南太平洋风险投资有限公司 (South Pacific Ventures FZE) v. 盘锦辽河油田凯特石油设备有限公司

At a glance

Parties

South Pacific Ventures FZE (UAE) v. 盘锦辽河油田凯特石油设备有限公司 (Panjin Liaohe Oilfield Kaite Petroleum Equipment Co., Ltd., China)

Case no.

(2019)辽02协外认8号

Court

Dalian Intermediate People's Court, Liaoning Province (collegiate panel: 季震宇 (presiding), 盛韵同, 董英杰)

Underlying award(s)

Award No. 23138/PTA/ASB/HTG, dated 3 October 2018, made in Singapore under the 2017 ICC Rules by sole arbitrator Jakob Ragnwaldh

Treaty

New York Convention (Articles IV and V)

Sector

Oil and gas equipment; jack-up drilling rigs; commercial agency

Outcome

The court recognised and enforced the Singapore award on 3 December 2019.

Amount

Award: USD 4 million, with 5% annual interest from 6 November 2014 until payment; RMB 400,000 and CHF 11,710.40 in costs; USD 65,000 in arbitrator fees and expenses and USD 40,400 in ICC administrative expenses. The court application fee of RMB 500 was charged to the respondent.

The dispute

South Pacific Ventures FZE, a Dubai company, signed an Agency Agreement with Kaite on 17 September 2010. It became Kaite's exclusive project agent, helping Kaite win an order from Pasargad Energy Development Company for two jack-up drilling rigs. In return Kaite was to pay a commission of USD 19.08 million (6% of the contract price) in instalments. The agreement referred disputes to arbitration in Singapore. South Pacific Ventures began ICC arbitration in 2017. Kaite did not take part, and a sole arbitrator found that Kaite had breached Section 5.1(b) of the agreement and awarded USD 4 million plus interest and costs. South Pacific Ventures then applied to the Dalian Intermediate People's Court, which has jurisdiction over Panjin, where Kaite is domiciled, to recognise and enforce the award under the New York Convention.

Key holdings

1. The court has jurisdiction. Under Article 283 of the Civil Procedure Law, the Supreme People's Court rules on foreign-related cases and a Liaoning High People's Court notice, the Dalian Intermediate Court hears first-instance foreign-related cases from Panjin, where Kaite is domiciled. pp. 3–4
2. The New York Convention applies. China and Singapore are both Contracting States, and the dispute is commercial under Chinese law, so it falls within China's reciprocity and commercial reservations. p. 4
3. Kaite received proper notice of the appointment of the arbitrator and of the arbitral proceedings. Its refusal to take part was its own choice about how to use its procedural rights. p. 4
4. A dispute under a commercial agency agreement can be arbitrated under Chinese law, so Article V(2)(a) does not apply. p. 5
5. Public policy under Article V(2)(b) means a serious breach of the basic principles of Chinese law, of national sovereignty, of public security, of good morals or of fundamental social and public interests. The agency agreement, which paid the agent for helping Kaite win foreign orders, offends none of these. p. 5
6. The award was recognised and enforced. The respondent bears the application fee of RMB 500. pp. 5–6

Procedural history

1. 17 September 2010South Pacific Ventures and Kaite sign the Agency Agreement for the Pasargad jack-up drilling rig project.
2. 11 October 2017South Pacific Ventures files for arbitration (No. 23138/PTA/ASB/HTG). Kaite receives the request on 22 October 2017 but does not reply.
3. 20 December 2017Jakob Ragnwaldh is appointed sole arbitrator.
4. 10 January 2018Case management conference is held. Kaite chooses not to attend and later refuses all courier deliveries.
5. 3 October 2018Award: Kaite is found in breach of Section 5.1(b) and ordered to pay USD 4 million plus interest and costs.
6. 24 June 2019The Dalian Intermediate People's Court registers the application for recognition and enforcement.
7. 3 December 2019The court recognises and enforces the award.

Tribunal, counsel and experts

Decided by

• Jakob Ragnwaldh Sole arbitrator — appointed by the institution (arbitrator in the underlying award)

For the claimant

北京天达共和律师事务所

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Keywords

• New York Convention
• recognition and enforcement
• foreign arbitral award
• China
• Singapore
• ICC Rules 2017
• public policy
• arbitrability
• proper notice
• default of respondent
• agency agreement
• commission
• jack-up drilling rigs
• Pasargad
• Article V(2)(b)
• commercial reservation
• reciprocity reservation
• Dalian

Summary generated with AI from the published documents — refer to the award for the authoritative text.