Anti-Suit Injunctions In International Commercial Arbitration

Traditionally,theanti-suit injunction is aprivate international law mechanism that resolves international civil and commercial judicial jurisdiction conflicts by restricting parties from raising or continuing parallel proceedings.Originated from jurisdiction competition between the Court of Chancery and the Common Law Courts in England,the mechanism subsequently extended to and became mainly applicable in the field of international commercial and civil dispute resolution.For a long time,due to differences in legal traditions and judicial ideologies,the legitimacy of this mechanism,which indirectly evaluates the competence of foreign courts,has been questioned by civil law countries.Recently,with the rise of party autonomy-based international commercial arbitration,the anti-suitinjunction has gained broad development space because of its unique role in safeguarding the effectiveness of arbitration agreementsand maintaining the integrity of arbitration proceedings.The main purpose of thethesis is to arguethe general legitimacy of anti-suit injunctions in international commercial arbitration by examining up-to-date practices andtheoretical research,examinehow the legitimacy of anti-suit injunctions should be manifested in concrete cases,andsuggest accessible approachfor the introduction of the mechanism into domesticinternational commercial arbitration legal system,based upon an analysis of the necessity,feasibility thereof.The thesis comprises of five chapters in addition to the Introduction.Chapter One aims to argue for the general legitimacy in international commercial arbitration scenarioof anti-suit injunctions based on the parties’ not to be suedright under effective arbitration agreements.The close relationship between the right to sue and courts’ jurisdiction inevitably leads to the indirect interference with the jurisdiction of foreign courts by the issuance of anti-suit injunctions ostensiblysolely against the breaching parties.The different weight given on individual justice and court’s jurisdiction by common law and civil law courts has made the anti-suit injunctiona controversial,unable to be mitigated by comitymechanism under traditional jurisdiction paradigms.The emergence of the new jurisdiction paradigm,which is primarily characterized by universal support for party autonomy,has fundamentally integrated the aim and process of protecting individual rights and coordinating judicialjurisdiction,thusprovides legitimate foundation for contractual anti-suit injunctions.Coherence in core value has made the anti-suit injunction a powerful tool for the protection of the parties’ not to be sued right under arbitration agreements.Complementing with traditional procedural remedies,suchas non-acceptance or dismissal,the anti-suit injunction facilitates the fullprotection of parties’ rights and expectations under arbitration agreements.Despite general acceptance of anti-suit injunctions in international commercial arbitration,and its coherencewith the spirit of the New York Convention,since the effectiveness of party autonomy is mainly based on existing legal systems,the application of the mechanism,even under the international commercial arbitration environment,should still be subject to reasonable restrictions set by international law principles,regulations,orcomity.Chapter Two argues that both the court and the arbitral tribunal generally possess the authority to issue anti-suit injunctions based on an analysis of relevant international laws,domestic laws,legal principles,and practical cases.Practice has proven that both common law courts and civil law courts have the general power to issue anti-suit injunctions,whichcan be interpretated in a unified formassubstantive legal remedies for procedural rights.The difference between the two is only that common law courts generally acknowledge and put in practice thisremedy,while civil law courtsonly confirm on specific occasions the feasibility of this practice.Parties’ right not to be sued under arbitration agreementsand procedural rights mentioned above are essentially the same.Therefore,whether to issue anti-suit injunctions based on effective international commercial arbitration agreements only depends on the judicial policy towards arbitration of each jurisdiction,which may even lead to the issuance of anti-suit injunctions for foreign arbitrations while necessary and appropriate.The power of arbitration tribunals to issue anti-suit injunctions,whether provided for by arbitral procedural laws,arbitration rules or arbitration agreements,or even inherent power of the arbitration tribunals,ultimately derives from the parties’ consent.Therefore,theapparent absence of legal authorizationfrom the seat,thoughmay weaken the effectiveness of arbitral anti-suit injunctions,does not affect the exercise of this power by arbitration tribunals.Considering the parties’ autonomy,the injunctions issued by both the seat court and arbitral tribunal exhibit a heightened legitimacy.Hence,in interactions between courts,it is recommended that the seat court takes the lead in issuing injunctions whenever possible.Similarly,when it comes to interactions between the arbitral tribunal and the court,the authority to issue such injunctions should ideally rest with the arbitration tribunal rather than the court.Chapter Threeargues that it is equally crucial to uphold parties’ consensus in concrete cases based on an examination of how the courts and arbitral tribunals handle specific cases involving anti-suit injunctions,and only through this approach can the legitimacy of anti-suit injunctions in international commercial arbitration be maintained.The existence of consent not only distinguishes contractual anti-suit injunctions from general anti-suit injunctions,but also allows contractual anti-suit injunctionsto bereviewed applying "Angelic Grace Principle" which isfavorable to the applicant.Under this principle,if there is a high probability of,or even prima facie evidence proving,the existence of aneffective arbitration agreement and breach thereof by the respondent,the court will usually issue an anti-suit injunction,unless the respondent can prove that there are "strong reasons".As a result,anti-suit injunctions have become a powerful tool for enforcing international commercial arbitration agreements and reflecting court’s strong support for arbitration.The extension of the effect of international commercial arbitration agreements to third parties leads tothe expansion of the "Angelic Grace Principle".However,the increased degree of court intervention in the process of seeking the parties’ consent contains within it the possible deviation from the parties’ autonomy,which will be detrimental eventually to the legitimacy of normal contractual anti-suit injunctions and the “Angelic Grace Principle”,thus calls for cautiousness.The arbitration tribunal’s review of anti-suit injunctions is also influenced by judicial practice and other interim measures,presenting diversified approaches.From the perspective of being a provisional measure,when the arbitral tribunal decides whether to issue an anti-suit injunction,it not only needs to conduct a preliminary review of its own jurisdiction but also must comprehensively assess the severity of the harm caused by the respondent’s actions,the urgency of the situation,and the impact on the convenience of the parties if the measure is taken or not.Thusto manifestits legitimacy.Chapter Four focuses on the legal obstacles facing recognition and enforcement of anti-suit injunctions and further argues that only when grounded in the consensus of the parties can anti-suit injunctions have the possibility to gain widespread acceptance.The serious consequences for non-compliance with court orders make parties hesitant to violate anti-suit injunctions issued by courts.However,when the court cannot effectively control the respondent orits property,this deterrent effect quickly diminishes because there are obstacles to the recognition and enforcement of the court’s injunctions outside the jurisdiction.Compared with court issued anti-suit injunctions,the lack of inherent enforcement measures makes arbitral anti-suit injunctions relying greatly on voluntary compliance.Meanwhile,though the New York Convention or the Model Law can provide feasible legal frameworks for the judicial recognition and enforcement of arbitral tribunal anti-suit injunctions,their practicality is still subject to uncertainty due to lack of unification of implementing mechanisms between jurisdictions.However,as shown in those small number of successful cases,the key to solving the problem of extraterritorial recognition and enforcement of court anti-suit injunctions and judicial recognition and enforcement of arbitral anti-suit injunctions lies within the injunctions themselves: only anti-suit injunctions based truly on the consensus of the parties can have a chance of wider acceptance.Chapter Five exploresthe necessity,feasibility,and suggests the approach ofthe introduction of anti-suit injunctions into domestic international commercial arbitration legal system against the background of the revision of The Arbitration Law of the PRC.From the perspective of necessity,the introduction of anti-suit injunctions can complement the procedural legal mechanisms,thus fully meetsparties’ expectations under the arbitration agreement,enhances the appeal and promotes the development of China’s international commercial arbitration.It can also help to resolve inter-regional jurisdictional conflicts,improve the court’s judicial assistance mechanism,and enhance the parties’ ability to cope with foreign anti-suit injunctions.From the perspective of feasibility,domestic courts’ practice of issuing anti-suit injunctions in maritime and intellectual property cases,and judicial protection of litigation rights,especially the recognition of the right to claim damages for parties whose litigation or procedural rights have been infringed upon through judicial precedents and normative judicial documents by the Supreme People’s Court,proves the feasibility of granting substantial legal relief to parties’ procedural rights in a broader sense.Therefore,confirming parties’ right not to be sued under arbitration agreements and granting anti-suit injunctions while their rights are being infringed upon,has theoretical and practical foundation.On the approach of introduction,the feature that anti-suit injunctions are based on effective arbitration agreements indicates that anti-suit injunction cases are preceded byreview of arbitration agreements’ effectiveness.Therefore,it can similarly be handled through the arbitration judicial review process.However,it is recommended that all anti-suit injunctions should be subject to review by the Supreme People’s Court and Astreintesshould be introduced to enhance their deterrent effect due to the distinctiveness of anti-suit injunctions.The Draft Arbitration Lawexplicitly defines the legal status of the seat of arbitration and the arbitral tribunal,granting the arbitral tribunal and emergency arbitrators the power to take interim measures.This lays the foundation for the introduction of the anti-suit injunction.However,it is advisable to remove the restriction that interim measures must be "related to the subject matter of the dispute" to provide the arbitral anti-suit injunction with more comprehensive legislative and judicial support.