Canada-China Symposium on Hotspots in International Arbitration held online

Vancouver time 6:30pm on September 1, 2022, and Beijing time 9:30am on September 2, 2022, “Canada-China Symposium on Hotspots in International Arbitration — The Enforcement of Arbitration Agreements and the Impact of Sanctions on International Arbitration”, sponsored by Vancouver Maritime Arbitrators Association (VMAA) and China International Economic and Trade Arbitration Commission (CIETAC) and co-organized by CIETAC North American Arbitration Center, was held online as scheduled.

The seminar was chaired by Ms. Catherine H. Liang, the Vice President of VMAA. Mr. Wang Chengjie, Vice Chairman of CIETAC, delivered the opening speech. Mr. Wang extended a warm welcome to the participants and expressed his gratitude to VMAA. He mentioned that this seminar focuses on the enforcement of arbitration agreements and the impact of sanctions on international arbitration, which is of practical significance. China and Canada enjoy a time-honored friendship with steady growth in bilateral trade and close exchanges in legal, cultural and other fields. He also pointed out that CIETAC is willing to work with the Canadian legal community to promote international arbitration.

Mr. Peter Swanson, the Founding Partner of Bernard LLP, spoke on the “Enforcement of Agreements to Arbitrate by Canadian Courts: the Curious case of s.46 of the Marine Liability Act”.  Mr. Swanson shared how the enforcement of arbitration agreements by Canadian courts has evolved over the past 25 to 30 years, and how Section 46 of the Maritime Liability Act can affect the enforceability of arbitration agreements to some extent. On the whole, however, the spirit of the Model Law has been well implemented in the practice of the Canadian courts.

Dr. Jerry Zhang, Director of Beijing Linli Law Firm, shared the “Recognition and Enforcement of Arbitration Agreements in China”. Through cases analysis, Dr. Zhang discussed the application of law, the selection of institutions and jurisdictions. Using the BNA vs. BNB case analysis, he explores the question of whether Chinese or foreign law is applicable when the parties choose a foreign arbitration institution but the arbitration venue is in Shanghai, China. In the recent Brentwood case, which was arbitrated by the ICC in Guangzhou, China, the court ruled that the decision could be applied for enforcement by reference to the foreign-related arbitration award in China. He pointed out that this would open up new prospects for the market of international arbitration institutions to conduct arbitration in China.

Mr. JJ Mclntyre, President of the VMAA, discussed the “Impact of Sanctions on International Arbitration”. In February, the European Union and many other countries announced sanctions against Russian states, Russian entities and individuals for affecting and disrupting global markets. Russian banks were removed from the SWIFT. All of these sanctions inevitably affect the performance of relevant contracts. He described a number of cases of sanctions where parties needed to know whether there was a termination or suspension clause in their contract that could deal with the sanction. When it comes to Force Majeure clauses, Mr. Mclntyre points out that Quebec is a civil law jurisdiction and its Civil Code has Force Majeure clause, while the relative law of the common law would be governed by an exemption of atrocity in cases of Frustration and Non-performance of a contract. For international arbitrators, the need to search for whether the company has been sanctioned is a new challenge.

Mr. David Gu, a partner of Junhe Law Firm, discussed the impact of sanctions on international arbitration from Chinese perspective. He noted that sanctions could lead to disruptions in international trade and the flow of goods. He referred to a number of legal problems arising from the sanctions affecting international trade and delivery by transport companies, as well as international payments and contract fulfilment. As a country of civil law, China has special clauses on Force Majeure and the Principle of Change of Circumstances. The parties concerned should first consider stating them in the contract, and pay attention to the issues of predictability and the application of the Principle of Fairness. Gu also discussed the arbitrators should consider issues related to sanctions that may affect arbitration, including related procedures, and the enforcement of arbitration awards. Chinese courts pay close attention to and prudently handle cases involving sanctions in practice, he added.

The seminar concluded with a closing address by Mr. Mclntyre, President of VMAA. He thanked all the speakers and participants, noting that in a world of increasingly frequent sanctions, it is important for peers in the international arbitration community to maintain communication, which promotes mutual understanding and helps us to make better decisions in the dispute resolution process. The symposium concluded successfully. Participants from different industries who are interested in the new issues of international arbitration expressed their concerns and exchange their observations.