株式会社 Acuon 资本 v. 田某1 & 田某2

At a glance

Parties

Acuon Capital Co., Ltd. (株式会社 ACUON 资本, Republic of Korea) v. Tian 1 (田某1) and Tian 2 (田某2) (PRC individuals)

Case no.

(2018)吉24协外认163号

Court

Yanbian Korean Autonomous Prefecture Intermediate People's Court, Jilin Province, China

Underlying award(s)

Korean Commercial Arbitration Board award No. 15113-0022 of 4 August 2016

Treaty

New York Convention 1958 (Article V); China–Korea Treaty on Judicial Assistance in Civil and Commercial Matters, Article 3(3)

Tribunal

Presiding judge 母龙刚; judges 金成焕 and 陈立晖

Sector

Banking; loan guarantee

Outcome

The Korean award was recognised and enforced (15 November 2018).

Amount

Award: KRW 1,557,851,524, plus 19% annual interest on KRW 1,175,859,042 from 15 October 2015 until payment, plus arbitration costs of KRW 18,708,183. Court application fee of RMB 500 charged to the respondents.

The dispute

On 7 February 2011, ACUON and J&DIB, as lenders, signed a loan agreement for KRW 10 billion with the borrower Huaxin Investment Co. The two respondents, the chairman and the assistant to the president of Jilin Tianyu Group, signed as joint and several guarantors. A separate joint guarantee agreement of the same date provided for arbitration at the Korean Commercial Arbitration Board in Seoul. ACUON lent KRW 5 billion. The borrower stopped paying after 28 January 2014. On 4 August 2016 the Korean Commercial Arbitration Board ordered the guarantors to pay the outstanding sum. ACUON then applied in China for recognition and enforcement of the award. The guarantors raised four objections: (1) the arbitration was procedurally irregular, because their request to join the borrower was refused and they said the debt had already been recovered through CIETAC arbitration; (2) the guarantee was void because it was never approved or registered with China's foreign exchange authority, so enforcing the award would breach Chinese public policy; (3) the request for double interest for late performance went beyond the award; and (4) they were not told the arbitration rules before an oral hearing was held.

Key holdings

1. Korea and China are both parties to the New York Convention. Under Article 283 of the PRC Civil Procedure Law, the application is reviewed under the Convention and the Civil Procedure Law. The respondents bear the burden of proving a ground under Article V. p. 7
2. The dispute is contractual, and the parties were free to choose the governing law and arbitration. The arbitration clause gave the Korean Commercial Arbitration Board jurisdiction over disputes under both the loan agreement and the guarantee agreement. The Board applied the chosen law, Korean law. No Article V ground was established. p. 7
3. Recognising and enforcing the award does not violate Chinese public policy. The court gave no separate reasons on the respondents' argument about foreign exchange registration. p. 7
4. The award of 4 August 2016 (No. 15113-0022) is recognised and enforced. The respondents bear the application fee of RMB 500. p. 7

Procedural history

1. 7 February 2011Loan agreement and joint guarantee agreement signed; both contain clauses providing for arbitration at the Korean Commercial Arbitration Board.
2. 25 February 2011ACUON disburses KRW 5 billion to the borrower.
3. 4 August 2016The Korean Commercial Arbitration Board issues award No. 15113-0022 against the guarantors.
4. 22 May 2018The Yanbian Intermediate People's Court accepts the application for recognition and enforcement.
5. 30 July 2018Hearing with the parties.
6. 15 November 2018Ruling recognising and enforcing the award.

Tribunal, counsel and experts

For the claimant

君合律师事务所 (JunHe), Shanghai and Dalian offices

For the respondent

天津高丽律师事务所 · 吉林延大律师事务所

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Keywords

• New York Convention
• Article V
• recognition and enforcement
• public policy
• Korean Commercial Arbitration Board
• KCAB
• joint and several guarantee
• foreign exchange registration
• cross-border guarantee
• China
• Korea
• loan agreement
• joinder of parties
• procedural irregularity
• China–Korea judicial assistance treaty
• Yanbian

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