以下文章来源于中伦文德律师事务所 ，作者ZLWD

Supreme People's Court Issued Six Guiding Cases on Judicial Review of Arbitration

On 27 December 2022, the Supreme People's Court issued the 36th batch of six guiding cases, all of which are arbitral judicial review cases. The purpose of issuing this batch of cases is to strengthen the guidance of arbitration judicial review cases, ensure uniformity in the scale of adjudication, promote the correct implementation of the law, achieve strict and fair justice, and strive to make the people feel the fairness and justice in every judicial case.

With regard to the six guiding cases issued by the Supreme People's Court, Guiding Case No. 196 clarifies the specific meaning and legal effect of the principle of independence of arbitration agreements; Guiding Case No. 197 interprets and applies the "before the first hearing" stipulated in Article 20(2) of the Arbitration Law; Guiding Case No. 198 clarifies the principle of a high degree of autonomy in arbitration agreements; Guiding Case No. 199 deals with the adjudication of virtual currency cases against the public interest; Guiding Case No. 200 provides guidance on clarifying legal concepts such as "ad hoc arbitration" and "expedited arbitration"; Guiding Case No. 201 deals with the determination of the legal nature of dispute resolution decisions made by internal dispute resolution bodies of the international sports organizations.

Beijing Fourth Intermediate People's Court Notified Applications for Recognition and Enforcement of Extraterritorial Arbitral Awards and Enforcement of Court Judgments

On 28 December 2022, the Beijing Fourth Intermediate People's Court (hereinafter referred to as "Beijing Fourth Intermediate Court") held a press conference to notify the achievements of the court in handling "applications for recognition and enforcement of extraterritorial arbitral awards and enforcement of court judgments" in recent years.

According to spokesperson Yuan Yuchi, since the Beijing Fourth Intermediate Court centralized its jurisdiction over applications for recognition and enforcement of extraterritorial arbitral awards and court judgments within the city in 2018, it has received a total of 332 such cases, with the total subject matter of the enforcement cases reaching more than RMB 5 billion. These cases involve a wide range of jurisdictions, complex and diverse enforcement contents, and encounter many new enforcement challenges, so the enforcement methods often need to be adjusted according to various differences in jurisdictions, national conditions, systems and legal interests. For example, in the case of foreign currency denominated monetary payments, due to foreign currency circulation management, foreign exchange control and other reasons, the court often needs to transfer and release the funds by means of foreign exchange or using intermediary accounts.

In addition, in order to improve the quality and efficiency of recognition and enforcement of extra-territorial arbitral awards and court decisions, the Beijing Fourth Intermediate Court has actively promoted the establishment of a system that dovetails with internationally prevailing rules and practices, established an online service guarantee mechanism for the identification of extra-territorial laws, refined the rules on judicial assistance in foreign-related commercial matters, promoted the mutual recognition and enforcement of extra-territorial arbitral awards and court decisions between countries (regions), and formed a professional and highly qualified team of judges to ensure accurate interpretation and enforcement of the contents of extraterritorial arbitral awards and court decisions. In addition, the Beijing Fourth Intermediate Court has fully optimised the connection mode of the case handling process and formed a working mechanism for review and enforcement, whereby the judges in charge of the case take into account the specificities of domestic enforcement of extra-territorial arbitral awards and court decisions at the review stage, so as to reduce the situation in which a recognised or recognized successful extra-territorial decision cannot be enforced in China.

Hainan International Arbitration Court Yazhou Bay Seed Industry International Arbitration Center was Established

On 5 January, Hainan International Arbitration Court Yazhou Bay Seed Industry International Arbitration Centre (hereinafter referred to as the "Arbitration Centre") was established in Sanya. It is reported that the construction of the Arbitration Centre is jointly promoted by the Hainan International Arbitration Court (Hainan Arbitration Commission) and the Sanya Yazhou Bay Science and Technology City Administration.

The establishment of the Arbitration Centre is aimed to accelerate the implementation of the national major decision of the "Southern Propagation Silicon Valley", with a focus on promoting the strategic development of the Nanfang Science and Technology City, the Nanfang National Research and Breeding Base, the Global Animal and Plant Germplasm Resources Introduction and Transfer Base, the National Modern Agricultural Industrial Park, the National Tropical Agricultural Science Centre, etc., to accelerate the construction of a seed industry science and technology innovation highland and seed industry intellectual property Special zone in the Sanya Yazhou Bay Science and Technology City and to promote Hainan to become the national intellectual property protection curatorial source.

According to the introduction, the arbitration centre will mainly carry out civil and commercial arbitration work related to intellectual property rights, trade and investment in the seed industry between domestic and foreign commercial entities, and all parties will give full play to the advantages of human resources, coordinate professional forces, integrate seed industry expert resources, discuss hot legal issues and classic cases in the field of seed industry and germplasm resource protection, study arbitration, mediation and other dispute resolution mechanisms in the seed industry; promote advanced experiences, The seminar will promote advanced experiences and theoretical achievements, provide training to commercial subjects on legal risk prevention, and promote commercial subjects' in-depth understanding and extensive use of arbitration, mediation and other dispute resolution mechanisms.

Nanjing Intermediate People's Court:

Where Only Expedited Arbitration has been Agreed and No Arbitration Institution has been Expressly Agreed, an Award Made by an Ad Hoc Arbitral Tribunal may be Recognized and Enforced in China

Legal Basis:

United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards 

Article V

1. Recognition and enforcement of the award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the competent authority where the recognition and enforcement is sought, proof that:

(A) The parties to the agreement referred to in article II were, under the law applicable to them, under some incapacity, or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made; or

(B) The party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present his case; or

(C) The award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration, provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be recognized and enforced; or

(D) The composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties, or, failing such agreement, was not in accordance with the law of the country where the arbitration took place; or

(E) The award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made.

Case Description：

On 17 May 2013, the purchaser, SvenskHonungsforadlingAB (hereinafter referred to as "Svensk Company") and the seller, Nanjing Changli Bees PRODUCT Co., Ltd. (hereinafter referred to as "Changli Bee Company") entered into the English version Honey Sales Contract No. NJRS13001 (hereinafter referred to as the "Contract"). The terms of dispute resolution stipulated in this contract are: "in case of disputes governed by Swedish law and that disputes should be settled by Expedited Arbitration in Sweden." During the performance of the contract, disputes occurred between the two parties due to the quality of honey. On 23 February 2015, Svensk Company applied to the Arbitration Court of Chamber of Commerce in Stockholm, Sweden, with Changli Bee Company as the respondent, for compensation. On 18 December 2015, the Arbitration Court rendered arbitration award SCCF2015/023, rejecting Svansk Company's application on the grounds that it had no jurisdiction.

On 22 March 2016, Svensk Company again applied for ad hoc arbitration in Sweden with Changli Bee Company as the respondent in relation to the Contract in question. During the arbitration review, the ad hoc arbitral tribunal and the Stockholm District Court sent the corresponding materials to Changli Bee Company and the legal representative of the company, but as of 4 May 2017, the ad hoc arbitral tribunal had not received any comments other than two e-mails from Changli Bee Company stating that no arbitration clause had been agreed in the Contract and that Swedish law should not apply. Thereafter, the ad hoc arbitral tribunal received a submission from Changli Bee Company's attorney regarding the objection to the jurisdiction of the arbitral tribunal and the extension of the submission of the defence. On 5 and 6 March 2018, the ad hoc arbitral tribunal organised hearings for both parties. On 9 June of the same year, the ad hoc arbitral tribunal rendered an arbitral award in accordance with the Swedish Arbitration Act: 1. Changli Bee Company shall pay US$286,230 and interest to Svansk Company for breach of the Contract; 2. Changli Bee Company shall compensate Svansk Company for SEK781,614 and HK$102,718.45. On November 22, 2018, Svensk applied to Nanjing Intermediate People's Court (hereinafter referred to as the "Court") for the recognition and enforcement of the said arbitral award.

Changli Bee Company stated that the arbitration procedure is not in accordance with the arbitration clause agreed between the parties, and ad hoc arbitration is not the same as expedited arbitration. According to the Chinese version of the contract between the parties, disputes under Swedish law shall be settled in Sweden by expedited arbitration, not ad hoc arbitration. Expedited Arbitration is a fast-track procedure developed by some dispute resolution institutions,, which makes the dispute resolution process simpler, but ad hoc arbitration is in no way equivalent to expedited arbitration, which is not the concept of expedited arbitration in the Swedish Arbitration Act. Therefore, the parties did not expressly agree to adopt ad hoc arbitration in their agreement, but only to adopt the rules of expedited arbitration. In addition, in the actual arbitration, there were cases where the arbitrator exceeded the scope of the parties' intention to arbitrate and Changli Bee Company was not notified of the appointment of the arbitrator and the arbitration process, which complied with the provisions of Article V B, C and D of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards regarding non-recognition and non-enforcement, and therefore the application of Svansk Company should be rejected.

Court’s View:

1. On the issue of whether the arbitral award exceeded the scope of arbitration agreed by the parties. The dispute concerned the parties' understanding of the dispute resolution clause agreed upon in the contract. During the court's review, both parties agreed that the arbitration clause in the Contract should be interpreted in accordance with Swedish law. Swanske argued that the Chinese meaning of the dispute resolution clause was "In the event of any dispute, Swedish law shall apply and the dispute shall be settled by expedited arbitration in Sweden." Changli Bee Company, on the other hand, understood the Chinese meaning of the above clause to mean "for disputes under Swedish law to be settled by expedited arbitration in Sweden." From the expression of the Chinese meaning of the clause by both parties, there was no material difference between the parties' understanding of the clause. The Court held that the parties did not disagree that disputes could be settled in Sweden through expedited arbitration, but only whether expedited arbitration could be conducted through ad hoc arbitration. Expedited arbitration is more efficient, convenient and economical than ordinary arbitration, the core of which lies in the simplification of the arbitration procedure, the shortening of the arbitration time and the reduction of the arbitration costs, thus allowing the parties' dispute to be resolved in a more efficient and economical manner. An ad hoc tribunal is also more efficient, convenient and economical than a permanent arbitral institution. In the present case, the parties had expressly agreed to settle the dispute by way of expedited arbitration, and the amount of the dispute was not significant, so the expedited arbitration did not preclude settlement by way of ad hoc arbitration.

In the end, the Court ruled to recognise and enforce the arbitral award rendered on 9 June 2018 by the ad hoc arbitral tribunal consisting of Peter Thorp, Sture Larsson and Nils Eliasson in relation to the Contract NJRS13001 between SvenskHonungsforadlingAB and Nanjing Changli Bees PRODUCT Co., Ltd.

Singapore High Court :

Foreign Emergency Arbitration Awards are Enforceable in Singapore

Case Description：

Both parties involved in this case are engaged in franchising business. The respondent in the arbitration, CVH, is a franchisee of the arbitration claimant, CVG, in Singapore, Malaysia, Taiwan and the Philippines. The contractual relationship between the parties was governed by four different franchise agreements (the "Agreements"). The Applicant also allows the Respondent to distribute its merchandise online.

In June 2020, the Applicant successfully completed bankruptcy protection proceedings under Chapter 11 of the United States Bankruptcy Code (1978) and was subsequently acquired by another company, which in turn led to a change in the management of the Applicant's company. Thereafter, a dispute arose between the parties regarding certain alleged breaches of the Agreement. The Respondent filed for rescission of the Agreement on the grounds of material breach and/or anticipatory breach, and therefore disassociated itself from the Applicant's group of companies. In response, the Applicant closed the Respondent's access to its global order system and cancelled the Respondent's previously outstanding orders, and the Respondent, therefore, deemed the Applicant to have accepted the termination of the Agreement.

On 25 May 2022, the Applicant filed an arbitration with the International Centre for Dispute Resolution (ICDR) of the American Arbitration Association. The place of arbitration is Pennsylvania, USA, and Pennsylvania law governs the proceedings. The Applicant simultaneously sought relief in the form of emergency measures. At the hearing on emergency measures, the Applicant argued for the application of the post-termination provisions agreed in the Agreement. However, it is noteworthy that in the post-trial submission, the Applicant again argued that the Agreement had not been terminated. The emergency arbitrator made an award ordering the parties to maintain the status quo until the Agreement was terminated. That is, the award was made on the basis that the Applicant regarded the Agreement as remaining undischarged.

The Applicant applied to the High Court of Singapore for enforcement of the emergency award, to which the Respondent objected. The respondent's main grounds were that: 1) the emergency award was not an award enforceable through the New York Convention under the International Arbitration Act; 2) the emergency award was outside the jurisdiction of the emergency arbitrator; and 3) the emergency award was contrary to the principles of natural justice. The High Court of Justice ultimately made the decision in this case.

Court’s View：

The definition of "arbitral tribunal" under section 2(1) of the amended Singapore International Arbitration Act(the "IAA") expressly includes "an emergency arbitrator". However, this article only applies to international arbitration under Singapore law and not to foreign awards enforced through the New York Convention in this case. In the chapter on "Foreign Awards" in Part 3 of the IAA, Article 27(1) provides that "arbitral award" means "an award as defined in the New York Convention, but includes an award made by an arbitral tribunal in an arbitral proceeding". (b) "arbitral award" means "an award as defined in the New York Convention, but also includes an order or direction made by an arbitral tribunal in arbitral proceedings in relation to a matter set out in section 12(1)(c)-(j) of this Act", but the chapter does not define "arbitral tribunal.

In this case, the High Court of Singapore, in a purposive interpretation of the legislative intent and scheme of the International Arbitration Act, held that the definition of "arbitral tribunal" in section 2(1) of the IAA should be extended to the provisions on foreign awards in section 27(1) of Part 3 of the IAA, "arbitral tribunal" may be interpreted to include emergency arbitrators. Accordingly, the term "arbitral award" in Article 27(1) of the IAA includes awards made by emergency arbitrators and Article 29 applies to foreign awards made by emergency arbitrators.

Section 29(2) of the IAA provides: Any foreign award which is enforceable under subsection (1) must be recognised as binding for all purposes upon the persons between whom it was made and may accordingly be relied upon by any of those parties by way of defence, set-off or otherwise in any legal proceedings in Singapore. The Court therefore held that the award in question was a binding award within the meaning of Article 29(2) of the IAA.

However, the High Court issued a decision against the enforcement of the emergency ruling on the grounds that it violated the principles of natural justice. In response to certain comments made by the applicant in its post-trial submissions, the respondent was unable to express its views and present its case. Under Article 31(2)(c) of the IAA，a court so requested may refuse enforcement of a foreign award if the person against whom enforcement is sought proves to the satisfaction of the court that"he was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present his case in the arbitration proceedings".

In considering the provisions of section 31(2) of the IAA relating to the refusal to enforce a foreign arbitration award, the High Court held that, the emergency award was made on the basis of the applicant's different statements during the post-court opinion stage, which deviated significantly from the applicant's previous position at the trial stage, and the Supreme Court finally ruled that the emergency award was not enforced because it violated article 31(2)(c) of the International Arbitration Act.