Litigation & Arbitration Archives | Rokas Law Firm

4th International Mediation & Arbitration Conference

babis — Mon, 30 May 2022 14:25:32 +0000

As part of our Dispute Resolution & ADR Team activities, we are delighted to sponsor the 4th International Mediation & Arbitration Conference that takes place this week from June 1 – 2, at Divavi Apollon Thalasso & Spa organized by Nomiki Bibliothiki under the auspices of the President of the Hellenic Republic Katerina Sakellaropoulou.

Our Partner Dr Αntonis Tsavdaridis head of our arbitraton team will be closing the sessions of the Arbitration Agreement together with Prof. Haris Pampoukis.
If you wish to register or find out more you can visit the following link

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Arbitration agreements under New York Convention

babis — Thu, 19 Oct 2017 08:46:43 +0000

Form and proof of arbitration agreements incorporated by reference under New York Convention

(Article by Dr. A. Tsavdaridis, published in the Arbitration & ADR Newsletter of the ILO on October 19, 2017)

In international trade, a general reference is sufficient to validly incorporate an arbitration clause contained in another document under Article II(2) of the New York Convention, provided that the clause is common and known to those engaged in a particular trade. The party seeking to enforce a foreign arbitral award must show that such general reference is contained in the means provided for in Article II(2) of the New York Convention, including an exchange of emails between the parties.

Facts

In 2015 a Marshall Island company, allegedly acting as the seller, and a Greek ship management company, allegedly acting as the buyer, entered into a series of agreements for the sale and purchase of bunker oil. A dispute arose between the alleged parties and the seller initiated arbitration in New York. As the winning party, the seller sought to enforce the arbitral award in Greece under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958.

The claimant submitted that the arbitration agreements were evidenced in the order notifications that followed the sale and purchase agreements and were sent via email by the seller to the buyer’s broker. The relevant and identical wording of the order notifications read as follows:

“The General Terms and Conditions of the seller (including the arbitration clause in these General Terms and Conditions), a copy of which as they appear in our website (www…) is at your disposal upon request, shall apply in this agreement.“

The respondent disputed the formal validity of the arbitration agreements invoked by the claimant and asserted that the parties had never entered into an arbitration agreement. Instead, the respondent submitted that the party presented as its broker was in reality an in–between buyer which then sold the bunker oil to the respondent and, as a result, there was no direct relationship between the claimant and respondent.

Decision

Applying Article II(1)–(2) of the New York Convention,(1) which sets out the requirements for the formal validity of an arbitration agreement, the Piraeus Single–Member First–Instance Court(2) observed that the writing requirement aims to enhance protection of the parties, but this should not harm the practice of international trade and international transactions. The court accepted that an exchange of letters, which fulfils the writing requirement under Article II(2) of the convention, also includes an exchange of emails, as under the applicable rules on evidence of the Civil Procedure Code,(3) an email is by its nature equated to a document such as a letter. The court went on to say that the writing requirement is fulfilled in the case of incorporation by reference of standard terms
containing an arbitration clause even though the parties have not signed the standard terms document, provided that the document containing the incorporation clause fulfils the writing requirement. The court held that in international trade, a general reference to another document is sufficient for the effective incorporation of the arbitration clause – without the need for an express and specific reference – in cases concerning a provision common and known to those engaged in the
particular trade, which consider the resolution of disputes through arbitration as a stable practice and refrain from making any reservation. The court explained that this is justified because arbitration has become the habitual dispute resolution method in international transactions and the parties should show enhanced vigilance in their business activities. Nevertheless, in the particular circumstances, the court found that there was no direct exchange of emails between the parties, as the claimant could not prove that the third party, to which the emails containing the incorporation clauses were addressed, was acting in the capacity of respondent’s broker. Further, there was no reply by the respondent confirming its agreement.

Comment
The court applied the New York Convention as the request for enforcement related to a foreign arbitral award.(4) It has been established by case law that the requirements set out by the New York Convention for the formal validity of arbitration agreements are substantive rules which prevail over any other domestic substantive or conflict of law rules.(5) It is also clear that even domestic consumer protection legislation that treats as abusive – and thus null and void – arbitration clauses contained in consumer contracts, despite the broad concept of the term ‘consumer’ in Greek law,(6) does not apply in respect to commercial relations that fall under the scope of the New York Convention.( 7 ) Article II(2) of the New York Convention is silent on whether a specific and express reference or only
a general reference is needed for a formally valid incorporation of an arbitration clause. Member state case law has followed both of these solutions. Greek case law has traditionally required a specific and express reference in non–New York Convention cases – particularly in respect of bill of lading incorporation clauses.(8) Nevertheless, in New York Convention cases, Greek courts have been prepared to accept a general reference as sufficient.(9) The present judgment follows this line of case law (although the incorporation clause contained a specific reference to an arbitration clause). However, it must be stressed that this deviation in favour of a general reference is not a consequence of the application of the New York Convention regime as such, but of specific circumstances – in particular:

the international character of the dispute (international trade and international transaction);
the common use of arbitration in the particular trade;
the awareness of the parties regarding this practice and its stable character; and
the absence of any reservation by them

Although Article II(2) of the New York Convention does not refer to electronic transmissions (eg, emails), which were unknown at the time it was drafted (1958), it is now settled that the circumstances described in Article II(2) are not exhaustive (and as a result include electronic means of transmission). This has been indicated in the recommendation regarding the interpretation of Articles II(2) and VII(1) of the New York Convention, issued by the UN Commission on International Trade Law in 2006;(10) and the present judgment is in line with this approach, although it does not expressly refer to it.(11) The court invoked certain Greek civil procedure provisions on evidence in support of its finding on the validity of the incorporation of an arbitration clause by reference through an email exchange. That said, it must be stressed that the interpretation of the convention is autonomous and does not depend on the particularities of national laws. Moreover, the applicability of the national court’s rules of procedure (as provided in Article III of the convention) is confined to the procedure to be applied by the court for enforcing the arbitral award and cannot extend to the interpretation of the convention’s substantive provisions (eg, Article II(2)). Lastly, while invoking a national law provision for accepting an email exchange as fulfilling the writing requirement cannot be ruled out under the most favourable right provision(12) in Article VII(1) of the convention,(13) the court has clearly not followed this path.

For further information on this topic please contact Antonios Tsavdaridis at Rokas Law Firm by telephone (+30 210 361 6816) or email (a.tsavdaridis@rokas.com). The Rokas Law Firm website can be accessed at www.rokas.com.

Endnotes
(1) Article II(1)–(2) of the New York Convention provides:
“1. Each Contracting State shall recognize an agreement in writing under which the parties undertake to submit to arbitration all or any differences which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not, concerning a subject matter capable of settlement by arbitration. 2. The term ‘agreement in writing’ shall include an arbitral clause in a contract or an arbitration agreement, signed by the parties or contained in an exchange of letters or telegrams.”
(2) Piraeus Single–Member First–Instance Court Judgment 2150/2017 (Admiralty Division).
(3) Especially, Article 444 of the Code of Civil Procedure, which equates to documents electronic means used to record, store, produce or reproduce data.
(4) Greece ratified the New York Convention by Legislative Decree 4220/1961 and applies both the commercial and the reciprocity reservations.
(5) Supreme Court Judgment 8/1997 (in plenary).
(6) See Article 2(7)(xxxi) of Law 2251/1994 on consumer protection. Greek law adopts a more expansive (compared to the original EU law provisions) concept of ‘consumer’ as being the end recipient of goods and services even if intended for professional or commercial needs.
( 7 ) Piraeus Court of Appeal Judgment 525/2014 (Admiralty Division).
(8) See Supreme Court Judgment 236/1966 (in plenary) and more recently Supreme Court Judgment 8/1996 (in plenary). Nevertheless, a general reference is accepted in charter party bills (eg, Congenbill); see Piraeus Court of Appeal Judgments 200 and 201/1997.
(9) See Athens Court of Appeal Judgment 9671/1995 and Piraeus Court of Appeal Judgment 525/2014 (Admiralty Division). Another judgment from the Athens Court of Appeal (7195/2007) was quashed by the Supreme Court (539/2013), which did not apply the New York Convention (for further details please see “Form requirements in arbitration clauses incorporated by reference“).
(10) See UN Document A/61/17, Annex II (at Page 61), available at www.uncitral.org.
(11) A passing reference to the United Nations Commission on International Trade Law 2006 recommendation is found in Piraeus Court of Appeal Judgment 525/2014 (Admiralty Division).
(12) It is debated whether, for example, the existence of a more favourable national law provision allows parties to ‘cherry pick’ between the different regimes of the convention and national law.
(13) Article VII(1) of the New York Convention provides:
“1. The provisions of the present Convention shall not affect the validity of multilateral or bilateral agreements concerning the recognition and enforcement of arbitral awards entered into by the Contracting States nor deprive any interested party of any right he may have to avail himself of an arbitral award in the manner and to the extent allowed by the law or the treaties of the country where such award is sought to be relied upon.”

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Arbitration News – Three is a crowd – Third-party arbitration funding

babis — Thu, 20 Jul 2017 12:11:14 +0000

Arbitration News – Three is a crowd – Third-party arbitration funding

(Article by Dr. A. Tsavdaridis, published in the Arbitration & ADR Newsletter of the ILO on July 20, 2017)

Third–party arbitration funding can benefit both under–resourced growing businesses as well as
established and profitable companies, allowing them to cover the legal costs of potentially
complex proceedings. However, companies should be aware of its potential risks and
downsides, such as concerns over confidentiality and privilege of sensitive information, the
funder’s self–interest in returning a profit on its investment and potential conflicts of interest
between funders and arbitrators. A number of jurisdictions and arbitration institutions are
considering introducing external regulation of third–party arbitration funding.

Is third–party arbitration funding common in your jurisdiction?
Third–party funding is uncommon in Greece and, to date, there is no known or recorded precedent of
an arbitration funded by a third party. Although Greece has no specific regulation for third–party
funding, it does not prohibit third–party funding in arbitration either. In this respect, Greek law
recognises and regulates, to a certain extent, lawyer funding schemes in the form of contingency fee
agreements (in which the lawyer gets up to 20% or 30% of a successful claim and may undertake to
cover the expenses for pursuing the claim). A party would generally be allowed to agree and arrange
an appropriate third–party funding scheme in an arbitration conducted in Greece on the basis of the
general principle of freedom of contract (Article 361 of the Civil Code) or could resort by analogy to
the existing regulation regarding contingency fee agreements.

What terms and conditions are generally associated with third–party arbitration
funding in your jurisdiction? Does this type of funding usually include punitive
measures in the event of an adverse outcome for the claimant company?
As aforementioned, third–party funding (either in litigation or arbitration) is not regulated in Greece,
as there is no known or recorded practice. The absence of a regulatory framework includes soft law
instruments, such as a code of conduct. With respect to punitive measures (eg, punitive damages),
although there is no practice, their inclusion may be validly agreed, provided that they are not
contrary to Greek public policy (mainly on grounds of disproportionality) in the first place, in which
case they would not be enforced. However, after–the–event insurance, which covers risks such as
legal costs after a claim has arisen, is not offered as a standard insurance product in the Greek
market, and those interested in obtaining such cover should seek for tailor–made solutions.
Third–party arbitration funding can involve potential risks for claimant companies.

What measures can be taken to avoid or minimise such risks?
Apart from the issues addressed in the following questions, which pose systemic risks to arbitration
with a potential impact on the interests of the claimant companies, the involvement of third–party
funding in arbitration may give rise to a variety of potential risks for claimant companies, such as a
risk of:

differing or even competing financial interests or priorities between the claimant company
and the third–party funder;
inadequate available funds or even a risk of insolvency of the third–party funder; and
an adverse outcome in cost–related matters, such as an application for security for costs
against the claimant company or a tribunal ruling relating to an award for costs.

Measures to avoid or minimise such risks can be taken through legislative enactment or private
ordering (in the form of soft law, such as code of conducts). As such regulations are not currently in
place, those intending to engage in third–party funding are strongly advised to address some of these
matters (especially issues of financial interests) in carefully drafted funding agreements and other
matters (eg, security for costs and awards on costs) in the arbitration agreement itself.

How does third–party funding affect the confidentiality and privilege of sensitive
material in arbitration proceedings?

To the extent that a third–party funder becomes privy to any kind of information with respect to
arbitration proceedings, this inevitably raises issues pertaining to the confidentiality of such
proceedings and attorney–client privilege. The best way to ensure such issues are appropriately and
efficiently solved is to address them in detail in the respective funding agreement.

Given the significant legal and ethical issues associated with third–party arbitration
funding, such as potential conflicts of interest and questions regarding impartiality, is
external regulation needed in your jurisdiction?

The absence of third–party funding practice does not call for immediate action in the form of external
regulation. Nevertheless, as third–party funding will inevitably take its place in Greek arbitration
practice, such regulation should be preventive rather than curative in nature. In this respect,
potential conflicts of interest regarding the role of counsel – who should serve both the interests of
the third–party funder, which may have appointed him or her, and the party to the arbitration to
which he or she owes a professional duty – should be addressed and resolved in the law regulating
lawyers’ conduct. A stark conflict of such interests and duties may emerge especially in settlement
negotiations. In the same vein, arbitrators should be independent and impartial not only towards the
parties to the arbitration, but also towards third–party funders. To ensure that the arbitrators’ duties
of independence and impartiality are addressed, a corresponding duty of the parties to disclose
third–party funding should also be put in place.

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Authority to enter into an arbitration agreement

babis — Thu, 15 Jun 2017 08:49:53 +0000

Arbitration News – Authority to enter into an arbitration agreement

(Article by Dr. A. Tsavdaridis, published in the Arbitration & ADR Newsletter of the ILO on June 15, 2017)

A person acting as a legal representative of a legal entity must be specifically authorised in order to
validly conclude an arbitration agreement. This precondition is not required where the arbitration
agreement is entered into by the competent organ of the legal entity, although the valid conclusion
of an arbitration agreement can be made conditional on additional requirements being met, such as
the approval of the entity’s general assembly.

Facts

Following the participation of a Greek bank (Hellenic Postbank) in the share capital of another Greek
commercial company, a shareholders’ agreement was entered into between the parties, which
contained an arbitration clause. Hellenic Postbank was later taken over by another Greek bank
(Eurobank), which took up the former’s claims and liabilities (apart from a series of non–performing
loans that were transferred to a ‘bad’ bank). After some time, both parties terminated the
shareholders’ agreement and brought claims and counterclaims in arbitration and an award was
rendered.

Eurobank sought to set aside the arbitral award on grounds of invalidity of the arbitration agreement
and, in particular, by invoking that Hellenic Postbank’s then–chief executive officer (CEO) was not
specifically authorised to validly conclude the arbitration agreement and that the latter’s validity
was conditional on the approval of Hellenic Postbank’s general assembly, which was never given.

The Athens Court of Appeal dismissed Eurobank’s application.Eurobank appealed before the
Supreme Court.

Decision

The Supreme Court dismissed the assertion regarding the lack of specific authorisation by the bank’s
CEO. The court held that the requirement that specific authorisation be obtained for the person
acting as a legal representative for the valid conclusion of an arbitration agreement refers only to a
person acting as a proxy or an agent of the legal entity and does not refer to an organ of the legal
entity – the very function of which is to represent the entity, such as the board of directors or its
substitute (eg, the CEO).
The assertion regarding the lack of the general assembly’s approval was upheld by the court, as it was
found that the Court of Appeal dismissed it without proper consideration of the evidence presented
by Eurobank.

Comment
The problem of whether an organ of a legal entity must be specifically authorised in order to validly
conclude an arbitration agreement has been a matter of concern in Greek case law for some time. It
owes its existence to the abusive effort of some entities to evade arbitration agreements which they
have previously concluded. In earlier case law, Greek courts have acceptedthat a specific
authorisation is also required for persons that serve as substitute organs of legal entities, based on a

provision in the Code of Civil Procedure which requires a specific authorisation for the conclusion of
arbitration and settlement agreements and the recognition and waiver of writs. However, the
Supreme Court quickly rejected this approach on the premise that an organ of a legal entity is a
reflection of the will of the entity itself, which is equally true even if another person (eg, the CEO)
has been substituted to perform the functions of the organ. The Supreme Court’s recent decision is
a confirmation that its previous case law stands firm.
Irrespective of the above, the court acknowledged that the validity of an arbitration agreement can
be made conditional on additional requirements being met, such as the approval of the entity’s
general assembly. Although this matter has been referred back to the Court of Appeal for further
consideration, it results from the Supreme Court’s decision that such an impediment for the validity
of the arbitration agreement can be remedied on grounds of the legal entity’s conduct, either through
the unreserved participation of the entity in the arbitration proceedings or on the basis of the
abusive nature of any subsequent contesting of the valid conclusion of the arbitration agreement
despite such unreserved participation by the entity.

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Supreme Court rules on scope of arbitration agreements

babis — Thu, 10 Nov 2016 14:23:54 +0000

Arbitration News – Supreme Court rules on scope of arbitration agreements

(Article by Dr. A. Tsavdaridis, published in the Arbitration & ADR Newsletter of the ILO on November 10, 2016)

An arbitration agreement which covers future disputes or differences arising out of the initial
agreement also covers future disputes or differences arising out of subsequent agreements that are
supplementary to the initial agreement.
Facts
A landowner contracted with a construction company for the construction of a rehabilitation centre
for individuals with longstanding health conditions. The parties entered into three consecutive
agreements to cover each phase of construction. All of the agreements contained identical clauses
which incorporated by reference the arbitration clause contained in the tender specification.
Subsequently, the parties entered into non-written agreements to cover either additional works not
provided for in the initial agreements or works that had been provided for, but where the parties
changed their modalities.
A dispute arose between the parties regarding the amount owed to the contractor with respect to the
additional works. The parties had agreed to determine the amount on completion of the additional
works.
The contractor initiated arbitration against the landowner and an award was partially rendered in its
favour. The landowner sought to set aside the award on the grounds that the arbitrators had
exceeded their power by deciding on a matter involving subsequent agreements for additional works
which fell outside the scope of the arbitration agreement. The competent court dismissed the
motion, holding that the initial agreements and the subsequent agreements were complementary and
indivisible as referring to the same project.(1) The landowner appealed before the Supreme Court.
Decision
Dismissing the appeal, the Supreme Court held(2) that an arbitration agreement may validly refer to
future disputes; in such cases, it must determine the definite legal relationship out of which such
disputes will arise, but it is not necessary to refer to specific disputes. The Supreme Court added that
an arbitration agreement does not extend its scope to disputes arising out of a subsequent agreement
between the same parties, even if the subject matter concerns the initial agreement. Nevertheless,
the Supreme Court held that such an extension shall occur where the subsequent agreement is
supplementary and indivisibly related to the initial agreement (which contains the arbitration
clause), as these are not separate agreements with related subject matter.

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Incidental matters in technical and legal disputes

babis — Thu, 14 Jul 2016 14:33:36 +0000

Arbitration News – Supreme Court clarifies incidental matters in technical and legal disputes

(Article by Dr. A. Tsavdaridis, published in the Arbitration & ADR Newsletter of the ILO on July 14, 2016)

Domestic arbitrators sitting under the institutional arbitration rules of the Technical Chamber of
Greece have jurisdiction to hear only technical disputes (including disputes on the fees of designers)
and not legal disputes. However, legal disputes of an incidental nature to the main technical dispute
can be heard.

Facts
A dispute arose out of an agreement for design and construction of a private hospital. The dispute
related to the fees of the contractor (the owner paid only part of its fees) and various breaches of the
agreement which influenced the demand for fees, as well as a limitation of action issue. The
agreement provided for domestic arbitration under the institutional arbitration rules of the
Technical Chamber of Greece.
The contractor initiated arbitration requesting the unpaid fees and the arbitral tribunal partly
accepted its request.
The owner sought to set aside the award before the Athens Court of Appeal, which upheld the
petition and annulled the award. The court held that the dispute was of a legal and not a technical
nature and thus fell outside the jurisdiction of a tribunal sitting under the arbitration rules of the
Technical Chamber.(1)
The contractor appealed before the Supreme Court.

Decision
The court held that the dispute over the contractor’s fee was of a technical nature according to the
legal provisions establishing the institutional arbitration of the Technical Chamber of Greece and
providing that only disputes of a technical nature may validly be referred to such arbitration.(2)
The special scientific knowledge and experience of the members of the Technical Chamber were
considered essential for determining the contractor’s fee; the arbitrators based their determinations
on assessments of the designs from both quantitative and qualitative perspectives.
The court also held that while some legal issues did not require technical knowledge (eg, the breach
of contract and limitation of action), they nevertheless fell under the jurisdiction of the tribunal and
were incidental matters in relation to the main technical issue. The dispute was therefore
characterised as being of a technical nature.

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Arbitration News – Jurisdiction of arbitral tribunal in state contracts

babis — Thu, 12 May 2016 09:34:26 +0000

Arbitration News – Jurisdiction of arbitral tribunal in state contracts

(Article by Dr. A. Tsavdaridis, published in the Arbitration & ADR Newsletter of the ILO on May 12, 2016)

When a national legal provision is fixed by means of a stabilisation clause in a concession agreement,
it becomes a contractual term of the agreement. Thus, any dispute relating to the interpretation and
application of the provision will fall under the scope of the arbitration clause contained in the
agreement and the arbitral tribunal’s jurisdiction.

Facts
A concession agreement for the building and operation of the Athens International Airport was
entered into between the government and a consortium of contractors led by Hochtief on July 31
1995 (ratified by Law 2338/1995). Article 25.1.1 of the agreement provided that “the provisions of
Article 26 of Law 2093/1992 as in force at the date of this agreement shall apply to the Airport
Company until and including 31 December 2015 or as otherwise provided herein, irrespective of any
future repeal or modification”.
Article 26 of Law 2093/1992 provided for tax exemptions in favour of airport construction
companies, transposing EU law on value added tax (VAT). Article 43.1 of the agreement also
provided that:
“any dispute under, pursuant to or in connection with this Agreement which is not resolved
in accordance with Article 44.1 (Resolution) or 44.1 (Panel) shall be referred to arbitration
by three arbitrators in accordance with the rules for the time being in force of the London
Court of International Arbitration.”
Following a 2011 tax audit, the Greek tax authorities imposed on the airport company additional
VAT for various transactions and the corresponding fines for incorrect VAT declarations. The
airport company initiated London Court of International Arbitration (LCIA) proceedings against the
Greek state. In 2013 the LCIA decided that the VAT and fines that had been imposed by the tax
authorities had violated Greek legislation – in particular, Article 26 of Law 2093/1992.

The airport company also filed proceedings before the Greek administrative courts for the
annulment of the additional VAT and fines. The Athens Administrative Court of Appeal held that
Article 26 was not part of the airport concession agreement, and that the reference to the provisions
of Article 26 in Article 25.1.1 of the agreement did not make them part of it.(1) As a result, the court
held that the arbitral award should be disregarded as the arbitral tribunal had had no jurisdiction to
decide on the application of Article 26. The airport company appealed before the Supreme
Administrative Court.

Desicion

The Supreme Administrative Court upheld the airport company’s appeal.(2) It held that as the
parties in the concession agreement had expressly provided that Article 26 of Law 2093/1992 would
be applied for the tax treatment of the airport company – in particular, that it would be fixed as it
was in force at the date of the agreement – Article 26 was a contractual term. As a result, the court
held that a dispute arising from this matter fell under the scope of the concession agreement’s
arbitration clause and thus under the arbitral tribunal ‘s jurisdiction.

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Arbitration News – Which law governs your arbitration agreement?

babis — Thu, 25 Feb 2016 10:48:34 +0000

Arbitration News – Which law governs your arbitration agreement?

(Article by Dr. A. Tsavdaridis, published in the Arbitration & ADR Newsletter of the ILO on February 25, 2016)

The place of arbitration and the law governing the main contract are important factors in
determining whether the parties made a tacit choice as to the law governing an arbitration
agreement. In the absence of a choice of law by the parties, Greek law governs the validity of
arbitration agreements relating to international commercial arbitrations held in Greece.
Facts
A dispute arose between a Romanian manufacturer of Dacia vehicles and a Greek distributor. The
distributor alleged that the manufacturer had breached the exclusive distribution agreement and
initiated court proceedings in Greece seeking approximately €20 million in damages, despite the
existence of an arbitration clause that provided for International Chamber of Commerce arbitration
in Paris. While the main contract also provided that it was governed by French law, there was no
explicit agreement with respect to the law governing the arbitration agreement.
The Athens First Instance Court accepted the respondent’s plea to stay the court proceedings(1) and
its decision was upheld by the Athens Court of Appeal.(2) The distributor subsequently appealed to
the Supreme Court.
The distributor’s main argument was that Paris was no longer a neutral place of arbitration (and thus
the arbitration agreement was null and void), as the manufacturer had since come under French
control. In addition, the distributor asserted that the place of arbitration could not – under the
circumstances – serve as an indication of the parties’ will with respect to the law governing the
arbitration agreement. However, the Court of Appeal held that the nationalities of the parties or their
shareholders were not criteria for selecting the place of arbitration, and that the place of arbitration
cannot in itself cast doubt – in advance – over the independence and impartiality of the arbitrators.

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Concept of public policy in domestic arbitration reconsidered

babis — Thu, 19 Nov 2015 12:06:17 +0000

Arbitration News – Concept of public policy in domestic arbitration reconsidered

(Article by Dr. A. Tsavdaridis, published in the Arbitration & ADR Newsletter of the ILO on November 19, 2015)

The Supreme Court recently settled a longstanding debate over public policy as it relates to
arbitration, holding that the concept of public policy as grounds to set aside domestic arbitral
awards is the ‘international’ concept of public policy that serves the public interest, not simply
individual public policy provisions that serve private interests.
Facts
An International Chamber of Commerce arbitration proceeding took place in Greece under domestic
arbitration legislation(1) between a large Greek construction company as claimant and a major Greek
refinery as respondent. The dispute concerned a contract for upgrading the refinery’s installations.
In an award rendered in 2009, the arbitral tribunal applied the hardship provision of the Civil Code
(2) and adjusted the contracted price following an unforeseen increase of 44% in the cost of steel.
The refinery sought to set aside the award on the grounds (among others) of violation of public
policy.(3) In particular, it claimed that the award violated the hardship provision of the Civil Code,
which in turn led to a violation of public policy.
The Athens Court of Appeal(4) dismissed the motion to set aside the award, holding that in order to
establish a violation of public policy as grounds to set aside a domestic arbitral award, there should
be a violation of public policy as understood in the international context (ie, the most fundamental
principles of Greek legal order), and not simply of a public policy provision (ie, a provision that
cannot be derogated from by agreement), such as the hardship provision of Greek law.
The refinery appealed to the Supreme Court, which referred the case for a full plenary hearing due to
its significance.(5)

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New ruling on implied waiver of setting-aside proceedings

babis — Thu, 03 Sep 2015 12:25:05 +0000

Arbitration News – New ruling on implied waiver of setting-aside proceedings

(Article by Dr. A. Tsavdaridis, published in the Arbitration Newsletter of the ILO on September 3, 2015)

The principle that a valid waiver of setting–aside proceedings before an award is rendered can be
implied when it is contained in an agreement ratified by law does not apply to the Greek state, which
is subject to additional requirements.
Background
Under Greek domestic arbitration law, a waiver of setting–aside proceedings is null and void if it takes
place before an award is issued. However, in arbitration agreements ratified by law (eg, in some
state contracts), such a waiver is valid as it is considered a special legislative provision.
“Implied waiver of setting–aside proceedings” reported on an appeal court judgment holding that, in
this context, an implied waiver of setting–aside proceedings has the same effect as an express
waiver. In a similar case the Supreme Court qualified the appellate ruling with respect to the Greek
state.

Facts
In 2007 the Greek government entered into a concession agreement with the concessionaire and a
consortium of contractors for the construction of part of the motorway connecting Athens and
Thessaloniki. The parties agreed that all disputes or differences of a non–technical nature would be
resolved through arbitration under the International Chamber of Commerce Rules of Arbitration, as
modified by the agreement. The parties also agreed that:
“the arbitral award shall be final and irrevocable, not being subject to any ordinary or
extraordinary legal means, and constitute an enforceable title without the need to be so
declared by state courts, the parties being bound to comply forthwith with its rulings.“
The parties also agreed that any award should be rendered within four months of signing of the terms
of reference. The concession agreement was ratified by Law 3605/2007 and its provisions acquired
legal force.
A dispute subsequently arose between the government and the concessionaire. After an arbitral
award was rendered, the state filed a motion to set aside the award. The respondent claimed that the
parties had effectively agreed to waive setting–aside proceedings

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