This column looks at three recent decisions concerning the enforcement of foreign arbitral awards. Two of the decisions reached opposite results on the issue of enforcing awards that were annulled at the place of arbitration. The third concerns refusal to enforce a CIETAC (China International Economic and Trade Arbitration Commission) award.
Annulled Award Enforced
In our November 2013 column, we discussed in detail the issue of enforcing arbitral awards that are annulled at the place of the arbitration. That included a discussion of the case between COMMISA and PEP (a subsidiary of Pemex, Mexico’s state-run oil company), which were parties to a contract for COMMISA to build and install two offshore platforms. The contract included a clause allowing PEP to rescind the contract (i.e., issue an administrative rescission) if COMMISA failed to comply with certain obligations under the contract. It also included an ICC (International Chamber of Commerce) arbitration clause. After the parties disagreed about whether COMMISA had met contractual milestones, Pemex seized the platforms and gave notice it was going to rescind the contracts. COMMISA then commenced arbitration, which resulted in a majority award that, by the time of the decision, was worth more than $400 million.
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