The Role of New York Convention in 1958 and UNCITRAL in Protecting its Member Countries on Tax Revenue

Abstract

The novelty of this research is that this research has never been conducted before. International business actors prefer dispute resolution using arbitration due to the lack of trust in the local court system and the closed nature of arbitration dispute resolution to keep their image and final arbitration decisions. To accommodate and protect the interests of international business actors or corporations, the New York Convention 1958 and UNCITRAL were agreed by its member states to recognize and implement international arbitration decisions. However, in its implementation, there is impartiality as the New York Convention and UNCITRAL do not regulate the interests of their members for certainty and protection in tax revenue even though the compensation received by the winning parties in a dispute in international arbitration is a tax object. Previous researches focused more on prominent issues such as the execution of an arbitral decision in the member states; the refusal of an international arbitration decision in a member state; the seat of arbitration and lex arbitration. This research aims to construct new ideas and discussion by the members of the 1958 New York Convention, UNCITRAL and supporters of international arbitration to find provisions that accommodate and protect the interests of member states in tax revenue potentials. This research is empirical legal research that aims to examine the process of law and investigate the provisions, rules, applied standards and literature. The results show that several obstacles lead to potential loss in tax revenues of member states so that it is necessary for them to revise the provisions and rules of UNCITRAL. Member states need to discuss and formulate provisions and rules as regards tax revenue that are more pro-state.