arbitral tribunal, subject to the
law mentioned above. The provisions have more to do with procedural than
k. Is the confidentiality of arbitral proceedings and
awards protected by law?
The proceedings are protected during
the arbitration. Nevertheless, it is possible to make public the proceedings
if they are presented before a court. An example would be an action filed to
nullify an arbitral award. The First Chamber of the Supreme Court of Justice
would settle that matter. Article 60 of Law No. 7727 stipulates that once
signed, the award shall be public unless the parties decide otherwise.
l. On what grounds will the courts set aside or decline
to enforce an award?
The provisions of Article V of the New
York Convention and Article 5 of the Inter-American Convention on
International Commercial Arbitration would apply in cases that involve the
recognition and enforcement of foreign arbitral awards.
m. What is the procedure for the enforcement of an award?
The arbitral award is binding and
unappealable. Law No. 7727 stipulates that the award shall be final, binding
for the parties and unappealable. The special remedies of nullity and review
can be filed solely for specific grounds established by law. Once the award
becomes final, the respective judicial authority would be responsible for
enforcing it, in accordance with the provisions of Article 12 of the Code of
n. Please list any institutions available within your
jurisdiction that provide international commercial arbitration services.
Provide internet address where available.
The Conciliation and Arbitration
Center of the Chamber of Commerce of Costa Rica and the Costa Rican-American
Chamber of Commerce (AMCHAM) are the only entities authorized by the
Ministry of Justice to intervene in international commercial arbitration.
3. Alternate forms of Dispute
a. Are other forms of alternative
dispute resolution (mediation, conciliation) available for the resolution of
commercial disputes within your jurisdiction?
Law No. 7727 regulates other
alternative mechanisms for the resolution of commercial disputes, such as
mediation and conciliation.
b. Does the law or do the courts
mandate or encourage the use of ADR in commercial disputes? Are there any
legal impediments to using ADR for the resolution of commercial disputes?
Alternate dispute settlement
mechanisms are optional in Costa Rica law. Law No. 7727 encourages the use
of these alternate mechanisms by recognizing the right of all persons to
recourse to said mechanisms. The courts are also authorized to promote
conciliation or mediation hearings at any stage of the judicial process.
Moreover, Law No. 7727 limits the use
of alternate dispute resolution mechanisms to disputes concerning disposable
c. Can courts enforce agreements to mediate or use other
forms of non-binding dispute resolution in commercial disputes?
No, alternative dispute resolution
mechanisms are voluntary in Costa Rica law.
However, if an arbitration agreement
exists, through filing under the exception for the arbitration agreement,
courts must refer the parties to resolve their disputes via arbitration.
They cannot do the same with conciliation, but yes with arbitration.
Pursuant to Article 9 of Law No. 7727,
conciliation/mediation agreements (recognized under Costa Rican Law, see
Article 4) shall have the force of res judicata and be enforced
Are there any organizations that specialize
in ADR for commercial disputes not already mentioned?
and Arbitration Center for the National Registry of Copyright and Related
The Conciliation and Arbitration Center of the Chamber
of Commerce of Costa Rica
the Costa Rican-American Chamber of Commerce (AMCHAM)
the Federated Association of Engineers and Architects
the Ministry of Labor
the Mediation and Conflict Management Center, teaching
the inns of the Latin University, ULACIT, municipality
of Puntarenas, Santa Cruz, Pérez Zeledón and municipality of Mora.
e. What rules govern confidentiality and admissibility of
evidence in other proceedings?
As established by Article 13 of Law
No. 7727, the duties of conciliators and mediators include the duty to
maintain the confidentiality of the documents and actions of the parties in
the mediation or conciliation proceedings and on the compensatory acts in
compliance with the conciliation agreement. Article 14 of said Law also
establishes the absolutely confidential nature of the content of the
preparatory activities, conversations and partial agreements of the
conciliation agreement. Costa Rican law also establishes that the mediator
or conciliator may not reveal the content of the discussions or the partial
agreements of the parties and that, in this sense, it is understood that the
mediator or conciliator shall guard trade secrets. The law also stipulates
that the parties may not relieve the mediator or conciliator of this duty,
and that testimony or admission by the parties or mediators about what
occurred or was expressed in the mediation or conciliation hearings may not
be used in evidence.
4. Legal Sources and References
In addition to the references above is there an
authoritative Internet site containing up-to-date information on dispute
resolution facilities available in this jurisdiction?
No information is available.
Please list respected reference works
relating to arbitration and ADR in your jurisdiction.
Artava Barrantes, Sergio. El Arbitraje
en el Derecho Costarricense. San José, Editorial Sapiencia, 2000, 584 pp.
Artava, Sergio. Nueva ley de arbitraje
de Costa Rica. Aciertos y Desaciertos. Revista Ivstitia. No. 151-152,
July-Aug. 1999, pp. 22-26.
Baudrit, Diego. Bases teóricas y
prácticas para un sistema de resolución alternativa de conflictos de derecho
privado en Costa Rica. San José, AID, 1995.
Bolaños Céspedes, Fernando. Arbitraje
Comercial en Costa Rica. Revista Judicial, No. 48, December 1989, pp.
Costa Rican Bar Association.
Justicia Alternativa en Costa Rica. (San José, 1995.
Garita, Victor. Arbitraje: un nuevo
horizonte para la búsqueda de un mejor justicia. San José, Costa Rica,
Gómez Rodas, Carlos. Apuntes sobre
arbitraje comercial internacional. Revista de Ciencias Jurídicas, No.
64, Sept-Dec. 1989, pp. 11-20.
Morera Alfaro, Francisco. Costa Rica:
del sistema de justicia tradicional a la justicia accesoria. Revista de
Ciencias Jurídicas, No. 77, Jan-April, 1994, pp. 9-17.
Paris, Hernando. Resolución
Alternativa de Conflictos: diseño y estrategias Revista Ivstitia, No.
100, April 1995, pp. 8-14.
Yglesias Mora, Roberto. Comentarios
sobre el RAC. Revista Ivstitia, No. 92, August 1994, pp. 4-6.