Annulment of arbitral awards Archives - Page 2 of 3 - international litigation blog
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Annulment of arbitral awards

French “Tribunal des Conflits” Rules on Jurisdiction to Enforce Arbitral Award Relating to Public Law Contracts

In a decision of 24 April 2017, the French Tribunal des conflits ruled on the issue of whether the French civil courts or the French administrative courts have jurisdiction to enforce arbitral awards relating to public and administrative law.READ MORE

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Yukos Case: Brussels Court of First Instance Unfreezes Russia’s Assets

On 8 June 2017, the Brussels Court of First Instance handed down its decision on the legality of the seizures of assets belonging to Russia carried out by Yukos Universal Ltd (YUL) in the context of the Belgian enforcement proceedings of the Yukos case. As you certainly know, the Yukos case refers to an arbitral saga that saw three arbitral tribunals issuing three arbitral awards which cumulatively ordered Russia, in 2014, to pay USD 50 billion as reparations for the irregularities committed during the nationalisation of the Russian oil company Yukos (click here for a report of the hearing that took place before the Brussels Court of First Instance in November 2016).

Following the issuance of the award in 2014 in its favour, YUL (one of Yukos‘s former shareholder) sought the exequatur and the enforcement of the award in several countries, including Belgium. The Belgian exequatur of the award was granted to YUL in June 2015. In addition, YUL was also allowed to freeze and seize several key assets belonging to Russia as well as assets belonging to two Russian press agencies (ITAR TASS and Ria Novosti).

As a response to those precautionary seizures, Russia filed a third-party opposition before the Brussels Court of First Instance in which it challenged the legality of those seizures. As explained earlier, Russia’s main argument in opposing those seizures was that the three awards rendered in favour of Yukos‘s former shareholders had all been annulled by the District Court of the Hague (the Netherlands being the seat of the arbitration) in April 2016. As a consequence of this judgment by the District Court of the Hague, Russia argued that the Belgian exequatur order which had initially been granted to YUL in June 2015 was null and void and YUL was thus not entitled to proceed with the seizure of Russia’s assets.

In its decision of 8 June 2017, the Brussels Court of First Instance fully sided with Russia on this point.READ MORE

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Paris Court of Appeal Endorses “Adverse Inferences” Principle

On 28 February 2017, the Paris Court of Appeal (the Court of Appeal) rendered an interesting decision endorsing the “adverse inferences” principle provided for under Article 9(5) of the IBA Rules on the Taking of Evidence in International Arbitration (the IBA Rules): “[i]f a Party fails without satisfactory explanation to produce any Document requested in a Request to Produce […] the Arbitral Tribunal may infer that such document would be adverse to the interests of that Party“.

The dispute at hand arose in the context of a share purchase agreement (the SPA) concluded between Dresser-Rand Group Inc. (the Buyer), a U.S. based company, and twelve Spanish companies (the Sellers) for the purchase of all shares in Grupo Guascor SL.READ MORE

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U.K. Supreme Court Clarifies Rules to Order Security As Condition to Challenge Arbitral Awards Enforcement Proceedings

On 1 March 2017, the U.K. Supreme Court (the Supreme Court) found that an arbitral award debtor should not be required to pay USD 100 million in security as a pre-condition to adjourn the enforcement of the arbitral award until a decision is taken on the annulment of the award.

The Supreme Court’s decision was issued in proceedings between Nigerian National Petroleum Corporation (NNPC) and IPCO (Nigeria) Ltd (IPCO). The latter was awarded USD 152 million following arbitration proceedings seated in Nigeria. NNPC sought to set aside the award before the Nigerian courts initially on jurisdictional grounds and, from 2009 onwards, on allegations of fraud.

Meanwhile IPCO sought the enforcement of the arbitration award before the U.K. Commercial Court. This was granted on an ex parte basis, but was soon challenged by NNPC which sought to have the enforcement order set aside or adjourned, in light of NNPC’s ongoing challenge against the award in Nigeria. In response, the U.K. Commercial Court agreed to adjourn the enforcement order under section 103(5) of the U.K. Arbitration Act 1996 (the Act). This provision allows a court before which an enforcement action is pending to adjourn its decision pending the decision on the setting aside or suspension of the award at the seat of arbitration. In this case, however, the Commercial Court subjected the adjournment of the order to the payment of security worth USD 50 million, later increased to USD 80 million in 2008.READ MORE

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Personal Thoughts on Admissibility of Third Party Opposition Against Arbitral Awards

I wanted to share with you some general personal thoughts regarding the recent decision of the Belgian Constitutional Court (the Constitutional Court) holding that third parties should be entitled to lodge third party opposition (tierce opposition) against arbitral awards.

As we discussed before, the Constitutional Court ruled that Article 1122 of the Belgian Judicial Code violated Articles 10 and 11 of the Belgian Constitution (i.e. the provisions of the Belgian Constitution on equality and non-discrimination), as this provision allowed third parties to challenge the validity of judgments rendered by a civil or a criminal court by means of third party opposition but did not offer third parties the same possibility to challenge arbitral proceedings.

According to its current reading, third party opposition under Article 1122 of the Belgian Judicial Code aims at bringing the parties back (for new proceedings) before the same judge who previously ruled on the case in the absence of the third party. Until the decision of the Constitutional Court of 16 February 2017, however, this solution applied to judicial proceedings only.

However, now that the Constitutional Court has found that this possibility should also be offered to third parties to arbitral proceedings, does this mean that new arbitral proceedings (in the presence of the third party) will have to take place before the initial arbitrators in the event that a third party files a third party opposition?READ MORE

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Belgian Constitutional Court Rules Third Party Opposition Against Arbitral Awards Admissible

On 16 February 2017, the Belgian Constitutional Court (the Constitutional Court) held that third parties should be entitled to lodge third party opposition (tierce opposition) against arbitral awards.

This judgment arose following an arbitral award given in 2012. A company that was not a party to the arbitration proceedings but nevertheless felt aggrieved by the award initiated third party proceedings before the Brussels Court of First Instance seeking the annulment of the award. Uncertain as to whether the relevant provisions of the Belgian Judicial Code allowed a third party to stage such proceedings, the Brussels Court of First Instance stayed the proceedings and referred the matter to the Constitutional Court for a preliminary ruling.READ MORE

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French Conseil d’État Clarifies Standard of Review in Arbitral Awards Annulment Proceedings

On 9 November 2016, the French Conseil d’État (the Conseil d’État), the French Administrative Supreme Court, ruled on the standard of review to be applied by French administrative courts in actions to set aside international arbitral awards.

Under French law, an action to set aside an arbitral award should, in principle, be brought before a civil court (i.e. the Court of Appeal of the place where the award is made). However, French administrative courts have jurisdiction to hear actions to set aside arbitral awards relating to administrative contracts.

The case at hand helps clarify the uncertainty concerning the standard of review to be applied by these administrative courts.READ MORE

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