INTRODUCTION

The dispute in these proceedings arises out of a distribution agreement between Castel Electronics Pty Ltd, an electrical goods distribution company registered in Australia, and TCL Air Conditioner (Zhongshan) Co Ltd, an air conditioner manufacturing company registered in the People’s Republic of China. Under a General Distributorship Agreement (“the distribution agreement”) made in December 2003 and later extended and varied, TCL granted Castel the exclusive right to sell TCL air conditioners in Australia. Castel claimed that TCL breached the agreement by, amongst other things, manufacturing and supplying air conditioners to other Australian distributors which were not branded “TCL”, to be sold in competition to those distributed by Castel. It also claimed that TCL supplied faulty and defective air conditioners to it.