Annulment Proceedings Research Articles

Selected Swiss Federal Tribunal Judgments in 2023 in Annulment Proceedings against CAS Awards

Selected Swiss Federal Tribunal Judgments in 2023 in Annulment Proceedings against CAS Awards

When Two Worlds Collide: Balancing the Finality of Arbitral Awards and Effectiveness of EU Competition Law in Austrian Annulment Proceedings

When Two Worlds Collide: Balancing the Finality of Arbitral Awards and Effectiveness of EU Competition Law in Austrian Annulment Proceedings

Dutch Supreme Court Finds for the First Time on Corruption and Arbitration in Context of Annulment Proceedings: Case Report on the Bariven and Yukos Decisions

This article reports on the findings of the Dutch Supreme Court in its first two decisions on corruption and arbitration in the context of annulment proceedings. In the Bariven decision of 16 July 2021, the Supreme Court reinstated an arbitral award which the Court of Appeal in The Hague had annulled, citing strong indications of corruption. The Yukos decision was handed down on 5 November 2021 but did not put an end to a saga which has been playing out in the Dutch courts since 2014. The annulment proceedings are currently pending before the Amsterdam Court of Appeal which will have to find on the merits of the Russian Federation’s procedural fraud defence following cassation by the Supreme Court over a refusal to admit this defence by the Hague Court of Appeal. This article is a case report, and its aim is limited to providing non-Dutch readers with insight into the Bariven and Yukos Supreme Court decisions. The article includes an introduction on Dutch annulment proceedings, the public policy exception as applied in such proceedings, and the related but distinct action of revocation. international arbitration, corruption, Netherlands, annulment, revocation, Bariven, Yukos

A Party’s Failure to Timely Rely on Notorious Publications Edited by an Arbitrator Precludes the Setting Aside of an Award for Lack of Impartiality. Note on Paris Court of Appeal Decision of 22 February 2022

The Paris Court of Appeal has recently held that a party was precluded from relying for the first time before it on the arbitrator’s alleged partiality based on articles authored by third parties and published in a journal co-edited by the arbitrator, whose existence and contents were notorious at the time of his appointment. To be allowed to rely on these facts in annulment proceedings, the applicant ought to have raised them before the sole arbitrator within the time limit provided for in the ICC Rules to challenge an arbitrator. A party’s failure to do so leads to the inadmissibility of its setting aside application. For an information to be notorious, it is sufficient that it be “easily accessible”. The fact that such information is contained in a database subject to a paying subscription is not sufficient to characterise a default of accessibility for arbitration professionals. Accordingly, information contained in such a database may be considered as “easily accessible”, and therefore “notorious” for arbitration practitioners. In addition, neither the scientific work freely carried out by the arbitrator in the context of his activities as editor of an arbitration journal, nor the titles and content of the articles relied upon to seek the setting aside of the award were such as to call into question the arbitrator’s impartiality.

Article: A Wolf in Sheep’s Clothing: Overlooked Procedural Deficiencies in ICSID’s Annulment Structure

i style=""Over the past several decades, the International Centre for the Settlement of Investment Disputes’ annulment procedure has proved an object of consternation for states and investors alike. The substantive principles of Article 52 of the ICSID Convention are commonly criticized as either too expansive or too narrow. The author contends that this criticism is misplaced, however, and that it is procedural deficiencies which will plague ICSID’s annulment proceedings in this time of broad investor-state dispute reform. Overconcentration of annulment committee appointment and challenge power in the hands of the Chairman of the ICSID Committee and ICSID Secretariat, compounded by continued problems of ‘double-hatting’ at the annulment level, threaten the due process rights and autonomy of parties to ICSID annulments. The author proposes a feasible restructuring of annulment appointment and challenge procedure under the ICSID Arbitration Rules as a potential rectification of these procedural flaws, including a dispersal of appointment power, a new pool system for annulment panel members, and the creation of an independent review body to consider challenges to annulment panel members.

Micula v Romania – A Saga of Lasting Significance

The dispute between the Micula parties and Romania has continued for over 16 years raising issues in investment arbitration and European Union (EU) law and particularly the enforceability of arbitral awards in varying jurisdictions. The proceedings, first brought before an ICSID Tribunal in 2005 (followed by annulment proceedings) have since led to enforcement proceedings across multiple fora including the EU Commission (involving State aid rules) as well as EU, English and US domestic courts. Whilst the Micula saga may be inching near to a conclusion, it threatens to cause lasting damage to what was intended to be a closed ecosystem of the ICSID Convention. A precedent has been set whereby instead of enforcing awards in accordance with the provisions of the ICSID Convention, Courts of ICSID Member States may proceed to enforce awards as though the ICSID Convention did not apply. As such, a discussion may need to take place in relation to the possible amendment of certain provisions of the ICSID Convention; however, in the short term it is important that supranational bodies unrelated to the ICSID Convention do not interfere with the obligations of ICSID Member States or purport to prohibit ICSID Member States from complying with ICSID awards.

THE EFFECT OF COMPOSITION OF CREDITORS ON THE ACTION FOR ANNULMENT

Bu çalışmada konkordatonun tasarrufun iptali davasına etkisi incelenmiştir. Tasarrufun iptali davası, İcra ve İflâs Kanununda düzenlenen iptal sebeplerinden birinin var olması halinde, alacaklılar tarafından, borçlu ve lehine tasarruf yapılan üçüncü kişiye karşı açılır ve takip alacaklısına tasarrufa konu mal üzerine haciz koydurmak suretiyle alacağını tahsil etme imkânı verir. Konkordato ise borçlarını vadesi gelmiş olmasına rağmen ödeyemeyen veya ödeyememe tehlikesi altında bulunan borçlunun, vade verilmek veya tenzilat yapılmak suretiyle borçlarını ödeyebilmesi veya muhtemel bir iflâstan kurtulması için alacaklılarıyla yapacağı konkordato anlaşmasına dayalı bir cebri icra kurumudur. Mahkeme tarafından konkordato mühleti verilen borçlunun, konkordato mühletinden önce veya mühlet içinde mal ve hakları üzerinde yaptığı tasarrufların iptal davasına konu olup olamayacağı ve iptal şartları, konkordato ve iptal davasına ilişkin düzenlemeler birlikte ele alınarak değerlendirilmelidir. Konkordato ve iptal davasının kesiştiği alanlara ilişkin olarak incelenmesi gerekli başlıca sorunlar şu konu başlıklarıyla özetlenebilir: Borçlunun tasarruflarını konkordato mühletinden önce veya mühlet içinde yapmasının iptal sebeplerine etkisi, konkordato mühleti verilen borçlunun malvarlığı üzerindeki tasarruflarının iptale tâbi olup olamayacağı, konkordato mühletinin tasarrufun iptali davasına etkisi, iptal sürelerinin nasıl hesaplanacağı, iptal davası için aranan özel dava şartlarının konkordato mühleti verilen borçlu aleyhine açılan iptal davasında aranıp aranmayacağıdır. Bu çalışmada, var olan ve olması gereken hukuk bakımından, yukarıda belirtilen konu başlıklarına ilişkin tespit ve öneriler ortaya konulmuştur.

Micula v Romania – A Saga of Lasting Significance

The dispute between the Micula parties and Romania has continued for over 16 years raising issues in investment arbitration and European Union (EU) law and particularly the enforceability of arbitral awards in varying jurisdictions. The proceedings, first brought before an ICSID Tribunal in 2005 (followed by annulment proceedings) have since led to enforcement proceedings across multiple fora including the EU Commission (involving State aid rules) as well as EU, English and US domestic courts. Whilst the Micula saga may be inching near to a conclusion, it threatens to cause lasting damage to what was intended to be a closed ecosystem of the ICSID Convention. A precedent has been set whereby instead of enforcing awards in accordance with the provisions of the ICSID Convention, Courts of ICSID Member States may proceed to enforce awards as though the ICSID Convention did not apply. As such, a discussion may need to take place in relation to the possible amendment of certain provisions of the ICSID Convention; however, in the short term it is important that supranational bodies unrelated to the ICSID Convention do not interfere with the obligations of ICSID Member States or purport to prohibit ICSID Member States from complying with ICSID awards.

De Klockner a Total: la reivindicación de la aplicación de las fuentes del derecho internacional en el arbitraje internacional de inversión extranjera

This article analyzes the applicability of the sources of international law and the principles of law in international investment arbitration, through the notorious change in point of view of the ICSID foreign investment panels, in matters of applicable law, with a special period of change between 2000 and 2010 between the Wena Hotels (2000-2002) and Total (2010) awards, a trend which extends to the present , in which ICSID arbitral proceedings have increasingly decided to apply to investor-State disputes the different sources of public international law and the general principles of law, both in original proceedings and in annulment proceedings, despite the private instrument. The article analyzes the possibility of applying international law as the main controlling rule in ICSID proceedings, the application by ICSID arbitral tribunals of both international customary law regarding international responsibility of the State, the applicationof international law principles to give content to the substantive protections to investors and to the reparations granted by the awards.

Milletlerarası Ticari Tahkimde Hakem Kararlarının İptalinde İrade Serbestisinin Sınırları

Party-autonomy is considered to be an overriding principle throughout the arbitral process and post-award stage. Thus, parties are entitled to agree to restrict the review of the arbitral award by the courts in annulment proceedings, either partially or fully excluding the review by the courts according to Turkish International Arbitration Law Article 15. Conditions of such limitation, which are set out in Article 15 align with other legal systems; however, consequences of waiver of annulment proceedings differ significantly. Legal protection provided to parties becomes insufficient if the award is enforced in Turkey to the extent that this shortcoming violates the right to a fair trial. This paper examines the waiver of annulment agreement in Turkish law in comparison with legal systems that parties have been provided with regards to the party-autonomy principle and proposes to have solutions for the violation of the right to a fair trial. Furthermore, it examines the effects of parties’ agreements to expand the review of the arbitral award under Turkish law in light of comparative law.

Finality, Fairness, And Consistency


 
 
 A unique feature of the ICSID framework is the built-in control mechanism that allows parties to seek annulment of an otherwise final award via Article 52 of the Convention. Unlike arbitration in other contexts, this mechanism is the exclusive means for review of an ICSID award. While scholars and practitioners regard this as one of the most innovative features of the ICSID regime, many of the grounds for annulment remain underdeveloped. In particular, annulment committees have applied the “serious departure from a fundamental rule of pro- cedure” ground inconsistently.
 Especially because challenges to arbitrators can occur dur- ing the appointment phase, during the arbitration itself, or during annulment proceedings, the proper standard for deter- mining bias remains convoluted. Accordingly, this Note exam- ines how different approaches to assessing arbitrator bias un- fold in annulment proceedings applying the “fundamental rule of procedure” ground. It argues that these differences have con- tributed to a greater number of unpredictable outcomes, under- mining a central purpose of ICSID. Two recent decisions—the Azurix and EDF annulments—highlight the divergent ap- proaches ad hoc committees have taken in addressing allegations of bias. This Note concludes by identifying the EDF approach as the most appropriate standard of review and dis- cusses possible routes for resolving differences in ICSID annul- ment decisions.
 
 

Should the Setting Aside of International Commercial Arbitral Awards be Abolished in India?

After years of uncertainty, India has recently adopted a decidedly pro-arbitration stance through legal and infrastructural changes geared towards making it a global international arbitration hub. Despite these changes, Indian Courts’ perceived lack of commercial sophistication and judicial delays have dissuaded foreign parties from choosing to seat international commercial arbitrations in India. Among other reasons, this is because they see erroneous annulments of India-seated tribunals’ awards, which would render them virtually unenforceable in most jurisdictions party to the New York Convention, as extremely likely. In order to assuage these concerns, this paper presents a mechanism that will allow foreign parties to restrict the scope of Indian Courts’ interference with India-seated arbitrations at the post-Award stage. This would allow parties to either completely exclude any annulment proceedings before Indian Courts by contract, or give these Courts the limited jurisdiction to issue a declaration that the Award complies with Indian law (as the lex arbitri) to aid enforcement in other jurisdictions. In allowing foreign parties to restrict the risk posed by Indian Courts to India-seated arbitrations, this may provide the spark necessary to attract foreign parties to start arbitrating in India.

On judicial autonomy and the autonomy of the parties in international adjudication, with special regard to investment arbitration and ICSID annulment proceedings

AbstractThe article addresses the relationship between judicial autonomy and the autonomy of the parties principles. The issue is not addressed so much through the lens of the procedural rules on the conduct of the proceedings, as through the prism of the general principles of adjudication which dictate the boundaries of judicial, or arbitral, decision-making. The focus will be on the combination between the principles ne, ultra and infra, petita and non liquet as they flow from the consensual nature of international adjudication and arbitration, on the one hand, and the principle jura novit curia which mirrors the autonomy of the judicial function, on the other. The analysis does not draw from national legal systems, nor from commercial arbitration. Due to the significantly different configuration of the principles at issue in different jurisdictions, it will focus on international litigation as an autonomous phenomenon. It will address firstly inter-state adjudication and then international investment arbitration. Special attention will be given to the ICSID system in consideration of its unique annulment mechanism. The article draws from researched case law an encouragement, if not simply the need, for international adjudicative bodies to undertake a proactive attitude in the conduct of the proceedings. More generally potentials emerge from the analysis, to the effect that not only inter-state adjudication may impact on investor-state arbitration, but also vice versa.

Judicial Passivism at the European Court of Justice?

AbstractAccording to the generally accepted understanding, judicial activism arises when a court behaves improperly, straying beyond the limits of the judicial function and acting like a legislature.It is convincing that in the great majority of the cases the Court of Justice of the European Union fulfils the roles assigned to it by the founding treaties of the European Union without any excess, but there are decisions which may be characterized as activist, be they necessary or useful for the proper functioning of the European legal system, and there are decisions (refusing or avoiding to decide) which may be qualified as manifestations of judicial passivism.Judicial passivism is defined in the narrow sense of the term, i.e., when the court clearly refuses or avoids to decide the case before it, or does not answer the question legitimately referred to it. In the jurisprudence of the CJEU, such cases arise when the Court systematically waits for the withdrawal of the action, exceeds the reasonable time of the proceedings, or does not answer the question raised in the preliminary ruling procedure by the national court. The inadmissibility of questions referred by national courts may be perceived as passivism when the qualification of ‘not a court or tribunal’ in the sense of Article 267 TFEU is questionable, or when the scope of the EU Charter of Fundamental Rights is defined too narrowly. Cases may arise – at least in theory – in which the Court, while it would be in a position to act, defers the question to the EU or the Member State’s legislator or to the national judge to decide, with the not entirely convincing qualification of the act under scrutiny in annulment proceedings as ‘not an act for the Article 263 TFEU’. The label ‘judicial passivism in a broad sense of the term’ is used when the Court sticks to its position in a questionable manner (conservatism as passivism), steps back from its earlier position, narrowing the scope of EU law expressly or implicitly overruling its former decision, or it introduces new conditions with the same result (retreat).It has been demonstrated that the Court systematically opposed the Member States, the Commission and the parties in the main proceedings, arguing in favour of inadmissibility of referrals for preliminary questions − the Court avoided, in a large number of cases, the temptation of judicial passivism. On the other hand, the Court’s increased rigour in the preliminary ruling procedures is detectable in recent years. The Court took a less benevolent approach towards the qualification of the referring body as ‘court or tribunal’; the questions proved to be ‘hypothetical’ more often than before, and more importantly, the lack of sufficient information regarding the factual and regulatory context led more easily to inadmissibility.The driving forces behind the passivism of the Courts of the European Union are the ‘reasonableness’ of the judiciary in a time of crisis of the European integration, self-defence against the overburden of case-law and against unnecessary pressure from the public, in order to maintain the health of the management of justice and a certain ‘path-dependence’ as far as the traditional theoretical foundations of European integration are concerned.

The Many-faced Court: The Value of Participation in Annulment Proceedings

European Court of Justice – General Court – EU procedural law and practice – Procedural rights of the parties to judicial proceedings before the EU Courts – Participation of the parties to judicial proceedings and the legitimacy of judicial decisions – Accuracy of decision-making, the right to a hearing and procedural economy as guiding values of EU procedural law and practice – Different procedural practices of the General Court and the Court of Justice – The filtering of appeals by the Court of Justice – The accountability of the EU Courts for their procedural law and standards

The Interest in Bringing Annulment Proceedings · Case C-544/17 P BPC Lux 2 Sàrl and Others v European Commission · Annotation by Federica Maldari

The Case deals with the decision of Portuguese authorities to put Banco Espirito Santo SA (BES) into resolution and to immediately create a ‘Bridge Bank’. The Portuguese authorities notified to the EC the proposal to grant €4.899 million of State aid to the ‘Bridge Bank’ by way of initial share capital. The EC concluded that the State aid at issue was compatible with the internal market. BPC Lux 2 Sàrl and the other subordinated creditors of BES initiated proceedings before national courts and ultimately to the Court of the Justice of the European Union. On 7 November 2018, the Court of Justice rejected the General Court’s Order to dismiss the action as inadmissible due to lack of interest. Consequently, the Court of Justice confirmed the principle that an interest in bringing annulment proceedings may arise where the annulment might benefit the applicant in pending proceedings before national courts. Keywords: State aid; Financial crisis; Subordinated creditors; Damages; Annulment proceedings; National legal basis.

Henry VIII: Conciliarist?

Abstract Henry VIII is seldom considered a steerer of religious policy and theories of his political ambition, conservative religiosity and susceptibility to manipulation by his advisors dominate the historiography. Accordingly, the notion that Henry may be characterised as a conciliarist is one that has only ever been rejected outright. However, a preliminary consideration of this heretofore unconsidered matter reveals uncertainty in the verity of our existing historical paradigms. Henryʼs writings (which we maintain are authentic), actions following the Sack of Rome and approach to his annulment proceedings serve as evidence which suggests that Henry was an interested amateur theologian with a sincere appreciation of conciliarism. An understanding of the Kingʼs Great Matter as essentially a dispute over papal power and Henryʼs solution of a royal supremacy are developed as the ecclesiological backdrop against which this appreciation is to be viewed. In the light that other such matters may have been similarly overlooked, indications of the need for further research are outlined throughout.

Multilevel conflict over policy application–detecting changing cleavage patterns

ABSTRACTThis paper presents actions for annulment as indicator for conflict over policy application in the EU and argues that it is a valuable complement to the indicator of infringement proceedings. This is because annulment actions shed light on conflicts in areas that remain undetected by infringement proceedings and because annulment actions are able to uncover potential multilevel characters of these conflicts. On this basis, the paper identifies four different types of multilevel application conflicts. Based on an original dataset on all actions for annulment initiated against the European Commission between 1957 and 2009, the paper explores the dominant cleavage structure in application conflicts over time. This cleavage structure has changed: national governments have started to become more and more reluctant to use their access to annulment proceedings to influence legal developments in many policy sectors as they no longer try to actively influence the legal dialogue in court.

An Anti-Enforcement Bias? The Application of the Substantive Public Policy Exception in Polish Annulment Proceedings

This article examines how Polish courts have dealt with annulment applications based upon purported violations of substantive public policy and measures the Polish jurisprudence against the standards developed by the national courts in England, France, Switzerland and Germany. It identifies an anti-enforcement bias of the Polish courts which, in sharp contrast to their European counterparts, still favour an expansive interpretation of the public policy exception and have surprisingly little qualms in engaging in a thinly veiled merits review with unclear boundaries. The markedly interventionist approach of the Polish judiciary encourages annulment applications, which both ill-serves the arbitral process generally and undermines recent efforts to promote Poland as a desirable seat for international arbitration specifically. A solution to these ills can only be found in a narrower interpretation of the substantive public policy exception, in harmony with the standards developed by the national courts in the major European arbitration centres.

Non-reviewable Facts in Swiss Annulment Proceedings: Undermining the Safeguards of Art. 190 PILA

Non-reviewable Facts in Swiss Annulment Proceedings: Undermining the Safeguards of Art. 190 PILA