Effective enforcement of arbitration awards under international commercial disputes
4 February, 2026
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Justice is important, but cash is king!
You have won GAFTA, FOSFA, LMAA or ICAC at the UCCI arbitration proceedings, that is great! But there is a gap between the arbitration award and funds in the account.
If you are engaged in agricultural export, you know the value of time. You signed the contract – the vessel sailed. You won the arbitration was won – the funds got lost?
It is a typical situation: there is a significant time gap between the moment when you notify the debtor on your intention to apply to arbitration and the moment when there is a practical opportunity to collect funds. During this period, the debtor often has almost complete freedom of maneuver, in particular, it can:
- transfer balance to an affiliated structure in another jurisdiction;
- reset balance in the framework of its standard operating activities;
- initiate winding-up the company.
The creditors’ standard approach is consistent: to obtain an award, to recognize it in the debtor’s registration country, to submit for enforcement. Formally, this path is logical. In practice, it works primarily in disputes with reputable, large and/or transnational companies, for which evasion of the award is more expensive than voluntary enforcement.
In our opinion, there is a more reasonable and effective strategy: not to wait for the recognition stage, and sometimes even for the arbitration award itself, but to build a path to the final result immediately after making a decision on initiating arbitration proceedings.
Does this strategy work? Yes, but the tools and their effectiveness vary significantly depending on the debtor’s country.
In various legal systems, such tools are known as freezing order, precautionary attachment, arrest, property preservation etc. Their common essence is to quickly block assets before the debtor can conceal them.
Let us consider the practice of taking precautionary measures in several jurisdictions where Interlegal worked most actively in 2024-2025. The choice of a specific jurisdiction for security is determined not by the creditor’s wish, but by location of the debtor’s assets – it is necessary to act where bank accounts or other assets are located. Therefore, this is not about choice and comparison, but about specifications.
Spain
Spanish case law is one of the most pragmatic in Europe for international creditors. There is no need to choose between recognition of arbitration award (exequatur) and seizure of assets: both steps can and should be carried out in parallel.
Jointly with an application to the Tribunal Superior de Justicia on recognition of foreign arbitration award, an application temporary seizure of bank accounts or other assets shall be filed. The court shall assess two key conditions: the existence of feasible claim (fumus boni iuris) and actual risk of loss of funds (periculum in mora). In urgent cases, the court can act ex parte, i.e. without preliminary summon of the debtor. This is crucial, since notification of the debtor often becomes the trigger for asset withdrawal.
A standard time limit for recognition of award in Spain makes up 6-9 months, while in complex cases it can be longer. In case of waiting for completion of exequatur and only then searching for assets, the risk of missing a window of opportunity is critical. Instead, a parallel approach changes economic feasibility of the dispute.
An additional tool within the EU is the European Account Preservation Order (EAPO) under the EU Regulation No. 655/2014. It has cross-border effect, iy applies ex parte and, under Article 14 of the Regulation, does not always require an exact account number: it is enough to provide name of the bank and information about the debtor, so the court could contact the national authority (Information Authority) with a request for accounts. However, such a procedure requires separate justification, e.g. why the applicant cannot obtain information independently, and works differently in different EU countries, since specific details significantly speed up the process. For an agricultural trader with counterparties throughout the EU, this is a tool that allows closing the perimeter before the debtor understands what is happening.
At the beginning of the year, a client who faced gross breach of contract by the Spanish counterparty applied to us. The client duly fulfilled the delivery obligations, but the payment was not received. Debt amount amounted to several million euros, while the debtor’s behavior indicated its unwillingness to bear liability under the contract. Following initial analysis, we proposed to abandon the exclusively classic scenario (arbitration before enforcement). Obviously, in such case time was working against the creditor.
The strategy was built up in two parallel directions:
- drawing up a statement of claim to arbitration in Ukraine in accordance with the Arbitration Agreement,
- initiating precautionary measures in Spain aimed to seize the debtor’s accounts.
Having arranged an action plan with our Spanish colleagues, we entrusted seizure to them, while Interlegal expert prepared a set of documents for the ICAC at the UCCI. Special attention was paid to evidence of reality of the debt and the debtor’s financial status, with a specialized analytical company involved. Having prepared the evidence base, we simultaneously filed a claim for arbitration in Ukraine, drew up a corresponding affidavit and submitted to the first instance court in Spain a statement of claim on seizure of accounts. Statement of claim provided detailed justification for both fumus boni iuris (prima facie justification of the claims) and periculum in mora (the risk that without immediate intervention enforcement of the further award will become impossible).
Just a month later, the court satisfied an application. The debtor’s bank accounts were seized within the declared principal debt amount, interest and estimated enforcement costs. The procedure took place inaudita parte, i.e. without prior notification of the debtor. The court’s precondition was a counter-guarantee: the court fixed its fairly symbolic amount regarding the amount of security, which is common in Spanish practice, when prima facie justification of the claim is beyond doubt.
The effect was rapid. Just a week after imposing seizure, the debtor initiated negotiations. The parties reached a compromise, entered into amicable agreement, while the client received the agreed amount – that was cost and time saving, without the need in full arbitration cycle.
UAE
In the United Arab Emirates, several legal regimes operate in parallel: federal courts (onshore) and two autonomous common law zones, namely DIFC (Dubai) and ADGM (Abu Dhabi). In fact, this is not a single jurisdiction, but several parallel systems with different logics, standards of proof, budgets and levels of predictability of the outcome.
Onshore courts formally provide an opportunity of precautionary measures, including preliminary seizure of bank accounts. However, in practice, courts act cautiously, especially in monetary disputes that have not yet been considered on the merits. Even having issued arbitration award, onshore courts may require additional formal elements and may reject claim security if they see a risk of excessive interference in the debtor’s activities. A vital factor is the cost: budgets drawing up and filing applications ito onshore courts can be significant, with regards to local lawyers’ fees and court fees. However, the costs do not always correlate with chances of success.
A different aspect is typical for DIFC and ADGM courts, which operate under the common law model and are often compared to English courts. In such jurisdictions, freezing orders are treated as an effective tool for fixing assets wither before or in parallel with principal court proceedings. The court’s approach focuses not on formal status of the dispute, but on the essence of risks: whether there is a convincing prima facie case and whether an actual risk of asset dispersion has been proven. The court can act quickly, in particular, issue an award without prior notice to the debtor. Meantime, the applicant should provide an undertaking in damages, i.e. unlimited personal obligation to reimburse all losses to the debtor if seizure turns out to be unjustified. This includes not only direct costs, but also other legal effects. In some cases, liability for undertaking may exceed the principal debt amount, which makes this tool financially risky and requires a careful assessment of the claim validity before applying. Therefore, preliminary seizure of funds in the accounts of companies registered in the UAE is possible. However, its economic feasibility and effectiveness may significantly depend on the selected contractor, since standards and cost of legal services in this country vary significantly.
In one of our recent cases, we managed to secure seizure of the debtor’s bank account followed by successful recovery at fairly moderate costs in this region. Furthermore, our practice in the UAE confirms the general trend: there are no universal solutions in this country, but there is only a combination of jurisdiction, evidence base, budget and timing, which either allows you to fix funds in due time or turns the dispute into longstanding and expensive proceedings without a guaranteed financial result.
Switzerland
Switzerland is a separate legal world. It is not EU member stated; therefore, it neither applies pan-European enforcement instruments such as the EAPO nor operates according to the logic of EU procedural law. Approaches that work well in EU countries often turn out to be unsuitable in Switzerland.
A key enforcement instrument is ex parte arrest (Arrestbefehl) under the Federal Debt Collection and Bankruptcy Act (SchKG/DEBA). By its nature, arrest is not an analogue of freezing order in the logic of common law and has no features of procedural pressure. It is a technical judicial award aimed at preserving a specific asset. The court shall consider and application quickly, without summoning the debtor and solely on the basis of documents, while recognition and full enforcement of award shall be built up following seizure.
A special aspect should be taken into account: Switzerland does not directly execute foreign enforcement measures, in particular, Anglo-Saxon Worldwide Freezing Orders. Unlike EU countries, there are no mechanisms for automatic or simplified transfer of foreign court orders. Any interference with assets requires a separate Swiss award.
Meantime, foreign orders can have practical significance as a context and a signal concering existence of a dispute and risks. Jointly with local arrest, this can strengthen general perception of the situation both by the court and by the bank.
The Swiss court neither assesses emotional component of the dispute nor predicts the arbitration outcome. It is concerned of particular items: presence of a monetary claim, documentary evidence, identification of the asset (in particular, account) and factual evidence of the risk of loss of assets without immediate intervention. Abstract assumptions do not work, precise, verifiable data are required.
It is important to understand that seizure of funds is a temporary measure. Following recognition of arbitration award by the Swiss court, the creditor shall convert seizure into a definitive attachment through the enforcement service after receiving the final award. The entire cycle from seizure to definitive attachment can last one year or year and a half, but the assets shall remain blocked for the whole period. The debtor can appeal against seizure within 10 days of receiving the notification of seizure of the account, but in practice, appeals rarely cause cancellation if the initial set of documents was prepared carefully.
We faced such a specific situation in several projects against Swiss debtors. In two similar cases, the initial applications to the court were legally correct, but the court lacked either specifics regarding correlation between the claim and the account, or factual evidence of the risk of asset withdrawal. The court did not analyze circumstances in details, so it rejected applying the arrest.
In fact, the contractor stated that this was consistent with regular practice and proposed the second round. One of the clients stopped at this stage, while the other agreed to continue cooperation. A set of documents was finalized: we added information about the bank and a specific branch from the previous contract materials, as well as provided additional facts confirming the cash flow and the debtor’s behavior. As a result of the second appeal, the arrest was imposed, while the funds were successfully fixed within the claim limits.
Such examples confirm that in Switzerland there is no aggressive procedural game and automatism. Instead, there is high predictability of the result, provided that the party speaks the court’s language, i.e. the language of documents, facts and clear identification of assets. With proper preparation, the Swiss arrest remains one of the fastest and the most reliable instruments for monetary claim security under international disputes.
Egypt
Egypt is a party to the 1958 New York Convention and has a national Arbitration Law No. 27/1994 which formally provides recognition and enforcement of foreign arbitration awards in local courts of appeal, mainly at the Cairo Court of Appeal. Regulatory framework appears to be quite mature, but actual effectiveness of enforcement is largely determined by procedural details.
Egyptian courts allow taking provisional measures of protection, including seizure of bank accounts or other assets, just before formal recognition and enforcement of arbitration award. Where there are reasonable grounds for actual risk of loss of assets, courts may recognize such measures, including those issued by foreign arbitration tribunals. However, such an opportunity almost always faces significant formal barriers.
A key requirement is impeccable procedural form. Arbitration award, arbitration agreement and all application shall have a duly certified translation into Arabic and shall be filed strictly in accordance with the prescribed manner. Special attention shall be drawn to proper official notification of the debtor via bailiff in accordance with the Civil and Commercial Procedural Code. Any alternative methods of notification, such as e-mail, courier delivery or actual receiving documents by the debtor, are treated as insufficient for launching procedural deadlines.
In practice, a bottleneck is the power of attorney of the creditor’s representative. The process of its issuing, notarization, legalization and translation often takes weeks or even months. At this stage the creditor most often loses time that the debtor uses to maneuver assets before commencement of the active phase of court proceedings.
After the debtor has been duly notified, the courts usually wait for expiration of the period for a possible appeal, which in practice often makes up ca. 90 days from the date of serving an award. This significantly prolongs the entire enforcement process: it takes months from filing documents to receiving an enforcement order, and even more under complicated circumstances.
Additional unpredictability is created by absence of an exhaustive list of precautionary measures in Egyptian legislation. Judicial practice is based on situation, relying on general rules on preservation of assets and specific behavior of the parties, which causes variability of approaches even in similar cases.
As a result, Egypt can be an effective jurisdiction for fixing assets even before completion of the procedure for recognition and enforcement of arbitration award. However, this is possible only given the maximum procedural discipline: impeccable documents, prompt translations, proper official notification and carefully drawn up power of attorney. Without this, even a strong arbitration award risks being left without actual financial result.
Turkey
Turkish model of preliminary seizure looks almost ideal from the outside. It is one of a few jurisdictions where security measures can be obtained quickly (sometimes within two weeks) and even before commencement of the procedure for recognition of arbitration award (according to International Private and Procedural Law – MÖHUK). The court acts promptly, the procedure is quite formalized, from a procedural aspect it is a strong tool for early fixation of the debtor’s assets.
The mechanism is quite simple: as soon as the arbitration award is apostilled and the power of attorney is issued, local lawyers file to the court an application on preliminary seizure of the debtor’s bank accounts. The court shall consider the application in a short time and, if there is sufficient justification, shall issue a ruling. Meantime, the law stipulates a strict condition: if the creditor does not file an application on recognition of arbitration award within seven days after issuing the ruling, the seizure shall be cancelled automatically.
Theoretically, everything looks attractive. In practice, a crucial factor is almost always not speed or construction, but the cost of entry.
In fact, legal costs and court fees are quite moderate. But the problem arises at the counter-security stage. Turkish courts systematically require providing security in significant amount of, usually from 15 to 40 per cent of the claim amount. IT can be either bank guarantee or cash deposit, which is effectively blocked for the entire duration of seizure. This element often changes the case economic feasibility.
In one of our cases, following successful FOSFA arbitration, we applied for early arrest to the Turkish court at the debtor’s registration. The court immediately issued a ruling on preliminary seizure. Formally, everything worked perfectly, quickly and without procedural discussions.
However, when it got clear that in order to implement seizure, the client would have to provide a counter-security in the amount equal to one third of the debt, economic feasibility of such a stage became the subject of serious discussion. In fact, in order to freeze a claim amounting to ca. 1 million USD, it was necessary to block the client’s own funds at the level of 300-400 thousand USD for an indefinite period.
Given that the procedure for recognition of arbitration award in Turkey may last up to two years, especially in case of appeals, such a scenario required reassessment of the strategy. However, instead of folding the cards, we proposed the client to raise the stakes.
At that time, we already had both award on the merits and ruling on preliminary seizure, so the debtor has studied them and we offered voluntary enforcement. Having briefly considered them, the debtor made a proposal that satisfied the client, followed by successful case settlement.
It is a rhetorical question, whether the result would have been the same in case of proceedings solely under the standard procedure for recognition and enforcement of arbitration award.
Enforcement strategy
Time is the most valuable asset in enforcement. Time losing almost always means losing control over the outcome. This is why in international trade disputes, secured measures have ceased to be an auxiliary tool and have become a key element of enforcement strategy.
Funds rarely appears after winning arbitration proceedings. Funds appear when the creditor has secured assets in due time and deprived the debtor of the opportunity to maneuver. Arbitration award is just one of the stages, not the final goal.
A rational approach is to commence enforcement not after receiving the award, but from the moment of making a decision to apply to arbitration. At this stage, evidentiary base of risks shall be formed, pressure points shall be identified and economic feasibility of the case shall be laid. Late action almost always means that the legal position is strong, but the financial outcome is uncertain.
Security measures do not automatically guarantee enforcement. They require preparation, budget and responsibility on the creditor’s part. However, they change balance of power in the dispute, transfer discussion from the plane of principles to the plane of real funds and often create prerequisites for settlement even before completion of the full arbitration cycle.
Such issues acquire particular importance in situations where the debtor holds assets in several jurisdictions at once. In such cases, security strategy becomes much more complicated, since each individual seizure shall be carefully synchronized with the others. The fact of receiving information by the debtor about the first freezing order almost always serves as a signal for immediate withdrawal of funds from other countries where the assets are not yet blocked.
An effective approach in such situations involves preliminary identification of all jurisdictions in which the debtor may have bank accounts or other liquid assets, in parallel with preparation of procedural sets of documents with local lawyers involved upon each of them. Applications should be filed synchronously or with a minimum time gap, usually within one to three days, with priority to jurisdictions where the fastest ex parte procedures are available. In practice, this often means starting with jurisdictions that can quickly impose seisure without notifying the debtor, followed by expanding perimeter of the security.
In such a model, transaction cost increases proportionally to the number of jurisdictions involved. Meantime, the alternative of losing assets after the first seizure due to the debtor’s prompt notification in most cases makes such approach economically feasible for claims amounting to ca. 3-5 million USD and more. A key factor for success remains coordination between teams in different countries, a single evidence strategy and strict timing control. Practice shows that even a difference of 24-48 hours between the first and the further seizures can be critical; this time is quite enough to withdraw millions out of the creditor’s reach.
In order to take measures in any jurisdiction, the court does not need assumptions or value judgments regarding potential risk. Crucial factors are objective, verifiable facts indicating a real threat of loss of assets before the stage of enforcement of the award. The most convincing for the courts shall be the debtor’s actions committed after the dispute arose or receiving notification of the claim, in particular: alienation or preparation for sale of key assets, sharp corporate changes, transfer of business or cash flows to affiliated structures, emergence of new encumbrances or obligations.
The courts pay special attention to patterns of behavior, rather than isolated events. A set of such indicators as the presence of other litigation or enforcement proceedings, public signs of financial difficulties, cessation or significant reduction of operating activities, mass dismissal of key employees, rejection of normal commercial and procedural communication, forms a clear idea for the court of periculum in mora. However, the courts do not expect direct evidence of actual withdrawal of funds; it is enough to show that without immediate intervention, enforcement of the further award will be significantly complicated or impossible.
Practice confirms that even information from public sources and from other market players, given that it is properly recorded, chronologically consistent and logically connected with the debtor’s behavior, may be sufficient to take security measures. A crucial factor is not the scope of evidence, but its quality, consistency and correlation to the debtor’s actions after the conflict began, which allows the court to make a reasonable statement on the need for immediate protection of the creditor’s rights.
Practical recommendations for commencement of debt recovery
- Immediately after the dispute arises, start collecting information about the debtor’s assets: in which banks and countries are accounts opened, approximate balances, cash flow.
- Before initiating arbitration, consult with lawyers in the jurisdictions where assets are located regarding the possibility and terms of security.
- While preparing for arbitration, prepare a set for security measures in parallel: evidence of the risk of asset withdrawal, employee dismissal, other defaults and disputes, financial analysis of the debtor, etc.
- After receiving arbitration award, do not wait for the completion of recognition procedure, apply for security immediately, if you have not done so yet.
- Finally, use a single coordination center, an experienced legal advisor, resources, skills and portfolio of proven contractors in the jurisdictions you need to manage the case.
Enforcement is not the final stage of dispute, but a separate process that begins much earlier than the final award is issued. Those who understand it in due time, receive not only moral satisfaction and a document on the table, but also an economically measurable result. Cash is king!
