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ORDERING CESSATION OF COURT PROCEEDINGS TO PROTECT THE INTEGRITY OF ARBITRATION AGREEMENTS UNDER THE BRUSSELS I REGIME
Published online by Cambridge University Press: 04 March 2016
Abstract
The 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.
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- Copyright © British Institute of International and Comparative Law 2016
References
1 Art 1(4) of the Brussels Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters.
2 Art 1(2)(d) of the Council Regulation (EC) No 44/2001 of 22 December 2000 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters.
3 See also J Harris and E Lein, ‘A Neverending Story? Arbitration and Brussels I: The Recast’ in E Lein (ed), The Brussels I Review Proposal Uncovered (BIICL 2012) 31, 32–5.
4 The phrase ‘Brussels I Regulation’ is used to refer to the applicable European instrument on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters. In other words, ‘Brussels I Regulation’ refers to the instrument in force in the Brussels I regime. When this article is specifically referring to a single instrument, namely to either Brussels Convention, Brussels I Regulation (2001) or Brussels I Recast, it will indicate this. Unless stated otherwise, a comment concerning the ‘Brussels I Regulation’ would be applicable to both Brussels I Regulation (2001) and Brussels I Recast.
5 A Briggs, Private International Law in English Courts (OUP 2014) 199.
6 Marc Rich and Co AG v Società Italiana Impianti PA, CJEU Case No C-90/89, Judgment of the Court, 25.7.1991, para 26.
7 Allianz SpA & Generali Assicurazioni Generali SpA v West Tankers Inc, CJEU Case No C-185/07, Judgment of the Court, 10.2.2009, para 24.
8 On anti-suit injunctions, see T Raphael, The Anti-Suit Injunction (OUP 2008); R Fentiman, International Commercial Litigation (2nd edn, OUP 2015) ch 16.
9 West Tankers (n 7) para 32 and Operative Part, see also paras 29–30.
10 For the analysis of these proposals, see Harris and Lein (n 3) 36–55; A Dickinson and E Lein (eds), The Brussels I Regulation Recast (OUP 2015) 57–61; Nuyts, A, ‘La refonte du règlement Bruxelles I’ (2013) 102(1) Revue critique de droit international privé 1, 11–13Google Scholar; di Brozolo, LG Radicati, ‘Arbitration and the Draft Revised Brussels I Regulation: Seeds of Home Country Control and of Harmonisation?’ (2011) 7(3) JPrivIntL 423Google Scholar; Illmer, M, ‘Brussels I and Arbitration Revisited: The European Commission's Proposal COM(2010) 748 final’ (2011) 75(3) Rabels Zeitschrift für ausländisches und internationales Privatrecht 645CrossRefGoogle Scholar.
11 B Hess, T Pfeiffer and P Schlosser, Report on the Application of Regulation Brussels I in the Member States (Heidelberg Report) September 2007, available at <http://ec.europa.eu/civiljustice/news/docs/study_application_brussels_1_en.pdf> paras 131–136; Commission of the European Communities, Green Paper on the Review of Council Regulation (EC) No 44/2001, COM(2009) 175 final, 21.4.2009, 9.
12 Option 1 at European Commission, Impact Assessment: Accompanying document to the Proposal for a Regulation of the European Parliament and of the Council on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters (Recast) SEC(2010) 1548 final, 14.12.2010, 36.
13 Option 2 at European Commission, Impact Assessment (n 12) 36–7.
14 Option 3 at European Commission, Impact Assessment (n 12) 37. This option reflects the proposal at the Heidelberg Report and Green Paper. See also European Commission, Proposal for a Regulation of the European Parliament and of the Council on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters (Recast) COM(2010) 748 final, 14.12.2010, which adopted this option.
15 Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters.
16 Gazprom OAO v Lietuvos Respublika, CJEU Case No C-536/13, Judgment of the Court, 13.5.2015.
17 Gazprom, Opinion of Advocate General Wathelet, 4.12.2014, paras 74–157.
18 Gazprom (n 16) para 41 and Operative Part.
19 See M Moses, ‘Will Antisuit Injunctions Rise Again in Europe?’ Kluwer Arbitration Blog on 20.11.2013.
20 Schlosser, PF, ‘Right and Remedy in Common Law Arbitration and in German Arbitration Law’ (1987) 4 JIntlArb 27, 28Google Scholar.
21 Remedies having a public law character are not however generally available in international commercial arbitration. One example is punitive damages. It is argued that an award granting punitive damages may not be enforced due to public policy considerations. See JDM Lew, LA Mistelis and SM Kröll, Comparative International Commercial Arbitration (Kluwer 2003) 651; K Hober, ‘Remedies in Investment Disputes’ in AK Bjorklund, IA Laird and S Ripinsky (eds), Investment Treaty Law: Current Issues III (BIICL 2009) 3, 13.
22 See Lew, Mistelis and Kröll (n 21) 649.
23 UK Arbitration Act 1996, section 48(5)(a).
24 Raphael (n 8) 196–8.
25 Elder, TE, ‘The Case against Arbitral Awards of Specific Performance in Transnational Commercial Disputes’ (1997) 13(1) ArbIntl 1Google Scholar.
26 GB Born, International Commercial Arbitration (2nd edn, Kluwer 2014) 3071–5.
27 Gould Marketing, Inc as successor to Hoffman Export Corporation v Ministry of Defence of the Islamic Republic of Iran, Iran–US Claims Tribunal Case Nos 49 and 50, Award, 22.6.1984, (1984/II) 6 Iran-US CTR 272.
28 Ministry of Defence of Islamic Republic of Iran v Gould Inc, 887 F.2d 1357; Ministry of Defence of Islamic Republic of Iran v Gould Inc, 969 F 2d 764.
29 For the applicability of injunctive remedies in investment arbitration, see Demirkol, B, ‘Remedies in Investment Treaty Arbitration’ (2015) 6(2) JIDS 403Google Scholar, especially 421–2.
30 ATA Construction v The Hashemite Kingdom of Jordan, ICSID Case No ARB/08/2, Award, 18.5.2010.
31 ATA (n 30) paras 132 and 133(4).
32 Demirkol, B, ‘Enforcement of International Commercial Arbitration Agreements and Awards in Investment Treaty Arbitration’ (2015) 30(1) ICSID Review 56, 65–8CrossRefGoogle Scholar.
33 Art III of the New York Convention states ‘[e]ach Contracting State shall recognize arbitral awards as binding and enforce them’.
34 eg UK Arbitration Act 1996, section 66; art 192(2) of the Swiss Private International Law Act; art 1514 of the French Code of Civil Procedure.
35 See Gazprom (n 16) para 26.
36 ibid, para 13.
37 ibid, paras 14–15.
38 ibid, paras 16–17.
39 ibid, para 18.
40 See Gazprom (n 17) Opinion, paras 74–152.
41 ibid, paras 98–112.
The argument that the CJEU judgment in West Tankers contradicts with previous CJEU judgments was not accurate. See Hartley, TC, ‘Antisuit Injunctions in Support of Arbitration: West Tankers Still Afloat’ (2015) 64(4) ICLQ 965, 968–70Google Scholar.
42 Gazprom (n 17) Opinion, para 130. See also para 127. This recital is analysed in Section IVB.
43 ibid, paras 133–135.
44 ibid, para 141 (emphasis in the original).
45 Gazprom (n 16) para 36.
46 The Brussels I Regulation does not govern enforcement decisions by a court of a Member State so long as an arbitral award or a non-Member State court judgment is involved.
47 See West Tankers (n 7) para 30.
48 See Recital 16 of the Brussels I Regulation (2001) and Recital 26 of the Brussels I Recast.
49 Fentiman (n 8) 295.
50 West Tankers (n 7) para 29.
51 See Gazprom (n 16) paras 38–40. While reaching this conclusion, the CJEU did not quash, or contradict with, its judgment in the West Tankers. As opposed to the suggestions of the Advocate General, it found a solution within the Brussels I Regulation (2001) without referring to Recital 12 of the Recast, which is on the exclusion of arbitration. It should be noted that the Advocate General suggested a solution based on the Brussels I Regulation (2001) only as a subsidiary argument (Gazprom (n 17) Opinion, paras 153–157). This would suggest that the CJEU still regards West Tankers as good law (Hartley (n 41) 973).
52 Art V(1)(a) of the New York Convention.
53 Art V(2)(a) ibid.
54 For obvious practical purposes, the enforcement of the arbitral award ordering cessation of court proceedings will be sought only in the country where these court proceedings are pending. There would be a lack of legal interest to enforce this award in other countries where there are no pending court proceedings against the award holder.
55 Art II(3) of the New York Convention.
56 Gazprom (n 16) para 43.
57 See Radicati di Brozolo (n 10) 452–3.
58 Hartley, TC, ‘The Brussels I Regulation and Arbitration’ (2014) 63(4) ICLQ 843, 857Google Scholar; Hartley (n 41) 974.
59 Hartley (n 41) 974–5.
60 See Gazprom (n 16) para 26.
61 eg art V(2)(b) of the New York Convention; art 1514 of the French Code of Civil Procedure.
62 Born (n 26) 3653.
63 Gazprom (n 17) Opinion, para 177 (emphasis added).
64 In this line of thought, see Gazprom (n 17) Opinion, para 181.
65 On the justification of conflict of laws rules, see L Collins (ed), Dicey, Morris and Collins on the Conflict of Laws (15th edn, Sweet & Maxwell 2012) 4–5; JJ Fawcett and JM Carruthers, Cheshire, North & Fawcett Private International Law (14th edn, OUP 2008) 4–5.
66 Compliance with fundamental procedural rules are of European public policy and the Brussels I regime specifically protects procedural public policy. See Skerl, JK, ‘European Public Policy (With an Emphasis on Exequatur Proceedings)’ (2011) 7(3) JPrivIntL 461, 462Google Scholar.
67 See also Collins (n 65) 592–3; Fawcett and Carruthers (n 65) 455.
68 See eg art 17(1) of the UNCITRAL Model Arbitration Law; art 28(1) of the ICC Rules of Arbitration; art 26(1) of the UNCITRAL Arbitration Rules (2010).
69 Art 17(2)(a)–(b) of the UNCITRAL Model Arbitration Law; art 26(2)(a)–(b) of the UNCITRAL Arbitration Rules (2010).
70 Vishnevskaya, O, ‘Anti-suit Injunctions from Arbitral Tribunals in International Commercial Arbitration: A Necessary Evil?’ (2015) 32(2) JIntlArb 173Google Scholar. cf L Lévy, ‘Anti-Suit Injunctions Issued by Arbitrators’ in E Gaillard (ed), Anti-Suit Injunctions in International Arbitration (Juris 2005) 115; Raphael (n 8) 303. For an example of arbitration proceeding where an anti-suit injunction was issued by the sole arbitrator P Tercier, see ICC Arbitration Case No 8307/FMS/KGA, 14.5.2001 (published partially in E Gaillard (ed), Anti-Suit Injunctions in International Arbitration (Juris 2005) 307).
71 On the enforcement of anti-suit injunctions, see A Yeşilırmak, Provisional Measures in International Commercial Arbitration (Kluwer 2005) 245–71.
72 Art 17-H(1) of the UNCITRAL Model Arbitration Law.
73 Born (n 26) 2511–15, 3020.
74 eg art 28(1) of the ICC Rules of Arbitration.
75 See Section IIB.
76 See eg art 17-I of the UNCITRAL Model Arbitration Law.
77 M de Boisséson, ‘Anti-Suit Injunctions Issued by National Courts at the Seat of the Arbitration or Elsewhere’ in E Gaillard (ed), Anti-Suit Injunctions in International Arbitration (Juris, 2005) 65; Collins (n 65) 865–6.
78 Collins (n 65) 865. See also JDM Lew, ‘Anti-Suit Injunctions Issued by National Courts to Prevent Arbitration Proceedings’ in E Gaillard (ed), Anti-Suit Injunctions in International Arbitration (Juris 2005) 25, 27–30.
79 Raphael (n 8) 193–6. See also ibid, 301–3; Collins (n 65) 865–9; Fentiman, R, ‘Antisuit Injunction and Arbitration Agreements’ (2013) 72(3) CLJ 521Google Scholar, 523.
80 Collins (n 65) 872 n 266. cf Raphael (n 8) 271–4.
81 Ust-Kamenogorsk Hydropower Plant JSC v AES Ust-Kamenogorsk Hydropower Plant LLP [2013] UKSC 35.
82 Fentiman (n 8) 534–5.
83 Gregory Paul Turner v Felix Fareed Ismail Grovit and Others, CJEU Case No C-159/02, Judgment of the Court, 27.4.2004, para 12.
84 ibid, para 24.
85 ibid, para 27.
86 ibid, para 27.
87 West Tankers (n 7) para 23.
88 ibid, paras 24–25.
89 E Gasser GmbH v Misat Srl, CJEU Case No C-116/02, Judgment of the Court, 9.12.2003, para 49.
90 West Tankers (n 7) paras 32 and 34.
91 Hartley states, ‘[a]lthough this decision met with a hostile reception in England, it is not lacking in legal logic’ (footnote omitted) (Hartley (n 58) 855).
92 See Section IIB.
93 Report on the Accession of the Hellenic Republic to the Community Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters, 24.11.1986, 1986(29) (C 298) Official Journal of the European Communities 1 (Evrigenis-Kerameus Report) §35.
94 cf West Tankers (n 7) para 27.
95 Hascher, DT, ‘Recognition and Enforcement of Judgments on the Existence and Validity of an Arbitration Clause under the Brussels Convention’ (1997) 13(1) Arbitration International 33Google Scholar, 40 and 42. But see National Navigation Co v Endesa Generacion SA [2009] EWCA Civ 1397. It seems that the misinterpretation of the report by the CJEU in West Tankers misled the Court of Appeal of England and Wales.
96 Evrigenis-Kerameus Report (n 93) para 35.
97 Rich (n 6) para 26.
98 Collins (n 65) 764.
99 See Collins (n 65) 389. See also the discussion on Recital 12, para 2 of the Recast in Section IVB.
100 Fentiman (n 8) 533; Briggs (n 5) 200.
101 Briggs (n 5) 200–1. See also ibid, 1003.
102 Recital 12, para 2 of the Brussels I Recast.
103 ibid, para 4.
104 Gazprom (n 17) Opinion, para 91.
105 ibid, para 125.
106 ibid, para 128 (emphasis omitted) referring to West Tankers (n 7) para 26.
107 Gazprom (n 17) Opinion, para 130.
108 ibid, para 132. See also the European Parliament resolution of 7 September 2010 on the implementation and review of Council Regulation (EC) No 44/2001 (2009/2140(INI)) para 10; Dickinson and Lein (n 10) 57.
109 Gazprom (n 17) Opinion, para 133.
110 ibid, para 137.
111 ibid, para 138.
112 ibid, para 148.
113 See Recital 22 of the Brussels I Recast. See also Dickinson and Lein (n 10) 336–43.
114 cf Fentiman (n 8) 536.
115 Hartley (n 41) 971–2.
116 See also Briggs (n 5) 1000–1.
117 Prior to the publication of the Recast, the Court of Appeal of England and Wales reached an opposite outcome (National Navigation Co v Endesa Generacion SA [2009] EWCA Civ 1397). For the discussion on the regime prior to the Recast, see Hascher (n 95) 40; R Fentiman, ‘Arbitration Agreements in Europe’ (2010) 69(2) CLJ 242; P Rogerson, Collier's Conflict of Laws (CUP 2013) 68 and 222; Hartley (n 58) 846. For the effect of the Recital, see Rogerson (n 117) 138; Dickinson and Lein (n 10) 78–9; Nuyts (n 10) 18; Dowers, N and Tang, ZS, ‘Arbitration in EU Jurisdiction Regulation: Brussels I Recast and a New Proposal’ (2015) 3(1) Groningen Journal of International Law 125Google Scholar, 138.
118 See eg Fentiman (n 8) 536.
119 This has been already confirmed in Rich (n 6) paras 19 and 26.
120 For the distinction between these two scenarios and an analysis on the interaction between the two CJEU cases, ie, Rich and West Tankers, see Hartley (n 41) 969–70.
121 This argument convinces even authors who consider that para 2 of Recital 12 excludes completely the verification of the validity of arbitration agreements from the scope of the Regulation and by doing so reverses a part of the considerations in the West Tankers judgment. See Nuyts (n 10) 17; Camilleri, SP, ‘Recital 12 of the Recast Regulation: A New Hope?’ (2013) 62(4) ICLQ 899, 904CrossRefGoogle Scholar. cf Bollée, S, ‘L'arbitrage et le nouveau Règlement Bruxelles I’ (2013) (4) Revue de l'Arbitrage 979, 983Google Scholar.
122 West Tankers (n 7) paras 28 and 30.
123 Hartley (n 41) 970.
124 See Briggs (n 5) 200 and 1003; Rogerson (n 117) 66–7; Dickinson and Lein (n 10) 74; Nuyts (n 10) 14; Dowers and Tang (n 117) 140.
125 Art 1(2) of the Brussels I Regulation.
126 See also Camilleri (n 121) 903–4.
127 See Section IVA.
128 See also Carducci, G, ‘The New EU Regulation 1215/2012 of 12 December 2012 on Jurisdiction and International Arbitration’ (2013) 29(3) ArbIntl 467, 488Google Scholar; Dowers and Tang (n 117) 140.
129 Briggs, for example, still rejects the power of an English court to issue an anti-suit injunction in relation to arbitration proceedings within the framework of the Brussels I Recast. See Briggs (n 5) 200 and 1003. Other authors concurring with this approach are Dickinson and Lein (n 10) 78; Nuyts (n 10) 17; Camilleri (n 121) 906; P Ortolani, ‘Anti-Suit Injunctions in Support of Arbitration under the Recast Brussels I Regulation’ MPILux Working Paper 6, available at <www.mpi.lu> 10; Dowers and Tang (n 117) 140. cf Cadet, F, ‘Le nouveau règlement Bruxelles I ou l'itinéraire d'un enfant gâté’ (2013) 140(3) Journal du Droit International 765, 786Google Scholar; Carducci (n 128) 490.
130 European Commission, Impact Assessment (n 12) 36.
131 See Dickinson and Lein (n 10) 60. See also Hartley (n 41) 972.
132 Dickinson and Lein (n 10) 60.