Anti-suit Injunctions Research Articles

Exclusive choice of court agreements: some issues on the Hague Convention on choice of court agreements and its relationship with the Brussels I recast especially anti-suit injunctions, concurrent proceedings and the implications of BREXIT

This article contends that the system of “qualified” or “partial” mutual trust in the Hague Choice of Court Agreements Convention (“Hague Convention”) may permit anti-suit injunctions, actions for damages for breach of exclusive jurisdiction agreements and anti-enforcement injunctions where such remedies further the objective of the Convention. However, intra-EU Hague Convention cases may arguably23 not permit remedies for breach of exclusive jurisdiction agreements as they may infringe the principles of mutual trust and effectiveness of EU law (effet utile) underlying the Brussels I Recast Regulation. The relationship between Article 31(2) of the Brussels I Recast Regulation and Articles 5 and 6 of the Hague Convention is mapped in this article. It will be argued that the Hartley–Dogauchi Report’s interpretative approach has much to commend it as it follows the path of least resistance by narrowly construing the right to sue in a non-chosen forum as an exception rather than the norm. This exceptional nature of the right to sue in the non-chosen forum under the Hague Convention can be effectively reconciled with the Brussels I Recast Regulation’s reverse lis pendens rule under Article 31(2). This will usually result in the stay of the proceedings in the non-chosen court as soon as the chosen court is seised. The impact of Brexit on this area of the law is uncertain but it has been argued that the likely outcome post-Brexit is that the regime applicable between the UK and the EU (apart from Denmark) in relation to exclusive jurisdiction agreements within the scope of the Hague Convention will be the Hague Convention.

A new frontier for Brussels I – private law remedies for breach of the Regulation?

The English courts have held that the Brussels I Regulation confers private law rights, such that an employee may obtain an anti-suit injunction on the basis of their “statutory right” to be sued in England under the employment provisions of the Regulation. This article examines the correctness of this proposition and argues that the Regulation does not confer rights or impose obligations on private individuals that they may enforce against one another. The article goes on to consider the implications of the English decisions and their remedial consequences, including the possibility of seeking an award of damages for breach of the Regulation.

The Future of Anti-Suit Injunctions in Support of Arbitration After the EU Court of Justice’s Judgment in the Gazprom Case

By its judgment of 10 February 2009 in Allianz and Generali Assicurazioni Generali (C-185/07, EU:C:2009:69), the EU Court of Justice declared anti-suit injunctions issued by Member States’ courts in support of an arbitration contrary to the Brussels I Regulation if proceedings between the same parties and on the same matter had been commenced before the courts of a Member State. However, in its judgment of 13 May 2015, Gazprom (C-536/13, EU:C:2015:316), the Court ruled that the said Regulation posed no obstacle to the recognition and enforcement of such injunctions when issued by arbitral tribunals. Since then, the Brussels I Regulation (recast) has come into force. Its recital 12 removes the foundation on which the Court based its judgment in Allianz and Generali Assicurazioni Generali, paving the way for Member States’ courts to issue anti-suit injunctions in support of arbitrations.

Enforcement of the Arbitration Agreement within the Context of the European Union

An arbitration agreement is the essential basis for international arbitration as it materialises the principle of party autonomy. Accordingly, parties to the agreement voluntary consent to litigate outside national courts employing a private and consensual method of resolving disputes, where an effective final and binding award is obtained and is enforceable by a court due to the New York Convention (NY Convention). The breach of this agreement means that a party will commence court proceedings as opposed to resorting to arbitration. When faced with a breach, the innocent party will have mechanisms at its disposal to prevent court proceedings and enforce arbitration, pursuant to the agreement. Traditionally, the remedies sought under common law have been the following: stay of proceedings and anti-suit injunctions. However, due to recent European Court of Justice (ECJ) case law, the resort to anti-suit injunctions has been severely questioned and parties have had to consider alternative remedies in order to obtain some form of relief. As a consequence, more emphasise has been given to an action in damages as a remedial option, which provides the innocent party with a remedy to at least recover costs for litigating in the wrong forum, since the resort to anti-suit injunctions within European Union (EU) Member State courts requires further clarification. Conversely, an award of damages does not depend on the cooperation of foreign courts and the breaching party. Additionally, the claim for damages is not an application for a provisional or interim measure, much like the anti-suit injunction. This means that it is procedurally simpler, as the claim for monetary relief can be considered in the course of the arbitration alongside other claims for breach, making this a great advantage. Finally, the enforcement of the award of damages can be done with less difficulty under the NY Convention and its compensatory result definitely outweighs that of simply impeding foreign proceedings. Hence, for the non-breaching party, it might be more advisable to seek protection in the form of damages.

Brexit and Arbitration: What Happens Next?

The purpose of this paper is to examine if Brexit may affect international commercial arbitration in the United Kingdom as well as in the European Union. In order to reveal this issue, firstly, it is analysed if Brexit has any effect on London as favourable seat of arbitration. Second, the author determines how Brexit may affect the recognition and enforcement of the foreign arbitral awards in both the United Kingdom and the European Union. Third, the paper deals with the anti-suit injunctions and their application in the United Kingdom after Brexit. When analysing the abovementioned issues, the author argues that Brexit will not affect international commercial arbitration in the United Kingdom and in the European Union but on the contrary – it may have very positive effects on this method of alternative dispute resolution. To reveal the subject-matter of the conference paper, the author analyses laws of the United Kingdom and the European Union as well as the relevant sources of international law. The author also bases his conclusions on the case-law and the opinions of legal doctrine.

Judicial Discretion in Light of the New European Rules on Jurisdiction in Civil and Commercial Matters: Reform or Continuity?

The free movement of judgments can be presented as a necessary corollary of the European internal market where goods, people, services and capital move freely. The first step towards the adoption of harmonized private international law provisions was made in 1968 with the conclusion of the Brussels Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters. In 1999, the entry into force of the Treaty of Amsterdam transferred the competence to legislate in the field of judicial cooperation in civil matters from the Member States to the European Union. This led to the transformation of the 1968 Brussels Convention, an instrument of inter-governmental cooperation, into a Regulation: Regulation (EC) 44/2001 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters, colloquially known as ‘Brussels I’. Subsequently, a Recast (reform) of the Regulation was agreed in 2012 which substantially amended Brussels I, and will replace it from 10 January 2015. This paper evaluates the extent to which the new jurisdiction rules of the Brussels I Recast impact on the exercise of judicial discretion by courts in the EU. This question is closely linked with the nature of Brussels I as a civilian instrument. Part I will consider how the activism of the European Court of Justice (now Court of Justice of the EU) had reinforced the civilian imprint of the Brussels I Regulation. Part II will assess whether the Recast is breaking away from what has been, for a period, considered the ‘systematic dismantling of the common law of conflict of laws’ by the EC (now EU). The article concludes that under the Brussels I Recast, the domain of both anti-suit injunctions and forum non conveniens has, if anything, been even further reduced. However the Recast has not only corrected some of the unwelcome consequences of an overly civilian interpretation of the Brussels I Regulation but simultaneously introduced, on the whole territory of the EU, a harmonised mechanism of jurisdictional regulation based on judicial discretion (which was hitherto available only in a few Member States). On this aspect, the Recast has the great merit of promoting (at least on paper) a better coordination between European and third States procedures, and one that may be easier to anticipate in third countries.

The Authority of Investment Treaty Tribunals to Issue Orders Restraining Domestic Court Proceedings

This article considers the authority of investment treaty tribunals to issue provisional measures affecting domestic courts or, as they are more commonly known, ‘anti-suit injunctions’. In particular, the article examines provisional measures of the kind ordered in the Chevron v Ecuador dispute, essentially to prevent the aggravation of an alleged denial of justice. It is contended that there is something distinctive about injunctive relief restraining another court or tribunal which is not necessarily captured by applying the standard provisional measures formula. It is further contended that measures restraining the continuation or enforcement of domestic court proceedings on the basis of the non-aggravation principle raise special considerations of comity and a concomitant need for care. The same considerations do not arise, at least not to the same degree, with respect to measures which seek to restrain domestic court proceedings in order to preserve the exclusivity or procedural integrity of investment treaty arbitration proceedings. The article concludes that there is an important difference between jurisdiction and authority. Investment treaty arbitration is one legal system amongst many, and cannot afford to appear insensitive to the concerns of domestic legal orders. That is so even where a serious breach of international law appears to be taking place. Investment treaty arbitration tribunals should be wary of applying a generic provisional measures test without first explaining and justifying a tailored anti-suit injunction analysis, which sets a principled and appropriately high bar for intervention. ‘John Marshall has made his decision; now let him enforce it!’ E Miles ‘After John Marshall's Decision: Worcester v Georgia and the Nullification Crisis’ (1973) 39 J South Hist 519, 519.

Exclusive Choice of Court Agreements: Some Issues on the Hague Convention on Choice of Court Agreements and its Relationship with the Brussels I Recast Especially Anti-Suit Injunctions, Concurrent Proceedings and the Implications of Brexit

This research paper argues that the Hague Convention’s system of ‘qualified’ or ‘partial’ mutual trust may permit anti-suit injunctions, actions for damages for breach of exclusive jurisdiction agreements and anti-enforcement injunctions where such remedies further the objective of the Convention. However, intra-EU Hague Convention cases may arguably not permit remedies for breach of exclusive jurisdiction agreements as they may be deemed to be an infringement of the principle of mutual trust and the principle of effectiveness of EU law (effet utile) which animate the multilateral jurisdiction and judgments order of the Brussels I Recast Regulation. The dynamics of the relationship between Article 31(2) of the Recast Regulation and Articles 5 and 6 of the Hague Convention will also be mapped in this paper. It will be argued that the Hartley-Dogauchi Report’s interpretative approach has much to commend it as it follows the path of least resistance by narrowly construing the right to sue in a non-chosen forum as an exception rather than the norm. This exceptional nature of the right to sue in the non-chosen forum under the Hague Convention can be effectively reconciled with the Brussels I Recast Regulation's reverse lis pendens rule under Article 31(2). This will usually result in the stay of the proceedings in the non-chosen court as soon as the chosen court is seised. The likely outcome post-BREXIT is that the regime applicable between the UK and the EU (apart from Denmark) in relation to exclusive jurisdiction agreements within the scope of the Hague Convention will be the Hague Convention.

Anti-Suit Injunctions in Support of London Seated Arbitrations Post-Brexit: Are All Things New Just Well-Forgotten Past?

Anti-Suit Injunctions in Support of London Seated Arbitrations Post-Brexit: Are All Things New Just Well-Forgotten Past?

Abandon Ship? West Tankers, Gazprom, and Anti-Suit Injunctions under “Brussels Ia”

Anti-suit injunctions have long been a contentious issue under EU law. With its West Tankers decision, the European Court of Justice (ECJ) had held that anti-suit injunctions must not be issued by courts of EU member states if the injunctions would curtail the jurisdiction of the courts of other member states. This decision was problematic because it gave free rein to parties who sought to delay arbitration proceedings through “torpedo actions” at state courts. The goal of the present article is to assess whether the ECJ’s conclusion from West Tankers still stands. Two developments give reason to doubt this: first, the ECJ’s decision in the matter Gazprom OAO v. Republic of Lithuania; second, the recast EU regulation on jurisdiction (“Brussels Ia”). The author assesses each in turn and concludes that EU law no longer prohibits anti-suit injunctions that aim at protecting arbitration agreements. Neither does EU law prohibit the recognition and enforcement of anti-suit awards issued by arbitral tribunals.

Incorporation of arbitration clauses into bills of lading under the PRC law and its practical implications

Under English law, an arbitration clause in a charter party may validly be incorporated into a bill of lading which has provided that an arbitration agreement under a charter party would be incorporated into such bill of lading. However, it appears that the Chinese maritime courts have taken a very different approach in this regard. There have been a number of recent important Chinese maritime courts’ decisions which have been approved by the Supreme People’s Court of the People's Republic of China (PRC). This article will review these decisions and discuss their practical implications, particularly on anti-suit injunctions filed in English or Hong Kong courts to restrain proceedings in China, and the enforceability of London or Hong Kong arbitral awards in China.

ORDERING CESSATION OF COURT PROCEEDINGS TO PROTECT THE INTEGRITY OF ARBITRATION AGREEMENTS UNDER THE BRUSSELS I REGIME

AbstractThe CJEU judgment in West Tankers created much controversy on the question of whether issuing an anti-suit injunction in order to protect the integrity of arbitration agreements should fall within the scope of the arbitration exclusion in Article 1 of the Brussels I Regulation (2001). The negative answer of the Court has been since challenged many times by academics and practitioners and new approaches were proposed during the drafting of the Brussels I Recast. Although the Court had not since considered whether the Recast modified the legal regime, in Gazprom the Advocate General gave his opinion on the basis that it had. The Court in Gazprom, however, saw the enforcement of an arbitral award ordering cessation of court proceedings to be a distinct issue which is not covered by the Brussels I Regulation. This article discusses first the applicability of the Brussels I Regulation to the enforcement of arbitral awards ordering anti-suit injunction as a final relief. Secondly, it examines anti-suit injunctions issued by Member State courts in the post-Recast era. It aims to reveal the extent to which an order for cessation of court proceedings (or an anti-suit injunction) to protect the integrity of arbitration agreements is permissible under existing law.

ARBITRAŽO TEISMO TAIKOMO DRAUDIMO PARALELIAI BYLINĖTIS TEISINĖ PRIGIMTIS IR PRAKTIKA

The article analyses legal nature and some practical problems of anti-suit injunctions issued by arbitral tribunals. One part of the article is dedicated to the tendencies of the European Court of Justice regarding the impact of Brussels I Regulation to the anti-suit injunctions granted by arbitral tribunals within the EU. The right of arbitral tribunal to grant anti-suit injunction consists of the right to decide on its own jurisdiction and the right to grant interim measures of protection. Such dual legal nature, on one hand, helps to apply anti-suit injunction flexibly, on the other hand, makes the relations between arbitration courts and national courts chaotic, due to different national legislation. With a view to unify the attitude of the states towards anti-suit injunction, as well as to encourage its effective implementation, it would be advisable, first of all, to unify the definition and establish clear procedural limits for anti-suit injunction, indicating when it has to be applied.Moreover, evaluation of the effect of parallel proceedings on the arbitral case should not be limited to identification of formal links. Also, it is neccessary to clarify criterions, which define abuse of arbitral process in the light of parallel proceedings, and to expand the list of sanctions in order to guarantee enforcement. Brussels I Recast was expected to bring a wider proarbitral perspective of EU and systemically remove all questions related to arbitration from the scope of the Regulation. Such step would confirm the legitimacy of anti-suit injunctions in EU. However, recent decision of European Court of Justice in Gazprom case left some doubts about the tendencies and interpretations of anti-suit injunctions and legal community is still in need of a clearer framework for anti-suit injunctions.

The End of Anti-Suit Injunction in EU in the Settlement of International Commercial Disputes

Two landmark cases namely Turner v. Grovit and Allianz SpA v. West Tankers Inc. have put a definitive end to the common use of anti-suit injunction whether for ‘unconscionability’ in the Turner v. Grovit or for ‘vexation or oppression’ like in Allianz SpA v West Tankers Inc. The ECJ has skillfully evaded the well-argued questions of their Lordships in both cases to stress the importance the Court of the Member States must realize in mutually trusting each other. This is well in line with the spirit of the various legislations, but what change will that bring? Is the ECJ ruling reasonable in light of the strong worldwide competition of which the judicial system is part? What would then be the significance of arbitration clause?

Forum-selection clauses: beyond the contracting parties

Canadian courts have started to consider whether and in what circumstances a non-contracting party will be treated as bound by a forum selection clause. This article examines several possible reasons for holding non-parties bound by such clauses and considers how the analysis would unfold in three different contexts: taking jurisdiction, staying proceedings based on forum non conveniens, and obtaining an anti-suit injunction. It draws on recent American decisions which have used both a closely related test and a global-transaction test to hold non-parties bound, considering the extent to which these tests might be adopted by Canadian courts.

Anti-Suit Injunctions Issued by National Courts In Favour of Arbitration: Need for Greater Judicial Restraint

Anti-suit injunctions restraining a party from pursuing proceedings in a foreign court, in breach of an arbitration agreement, have typically been issued by common law Courts to enforce arbitration agreements. However, such injunctions violate the judicial sovereignty of foreign courts, prevent the Court from adjudicating upon disputes before it and restrict access to Courts. The fact that these injunctions operate in personam do not justify interference with foreign proceedings. This paper argues that such injunctions are not contemplated by the UNCITRAL Model Law on International Commercial Arbitration, 1985 and The Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958. The paper further advocates adopting a definition of comity, which is in conformity with the principle of equality of courts, and is akin to the principle of ‘mutual trust’ underlying the Brussels I Regulation. The paper concludes that greater judicial restraint ought to be exercised in issuing such injunctions, which are becoming unnecessary in view of the increasingly arbitration friendly jurisprudence around the world.

DOES THE JUDGMENT OF THE CJEU IN GAZPROM BRING ABOUT CLARITY ON THE GRANT OF ANTI-SUIT INJUNCTIONS UNDER THE BRUSSELS I REGULATION?

On 13 May 2015 the CJEU delivered the much anticipated judgment in Gazprom OAO v Republic of Lithuania. The CJEU had before it issues relating to the grant of anti-suit injunctions by member state courts/arbitral tribunals to enforce arbitration agreements, and also, most importantly if the Brussels I Regulation would apply to the case at hand. The case gains in significance, as the Advocate General (AG) had in December 2014, while giving his opinion on the matter had proceeded to apply a ‘future law’ on a matter pending before the courts, strongly recommended that the CJEU reconsider its judgment handed down in Allianz v West Tankers(The Front Comor). Earlier, in the West Tankers case the CJEU ruled that it was incompatible with the Brussels Regulation for the court of a EU Member State to grant an injunction restraining a party from commencing or continuing court proceedings brought in breach of an arbitration agreement. In reaching this decision, the CJEU held that if proceedings were to come within the scope of the Brussels I Regulation, then a preliminary issue concerning the validity of an arbitration agreement also came within the scope of the Regulation.

ANTI-SUIT INJUNCTIONS IN ARBITRAL AWARDS: ENFORCEMENT IN EUROPE

THE status of anti-suit injunctions in Europe has long given rise to controversy. The decision of the Court of Justice of the European Union in Case C-536/13, Gazprom OAO [2015] All E.R. (EC) 711 sheds a new light on the relationship between anti-suit injunctions and the European jurisdiction regime embodied in the Brussels Regulation (Regulation No. 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters). In this much anticipated judgment, the Court of Justice confirmed that, by virtue of the arbitration exclusion in Article 1(2)(d) of the Brussels Regulation, Member State courts are not precluded from enforcing anti-suit injunctions issued by arbitration tribunals and aimed at restraining the proceedings before Member State courts. Although the decision was given before the Recast Brussels Regulation came into force (Regulation No. 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, effective from 10 January 2015), it can be assumed that the same conclusion would have been reached under the new law.

Notes on the EUCJ’s ruling inGazprom:West Tankersis unaffected and anti-suit injunctions issued by arbitral tribunals are not governed by EU Regulation 44/2001

On 13 May 2015 the Grand Chamber 1 of the Court of Justice of the European Union (hereafter the ‘Court’ or ‘EUCJ’) provided a preliminary interpretative ruling (Case C-536/13) 2 on the Council Regulation (EC) 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters and with regard to an anti-suit injunction issued by an arbitral tribunal, in connection with the Gazprom OAO proceedings before Lithuanian courts. Those who are not satisfied with the Court’s ruling in the West Tankers case in 2009 hoped perhaps that this new ruling would change, and improve, the status of anti-suit injunctions in the EU. However, such hope was doomed to fail in view of the different context and questions that the Court had to deal with in relation to the Gazprom case. Prompt reporting of events or breaking news is common place nowadays. Such practice reduces significantly the time needed for reflection and proper coverage of the event. The ruling in Gazprom also prompted some immediate reports on line. One of these reads: ECJ allows anti-suit injunctions by arbitrators. In an eagerly awaited ruling, the European Court of Justice has held that anti-suit injunctions issued by arbitral tribunals are not prohibited by the Brussels I Regulation – but practitioners hoping that the court would reconsider its controversial decision in West Tankers will have to wait. 3

ANTISUIT INJUNCTIONS IN SUPPORT OF ARBITRATION:WEST TANKERSSTILL AFLOAT

AbstractIn its eagerly awaited judgment inGazprom, the CJEU declined to follow the Opinion of Advocate General Wathelet thatWest Tankersis no longer good law. TheWest Tankerscase decided that the courts of one Member State are precluded from granting antisuit injunctions directed at proceedings in the courts of another Member State, even if the proceedings in which the injunction is granted fall outside the scope of the Brussels Regulation by reason of the fact that they are concerned with arbitration. TheGazpromcase confirms thatWest Tankersis still good law.