The United States has two parallel court systems: federal courts, with limited jurisdiction set by the Constitution and Congress, and state courts, which hear most contract disputes. Arbitration agreements are strongly enforced under the Federal Arbitration Act and foreign arbitral awards under the New York Convention. Foreign court judgments, by contrast, are enforced under state law with no treaty in force, which is a key reason cross-border contracts often choose arbitration.
Federal and state courts
Federal courts comprise 94 district courts, 13 courts of appeals and the Supreme Court, with judges appointed for life. They hear cases under federal law and, under diversity jurisdiction, disputes between citizens of different states or between a US citizen and a foreign party where more than 75,000 US dollars is at stake. A foreign company suing or being sued by a US party can often choose or remove a case to federal court on this basis.
State courts hear most contract and tort cases, and their structure and methods of selecting judges vary. Some states have specialised business courts or commercial divisions; which court is most suitable depends on the state and the dispute.123
Arbitration
The Federal Arbitration Act makes written arbitration clauses in contracts involving interstate or foreign commerce valid and enforceable, subject only to general contract defences and a 2022 carve-out for sexual assault and sexual harassment disputes. US courts generally hold parties to their arbitration agreements.
The United States has applied the New York Convention since 29 December 1970, with reservations limiting it to commercial matters and to awards made in other contracting states. The Convention is implemented through chapter 2 of the Federal Arbitration Act, so foreign awards are enforced through federal law rather than varying state rules.456
Foreign judgments and mediation
No judgment-enforcement treaty is in force for the United States. A foreign judgment must be enforced by bringing a lawsuit in a US court under the law of the relevant state, applying principles such as comity and reciprocity. The United States signed the Hague Choice of Court Convention in 2009 but has not ratified it.
The United States has also signed but not ratified the Singapore Convention on Mediation, so a mediated settlement with a US party is generally enforced as a contract. Parties who want an internationally enforceable outcome often record a mediated settlement as an arbitral award or use an arbitration clause.789
| Instrument | US status | Route |
|---|---|---|
| Foreign arbitral award | New York Convention in force since 1970 (reciprocity and commercial reservations) | Federal Arbitration Act chapter 2 |
| Foreign court judgment | No treaty in force | Lawsuit under state law |
| Hague Choice of Court Convention | Signed 2009, not ratified | Not available |
| Singapore Convention on Mediation | Signed 2019, not ratified | Not available; enforce as contract |
Documents usually needed
- Dispute resolution clause naming the governing law, forum or arbitral seat and rules
- Certified copy of the arbitral award and arbitration agreement for enforcement
- Certified copy of a foreign judgment with evidence of proper service and finality
- Evidence of the parties' citizenship and amount in controversy where federal diversity jurisdiction is relied on
Common mistakes
- Choosing a foreign court without checking how its judgment would be enforced against US assets; there is no treaty route.
- Assuming one US court system; federal and state courts have different jurisdiction and procedures.
- Drafting a narrow arbitration clause that leaves related claims in court.
- Assuming a mediated settlement is enforceable abroad under the Singapore Convention; the United States has not ratified it.
When the business crosses borders
- Arbitral awards made in the United States can be enforced in other New York Convention states; US court judgments depend on each foreign country's law.
- Foreign parties can use federal diversity jurisdiction for claims against US citizens above 75,000 US dollars.
- Because the United States applies the New York Convention on a reciprocity basis, awards from non-contracting states fall outside it.
Questions businesses ask
Will a US court enforce our home-country court judgment?
Possibly, but only through a new lawsuit under the law of the state where enforcement is sought. No treaty on enforcement of judgments is in force for the United States.7
Is arbitration a safer choice for enforcement?
Usually, for cross-border contracts. Foreign arbitral awards from New York Convention states are enforced under federal law, and the Federal Arbitration Act strongly upholds arbitration clauses.456
Can a foreign company sue in federal court?
Yes, where the claim arises under federal law, or under diversity jurisdiction against a US citizen where more than 75,000 US dollars is in dispute.3
What this guide does not yet confirm
These points need checking with a qualified local professional in the United States before you rely on them.
- Which states have adopted the Uniform Foreign-Country Money Judgments Recognition Act was not confirmed on an official source.
- State business courts and commercial divisions (for example Delaware Court of Chancery, New York Commercial Division) were not source-checked.
- Arbitral institutions active in the United States and state arbitration statutes were not reviewed.
- ICSID membership and investment treaty protection were not source-checked.
- Court fees, typical timeframes and litigation costs were not researched.
Sources and review status
Each statement is numbered to the source it was checked against. We use official sources where we can, and each statement says whether it was checked against an official or a secondary source. Sources last checked on 19 October 2026. None of it has been professionally reviewed yet: it is research checked against official and secondary sources by WONE Global, not legal or tax advice.
The federal court system consists of the Supreme Court, 13 US Courts of Appeals, 94 US District Courts and bankruptcy courts; federal judges are nominated by the President, confirmed by the Senate and typically hold office for life. Federal. Federal courts hear cases under federal law and treaties, admiralty, bankruptcy and other matters assigned by the Constitution and Congress.
Each state's constitution and laws establish its own courts, which hear most contract and tort cases, and state court judges are selected in a variety of ways, including election and appointment. State level; structure differs by state.
Federal district courts can hear civil cases between citizens of different states, or between a citizen of a state and a citizen or subject of a foreign state, where the amount in controversy exceeds 75,000 US dollars, excluding interest and costs. Federal (diversity jurisdiction). A corporation is a citizen of every state and foreign state where it is incorporated and of the state or foreign state of its principal place of business.
Statutory text read on the Cornell Legal Information Institute reproduction of the United States Code; the official text is published at uscode.house.gov.
Under section 2 of the Federal Arbitration Act, a written arbitration clause in a maritime contract or a contract involving interstate or foreign commerce is valid, irrevocable and enforceable, save on grounds that would revoke any contract or as provided in chapter 4. Federal; applies in federal and state courts to contracts involving commerce. Chapter 4 was added in 2022 and applies to disputes or claims arising or accruing on or after 3 March 2022.
Chapter 4 concerns pre-dispute arbitration of sexual assault and sexual harassment disputes (Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021); that description is general knowledge, not from the page read. Application in state courts is settled case law, not stated in the section.
The United States acceded to the New York Convention on 30 September 1970, effective 29 December 1970, applying it only to awards made in another contracting state and only to commercial relationships. Federal; reciprocity and commercial reservations.
The New York Convention is implemented in US law by chapter 2 of the Federal Arbitration Act (9 USC 201-208). Federal.
There is no bilateral treaty or multilateral convention in force between the United States and any other country on recognition and enforcement of court judgments; enforcement of foreign judgments in the United States is governed by state law and requires a lawsuit in a competent court. State law. Courts apply principles including comity, reciprocity and res judicata; many states have adopted a uniform recognition act, which was not confirmed on this page.
The United States signed the 2005 Hague Convention on Choice of Court Agreements on 19 January 2009 but has not ratified it, so it is not in force for the United States. International.
The United States signed the Singapore Convention on Mediation on 7 August 2019 but has not ratified it. International. Mediated settlement agreements are therefore enforced in the United States as contracts under state law; this consequence is our reading.
Questions on this topic
9 statements on courts, arbitration and enforcement in the United States
