UK P&I Club NV v República Bolivariana De Venezuela

Article 6 is not absolute. A restriction on access to court may be justified where it preserves a legitimate domestic policy, pursues that policy proportionately, and does not impair the essence of the right. Where customary international law contains no established rule governing state immunity from injunctions, a domestic rule may satisfy article 6 if it falls within the range of possible rules consistent with current international standards. An anti-suit injunction is a coercive order because breach exposes the defendant to criminal or financial penalties. It therefore falls within enforcement jurisdiction, even where the underlying dispute concerns commercial activity. Section 13(2)(a) of the State Immunity Act 1978 could not be read down under section 3 of the Human Rights Act 1998.

The Clubs insured a cruise liner involved in a collision with a Venezuelan naval vessel. Venezuela brought damages claims in Venezuela and Dutch Curaçao, while the Clubs contended that the claims were subject to London arbitration under the insurance arrangements.

The High Court held that Venezuela had no adjudicative immunity under sections 1, 3(1)(a) and 9 of the State Immunity Act 1978, but that section 13(2)(a) prevented a final anti-suit injunction. It declared the arbitration position, set aside the interim injunction and dismissed the Clubs’ injunction claims: [2022] EWHC 1655 (Comm). The Clubs appealed. The central questions were whether section 13(2)(a) was compatible with article 6, whether anti-suit injunctions belonged to adjudicative or enforcement jurisdiction, and whether the provision could be read down.

1. Appeal dismissed. The court upheld the refusal of a permanent anti-suit injunction restraining Venezuela from pursuing proceedings in Venezuela and Dutch Curaçao.
2. Article 6 permits proportionate restrictions which pursue a legitimate aim, do not impair the essence of the right to a fair hearing, and bear a reasonable relationship of proportionality to that aim. Where there is no established and applicable rule of customary international law governing the immunity in question, a rule within the range of possible rules consistent with current international standards can justify the restriction. Benkharbouche v Secretary of State for Foreign and Commonwealth Affairs concerned an established customary rule governing adjudicative immunity and did not require a different result. [2017] UKSC 62
3. There was no widespread, representative and consistent state practice accepted as legally obligatory which classified injunctions, or anti-suit injunctions, as part of adjudicative jurisdiction. The restrictive doctrine therefore did not govern immunity from injunctions. The United Kingdom was not an international outlier.
4. An injunction is coercive immediately it is ordered because breach exposes the defendant to potential criminal and financial penalties. It differs from an award of damages, which has no coercive effect until enforcement proceedings begin. The injunction therefore belongs to enforcement jurisdiction. This supported, but was not necessary to, the conclusion reached from the absence of a customary international-law rule.
5. The restriction was also justified by legitimate domestic policy. The relevant considerations were international sensitivity and comity, the policy against threatening states with coercive action and potential sanctions, and the availability of declaratory, arbitral and compensatory remedies. Denying an injunction did not impair the essence of the Clubs’ article 6 rights.
6. Even if section 13(2)(a) had been incompatible with article 6, section 3 of the Human Rights Act 1998 could not be used to create the proposed commercial-activity or property-based carve-outs. Those changes would contradict the substance and legislative policy of the provision.
7. Lord Justice Popplewell and Lord Justice Phillips agreed with the judgment of Sir Geoffrey Vos MR.

1. Court of Appeal (Civil Division) ([2023] EWCA Civ 1497, 20 December 2023): appeal dismissed. Sir Geoffrey Vos MR gave the judgment; Popplewell LJ and Phillips LJ agreed.
2. High Court, Commercial Court (Sir Ross Cranston, sitting as a deputy judge): declared that Venezuela’s claims were subject to London arbitration, set aside the interim anti-suit injunction and dismissed the Clubs’ injunction claims: [2022] EWHC 1655 (Comm); [2022] 1 WLR 4856.
3. Supreme Court: refused permission to appeal on 28 October 2022, stating that the grounds raised no arguable point of law.