OWH SE iL v RTI Ltd & Anor

Enforcement of a domestic arbitration award may be refused on grounds of English public policy, but the jurisdiction requires a careful balance between the public interest engaged by the relevant policy and the strong public interest in finality and enforcement of awards.

An ancillary sanctions immunity, unlike a prohibition on payment, does not itself make payment unlawful and need not be invoked. Its availability will not ordinarily justify refusing enforcement where the defence was not raised before the tribunal, no actual illegality is alleged, and the tribunal had no evidence on which to determine the defence.

The Henderson v Henderson principle is merits-based. A point which could have been raised earlier is not automatically abusive.

OWH obtained permission under section 66 of the Arbitration Act 1996 to enforce an LCIA award requiring RTI and Rusal to pay approximately €214 million under currency-swap arrangements.

Rusal applied to set aside the permission order, arguing that enforcement would offend English public policy because RTI might have obtained protection under Article 46A of the Sanctions and Asset-Freezing (Jersey) Law 2019. It also sought an adjournment pending a proposed Privy Council appeal concerning Article 46A and pending BIT arbitration proceedings.

The central issues were whether the public-policy argument was barred as an abuse of process, whether it could justify refusing enforcement, and whether either proposed proceeding warranted an adjournment.

1. Applications and disposition. The application to adjourn the set-aside application was refused. Rusal had no real prospect of successfully resisting enforcement on English public-policy grounds, and the set-aside application was dismissed. The withdrawn application concerning alternative service was not determined; costs were deferred for consequential determination.
2. Public policy. The court accepted that section 66 of the Arbitration Act 1996 gives a discretion to refuse enforcement of a domestic award on public-policy grounds. That discretion must be exercised with extreme caution, having regard to both the relevant public interest and the strong public interest in the finality and enforcement of arbitration awards.
3. The court rejected the submission that the public-policy argument was necessarily barred by the Henderson v Henderson principle. The applicable approach is the broad, merits-based test stated in Johnson v Gore Wood [2002] 2 AC 1. Although Article 46A could, and possibly should, have been raised in the arbitration, there was no evidence of a deliberate tactical decision to reserve the English public-policy argument for enforcement proceedings.
4. The court accepted that Article 46A and section 44 of the Sanctions and Anti-Money Laundering Act 2018 serve an important supporting function within the sanctions regime. They provide immunity in appropriate circumstances, but do not themselves prohibit payment. The immunity was not sufficiently important to require refusal of enforcement where actual illegality was not alleged, the defence had not been raised before the tribunal, and there was no supporting evidence before it.
5. The possibility that RTI might succeed before the Privy Council did not justify an adjournment because that success would not alter the English court’s conclusion on enforcement. The proposed BIT arbitration likewise provided no sufficient reason for delay. Its claims appeared ambitious and uncertain, and the likely delay was at least a year.
6. Section 9 of the Arbitration Act 1996 did not assist Rusal because enforcement of the award was not itself a matter capable of being referred to arbitration.

This was a first-instance decision concerning enforcement of an LCIA award. Prior Jersey enforcement proceedings were described but were not appellate stages of the present English application.