US No. 1002, OJSC Ukrnafta v. Carpatsky Petroleum Corporation, United States Court of Appeals, Fifth Circuit, No. 19-20011, 6 April 2020
The Court of Appeals explained that as a court of secondary jurisdiction, it had a limited scope of review and could only deny enforcement on the grounds listed in Art. V of the 1958 New York Convention, which were to be construed narrowly and did not include a review of the merits. On the facts of the case, it found that there was a valid agreement for SCC arbitration in an amendment to the original contract (which had contained a different arbitration clause) because the person who signed the amendment had the necessary capacity; and that there had been no violation of due process because the SCC arbitration had complied with the basic safeguards which constituted due process in the United States. Further, confirmation of the award would not violate the public policy interest in international comity by disrespecting the decision of the Ukrainian courts, which had held that the contractual amendment was invalid; there would be no such violation because the Court, as a court of secondary jurisdiction under the New York Convention, would not apply US law in another country or resolve whether the award would be enforced in Ukraine or satisfied with assets located in Ukraine. Comity concerns were also counterbalanced by the “emphatic” US policy favoring international arbitration.
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