Arbitration exclusion

The recast Regulation[1], much like its predecessor, excludes arbitration within its scope. The recast does however include guidance under Recital 12[2] on how to interpret the exclusion.[3] The relationship between arbitration and the previous Regulation[4] was as Brozolo[5] argued a controversial and contentious debate.[6] The justification for this exclusion was based on the fact that arbitration was covered under the New York Convention[7] as well as the 1961 Convention.[8] The recast Regulation did not follow the proposal recommended in 2010[9] which had encouraged the implementation of arbitration rules.[10] Excluding arbitration can arguably leave a gap for parallel proceedings between Member States to occur.

 

It was considered in the March Rich[11] case that arbitration is not covered under the Convention if it was the central issue of the case.[12] Furthermore, the judgements in the West Tankers[13] case and the Turner[14] case confirmed that anti-suit injunctions are prohibited.[15] However, the there is a debate as to whether Recital 12[16] allows arbitration to be permitted under this provision. The purpose of an anti-suit junction is to prevent parallel proceedings however, as illustrated in the West Tankers[17] case, it was ruled that granting an anti-suit injunction was incompatible with the Regulation.[18] The question faced by the CJEU[19] was whether it was applicable to grant the anti-suit injunction to West Tankers which would have prevented the defended from continuing proceedings in Italy. It was argued on the basis that the Regulation did not include arbitration, therefore the English Court could not deny such a request. It was held that no injunction could be granted. This decision was met with a lot of criticism as it opened the gates for individuals with arbitration agreements to abuse the system and leave Member States powerless to fight back.

[1] 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 (recast), OJ L 351/1, 20 December 2012, Article 1(2) (d)

[2] ibid, Recital 12

[3] Trevor Hartley, ‘Choice-of-Court Agreements and the New Brussels I Regulation’ (2013) Law Quarterly Review 309

[4] Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters

[5] Luca Brozolo, ‘Arbitration and the draft revised Brussels I Regulation: Seeds of home country control and harmonisation?’ (2011) Journal of Private International Law 423

[6] Notary public London website

[7] Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958)

[8] European Convention on International Commercial Arbitration of 1961

[9] 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 COM/2010/0748 final <http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A52010PC0748> (accessed 1/2/2017)

[10] Antonio Leandro, ‘Towards a new interface between Brussels I and Arbitration?’ (2015) Journal of International Dispute Settlement 188

[11] C-190/89 Marc Rich & Co. AG v Società Italiana Impianti PA. [1991] ECR I-03855

[12] Hamed Alavi, ‘A step forward in the harmonisation of European jurisdiction: Regulation Brussels I Recast (2015) Baltic Journal of Law and Politics 159

[13] Case C-185/07 West Tankers Inc. v Allianze SpA [2009] ECR 1-00663

[14] Case C-159/02 Turner v Grovit [2005] ECR 1-03565

[15] Chukwudi Paschal Ojiegbe, ‘From West Tankers to Gazprom: anti-suit injunctions, arbitral anti-suit orders and the Brussels I Recast’ (2015) Journal of Private International Law 267

[16] 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 (recast), OJ L 351/1, 20 December 2012

[17] Case C-185/07 West Tankers Inc. v Allianze SpA [2009] ECR 1-00663

[18] Ibid, para 35

[19] The Court of Justice of the European Union (CJEU)