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Jurisdictional challenge based on a complex contractual setting rejected

26 July 2017

Authors: Nathalie Voser; Benjamin Gottlieb

The Swiss Supreme Court has rejected a request to set aside an award in which the arbitral tribunal declared itself competent to decide a dispute arising out of a gas supply contract between Egypt and Israel. The contract was concluded in the aftermath of the two countries' peace agreements of 1979.

The case concerned the export of gas from Egypt to Israel. The intermediary sued the suppliers under both the supply contract, as well as under a tripartite agreement, for failure to provide the agreed minimum amounts. Given the complex contractual structure of the deal, the competence of the arbitral tribunal under the tripartite agreement was disputed and following the tribunal's award in 2015, the suppliers petitioned the Supreme Court to set aside the award.

The Supreme Court held that the petitioners failed to establish that the claimant has sued under the wrong contract and arbitration agreement. In passing, the Supreme Court also addressed procedural issues such as the law applicable to preliminary questions of the validity of the arbitration agreement and the scope of arguments which can be made in the second round of briefs in the setting aside proceedings before the Supreme Court. (Decision 4A_34/2016.)

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Published in Practical Law Arbitration

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Elliott Geisinger
Elliott Geisinger

Nathalie Voser
Nathalie Voser

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