Originally from European International Arbitration Review (EIAR)

I. Introduction/Summary

Ireland is a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. In a recent case, the Irish High Court held that under the implementing Irish legislation, the court has discretion to refuse to accept jurisdiction over an attempt to enforce an arbitral award under the Convention.

The Court then declined to exercise jurisdiction based on the facts of the case, including that the case has no connection with Ireland, there are no assets within Ireland, and there is no real likelihood of assets coming into Ireland. Other relevant factors that led the Irish Court to decline jurisdiction included that this was the fourth attempt on the part of the petitioner to enforce this arbitral award, and it would be unjust to require the respondent to bear the burden and expense of defence yet again. The Court found little evidence to demonstrate any “solid practical benefit” to be gained by petitioner in enforcing the award in Ireland and specifically observed that the desire of the petitioner to obtain a judgment from a “respectable” court had already been exercised in other jurisdictions, thus far without success.

II. Background

Yukos Capital S.A.R.L. (“Yukos Capital”) brought enforcement proceedings in Ireland against OAO Tomskneft VNK (“Tomskneft”) arising out of an ICC arbitral award from 2007.

Yukos Capital first sought recognition and enforcement of the award in Russia, where Tomskneft is incorporated and conducts business. Tomskneft resisted that application on a series of grounds. In July 2010, the Tomsk Regional Arbitrazh Court refused to recognise and enforce the award on the bases that there had been improper notification of the arbitral proceedings and that it would be contrary to the public policy of the Russian Federation to enforce the award, which grounds for refusal are provided by Articles V(1)(b) and V(2)(b), respectively, of the New York Convention. The Tomsk Regional Arbitrazh Court’s ruling was upheld on appeal.