THE AUTHOR:
Esen Aydin, Legal Content Manager at Jus Mundi
Arbitration Aftermath with Zeyad Abouellail and Esen Aydın: Your trusted source for the latest post-award developments in the dynamic world of investor-State and commercial arbitration. Back with a fresh perspective, Zeyad focuses on cases involving States, ministries, and public entities, while Esen handles disputes between private parties. From settlements and compliance with awards to recognition, enforcement procedures, annulment, and beyond. Each week, we bring you global insights and updates to navigate this ever-evolving landscape.
Mammoet v. BOC
Amsterdam Court of Appeal Grants Enforcement of ICC Award Against Iraqi State Oil Company
ICC Case No. 23878/AYZ
Institution: ICC (International Chamber of Commerce)
Tribunal: (President), Lionel Persey (Appointed by the claimant), Mohamed S. Abdel Wahab (Appointed by the respondent)
Seat of arbitration: Dubai International Financial Centre (DIFC)
On 11 February 2025, the Amsterdam Court of Appeal granted Mammoet’s request to enforce an ICC award issued in 2021 in an oil tanker salvage dispute.
Background
In December 2013, Iraqi state oil company Basra Oil Company (“BOC”) and Dutch transport and salvage company Mammoet Salvage BV (“Mammoet”) signed a wreck removal agreement (“Agreement”) regarding an oil tanker that sank off the coast of Iraq.
Disputes over the salvage method, unforeseen circumstances and payment terms caused delays and costs overruns, leading Mammoet to suspend activities in August 2015. After the suspension, Mammoet attempted to withdraw its ships from the area, but the Iraqi Navy blocked their departure. Following negotiations in 2016, salvage was completed in 2017, though the commercial dispute persisted.
In August 2018, Mammoet commenced arbitration proceedings. BOC contested the claims and filed four counterclaims, one of which was called “Counterclaim No. 4.” On 2 November 2021, the tribunal rendered its Final Award and a separate Award on Counterclaim No. 4, granting USD 85 million in damages to Mammoet in the Final Award and USD 37 million to BOC in the Award on Counterclaim No. 4.
In 2022, BOC filed a request to annul the Final Award, but the Court of First Instance of the DIFC rejected the request. Mammoet then petitioned the Dutch courts for enforcement of the Final Award rendered by the tribunal.
Recognition and Enforcement Proceedings Before Amsterdam Court of Appeal
Mammoet based its enforcement request on the non-fulfillment of the obligation to pay the remaining sum after offsetting the amount awarded to BOC in the Award on Counterclaim No. 4. BOC argued that there were two grounds for refusing enforcement of the Final Award: (1) absence of a valid arbitration agreement due to excess of jurisdiction regarding the Navy’s actions and (2) violation of public policy.
- Tribunal’s Jurisdiction over the Detention Claims
BOC argued that the arbitral tribunal lacked jurisdiction over the Detention Claims, as they involved actions ordered by the Iraqi navy, which is accountable only to the Iraqi government, making the claims non-arbitrable; in line with this, a valid arbitration agreement regarding the Detention Claims is lacking.
The Amsterdam Court of Appeal decided that the arbitral tribunal had jurisdiction over the Detention Claims, as the Terms of Reference established that the dispute involved BOC’s communications and instructions to the Iraqi Navy, not the Navy’s actions themselves. The court found that the arbitral tribunal did not rule on the actions of the Iraqi Navy per se, but only on those of BOC. It also noted that the tribunal had determined that the Navy’s detention of Mammoet’s ships fell under BOC’s direct control.
- Violation of Public Policy
BOC argued that enforcement of the Final Award should be denied on public policy grounds, alleging that Mammoet engaged in bribery by making secret payments to an influential Iraqi politician to manipulate the dispute’s resolution and obstructed a fair trial.
The Amsterdam Court of Appeal found that while Mammoet engaged in bribery by seeking a politician’s influence in exchange for payment, the arbitral tribunal properly investigated the matter, imposed consequences on Mammoet by awarding BOC USD 37 million due to a violation of the code of ethics under the Agreement. The Court concluded that the tribunal acted within its jurisdiction, provided BOC an opportunity to be heard, and that any alleged insufficiency in the tribunal’s reasoning did not constitute grounds for refusing enforcement.
In conclusion, the court granted Mammoet’s request for enforcement of the Final Award, insofar as this request concerned the amount granted under the Final Award, reduced by BOC’s claim granted under the Award on Counterclaim No. 4.
DNA v. DMZ
Singapore High Court Rejects Challenge Against SIAC Registrar’s Decision
Institution: SIAC (Singapore International Arbitration Centre)
Tribunal’s composition: N/A
Seat of arbitration: Singapore
In a recently published anonymized judgment, the Singapore High Court ruled that it cannot review an administrative decision by SIAC’s Registrar regarding the commencement date of an arbitration.
Background
DMZ and DNA, entered into four contacts for the sale of oil products by DNA to DMZ. Disputes arose between the parties and DNA filed a Notice of Arbitration on 24 June 2024.
After several exchanges between SIAC and DNA to clarify the number of arbitration agreements being invoked, SIAC issued a letter on 9 July 2024 stating that the Registrar had deemed the arbitrations to have commenced on 3 July 2024. In its response to the notice of arbitration, DMZ argued that DNA’s claims were time-barred because the arbitrations commenced on 3 July 2024, after the 6-year time period to bring claims had expired. However, in a letter dated 30 July 2024, SIAC revised the commencement date to 24 June 2024 upon DNA’s request.
DMZ sought from the Singapore High Court a declaration that the commencement date of the arbitrations was 3 July 2024, a ruling that the 30 July decision was unlawful and an order setting it aside.
Singapore High Court’s Reasoning on the Request
DMZ argued that there was a contractual relationship between the parties and SIAC, which required SIAC to comply with its Rules when determining the commencement date of the arbitrations. DMZ contended that the Registrar had breached the SIAC Rules by issuing the 30 July decision.
The Singapore High Court found DMZ’s argument to be self-defeating, stating that its request to review the 30 July decision was itself a breach of the SIAC Rules. The Court held that it lacked jurisdiction to review the Registrar’s decision, as Article 40.2 of SIAC Rules stipulates that parties “waive any right of appeal or review in respect of any decisions of the President, the Court, and the Registrar to any State court or other judicial authority.” While the Court acknowledged that the Registrar’s determination was not beyond scrutiny and must be exercised lawfully, it concluded that in this case, DMZ had acted in breach of the SIAC Rules, amounting to an abuse of process.
DMZ further argued that SIAC Rule 40.1 rendered the 9 July decision “conclusive and binding,” leaving the Registrar without authority to replace it with the 30 July decision. However, the Court rejected DMZ’s interpretation, disagreeing that the Registrar was functus officio. It held that the Registrar retained the power to review their own decision, as such decisions are administrative in nature, and the SIAC Rules require the institution to ensure that decisions are fair, expeditious, and economical.
Therefore, the Court rejected DMZ’s claims that the Registrar was not permitted to reconsider the 9 July decision and ruled that it lacked jurisdiction to review this administrative decision.
Pertamina v. Phoenix Petroleum
Singapore Court of Appeal Awarded Costs in Enforcement Proceedings
SIAC Case No. 084 of 2022
Institution: SIAC (Singapore International Arbitration Centre)
Tribunal: N/A
Seat of arbitration: Singapore
In its judgment of 5 March 2025, the Singapore International Commercial Court (“SICC”) ruled that costs would follow the event in enforcement proceedings, allowing Pertamina to recover over SGD 300,000 in costs.
Background
In November 2019, Phoenix Petroleum Philippines (“Phoenix”) and Pertamina International Marketing & Distribution Pte Ltd (“Pertamina”) executed a Memorandum of Understanding (“MoU“) outlining their intention to establish a regional strategic partnership for the supply of petroleum products. The MOU contained an arbitration agreement referring the disputes between the parties to SIAC arbitration.
Between November 2019 and June 2021, Phoenix awarded multiple Sale Contracts to Pertamina and the shipments under these contracts were duly delivered. However, the total amount due under these contracts, exceeding USD 124 million, remained unpaid, prompting Pertamina to commence SIAC arbitration.
In a SIAC Final Award dated 28 November 2023, the arbitral tribunal ruled that Udenna, a third-party guarantor, was jointly and severally liable to Pertamina along with Phoenix for the unpaid shipments and demurrage incurred.
Pertamina initiated enforcement proceedings before the SICC, which ultimately enforced the award. Phoenix argued that disputes arising from the individual sale contracts did not fall within the scope of the arbitration agreement in the MOU. However, the Court rejected Phoenix’s arguments and awarded USD 319,000 in costs to Pertamina.
Meanwhile, Udenna filed proceedings in the Philippine courts seeking an injunction to restrain Pertamina from enforcing the award against it. This led to a request for an anti-suit injunction to restrain Udenna from pursuing Philippine court proceedings, which was later withdrawn by Pertamina.
Udenna also challenged Pertamina’s enforcement efforts in Singapore, citing a failure to meet service requirements and asking the court to set aside the service. The SICC found that the service had been validly executed and the SICC decision was later confirmed by the Singapore Court of Appeal. However, the parties disagreed on which party should bear the costs for these proceedings.
Court’s Decision on the Allocation of Costs
The judgment on costs arising from the proceedings between Udenna and Pertamina was rendered on 5 March 2025 by the Singapore International Commercial Court.
The Court first set out the relevant legal principles for the award of costs, stating that a successful party is entitled to costs and that the quantum of the costs award will generally reflect the costs incurred by the party entitled to costs, subject to the principles of proportionality and reasonableness.
Service Claims
The Court further noted that, given the nature of the claims and the fact that the sums at stake exceeded USD 143 million, the costs claimed by Pertamina were not disproportionate.
It then proceeded to determine whether the costs were reasonable. The Court emphasized that the issues in the service dispute were complex and novel, particularly in light of Singapore’s recent accession to the Hague Service Convention. The necessity to liaise with Philippine counsel were also considered an element for the reasonableness of the costs incurred by Pertamina.
However the court reduced the claimed costs by SGD 20,000 because the involvement of Herbert Smith Freehills, Pertamina’s counsel in the arbitration, went beyond what was reasonably necessary because it duplicated some of the work undertaken by Prolegis.
After reducing the above sum the Court granted around SGD 247,000 in costs for the service claims.
Court’s Decision on the Allocation of Costs
The Court acknowledged that Pertamina had sought an anti-suit injunction and claimed costs for these proceedings. While it found that Pertaina would not have been entitled to the full relief sought, it determined that pursuing the injunction was reasonable until the Philippine court proceedings were withdrawn. Accordingly, the Court ruled that Pertamina was entitled to reasonable costs.
However, the Court noted a significant overlap between these proceedings and the earlier Phoenix claims, where some of Pertamina’s legal expenses had already been compensated in previous cost decisions. Exercising its discretion, the Court reduced the total amount claimed and awarded SGD 75,000 to Pertamina.
Ultimately, the Court assessed and fixed the total costs owed to Pertamina at around SGD 322,000.
ABOUT THE AUTHOR
Esen Aydın is a Legal Content Manager at Jus Mundi and a PhD candidate at Istanbul University. Her research focuses on private international law and commercial arbitration. She holds two Master’s Degrees in International Arbitration and Dispute Settlement from Istanbul University and SciencesPo, Paris. Prior to joining Jus Mundi, Esen worked as a teaching assistant in Private International Law.
