Lloyd's Maritime and Commercial Law Quarterly

Professor Francis D Rose

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ARBITRATION AND THE BRUSSELS REGULATION AGAIN

Adrian Briggs*

Re Gazprom OAO

If the Brussels I Regulation1 prevents a court in a Member State granting an injunction to stop a respondent bringing proceedings in a civil or commercial matter before the courts of another Member State,2 even though the entire basis for the relief applied for is the respondent’s breach of his contractual agreement to arbitrate, does the prohibition extend to the case in which an analogous award is issued by an arbitral tribunal? According to the European Court (“ECJ”), it does not: neither proceedings before arbitral tribunals, nor awards made by arbitral tribunals, nor orders made in judicial proceedings based on the award of an arbitral tribunal, fall within the scope of the Brussels I Regulation. It followed that an award made by a Swedish arbitral tribunal, requiring a party to a proceedings before it to discontinue judicial proceedings which it had launched before the Lithuanian courts was, so far as the Brussels I Regulation was concerned, free to be recognised3 and given effect by the Lithuanian courts in accordance with Lithuanian law. Any suspicion that the award was an anti-suit injunction,4 and therefore a measure which was intrinsically incompatible with the Regulation, was deflected by the observation that, if the Regulation did not apply to arbitration, it could not apply to the awards made by arbitrators and to measures ordered to give them effect.

So understood, the decision of the ECJ in Re Gazprom OAO 5 is welcome and largely unremarkable. It came about as follows. The principal shareholders of Lietuvos Dujos AB, a natural gas enterprise organised under the laws of Lithuania,6 were Gazprom (a Russian conglomerate), a German energy company, and the Lithuanian State. A shareholders’ agreement provided for differences to be referred to arbitration before a tribunal in Stockholm. When relations within Lietuvos Dujos AB became strained, the Lithuanian State applied to the Lithuanian courts for an order that an inquiry be opened into the internal affairs of the enterprise. Gazprom considered, unsurprisingly, that the complaint raised matters which, on a true construction of the shareholders’ agreement, the Lithuanian State had agreed to arbitrate rather than litigate. It therefore applied to the Stockholm tribunal for, and obtained, an interim award which directed the State to abide by its agreement and discontinue the proceedings brought by it before its own courts. When Gazprom attempted to have the award enforced in Lithuania, the Lithuanian Supreme Court, conceiving the interim award to be in the nature of anti-suit injunction, asked the ECJ whether it was entitled or bound to disregard it as bearing the taint of Turner v Grovit 7 or Allianz SpA v

1. Council Regulation 44/2001 (“the Brussels I Regulation”). The exception for arbitration is found in  Art 1(2)(d) of the Regulation. The judgment does not discuss the Recast Regulation 1215/2012.

2. So held in Allianz SpA v West Tankers Inc (C-185/07) [2009] ECR I-663.

3. Or not recognised.

4. See the judgment at [25], echoed at [30], where the Court says, with notable care, that the Lithuanian court classified the award as an anti-suit injunction. The Court did not say that it agreed, no doubt because it sees the award as an award, not as a judgment, and would itself reserve the nomenclature of ‘anti-suit injunction’ to orders made by a court.

5. Re Gazprom OAO (Case C-536/13) EU:C:2015:316; [2015] 1 Lloyd’s Rep 610 (on a reference from the Supreme Court of Lithuania).

6. The company was, and is, responsible for the system by which natural gas was distributed in Lithuania.