Abstract

<p>Much ado was made about the decision of the Swiss Federal Supreme Court declaring that competition law is not part of public policy pursuant to Art. 190 (2)(e) PIL Act. Too much probably. On the one hand, the present case did not offend EU competition law, which had been fully argued in the arbitration. The arbitral tribunal examined the arguments and found no violation of EU competition law. The losing party seems merely to have sought a review of the merits by the Supreme Court, which the latter is obviously not entitled to perform: Appeals on the merits, even if disguised as challenges of alleged public policy violations, are not available in any modern arbitration legislation. It would have been for the challenging party to show that competition law was violated and is part and parcel of the deliberately restrictive public policy grounds of Art. 190 PIL Act. The Supreme Court expressed incomprehension that, in its lengthy application, the challenging party did not spend more than five pages on this decisive issue (par. 1.2.3). It should also be noted that even in the EU, where a violation of EU competition law is, perhaps understandably, considered to be tantamount to a public policy violation, the argument of a purported violation cannot be raised without limitations. It must be raised <it>before the Arbitral Tribunal</it>. Failing timely argument, it is not for the state courts to interfere at the stage of a challenge of the award.</p> <p>In the well known precedent <it>Thalès v. Euromissile</it> (J.D.I.-Clunet 2/2005, p. 358), the Paris Court of Appeal refused to review an arbitral award that had purportedly failed to recognize that the contract underlying the arbitration was contrary to EU competition law and therefore void. In a similar case, the Paris Court upheld an arbitral award reminding the parties that ?La Cour, qui n’est pas le juge du procès mais de la sentence, n’exerce cette fois sur celle-ci qu’un contrôle intrinsèque puisque seule sa reconnaissance ou son exécution est examinée au regard de la comptabilité avec l’ordre public international.? The Court found that the Arbitral Tribunal had declared the contract between the parties to the arbitration void in light of EU competition law, that the issue had been fully pleaded in the arbitration, and that the challenge of the award was an inadmissible appeal on the merits (C. Paris, 1ère Ch., 23 March 2006, <it>SNCF v. Cytec Industries</it>, reported in Gazette du Palais / Cahiers de l?arbitrage No. 2006/1, p. 48).</p> <p>In light of these restrictions, the outcries of some self-declared champions of EU competition law against the decision of the Federal Supreme Court are somewhat surprising considering that the Court merely refrained from setting aside an award where the arbitral tribunal had fully examined the issue.</p>

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