From: Ten Typical Enforcement Cases for Recognition and Enforcement of Extraterritorial Arbitral Awards and Court Judgments

[Information of the parties involved]

Applicant: AA Energy Co., Ltd.

Respondant: BB Air Conditioning Co., Ltd.

Basic Information of the Case

AA Energy Co., Ltd. signed a contract with BB Air Conditioning Co., Ltd., agreeing that BB Air Conditioning Co., Ltd. will provide AA Energy Co., Ltd. with the air condensers and other equipment required for its proposed construction project, and agreeing that any disputes arising from this shall be resolved by the Milan Domestic and International Arbitration Court. During the performance of the contract, due to the breach of contract by BB Air Conditioning Co., Ltd., AA Energy Co., Ltd. submitted the dispute to the Milan Arbitration Court for arbitration. After the Milan Arbitration Court heard the case, an arbitration award was made, ruling that BB Air Conditioning Co., Ltd. shall pay damages of over 700000 euros to AA Energy Co., Ltd. and pay corresponding interest, arbitration fees, and other legal fees at the Italian statutory interest rate. BB Air Conditioning Co., Ltd. appealed against the arbitration award to the Milan Court of Appeal, requesting the court to declare the arbitration award invalid. After trial, the Milan Court of Appeal ruled to reject all appeal requests from BB Air Conditioning Co., Ltd. BB Air Conditioning Co., Ltd. did not appeal to the Italian Supreme Court of Appeal. Later, AA Energy Co., Ltd. applied to the Fourth Intermediate people's court of Beijing for recognition and enforcement of the arbitration award made by the Milan Arbitration Court.

In the process of review by the Fourth Intermediate people's court of Beijing, BB Air Conditioner Co., Ltd. submitted defense reasons such as the application for enforcement has exceeded the time limit for application for enforcement. After review, BB Air Conditioner Co., Ltd.'s defense reasons could not be established. The Fourth Intermediate people's court of Beijing ruled to accept and implement the arbitration award made by Milan Arbitration Court.

During the implementation, the Fourth Intermediate people's court of Beijing searched the property of BB Air Conditioning Co., Ltd. and found that there was sufficient cash deposit under the name of BB Air Conditioning Co., Ltd., so it took corresponding freezing measures. BB Air Conditioning Co., Ltd. raised an objection to the execution and requested to cancel the execution of the case on the grounds of Software bug and violations of the law that were recognized and executed by the ruling. After the trial of the objection and reconsideration procedures, the relevant courts have found that the objection content is not specific to the specific execution behavior and does not fall within the scope of the examination of the objection. Therefore, they have rejected the objection and reconsideration application of BB Air Conditioning Co., Ltd. Later, the Fourth Intermediate people's court of Beijing resumed enforcement. Since the amount of debt assumed by BB Air Conditioning Co., Ltd. determined by the arbitration award of Milan Arbitration Court is calculated in euros, and the corresponding interest is calculated at the Italian legal interest rate, in order to clarify the specific amount of implementation, reduce disputes between the two parties, and facilitate smooth implementation, the Fourth Intermediate people's court of Beijing organized a conversation between the parties, and both parties fully expressed their opinions, and finally determined the total amount of creditor's rights in RMB, On this basis, the case funds were promptly allocated and returned to AA Energy Co., Ltd.

Enforcement Results

In the absence of any objection from both parties regarding the execution amount, the bank deposits under the name of the executed person were forcibly transferred in accordance with the law and all were returned to the applicant for execution. The case was ultimately fully enforced.

Typical significance

According to the current laws and regulations of our country, after the review by the Economic Cooperation Chamber of the recognition and enforcement of the arbitral awards of foreign arbitration institutions, if the ruling is recognized and enforced, the ruling will come into force once it is served, and the parties have no appeal, reconsideration and other relief procedures. During the execution process, the person subjected to execution often raises procedural objections and requests the court to stop the execution. For objections, the parties need to distinguish whether the objection is specific to the execution behavior or the basis of the execution, and make judgments separately, and predict the corresponding results. During the execution of this case, BB Air Conditioning Co., Ltd. deemed the civil ruling recognized and executed to be incorrect and illegal on the grounds that the application for execution exceeded the time limit for execution, requested the revocation of execution, and raised objections to execution and reconsideration. However, the reasons for the objection were not specific to the specific execution behavior, and therefore did not fall within the scope of the execution objection review. The application was ultimately rejected. The case fully protected the rights of the person subjected to enforcement in the process of implementation. Although the person subjected to enforcement still had objections after the objection and reconsideration were rejected, in order to ensure the timely implementation of the arbitral award and the timely realization of the rights of the applicant for enforcement, the Fourth Intermediate people's court of Beijing firmly took enforcement measures against BB Air Conditioning Co., Ltd., deducted and returned all the case funds in a timely manner, Ultimately, the amount determined by the arbitration award was fully realized. The handling of the case also reflects the professionalism, carefulness, responsibility and responsibility of the Fourth Intermediate people's court of Beijing in recognizing and implementing foreign arbitral awards.

Expert comments

This case is a typical case of the effective connection between the New York Convention and Procedural law such as the Civil Procedure Law of China. After the Beijing Fourth Intermediate People's Court ruled to recognize and enforce the arbitration award made by the Milan Arbitration Court, in accordance with the relevant provisions of China's Civil Procedure Law and compulsory execution, it dealt with the objections and reconsideration raised by the person subjected to execution during the execution process, and fully listened to the opinions of all parties on the determination of the currency for fulfilling obligations, made a decisive judgment in accordance with the law, and resolutely implemented it. This not only fully guarantees the rights of the person subjected to enforcement, but also ensures the realization of the rights of the applicant for enforcement. This reflects China's inclusive judicial attitude towards supporting the international arbitration system and its determination to implement the New York Convention, which is conducive to further improving China's business environment and international economic status.