Anti-Suit Injunctions and the Governing Law of Arbitration Agreements
📂 Case Details
Case Title: UniCredit Bank GmbH v RusChemAlliance LLC
Citation: [2024] UKSC 30
Court: Supreme Court of the United Kingdom
Judges: Lord Reed PSC, Lord Hodge DPSC, Lord Hamblen, Lord Leggatt, and Lord Richards
Date: 19 July 2024
Legal Area: International Arbitration – Anti-Suit Injunctions – Governing Law of Arbitration Agreements
Parties:
Appellant: RusChemAlliance LLC (RCA), Russia
Respondent: UniCredit Bank GmbH, Germany
⚖️ Background of the Dispute
The dispute arose from several engineering, procurement, and construction (EPC) contracts for large-scale facilities in Russia. These contracts were secured by on-demand bonds issued by UniCredit. The bonds were governed by English law and contained an arbitration clause providing for ICC arbitration in Paris.
When the EPC contracts were terminated for alleged non-performance, RCA commenced court proceedings in Russiaagainst UniCredit. In response, UniCredit applied to the English High Court for an anti-suit injunction, seeking to restrain RCA from pursuing those Russian proceedings on the basis that they breached the arbitration agreements.
🔍 The Legal Question
The Supreme Court had to decide:
Whether the arbitration clause in the English-law-governed bonds was itself governed by English law or by the law of the seat of arbitration (French law); and
Whether the English courts could properly grant an anti-suit injunction to restrain proceedings in Russia, despite the arbitration having a foreign seat (Paris).
The Court’s Ruling
The Supreme Court dismissed RCA’s appeal, upholding the Court of Appeal’s decision to grant the injunction.
Governing Law of the Arbitration Clause:
Applying Enka v Chubb, the Court held that English law governed the arbitration agreement because the bonds expressly adopted English law as the governing law of the contract, and nothing in their wording excluded the arbitration clause from that choice.
The Court rejected RCA’s argument that the arbitration clause should instead be governed by the law of the seat (French law), stating that such an approach would undermine certainty and be “neither clear nor simple to apply.”
Jurisdiction and Anti-Suit Injunction:
The Court confirmed that UniCredit’s claim fell within the contract gateway for service out of the jurisdiction under CPR PD 6B, para 3.1.
It further held that under CPR 6.37(3), there is a presumption that the English courts are the proper forum for claims seeking to enforce arbitration agreements through anti-suit injunctions.
The fact that the arbitration’s seat was in France did not make it inappropriate for the English court to issue such an injunction.
Accordingly, the anti-suit injunction stood, requiring RCA to discontinue its Russian proceedings.
Significance of the Decision
The UniCredit v RusChemAlliance decision reinforces several key principles of English arbitration law:
The law of the underlying contract will generally govern the arbitration agreement, unless expressly excluded.
English courts maintain broad powers to issue anti-suit injunctions to protect arbitration agreements, even when the arbitration has a foreign seat.
Certainty and predictability remain central to England’s pro-arbitration legal framework, making it a preferred jurisdiction for resolving cross-border commercial disputes.
What Businesses Should Know
For companies operating internationally and entering contracts containing arbitration clauses:
Always align the governing law of the contract and the arbitration clause to avoid jurisdictional uncertainty.
English courts can protect your right to arbitrate by restraining foreign court actions that breach arbitration agreements.
Even where arbitration is seated abroad, English law remains a robust and reliable choice for contract governance and dispute protection.
Consider including explicit references to English law in guarantees, bonds, and related security instruments to ensure consistency and enforceability.