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UniCredit Bank GmbH v RusChemAlliance LLC
Factual and Procedural Background
The Appellant, a Russian company (“Appellant”), entered into two 2021 construction contracts with two German companies (“Company A”) for large-scale gas projects in Russia. Payment obligations were secured by seven on-demand bonds issued by the Respondent, a German bank (“Respondent”). Each bond (i) is expressly governed by English law and (ii) contains an International Chamber of Commerce arbitration clause naming Paris as the seat and English as the language.
After the 2022 EU sanctions regime disrupted the underlying project, Company A refused repayment of advance payments. The Appellant demanded payment on the bonds, but the Respondent declined, citing EU sanctions. On 5 August 2023 the Appellant sued the Respondent in the Arbitrazh Court of St Petersburg under newly enacted Russian procedural provisions (Art. 248.1 and 248.2) that purport to confer exclusive Russian jurisdiction where sanctions are involved.
On 22 August 2023 the Respondent began Commercial Court proceedings in London seeking, inter alia, an anti-suit injunction. An interim injunction was granted on 24 August 2023. The Appellant challenged English jurisdiction. Sir Nigel Teare (sitting as a High Court judge) upheld the challenge but continued the injunction pending appeal ([2023] EWHC 2365 (Comm)).
On 29 January 2024 the Court of Appeal (Bean, Males & Lewis LJJ) reversed that decision, confirmed English jurisdiction and granted a final mandatory injunction compelling discontinuance of the Russian proceedings ([2024] EWCA Civ 64).
The Supreme Court granted permission to appeal on the sole issue of jurisdiction. On 23 April 2024 it unanimously dismissed the appeal, leaving the Court of Appeal’s order intact.
Legal Issues Presented
- Whether the arbitration agreements contained in the bonds are governed by English law (“the governing law issue”).
- Whether, assuming English governing law, England & Wales is the proper forum in which to bring the Respondent’s anti-suit claim (“the proper place issue”).
Arguments of the Parties
Appellant's Arguments
- The arbitration clauses are governed by French law (law of the seat), not English law; therefore the CPR contract gateway for service out does not apply.
- Under article 248.1 Russian courts possess exclusive jurisdiction; the English courts should defer.
- Even if the English court has gateway jurisdiction, France (the seat) or arbitration itself is the “proper place” for any relief, not England.
- The Court of Appeal misapplied Enka principles and ignored an exception in para 170(vi)(a) of that case.
Respondent's Arguments
- Clause 11 expressly subjects “this Bond” and all related obligations to English law; under Enka and Kabab-Ji that choice covers the arbitration clause.
- The English contract gateway is therefore satisfied; there is at least a good arguable case, and the Court of Appeal decided the point finally.
- England is the proper place because (i) the bonds are governed by English law, (ii) neither the French courts nor arbitral tribunals can give effective coercive relief, and (iii) the anti-suit injunction enforces the parties’ bargain.
- The Russian proceedings are in breach of contract; only an English injunction can practically protect the Respondent’s rights.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Enka Insaat ve Sanayi AS v OOO Insurance Company Chubb [2020] UKSC 38 | General presumption that a governing-law clause applies to the arbitration clause. | Applied to hold the bonds’ English governing-law clause also governs the arbitration agreements. |
| Kabab-Ji SAL v Kout Food Group [2021] UKSC 48 | Affirmed Enka; phrase “this Agreement” ordinarily covers the arbitration clause. | Used as direct authority that the wording “this Bond” captures clause 12. |
| Dallah Real Estate & Tourism Holding Co v Pakistan [2010] UKSC 46 | French “substantive rules of international arbitration” form part of French law. | Cited when analysing foreign-law exception argued by the Appellant. |
| Carpatsky Petroleum Corp v PJSC Ukrnafta [2020] EWHC 769 | Inference of seat law governing an arbitration clause where no contract-wide choice exists. | Distinguished; reasoning expressly disapproved and limited. |
| Hood v Newby (1882) 21 Ch D 605 | Judgments must be read in factual context. | Quoted to caution against over-reliance on isolated phrases from earlier cases. |
| Quinn v Leathem [1901] AC 495 | A case is authority only for what it decides. | Same contextual point as Hood v Newby. |
| Spiliada Maritime Corp v Cansulex Ltd [1987] 1 AC 460 | Forum non conveniens test. | Held inapposite where parties have an arbitration agreement. |
| Turner v Grovit [2001] UKHL 65 | Party with exclusive forum right need not show comparative convenience. | Supports enforcement of contractual forum clauses. |
| Donohue v Armco Inc [2001] UKHL 64 | Court normally enforces exclusive jurisdiction clauses absent “strong reasons”. | Applied by analogy to arbitration clauses. |
| Aggeliki Charis (The Angelic Grace) [1995] 1 Lloyd’s Rep 87 | Anti-suit injunctions should ordinarily issue to uphold arbitration agreements. | Quoted for the “good reason needs to be shown why not” principle. |
| Ecobank Transnational Inc v Tanoh [2015] EWCA Civ 1309 | Factors affecting discretion to grant anti-suit relief (e.g., delay or submission). | Cited when listing discretionary considerations. |
| SAS Institute Inc v World Programming Ltd [2020] EWCA Civ 599 | Further examples of discretion in granting injunctions. | Same context as Ecobank. |
| Airbus Industrie GIE v Patel [1999] 1 AC 119 | Comity requires sufficient English interest before granting anti-suit relief in non-contract cases. | Distinguished; contractual arbitration context changes the comity analysis. |
| IPOC International Growth Fund Ltd v CT-Mobile LV Finance Group [2007] CA (Bda) 2 Civ | Personal jurisdiction plus contractual right suffices for anti-suit injunction even with foreign seat. | Adopted as persuasive authority. |
| Channel Tunnel Group v Balfour Beatty [1993] AC 334 | Interim relief not incompatible with foreign-seat arbitration agreement. | Supports compatibility of English injunction with Paris-seat arbitration. |
| AES Ust-Kamenogorsk v Ust-Kamenogorsk [2013] UKSC 35 | Anti-suit power derives from Senior Courts Act 1981 s.37, not Arbitration Act 1996 s.44. | Applied when discussing procedural gateways. |
| West Tankers (The Front Comor) [2007] UKHL 4 | Anti-suit injunction as a tool of the supervisory court. | Quoted but clarified that power here is not limited to seat courts. |
| Sheffield United FC v West Ham United FC [2008] EWHC 2855 (Comm) | Implied consent to English court support where England is the seat. | Referenced when distinguishing foreign-seat cases. |
| Nomihold Securities Inc v Mobile Telesystems Finance SA (No 2) [2012] EWHC 130 (Comm) | Same point as Sheffield United. | Cited to confirm compatibility rationale. |
| Sharab v Al-Saud [2009] EWCA Civ 353 | Submission can create jurisdiction where none existed. | Cited when analysing potential French jurisdiction. |
| Commerzbank AG v RusChemAlliance LLC [2023] EWHC 2510 (Comm) | Parallel factual background; expert evidence on French jurisdiction. | Relied on for uncontested French-law evidence. |
| Deutsche Bank AG v RusChemAlliance LLC [2023] EWCA Civ 1144 | Parallel arbitral proceedings demonstrating party behaviour. | Used illustratively when assessing efficacy of arbitration. |
Court's Reasoning and Analysis
Governing Law Issue. Applying Enka and Kabab-Ji, the Supreme Court held that clause 11’s choice of English law covers clause 12’s arbitration agreement. The Appellant’s reliance on para 170(vi)(a) of Enka (suggesting potential displacement by seat law) was rejected; that passage is now to be disregarded. The Court distinguished and criticised Carpatsky, clarifying that choosing a foreign seat does not, without more, import that seat’s law.
Proper Place Issue. The forum-conveniens test from Spiliada was deemed inappropriate where the claim merely enforces an arbitration agreement. Instead, the Court adopted a presumption that it should enforce the contract unless the foreign seat makes it inappropriate. Factors considered:
- English governing law supplies a substantial connection.
- The French courts lack jurisdiction to grant anti-suit relief and, in any event, could not effectively coerce compliance.
- An arbitral tribunal or emergency arbitrator could issue only contract-based orders unenforceable in Russia; therefore arbitration affords no effective remedy.
- Comity is not offended: both Russia and France are New York Convention states, and the injunction merely secures compliance with article II(3).
Accordingly, England & Wales is an appropriate and effective forum to grant the injunction.
Holding and Implications
DISMISSED. The Supreme Court affirmed the Court of Appeal’s order maintaining the final mandatory anti-suit injunction against the Appellant and confirmed English jurisdiction.
Implications: (1) Reinforces that a contract-wide English governing-law clause will ordinarily govern the arbitration clause, even with a foreign seat. (2) Clarifies that the Enka para 170(vi)(a) “seat-law exception” should no longer be relied upon. (3) Establishes that English courts may exercise anti-suit jurisdiction over foreign-seat arbitrations where English law governs and no effective alternative remedy exists, without applying a full Spiliada analysis.
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