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The purpose of anti-suit relief

Relief that a court may order is a valuable tool in preventing unconscionable conduct by one party to an pursuing litigation. Read on to learn more.

In common law jurisdictions, a party seeking to ensure that arbitration, rather than litigation, takes place has the ability to seek an anti-suit injunction. A notable recent example of this is the case of Enka Insaat Ve Sanayi AS v OOO Insurance Company Chubb [2020] UKSC 38).

The purpose of anti-suit relief is to prevent or restrain court proceedings that have been commenced, or are about to be commenced, in violation of an existing arbitration agreement. The intention is to prevent what is sometimes called “forum shopping” and the relief that a court may order is a valuable tool in preventing unconscionable conduct by one party to an arbitration agreement in pursuing litigation, despite the prior contractual obligation to arbitrate.

Civil law states do not generally have an equivalent of the anti-suit injunction and instead place considerable reliance on principles of sovereignty and comity. Thus, even a well-established arbitral centre such as Switzerland does not offer this form of injunctive relief. That having been said, there are civil law jurisdictions where, in particular circumstances, a judge will be empowered to order that a party suspends or vacates litigation brought by it in another state and examples may be found of such orders being made in France and in some Latin American states. However, it remains the exception, rather than the norm.

Similarly, where a court in the state of the seat of an arbitration does issue anti-suit relief, consideration will need to be given as to whether the courts in the state where the litigation has been or is intended to be initiated will recognise the order. This is by no means just a theoretical difficulty and it has been known for a court in that other state to take action in retaliation by forbidding the party against whom the injunction was issued from complying with the issuing court’s decision.

For parties in the Association of Southeast Asian Nations (ASEAN) +6 (with China, Japan, South Korea, Australia, New Zealand and India), where there are states of both legal traditions, great care is, therefore, needed. Where there is perceived to be a risk of a party to an arbitration agreement seeking to avoid its obligation and resorting to litigation, especially where any of the jurisdictions likely to be involved do not recognise anti-suit relief, the most prudent approach is for the arbitration agreement to be designed and drafted very carefully in the first instance and consideration being given to including additional contractual provisions that may reduce the risk of needing to resort to an anti-suit injunction.

© College of Law
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International Arbitration: Process and Procedure

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