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Litigation Funding Case Study🔎: "A Breakthrough in Litigation Funding for State-Owned Enterprises in Mainland China."   Co-authored by General & Senior Legal Counsels for Greater China and Southeast Asia, Lee Irene & Alanna Lau, alongside David Walker, Senior Legal Counsel UK for Deminor, this case study uncovers:   💼 How Third-Party Funding Solutions removed all the financial barriers and uncertainty. 💼 How understanding the language and cultural nuances played a significant role in building trust and facilitating efficient communication. 💼 How Deminor's team was able to remove the complexities of the arbitration process, enabling the client to proceed with confidence.   🌐Dive into the entire case study here: https://lnkd.in/eBtkGpis

  📯 ARBITRATION & BANKRUPTCY PROCEEDINGS: Can an arbitral award granting a claim against a debtor undergoing bankruptcy receive exequatur? The French Court of Cassation delivered a landmark ruling on this issue on 15 May 2024. 💨 The case involved Vergnet S.A., a French renewable energy company, and Hydro Construction & Eng. Co. Ltd, an Ethiopian drilling and engineering firm. The dispute arose from a subcontract for drilling works for a wind park project in Ethiopia, which Vergnet unilaterally terminated, leading to ICC arbitration proceedings in Geneva that concluded in favour of Hydro Construction. 🏛️ Hydro Construction subsequently obtained the exequatur of the award in France. The Paris Court of Appeal, however, revoked the exequatur order, reasoning that recognition of the award would conflict with the French insolvency law principle of suspension of individual legal actions. Hydro Construction thus initiated a recourse before the French Court of Cassation, arguing that it was only aiming to establish its claim as part of Vergnet’s reorganization process rather than seeking immediate payment. ⚖ The Court of Cassation upheld Hydro Construction’s claim. First, it recalled that, the principle of suspension of individual legal actions, does not allow to make legally enforceable an arbitral award against a debtor undergoing bankruptcy (§3). Importantly, the Court distinguished – in this particular context – between enforcing an award, which might disrupt reorganization efforts, and recognizing an award in order to validate a creditor’s claim. The Court further clarified that the latter does not contravene “the collective and egalitarian nature of [bankruptcy] proceedings” (§4), noting that Hydro Construction sought solely to validate its claim without compelling payment from Vergnet (§5). ⏪ The Court thus overruled the Paris Court of Appeal’s decision and confirmed the exequatur order. 📌 Takeaway? This decision underscores a crucial distinction in international arbitration and bankruptcy law, confirming that the recognition of an arbitral award – as opposed to its enforcement – for the purpose of establishing claims within bankruptcy proceedings is permissible and does not conflict with international public policy. It endorses the way for creditors in similar situations to secure their claims without undermining the collective framework of debtor reorganization. #internationalarbitration #Frenchcourts

Legal walk n ° 4: The interest of arbitration in extractive contracts. Arbitration plays a crucial role in extractive contracts, especially in the mining and oil sectors, for several reasons. Here are the main interests of arbitration in this context :  1. Neutrality and Impartiality: Arbitration makes it possible to choose a neutral forum to resolve disputes, which is essential in extractive contracts often involving parties of different nationalities. Arbitration offers a more impartial field, reassuring foreign investors and governments. 2. Specialization of Arbitrators: Extractive contracts are often complex and technical. Arbitration makes it possible to appoint arbitrators who have specific expertise in the relevant fields (mining law, petroleum law, environmental issues, etc.). This ensures a deeper understanding of the issues in the sector and a better informed decision. 3. Confidentiality: Arbitration offers greater confidentiality compared to legal proceedings. This is especially important in the extractive sectors, where sensitive commercial issues, proprietary technologies, or investment strategies should not be exposed to the public or competitors. 4.Flexibility and Adaptability: The parties can agree on procedural rules adapted to their specific needs, which is not always possible in national judicial systems. This flexibility makes it possible to manage disputes more efficiently and speed up the resolution process, which is crucial in an industry where delays can be extremely costly. 5. Enforcement: Arbitral decisions are generally easier to enforce internationally thanks to treaties such as the New York Convention of 1958, which obliges signatory states to recognize and enforce foreign arbitral awards. This gives an additional guarantee to the parties that the decisions will be respected, which is especially relevant for foreign investors in extractive projects.  6. Preservation of commercial relations: Arbitration is often less confrontational than judicial disputes. By promoting a more consensual dispute resolution, it helps to preserve commercial relations between the parties, which is important in long-term extractive projects where the parties must continue to collaborate after the resolution of a dispute.  7. Efficiency and Speed: In many cases, arbitration is faster than ordinary court proceedings. 8. Jurisdictional Flexibility: The parties can choose the jurisdiction (seat of the arbitration) and the law applicable to their arbitration, which avoids the constraints and uncertainties related to the application of the national laws of certain less developed or unstable jurisdictions.

Staying litigation in favour of arbitration – the “real and proper purpose” qualification: In the Supreme Court’s judgment in Mozambique v Privinvest, Lord Hodge considered (obiter) that an application to stay legal proceedings could be refused if there was no “real and proper purpose” for it. In Mozambique, Lord Hodge thought it was difficult to see a “real and proper purpose” for the application to stay the litigation in favour of arbitration because, due to their having been joined to the litigation as Part 20 Defendants, the entirety of the dispute against the applicants would potentially be in the public domain and the parties would not have the advantage of privacy which an arbitration may give. On the same date that the Supreme Court delivered judgment in Mozambique, Lord Hodge, sitting this time in the Privy Council, delivered the judgment in FamilyMart v Ting Chuan. Again, Lord Hodge said that the court could refuse an otherwise mandatory stay of litigation if the applicant has no “real or proper purpose” for seeking the stay. That could include not only an application for a stay in relation to issues that were peripheral to the legal proceedings but also an application that amounted to an abuse of process. So far, to my knowledge, the argument that a stay should be refused because the application was not made for a “real and proper purpose” has been advanced twice – once in Sodzawiczny v Smith and once in the recent judgment of Tumpuan v ING. In Sodzawiczny, Foxton J did not find it necessary to consider the argument, but said that the principle would represent a “significant and, it is respectfully suggested, controversial development in English arbitration law”, the precise juridical basis for and practical parameters of which have yet to be explored. In Tumpuan, Stephen Houseman KC noted Foxton J’s misgivings, but said he did not need to consider the qualification given that the application made before him was not abusive or improper. Although controversial, the “real and proper purpose” qualification has (as Foxton J acknowledged) received support at the highest level of judicial authority, so although it has not succeeded yet, I’ll be surprised if it isn’t raised again (soon!). #arbitration #litigation #mozambique #familymart #realandproperpurpose #stay #nopicturetoday https://lnkd.in/exHagkdp (Mozambique) https://lnkd.in/ejrXbVcx (FamilyMart) https://lnkd.in/e-AgDVfu (Sodzawiczny) https://lnkd.in/evPyA-hG (Tumpuan)

🌟 Enforcement Strategies for Arbitral Awards 🌟 The English Commercial Court has granted Crescent Gas Corporation Limited (CGC) ownership of a London property to recover part of a USD 2.6 billion judgment debt from the National Iranian Oil Company (NIOC). 💡 Summary: The dispute stemmed from a 25-year Gas Sales and Purchase Contract between Crescent Petroleum and NIOC. After securing an arbitral award of USD 2.4 billion in 2021, CGC faced challenges in enforcing the judgment. Notably, however, NIOC had transferred commercial real estate in central London, with an estimated value of GBP 100 million, to another entity. The court inferred that the purpose of this transaction was to put the property beyond CGC’s reach as the judgment creditor, before CGC could enforce its judgment against the property. The transfer was for no consideration. Further, arguments that the property was held on trust (and that it therefore was not owned by NIOC and could not be transferred to CGC) failed. This is because the alleged trust declarations were either issued before the other entity had acquired legal personality in 2019, rendering them ineffective, or because they did not adhere to the stringent legal requirements for establishing a trust in land as mandated by s.53(1)(b) of the Law of Property Act 1925. Ultimately, the court held that the transfer was a transaction at an undervalue, as defined by s.423 of the Insolvency Act 1986. In partial satisfaction of the USD 2.6 billion award, the court ordered that the property be transferred to CGC. 🔑 Enforcement Strategies & Key Takeaways: Utilising s.423 of the Insolvency Act 1986: This provision enables courts to reverse transactions made to defraud creditors, highlighting its importance in enforcement strategies. Court's Robust Approach: The court’s willingness to interpret s.423 broadly strengthens the enforcement of arbitral awards, ensuring they are not merely theoretical victories. Complexities of Trusts and Property Law Across Jurisdictions: The case underscores the necessity for precise adherence to formal requirements in trust declarations, especially in international contexts. I cover the above and more in my first article for Wolters Kluwer: International Arbitration & Mediation. Thanks to Krystal Lee and Maria Fanou for their helpful edits on previous drafts. #LegalUpdate #ArbitralAward #EnforcementStrategies #InternationalArbitration #TrustLaw #InsolvencyAct #CommercialCourt #CGC #NIOC #KluwerArbitrationBlog

NEW Lloyd’s Open Form (LOF) 2024 We are pleased to announce the introduction of LOF 2024 and the Lloyd’s Salvage Arbitration Clause (LSAC) 2024. The new LOF and LSAC are the culmination of many months of consultation with the users and potential users of the Form and we would like to thank all those involved for their contributions. The main changes to the LOF are captured in the new Important Notice No. 5, which, for the first time, requires the Contractors and owners of the property to provide to the Council of Lloyd’s the following data relevant to the services rendered under the Agreement:- (i) ESG Data. Within 60 days of the termination of the services under this Agreement a completed Environmental, Social & Governance data collection form. (ii) Salved Values. Within 60 days of the termination of the services under this Agreement details of the value of the property salved (the “salved values”) (iii) Settlement Data. Within 60 days of a settlement concluded with any or all of the parties to this Agreement details of the settlement. These requirements, which are set out in further detail in clause 15.2 of the new LSAC, are designed to enable Lloyd’s to collect and publish, in aggregated and anonymous form, data/information relating to all LOF services, whether proceeding to an arbitration or settled amicably between the parties. Perhaps the biggest change to the LOF arbitration procedure for many years sees the old Fixed Cost Arbitration Procedure (FCAP) replaced by the new Fast Track Documents Only (FTDO) procedure, which is set out in clauses 8, 9 and 11 of the LSAC. LSAC clause 8.1 directs that “every arbitration where the security demand is US$10 million or less will be dealt with on a fast-track documents-only (“FTDO”) basis unless the Arbitrator orders otherwise”, but the FTDO procedure will not apply in those cases where, upon application by one or more parties, the Arbitrator considers that an oral hearing is needed or appropriate. Further LSAC clause 8.3 states that “every arbitration where the security demand is more than US$10 million shall be dealt with in accordance with the Oral Hearing procedure unless the Arbitrator orders that it should be dealt with under the FTDO procedure.” If you have any questions regarding the LOF 2024 or LSAC 2024 please direct them to the Salvage Arbitration Branch – Lloyds-salvage@lloyds.com or visit https://lnkd.in/euuGUqyk

Gabriel Resources Ltd - Update on ICSID Arbitration - Tribunal Decision https://lnkd.in/eUZMgZ2D March 8, 2024 - Gabriel Resources Ltd. (TSXV:GBU) announces that the World Bank's International Centre for Settlement of Investment Disputes (ICSID) today issued a decision dismissing, by a two to one majority, the Company's arbitration claims filed against the Romanian Government relating to its investments in the Roia Montan gold and silver mining project. In addition, the Tribunal awarded Romania approximately US$10m in legal fees and expenses incurred in connection with its defence of the arbitration. The award is binding on the parties. Gabriel initiated the arbitration before ICSID in July 2015 under the Canada-Romania and UK- Romania bilateral investment treaties following the Romanian Government's refusal to act on the permitting of the Roia Montan project. The Company strongly disagrees with the majority's decision, which is entirely inconsistent with any objective assessment of the evidence presented in this case, as demonstrated by the compelling dissenting opinion of one of the arbitrators. The Company is analyzing the Tribunal's decision with its legal advisers to evaluate its options, including to challenge the decision through the annulment process prescribed by the ICSID Convention. Anna El-Erian, Chair of Gabriel Resources said: "We consider the decision of the majority to be deeply flawed. As recognized by the dissenting arbitrator, the Romanian Government's sustained political interference with Gabriel's contractual rights prevented the development of a flagship mining project owned in partnership with the State. We will take time to evaluate our options, but hasten to record our sincere appreciation to our shareholders for their unwavering support and patience throughout this prolonged process. We would also like to express our gratitude to our earnest and hard-working management and team of employees, in Romania and abroad, who have devoted a significant part of their careers to the development of the project in the sincere belief that it was in the country's best interests." Dragos Tanase, CEO of Gabriel Resources said "Gabriel's shareholders invested hundreds of millions of dollars to deliver a transformational mining project that would have brought very significant social and financial benefits to the Romanian people, not only in Roia Montan but across Romania. We regret that Romania, its economy and its citizens, have missed the opportunity to benefit from this mining project. We will be studying the Tribunal's decision in detail before evaluating our next steps."

Resolution of Petroleum Disputes: Whither the Arbitration and Mediation Act 2023? by Uche Val Obi SAN, Alliance Law Firm https://lnkd.in/eTHHAcQg The #Arbitration and #Mediation Act (AMA) 2023 creates a legal framework for mediation and seek to address the challenges plaguing arbitration practice in #Nigeria. This legislation is critical to the petroleum industry, considering the commercial exigencies and preference for alternative dispute resolution (ADR) in the industry by the Petroleum Industry Act (PIA) 2021. Adopting the doctrinal research methodology, this study examined the implications of AMA on the petroleum industry and its interaction with the PIA. It is found that the Act has successfully created clarity in mediation practice and instances the court may intervene in arbitration proceedings. It is, however, observed that the creation of the Award Review Tribunal (ART) did not successfully reduce the courts’ intervention in arbitration process; rather, it added another layer of protocol to the arbitration process. It is also noted that AMA still maintains a subservient position to PIA and other industry regulations on ADR. 

It took me about 15 years to say that I am involved full-time in arbitration-related work. It is mostly international arbitration now. It was a path from a junior lawyer to working in various partnerships and ending up as an independent (solo) practitioner.   The path does not look like a straight line at all. It started with a lot of reading in the field, mostly in the evening (after work) and on Saturdays – all of this while working in commercial disputes. That was at the beginning of my career.   Later on, I got some work in several domestic arbitration cases. Domestic arbitration in Moldova is very much like court proceedings – with short, unpredictable, and endless hearings.   The next step was to get hired as local counsel for several international arbitration cases. I loved learning from more experienced attorneys and arbitrators. I still do that to this day. This opened the door to acting as a lead counsel in a number of complex international arbitration cases and, eventually, as an arbitrator in the same category of cases.   On the way there, I got another LL.M. (this time, in international arbitration). I helped draft the new Moldovan law on arbitration, which is still in the making. I acted as a legal expert in one dispute, as well as represented Clients in a series of simple & low-value arbitrations – with the main purpose of staying in the flow of the practice.   My cases ranged from construction arbitration to GAFTA, LMAA, oil & gas, and CISG arbitration.   It was not a straight path. The cases were of different colors. It is not always big and complex, especially in the beginning, but it is arbitration. And that is what counts for me.