Posts Tagged Lithuania

Gazprom, arbitral Antisuit Injunctions and the Judgments Regulation: Wathelet AG gets one or two things off his chest

Wathelet AG opined yesterday in Gazprom, Case C-536/13, re the fate of arbitral anti-suit injunctions. (See my posting on the application, for context). He takes the opportunity to add to the chorus of criticism of the ECJ’s West Tankers ruling, at considerable length; and to review the ‘new’ regime under the Brussels I recast, in light of recital 12 of that Regulation.

His review of the ‘new’ regime of the Brussels I recast, and the contrasting positions of the EC and a number of Member States, support my proposition that the recast, by incorporating a summary of previous case-law in its recitals, has certainly not clarified things beyond discussion. Wathelet in fact suggest that the recitals do rebuke the ECJ and return application of the Regulation to the Rich scenario – however I am not convinced that Rich itself necessarily clarifies things. (It, too, like Van Uden and like the current recital, uses a confusing variety of criteria. I have a paper forthcoming on the Brussels I recast (already in a Dutch version should readers be interested) which looks into this).

At any rate, the lengthy review of the position under the recast evidently is outside the scope of the preliminary review, since the recast does not apply to it, and the ECJ is certain not to entertain the AG’s review of the recast and his rebuke of West Tankers at all. (Although his critical views are not likely to endear him to the Court).

Returning to the actual questions, the AG suggests the Court reply that that the Brussels I Regulation is not applicable in the present case (it falling exclusively within the scope of the 1958 New York Convention) and that, in any event, (what is effectively) an anti-suit injunction issued by an arbitration tribunal is not contrary to that Regulation. Finally, that under the New York Convention, a Member State cannot classify Brussels I’s jurisdictional regime as being ‘ordre public’ and hence capable of leading to refusal of recognition of an arbitral award.

The AG decisively supports arbitration in this opinion, however the ECJ is bound to be much shorter (and perhaps less sympathetic) in its judgment. To be continued….

Geert.

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Should arbitral anti-suit injunctions follow the West Tankers fate? Lithuanian court challenges the ECJ

In Case C-536/13 Gazprom, the Lithuanian Supreme Court has challenged the ECJ to specify the limits (or not) of its findings in West Tankers – on which I have reported extensively elsewhere. The Court of Justice ruled in February 2009 on the basis of effet utile that the English courts were out of their league in issuing an anti-suit injunction, prohibiting Allianz and Generali from pursuing the case in the Italian courts (on the basis of Article 5(3)’s special jurisdictional rule for tort) and obliging them to take the case to arbitration in London.

In Gazprom, A tribunal rendered an award holding that proceedings by Lithuania in Vilnius partially breached the arbitration clause in the shareholders’ agreement between parties. The arbitral tribunal ordered the Republic of Lithuania to withdraw certain claims filed before the Lithuanian courts and to amend other claims. Gazprom is seeking enforcement of the SCC award in Lithuania. Relevant summaries of the award and of the Lithuanian proceedings are available here. The instruction of restraint contained in the award is effectively an anti-suit injunction, albeit rendered by a tribunal instead of a court. The effect of both is the same: does the West Tankers rationale therefore hold (West Tankers, readers will remember, relied on the effet utile of the Regulation to extend its reach to anti-suit injunctions in support of arbitral proceedings, notwithstanding the latter’s clear exclusion from the Regulation)?

Questions referred:

Where an arbitral tribunal issues an anti-suit injunction and thereby prohibits a party from bringing certain claims before a court of a Member State, which under the rules on jurisdiction in the Brussels I Regulation has jurisdiction to hear the civil case as to the substance, does the court of a Member State have the right to refuse to recognise such an award of the arbitral tribunal because it restricts the court’s right to determine itself whether it has jurisdiction to hear the case under the rules on jurisdiction in the Brussels I Regulation?

Should the first question be answered in the affirmative, does the same also apply where the anti-suit injunction issued by the arbitral tribunal orders a party to the proceedings to limit his claims in a case which is being heard in another Member State and the court of that Member State has jurisdiction to hear that case under the rules on jurisdiction in the Brussels I Regulation?

Can a national court, seeking to safeguard the primacy of European Union law and the full effectiveness of the Brussels I Regulation, refuse to recognise an award of an arbitral tribunal if such an award restricts the right of the national court to decide on its own jurisdiction and powers in a case which falls within the jurisdiction of the Brussels I Regulation?

No chamber has as yet been allocated to the case however I would not be surprised were it to be the Grand Chamber.

Geert.

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SPS meets Geopolitics: the Lithuanian WTO complaint against Russia’s restrictions on dairy

Lithuania is suspecting that a combination of its currently holding the rotating presidency of the European Union, and Russian jittery over an impending trade and association agreements with the Ukraine, Moldova and Georgia (Armenia has pulled out under Russian pressure), explains the actions taken by Russia against Lithuanian Diary imports.

Russia notified the measure to the WTO on 11 October. Not much detail is given in the notification as to the health hazard identified, other than ‘due to detection of incompliance to microbiology, sanitary chemical and organoleptic requirements.’ – a fault which it had recently found in Russian dairy products, too and which of course Lithuania are denying.

How and where the Lithuanian complaint is currently developing is a little bit fuzzy: the EC has reportedly spoken at the WTO against the Russian action, on behalf of Lithuania (and of course to the dislike of Russia) , however I understand informal talks are underway, too.

Geert.

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Lithuanian Supreme Court refuses recognition based on Ordre Public – Right of the Child to be heard

The Lithuanian Supreme Court held on 30  April 2013 that a Russian Federation judgment granting child custody, could not be recognised in Lithuania for reasons of Ordre Public. The 7-year-old  child had not been heard (including on his opinion with whom of the parents he’ld prefer to live) either directly or indirectly  in the underlying proceedings. Hearing the child, the Court held, was however prerequisite under international human (children’s) rights Conventions.

Recourse to Ordre Public is not common, as readers will be aware. The judgment therefore is quite significant (and correct in my view), particularly as the European Commission is currently trying to map its use across the Member States (within the EU or vis-a-vis relations with third States, such as here).

Thank you to Sigita Fomičiova for the tip-off and copy of the judgment.

Geert.

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