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A jurisdictional battle of the ASIs: Can you unring a bell?
A jurisdictional battle of the ASIs: Can you unring a bell?
9 June 2025
Series
Blogs
9 June 2025
In UniCredit Bank GmbH v RusChemAlliance LLC [2025] EWCA Civ 99 and Bayerische Landesbank and others v RusChemAlliance LLC [2025] EWHC 924 (Comm), the claimants sought to revoke anti-suit injunctions and declarations granted in their favour by the English courts.
Both cases concerned bonds issued by the banks to RusChemAlliance (“RCA”). When the banks refused to pay on the bonds due to international sanctions, RCA initiated proceedings in Russia despite the bonds providing for arbitration in Paris. The English court, having decided it had jurisdiction to do so, ordered final anti-suit injunctions (“ASIs”) to restrain RCA from pursuing claims alleged to be breaches of the arbitration agreements. Further background on UniCredit is in our earlier posts.
Subsequently, RCA obtained anti-ASIs from the Russian Arbitrazh (Commercial) Court which ordered the banks to take all measures within their control to cancel the effect of the ASIs, providing for “very significant financial penalties" if the banks did not comply.
The banks applied to the English courts to revoke the ASIs due to changed circumstances. The Court of Appeal (“CoA”) varied (rather than revoked) its previous order in UniCredit and the High Court (Foxton J) in Bayerische Landesbank largely followed the precedent set in UniCredit. The ASI granted in the Deutsche Bank case discussed in a previous post had previously been revoked.
In UniCredit, the CoA considered the following central issues :
Whilst the CoA agreed to discharge the injunctive parts of the ASI order, it refused to revoke the decisions on jurisdiction to grant the ASIs since the English courts determined they did have jurisdiction under English law.
In Bayerische Landesbank, Foxton J’s approach was consistent with the CoA and revoked the ASIs (and costs orders) with the additional reasoning that such orders were “forward-looking” and subsequent events could materially change the circumstances in which those orders were granted, such that a revocation order was appropriate.
Foxton J followed the CoA’s reasoning regarding jurisdiction and held that the declarations on jurisdiction could not “be revoked any more than a bell can be unrung" and were not forward-looking in the same way as the ASIs. Those declarations were a statement of the court’s position as a matter of English law and revoking them could create a misleading impression that the English court had originally acted without jurisdiction.
These judgments confirm the English court’s power to discharge final ASIs and their willingness to do so in light of changed circumstances. In particular, the courts are willing to take a pragmatic approach to “jurisdictional battles” and not look behind a foreign court’s authority to make orders as to its own jurisdiction even where this may conflict with the English court’s. Of similar importance is the appreciation that private parties (such as large banks) are capable of making their own commercial decisions which the English court should not second-guess.
The counterpart to such flexibility as regards private parties is the English court’s robust approach to protecting the jurisdiction of the parties’ chosen forum. While the English courts stand firm on the position under English law, the utility of this to a commercial party when faced with significant penalties in a foreign jurisdiction (as a result of a foreign counterparty not respecting the jurisdiction of the chosen forum), could be questionable.
A further consideration arising is to what extent parties making similar applications will be considered to have waived their counterpart’s obligation to arbitrate. Although mentioned briefly in the judgments, it is an area where deeper exploration would be of interest for private parties and for arbitration practitioners alike.