I The Doctrine Party Autonomy
 
The doctrine of party autonomy, which was first developed by academic writers then adopted by national courts, has gained extensive acceptance in national systems of law, despite their difference, common law, civil law and socialist countries have all equally been affected by the movement towards the rule relations. This development has come about independently in every country and without any concerted effort by the nations of the world; it is the result of separate, contemporaneous and pragmatic evolutions within the various national system of conflict of law[1]
The theory of party autonomy insists that arbitration should place on its goals and objectives. A complete picture of arbitration can only be presented by considering its use and purpose, and the way in which its responds to the needs of the business community.[2] This theory also suggests that party autonomy is important to develop arbitration completely. Respect for the party’s freedom of choice will fulfill the aspirations of those who use arbitration and also help in the development of arbitration an institution.[3]Party autonomy is a very important principle for private international law, code of civil, and international commercial arbitration to always adopt it[4] In other words, the foundation of international arbitration was built by the party autonomy. And hence the doctrine of party autonomy is the most principle of the international commercial arbitration.[5]
However, the relationship between the courts and private tribunals is not always as harmonious as it is today. In England, the central courts have for centuries done everything they could to protect their system, and kept watch for any violation in their jurisdiction. Even among the court themselves has faced very severe battles to sacrifice others, in order to expand their own jurisdiction. Commercial law was one unfortunate victim of this rivalry, which as the common law courts gradually usurped the powers of those institutions most responsive to external influences, has lost much of its international character. These common law courts are notably the ecclesiastical courts, the courts of Admiralty and the merchant courts. Arbitration due to being seen as a private dispute settlement mechanism designed to oust the jurisdiction of the courts and to substitute private adjudication for public decision-making, was similarly for a long time viewed with disfavor. This hostility to the private process of arbitration was instead a widespread phenomenon, and not a confinement of the English courts.[6]
Every action, however, asks for reaction. The stricter the controls are, the more vehement the demands for liberation will be needed. No matter in England or elsewhere, it is ultimate that pressures that come from the commercial community were not to be denied. Fierce judicial opposition to arbitration, under the closest judicial scrutiny, gradually gave way to a wary acceptance. It is only in the last half of the twentieth century, though it is only the past two decades for England, that courts have finally come to terms with the fact that parties of arbitration agreements want privacy, confidentiality and finality in the settlement of their disputes, and view judicial intervention in the arbitral process or in the review of awards as a measure to be taken only in exceptional circumstances. It was the arbitrators and the parties rather than the courts who should control the procedure, as it was the parties that entrusted the determination of their dispute to an arbitral tribunal. It was not the courts but the arbitral tribunal which in the first instance should decide such matters as the validity of the contract in dispute and the extent of the tribunal's jurisdiction.[7]
 
II National Sovereignty
 
States within the present framework of international commercial arbitration, are the bodies which have significant power to decide how this arbitration market should be developed. This is so as they are known as having a proper and useful part to play in the granting of supervisory and supportive measures of arbitrations. These arbitrations are bound to their jurisdiction and the arbitral awards brought before them seeking recognition or enforcement. To put it briefly, states in the matter of determining of how arbitration should operate in an international market, hold the most effective and direct controlling power.[8]The control power of the government can be practiced in the different sates of arbitration. Due to Article V of New York Convention, if at the request of the party against whom it is invoked, then it can only provide recognition and enforcement of a foreign arbitral award may be refused, only when that party provides the competent authority where the recognition and enforcement is sought, proof of one of the matters listed in the ensuing paragraphs. The grounds mentioned in paragraph (e) are those that are among these paragraphs, which specifically means that the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that order was made.[9]Clearly, Article 5 besides the beginning reasons only prevents the refusal of enforcement to be mandatory. The evidential proof of one of these reasons offers the courts of a Convention state the right to refuse recognition or enforcement, instead of enforcing by obligation. The refusal is not consistent. [10]
Besides, under Article VII of New York Convention, the provisions are not made to influence the validity of the multilateral or bilateral agreements that are recognized and enforced in regarding the arbitral awards of contracting states, nor take away any right of the interested party he may have to make available for himself of an arbitral award in the manner and to the extent, which was allowed under the law or the treaties of the state in which such an award is sought to be relied on.[11] In the argument of discussing the autonomy of the territoriality and party autonomy, one of the most remarkable features is that both support the citing of the New York Convention to support its position that the role of lex loci arbitri are apparently been recognized by territorialists on the grounds of various provisions of the Convention；[12] and that the advocates of party autonomy and the statelessness of awards, consider that Article 7 has clearly constructed that the rights of the state that enforce the arbitration is to permit the enforcement of foreign arbitral awards to follow local orders, despite its annulment by the court of origin, where the annulment under domestic laws is not the reason of the refusal of recognition of arbitral awards.         However one thing is clear, that is the importance of the recognition of the New York Convention concerning the lex loci arbitri is recognized；and while Article VII permits the lex loci arbitri to be neglected, it of course has no reason to provide the concept of a stateless award. On the contrary, it strongly claims that stateless awards should not be enforced under the Convention. One authority in the expertise of the Convention states that：[13]
Therefore states possess the decision whether to recognize arbitration as a power to legally resolve dispute mechanisms.  Each state over and above the recognition of arbitration as an alternative dispute settlement mechanism, has their own standards to determine which kinds of disputes to submit to arbitration and how arbitration mechanisms operate. All the above are all implanted in their traditional arbitration and traditional relationship between arbitration and the courts. What is more, states have the power to determine the validity of the arbitral awards in the recognition and enforcement stage.[14]
 
III National Sovereignty and Party Autonomy Spectrum
 
The traditional concept of territoriality is based on the general principle of international law, which is one state has sovereignty in his own territory, and its court has particular power in his territory to decide the legal effects of acts done, here including subsequent arbitral awards that were made. The concept of party autonomy in arbitration approves that the mandatory of arbitral awards are derived solely out of agreements of the parties, and not from national laws. None of these two methods, however, have embodied a singular and homogenous concept. The covering scope of the territoriality principle follows whether the court of a particular state agrees of the difference of the level of the decisions based on courts of other states of competent jurisdiction. Similarly, there is also no singular concept of party autonomy. Territoriality and party autonomy in fact, can not be clearly classified into two, but to take part in the spectrum together.[15]
Firstly, the law of the enforcing state will under normal circumstances ask its court to refuse to recognize and enforce an arbitral award that has been set aside by the court of competent jurisdiction. In other words, such kind of law adopts the Article 5 of the New York Convention, and is a provision that is mandatory yet has no discretion. An example of this kind of model is the Italian Code of Civil Procedure and the Netherlands Private International Law Act. Italian Code of Civil Procedure provides that
“The Court of Appeal should refuse the recognition and enforcement of foreign arbitral awards, and if the opposing proceedings between the other party or adopted arbitral award prove to be one of the following conditions：
(5) The arbitral award has not yet been bound by the party, or been set aside or suspended by the competent authorities of the state either under, or in which the law was being made.” [16]
But, Netherlands Private International Law Act has different compositions yet produce the same effects, as shown as below：
“ If there are no provisions relevant to recognition and enforcement that can be applied, or applicable provisions are permit by provisions for parties to depend on seeking the recognition and enforcing of the law of the states, the arbitral awards made in foreign states can be recognized and enforced in Netherlands….unless：
(e)The arbitral award has been set aside by a competent authority of a state that made the award.”[17]
Thus under the law of Italy and Germany, arbitral awards that are set aside in the seat of arbitration makes it mandatory to refuse to be enforced. These laws provide a fine example of territoriality. Secondly, inside its own territory, a state has the sovereign and particular power of its court to make a judgment on the legality which are done within that territory. The above discussions mentioned however are about domestic law and court decision made within the country that have not clearly been given power to recognition in relation to any one. And due to political factors, the decision of setting aside an arbitral award made by a competent judicial foreign court, usually receives the respect of the court of the state that makes the enforcement. This is particularly so when bound to rights of impeachment in cases, for example, like procedural unfairness or the obtaining of a judgment by fraud. States that follow this model have generally adopted provision in their arbitration law of provisions that accord to Article V of the New York Convention. Some states have made revisions, while others have not. Although that order annuls the arbitral award, they also have the power to allow a discretion to be enforced just like Article V of New York Convention.[18]
As mentioned above, the validity of arbitral awards depends on the lex fori and the law of the country where the winning party seeks for recognition and enforcement. Furthermore, the arbitration state will have to recognize the situation when the winning party starts to enforce the arbitral award. This kind of situation can more indirectly cause the uncertainty of international commercial arbitration.[19] In other words, due to the strong intervention of the jurisdictional system into the arbitral process, sometimes party autonomy and supervision of national courts would not be satisfied in balance. In order to solve this situation of conflict, a method that can solve this kind of dispute has to be developed under the recent supranational arbitration framework.[20]