Serbijos Respublikos privatizavimo ginčų sprendimo agentūra v. akcinė bendrovė įmonių grupė „Alita“

At a glance

Parties

Serbian Privatization Agency (Serbijos Respublikos privatizavimo ginčų sprendimo agentūra), applicant, v. AB įmonių grupė „Alita“ (Lithuania), interested party/debtor

Case no.

Supreme Court of Lithuania, civil case No. e3K-3-336-611/2018

Court

Supreme Court of Lithuania (Lietuvos Aukščiausiasis Teismas), Civil Division

Underlying award(s)

Partial award of 15 November 2011 and final award of 19 September 2012, Foreign Trade Court of Arbitration at the Serbian Chamber of Commerce and Industry, Belgrade, case No. T-12/10

Treaty

1958 New York Convention, Article VI

Court

Judges Danguolė Bublienė, Andžej Maciejevski (rapporteur), Gediminas Sagatys (presiding)

Sector

Privatisation; beverages

Outcome

Cassation proceedings terminated (27 September 2018): a ruling on security under Article VI of the New York Convention cannot be appealed in cassation.

Amount

Final award: EUR 5,100,000 and EUR 11,748,655 in penalties (Alita's liability capped at LTL 39,196,065), plus RSD 23,549,674. Security requested: bank guarantee of EUR 11,544,469. Costs: EUR 1,504.16 awarded to Alita (EUR 5,264.48 claimed).

The dispute

The Serbian Privatization Agency won a partial and a final award in Belgrade arbitration No. T-12/10 against AB „ALT Investicijos“, the Swedish company United Nordic Beverages AB and AB įmonių grupė „Alita“. The partial award extended the claim to Alita and rejected its objection to jurisdiction. The final award ordered United Nordic Beverages and Alita to pay the penalties jointly. The Agency applied to the Lithuanian Court of Appeal to have both awards recognised and enforced in Lithuania. Alita had applied to the Serbian courts to set the awards aside. It argued that the arbitration clause had been extended to it although it had not signed it, and that the Serbian courts had already annulled the partial award twice. On 7 February 2018 the Court of Appeal stayed the recognition proceedings until the Serbian courts gave a final ruling. The Agency asked that Alita be ordered to provide a bank guarantee of EUR 11,544,469 under Article VI of the New York Convention. The Court of Appeal had already refused interim measures on 6 February 2018, and the Agency appealed that refusal in cassation.

Key holdings

1. Article VI gives the court wide discretion ("may, if it considers it proper") and sets no criteria for ordering security. The court may order security only at the request of the party seeking enforcement, never on its own motion. "Security" is not a guarantee in the Civil Code sense: it covers any measure that ensures the award is actually paid if it is later enforced. ¶¶ 15–16
2. Article VI security is a separate institution, but in Lithuania it is applied through the interim-measures rules of the Code of Civil Procedure. The conditions are essentially the same as for interim measures, with one extra ground: security may also be ordered where the party resisting recognition is clearly delaying the recognition proceedings. ¶¶ 17–18
3. Whether to order security in a given case is a question of fact, not of law. A request for Article VI security is treated as a request for interim measures and is decided under the interim-measures chapter of the Code of Civil Procedure, applied by analogy. It is not a separate, free-standing request. ¶¶ 19–20
4. Under Article 151(2) of the Code of Civil Procedure, rulings on interim measures cannot be appealed in cassation, and this applies by analogy to rulings on Article VI security. The Convention does not require a cassation remedy. The parties may file a new request if circumstances change. The cassation proceedings were therefore terminated. ¶¶ 21–23 and operative part
5. Because the proceedings were terminated, the Agency bears its own costs. It must pay Alita EUR 1,504.16 in representation costs; Alita had claimed EUR 5,264.48. ¶¶ 24–25

Procedural history

1. 15 November 2011Belgrade tribunal issues a partial award in case No. T-12/10. It extends the claim to Alita and rejects the jurisdictional objections.
2. 19 September 2012Final award orders United Nordic Beverages AB and Alita to pay EUR 5,100,000 and EUR 11,748,655 in penalties, plus RSD 23,549,674. Alita's liability is capped at LTL 39,196,065.
3. 6 February 2018Lithuanian Court of Appeal refuses the Agency's request for interim measures and for a guarantee. It finds that Alita's financial position is good and that enforcement is not at risk.
4. 7 February 2018Court of Appeal joins Alita's application to refuse recognition with the Agency's application for recognition. It stays both until the Serbian courts give final rulings on the awards.
5. 27 September 2018Supreme Court of Lithuania terminates the Agency's cassation appeal and awards Alita EUR 1,504.16 in costs.

Tribunal, counsel and experts

Decided by

• Gediminas Sagatys Judge, Supreme Court of Lithuania (presiding judge)
• Danguolė Bublienė Judge, Supreme Court of Lithuania
• Andžej Maciejevski Judge, Supreme Court of Lithuania (rapporteur)

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Keywords

• New York Convention Article VI
• suitable security
• stay of enforcement
• adjournment
• set-aside pending at seat
• interim measures
• bank guarantee
• recognition and enforcement
• Article V(1)(e)
• cassation appeal inadmissible
• Lithuania
• Serbia
• Belgrade Foreign Trade Court of Arbitration
• non-signatory
• Alita
• United Nordic Beverages
• privatisation

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