INTERNATIONAL ARBITRATION AND PUBLIC POLICY Devin Bray Heather L. Bray Editors JURIS
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Summary Table of Contents About the Editors... xi About the Authors... xiii Foreword... xxiii Part I: Public Policy - An Overview Chapter 1 An Introduction to International Public Policy Lord (Peter) Goldsmith... 3 Chapter 2 Standards of Procedural International Public Policy Richard Kreindler... 9 Chapter 3 Issues of Substantive Transnational Public Policy Stephen Jagusch... 23 Part II: Specific Manifestations Chapter 4 The SNF v. International Chamber of Commerce Case and the Obligation to Conduct Arbitration Proceedings with "Expected Dispatch" Elie Kleiman... 49 Chapter 5 Navigating in the Archipelago of Swedish Due Process Safeguards: A Sea Chart Indicating a Few Treacherous Reefs Finn Madsen... 93 Chapter 6 Recent Swiss Developments on Exclusion Agreements Laurent Lévy and Tetiana Bersheda... 117 iii
iv INTERNATIONAL ARBITRATION AND PUBLIC POLICY Chapter 7 Public Policy in Swiss International Arbitration Law: For Once, Adjectives Make a Difference Pierre A. Karrer... 137 Chapter 8 Dispute Resolution of Shareholder Agreements in Ukraine: For Better or Worse? Timur Bondaryev and Markian Malskyy... 147 Chapter 9 The Scope of Review in Annulment Proceedings Piero Bernardini... 167 Chapter 10 Public Policy as Ground for Annulment of or Non-recognition of Enforcement of Arbitral Awards in East Asia Michael Hwang and Shaun Lee... 183 INDEX... 221
Table of Contents Part I: Public Policy - An Overview Chapter 1 An Introduction to International Public Policy Lord (Peter) Goldsmith... 3 I. The Basis of Public Policy... 5 II. The Mutability of Public Policy... 6 III. The Nature of International Public Policy... 7 IV. Conclusion... 8 Chapter 2 Standards of Procedural International Public Policy Richard H. Kreindler... 9 I. Transnational Procedural and Substantive Public Policy... 10 II. Equal Treatment versus Due Process... 14 III. Public Policy Violations and Treaty-Based Arbitration... 15 IV. Violations of Procedural Public Policy Across Jurisdictions... 16 V. Violations of Transnational Procedural Public Policy... 19 VI. Conclusion... 21 Chapter 3 Issues of Substantive Transnational Public Policy Stephen Jagusch... 23 I. Introduction... 23 II. What Is Transnational Public Policy?... 24 III. What Is Substantive Transnational Public Policy?... 27 A. How Substantive Transnational Public Policy Is Identified... 28 1. Arbitral Awards... 29 v
vi INTERNATIONAL ARBITRATION AND PUBLIC POLICY 2. National Court Decisions... 30 3. International Conventions... 30 4. Inter-Governmental Organizations (IGOs), Non-Governmental Organizations (NGOs) and General Principles of Law... 31 B. Problems in Defining Public Policy... 32 C. Core Matters of Substantive Transnational Public Policy... 32 1. Observing Obligations (especially arbitration agreements)... 32 2. Corruption and Bribery... 33 3. Money Laundering... 36 4. Antitrust... 37 D. Applying Substantive Transnational Public Policy... 38 1. Discretion to Apply... 38 2. Consequences of Application... 42 IV. Conclusion... 45 Part II: Specific Manifestations Chapter 4 The SNF v. International Chamber of Commerce Case and the Obligation to Conduct Arbitration Proceedings with "Expected Dispatch" Elie Kleiman... 49 I. Responsibility of Arbitral Institutions to Ensure the Expected Dispatch of the Proceedings... 59 A. The Contractual Nature of the Obligation to Provide the Expected Dispatch for a Case... 59 B. The Extent of the Contractual Obligation of the Arbitral Institution to Ensure the Expected Dispatch of the Proceedings... 70 II. Responsibility of the Other Actors of an International Arbitration to Ensure the Expected Dispatch for a Case... 84 A. Responsibility of Arbitrators... 84 B. Responsibility of the Parties and Their Counsels... 89
TABLE OF CONTENTS vii Chapter 5 Navigating in the Archipelago of Swedish Due Process Safeguards: A Sea Chart Indicating a Few Treacherous Reefs Finn Madsen... 93 I. Background... 93 II. The Legal Framework for the Procedure in Arbitrations in Sweden... 97 A. The SAA as the Lex Arbitri and its Implications... 97 B. Are the Procedural Safeguards in Swedish Arbitration Law to be Applied Differently in Domestic and International Arbitrations?... 99 III. The Swedish Reefs to Watch Out For... 102 A. The Importance of the Request for Relief Submitted by the Parties and the Limits on the Mandate of the Arbitrators Set Forth in the Request for Relief... 102 B. Factual Circumstances Invoked... 105 C. Separate Arbitral Award Separate Issue or Part of the Matter... 109 D. The Irregularity Ground... 110 IV. Conclusions... 115 Chapter 6 Recent Swiss Developments on Exclusion Agreements Laurent Lévy and Tetiana Bersheda... 117 I. Introduction... 117 II. The Law Governing Exclusion Agreements... 119 III. The Case Law of the Swiss Federal Court... 120 A. General Rules... 120 B. Examples of Valid Exclusion Agreements... 124 C. Examples of Invalid Exclusion Agreements... 126 IV. The Scope of Exclusion Agreements... 129 V. The Compatibility with Public Policy... 132 VI. Conclusion... 136
viii INTERNATIONAL ARBITRATION AND PUBLIC POLICY Chapter 7 Public Policy in Swiss International Arbitration Law: For Once, Adjectives Make a Difference Pierre A. Karrer... 137 I. Judicial Review... 137 A. Swiss Court s Review Public Policy... 137 B. Procedural Public Policy... 141 C. Arbitral Tribunal s Decision Public Policy... 142 II. Recognition and Enforcement Public Policy... 143 Chapter 8 Dispute Resolution of Shareholder Agreements in Ukraine: For Better or Worse? Timur Bondaryev and Markian Malskyy... 147 I. Introduction... 147 A. Historic Background... 149 B. Current Trends in Corporate Disputes in Ukraine... 150 II. The Recommendations 2007 of the Presidium of the Highest Commercial Court of Ukraine... 152 A. Regulation of Shareholder Agreements by Foreign Governing Law is Null and Void... 155 B. Regulation of Shareholder Agreements by Foreign Governing Law Infringes the Public Policy of Ukraine... 156 C. Disputes Regarding Shareholder Agreements May Not Be Referred to International Commercial Arbitration... 157 III. Resolution 2008 of the Plenum of the Supreme Court of Ukraine... 159 IV. Amendment of the Ukrainian Commercial Procedural Code in 2011... 160 V. Recent Court Practice Concerning Non-Arbitrability of Corporate Disputes... 161 A. Recognition of Arbitral Award in the Ukrainian Local Court... 161
TABLE OF CONTENTS ix B. Related Case... 162 C. Feasible Alternative... 163 1. Defining the Hardship... 163 2. Corporate Structuring Outside of Ukraine... 164 VI. Conclusion... 165 Chapter 9 The Scope of Review in Annulment Proceedings Piero Bernardini... 167 I. The Development of International Arbitration... 167 II. Public Policy in International Arbitration... 168 A. Is the Operation of Public Policy the same in Award Annulment and Enforcement Cases?... 168 B. Cases Where Such Operation Is Different... 171 C. The Content of International Public Policy... 173 D. The Extent of Court Control Regarding Public Policy... 174 E. The Need for an Effective Control of Public Policy... 181 Chapter 10 Public Policy as Ground for Annulment of or Non-recognition of Enforcement of Arbitral Awards in East Asia Michael Hwang and Shaun Lee... 183 I. Introduction... 183 II. Judicial Approach to Setting Aside, Recognition and Enforcement... 184 III. The Scope of Public Policy... 185 A. Source of Public Policy... 185 B. Enforcement and Recognition... 186 C. Errors of Fact and Law... 186 D. Costs... 202 E. Violation of Domestic Law... 204 F. Parallel Litigation... 211
x INTERNATIONAL ARBITRATION AND PUBLIC POLICY G. Grounds for Non-enforcement or Annulment: Exclusive or Non-exclusive?... 215 IV. Conclusion... 220 INDEX... 221