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Part III The Initiation of the Arbitration and the Identification and Clarification of the Issues Presented, Ch.17 Interim Measures

From: The UNCITRAL Arbitration Rules: A Commentary (2nd Edition)

David D Caron, Lee M Caplan

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2021. All Rights Reserved. Subscriber: null; date: 15 April 2021

Subject(s):
Settlement of disputes — Interim and provisional measures — UNCITRAL Arbitration Rules — Arbitral tribunals

(p. 513) Chapter 17  Interim Measures

  1. 1. Introduction 513

  2. 2.  Interim Measures—Article 26 514

    1. A. Text of the 2010 UNCITRAL Rule 514

    2. B. Commentary 515

      1. (1)  The precondition of a request by a party—Article 26(1) 516

      2. (2)  The types of interim measures that may be granted—Article 26(2) 517

        1. (a)  Maintain or restore the status quo 518

        2. (b)  Prevent prejudice to the arbitral process itself 518

        3. (c)  Preserve assets for possible satisfaction of award 519

        4. (d)  Preserve evidence 519

      3. (3)  Conditions for the ordering of interim measures—Article 26(3) 520

        1. (a)  A likely harm not adequately reparable by an award of damages 521

        2. (b)  An appropriate balance of likely harms 522

        3. (c)  A reasonable possibility of success on the merits 522

        4. (d)  Further conditions imposed by the agreement of the parties 524

      4. (4)  Conditions relaxed for the preservation of evidence—Article 26(4) 524

      5. (5)  The form (award or order) in which interim measures are granted 524

      6. (6)  Tribunal's power to modify, suspend or terminate interim measures—Article 26(5) 525

      7. (7)  Security for the costs of interim measures—Article 26(6) 526

      8. (8)  Disclosure by any party of any material change—Article 26(7) 527

      9. (9)  Liability for costs and damages—Article 26(8) 528

      10. (10)  Relations between the arbitral tribunal and municipal courts in issuing interim measures—Article 26(9) 529

      11. (11)  Issuance of preliminary orders 530

      12. (12)  Comparison to the 1976 UNCITRAL Rules 532

    3. C. Extracts from the Practice of Investment Tribunals 533

    4. D. Extracts from the Practice of the Iran–US Claims Tribunal 543

      1. (1)  Tribunal Rules (1983), Article 26(1) 543

      2. (2)  Tribunal Rules (1983), Article 26(2) 550

      3. (3)  Tribunal Rules (1983), Article 26(3) 551

1. Introduction

Judicial and arbitral proceedings take time—occasionally a great deal of time. As a result courts and tribunals may be called upon to preserve the alleged rights of the parties during the pendency of the proceedings by ordering interim measures. Article 26 of the 2010 UNCITRAL Arbitration Rules addresses the subject of interim measures. It does so in substantially greater detail than the 1976 UNCITRAL Arbitration Rules.

Article 26(1) provides that the tribunal, on the request of a party, may grant interim measures while Article 26(2), through a non-exhaustive list, describes the types of measures the tribunal can grant. Article 26(3) sets forth the conditions that the requesting (p. 514) party needs to satisfy for the ordering of interim measures, while Article 26(4) potentially relaxes those conditions in the case of a request for the preservation of evidence. Article 26(5) recognizes the tribunal's power to modify, suspend or terminate interim measures when necessary. Article 26(6) authorizes the tribunal to require that the requesting party provide appropriate security in connection with the interim measures. Article 26(7) recognizes the tribunal's power to require any party to disclose material changes in connection with the interim measure. Article 26(8) addresses the requesting party's potential liability for costs and damages. Article 26(9) provides that a request for interim measures to a municipal court is not an act inconsistent with or a waiver to the agreement to arbitrate.

2. Interim Measures—Article 26

A. Text of the 2010 UNCITRAL Rule1

Article 26 of the 2010 UNCITRAL Rules provides:

  1. 1. The arbitral tribunal may, at the request of a party, grant interim measures.

  2. 2. An interim measure is any temporary measure by which, at any time prior to the issuance of the award by which the dispute is finally decided, the arbitral tribunal orders a party, for example and without limitation, to:

    1. (a)  Maintain or restore the status quo pending determination of the dispute;

    2. (b)  Take action that would prevent, or refrain from taking action that is likely to cause, (i) current or imminent harm or (ii) prejudice to the arbitral process itself;

    3. (c)  Provide a means of preserving assets out of which a subsequent award may be satisfied; or

    4. (d)  Preserve evidence that may be relevant and material to the resolution of the dispute.

  3. 3. The party requesting an interim measure under paragraphs 2 (a) to (c) shall satisfy the arbitral tribunal that:

    1. (a)  Harm not adequately reparable by an award of damages is likely to result if the measure is not ordered, and such harm substantially outweighs the harm that is likely to result to the party against whom the measure is directed if the measure is granted; and

    2. (b)  There is a reasonable possibility that the requesting party will succeed on the merits of the claim. The determination on this possibility shall not affect the discretion of the arbitral tribunal in making any subsequent determination.

  4. 4. With regard to a request for an interim measure under paragraph 2 (d), the requirements in paragraphs 3 (a) and (b) shall apply only to the extent the arbitral tribunal considers appropriate.

  5. (p. 515) 5. The arbitral tribunal may modify, suspend or terminate an interim measure it has granted, upon application of any party or, in exceptional circumstances and upon prior notice to the parties, on the arbitral tribunal's own initiative.

  6. 6. The arbitral tribunal may require the party requesting an interim measure to provide appropriate security in connection with the measure.

  7. 7. The arbitral tribunal may require any party promptly to disclose any material change in the circumstances on the basis of which the interim measure was requested or granted.

  8. 8. The party requesting an interim measure may be liable for any costs and damages caused by the measure to any party if the arbitral tribunal later determines that, in the circumstances then prevailing, the measure should not have been granted. The arbitral tribunal may award such costs and damages at any point during the proceedings.

  9. 9. A request for interim measures addressed by any party to a judicial authority shall not be deemed incompatible with the agreement to arbitrate, or as a waiver of that agreement.

B. Commentary

Article 26 of the 2010 UNCITRAL Rules is significantly more detailed than the corresponding article in the 1976 UNCITRAL Rules. In one respect, the dramatic expansion of the article runs counter to the guiding principles the Working Group adopted, namely “any revision of the UNCITRAL Arbitration Rules should not alter the structure of the text, its spirit and drafting style and that it should respect the flexibility of the text rather than make it more complex.”2 However, an additional guiding principle was that the new Rules should be consistent with both the 1958 New York Convention, the 1985 UNCITRAL Model Law on International Commercial Arbitration and the 2006 Amendments to the Model Law. It is this additional principle that explains the dramatic expansion of Article 26. In particular, Article 26 of the 2010 Rules does not so much track the 1976 Rules as it tracks, with some deviations, Article 17 of the Model Law, as amended.3

This explanation of course begs the question as to why the Model Law's provision was expanded. As Castello explains, this detailing was thought necessary so that municipal courts might feel more comfortable enforcing interim measures if the law authorizing such (p. 516) measures was absolutely clear about the scope of the arbitrator's power.4 While space for arbitral discretion is a value within the arbitration, the drafters of the Model Law appear to have had concerns about an outside authority not adding its coercive power unless there was a transparent basis of decision.

While Article 26 of the 2010 Rules has Article 17 of the Model Law as its starting point, it does not track it entirely. The Working Group was quick to recognize that not all of Article 17 should carry over given the difference in function and scope. For example, the provisions relating to enforcement of interim measures was a matter for national legislation, not arbitration rules. As a result, not all concepts were included in the 2010 Rules.5 One author explains that while making significant changes to the interim measures article, the drafters of the 2010 Rules were careful to recognize the ambit of arbitration rules and deliberately excluded issues such as the recognition and enforcement of interim measures and the authority of courts to order interim measures.6 Simultaneously, the fact that Article 17 was the starting point also became a constraint in drafting in that it was thought important that an addition did not imply that that possibility was not implicit in Article 17 as well.7 For the purpose of this Commentary, it is critical to recognize that given the strong relationship between Article 17 of the Model Law and Article 26 of the 2010 Rules, the travaux préparatoires of the former are also relevant to the latter. This is especially appropriate inasmuch as many of the same delegates were in involved in both processes.

In many, but not all, respects, Article 26, as expanded, is consistent with the practice that developed under the skeletal version of corresponding Article 26 of the 1976 Rules.8 Some experienced arbitrators may lament the attempt to articulate and confine the manner with which arbitral discretion is utilized. Newer, less-experienced arbitrators and counsel may welcome the stronger guidance provided.

(1)  The precondition of a request by a party—Article 26(1)

Article 26(1) first and foremost recognizes the authority to grant interim measures. It also contains a significant precondition, namely that the interim measures be requested by a party. The requirement of a request from a party is present in the 1976 UNCITRAL Rules, where the travaux préparatoires indicate clearly that a party request is a prerequisite to the (p. 517) ordering of interim measures.9 Thus, in arbitration under the UNCITRAL Rules, a tribunal is not entitled to order interim measures on its own initiative.10

Article 26 is silent as to the form of the request by a party. Although Article 26(1) does not preclude the admission of oral requests (made, for example, during a hearing), requests should, whenever possible, be in writing and should “set forth sufficient reasons to enable comments by the other party and deliberations by the tribunal.”11

An arbitral tribunal is not a court of general jurisdiction and therefore its authority to grant interim measures is circumscribed by its jurisdiction as determined by the agreement of the parties. In particular, as an arbitral tribunal's jurisdiction encompasses only the parties before it, interim measures may not be directed to non-parties.12 As a result the tribunal cannot order the attachment of properties, which are in the direct possession of a third party; such measures are likely to require the assistance of courts or other competent domestic authorities.

(2)  The types of interim measures that may be granted—Article 26(2)

Article 26(2) defines interim measures and provides a non-exhaustive list of types of interim measures a tribunal can order.13 Article 26(2) describes the circumstances of interim measures while Article 26(3) discussed in section 2(B)(3) sets forth the conditions under which interim measures may be granted.14

There is a subtle shift in the definition of interim measures that is an important clarification on their scope and purpose. The chapeau to the definition of interim measures in Article 26(2) is “any temporary measure by which, at any time prior to the issuance of the award by which the dispute is finally decided, the arbitral tribunal orders a party ….” This chapeau is followed by four examples. The subtle shift is that the phrase “in respect of the subject-matter of the dispute” present in the 1976 Rules is not present in either Article 17 of the Model Law or Article 26 of the 2010 Rules. In particular, as the four examples demonstrate, it was thought that a focus on the “subject matter” of the dispute is overly restrictive, and that the purpose of interim measures has a broader focus than just the arbitral (p. 518) process.15 In practice, Article 26 of the 1976 Rules had been interpreted in this fashion,16 but the clarification is nonetheless welcome.

Following this chapeau, Article 26(2) proceeds to lists four broad categories of interim measures a tribunal may issue. However, it must be stressed that the provision explicitly states that these four categories are intended only as examples, and do not limit the arbitral tribunal's power to order other measures that would be appropriate in light of the particular circumstances.17

(a)  Maintain or restore the status quo

Under subparagraph (a), interim measures may be taken to “maintain or restore the status quo pending determination of the dispute.”18 Thus, for example, interim measures sought before the Iran–US Claims Tribunal have included the stay of the sale or transfer of goods in possession of the claimant.19 The Tribunal has also issued an interim order directing the conservation of goods.20 An order for the stay of a planned auction of immovable properties is another example of this category of interim measures.21

(b)  Prevent prejudice to the arbitral process itself

The Working Group carefully drafted subparagraph (b) to highlight the fact that the tribunal has the power to order interim measures not only in case of current or imminent harm to a party, but also in case of prejudice to the arbitral process itself.22 Drafters of the 2006 Amendments to the Model Law selected the words “likely to cause,” rather than “would cause,” as it was noted that at the time such interim measures are sought, there are often insufficient facts to determine whether the arbitral process would in fact be prejudiced.23 The Working Group also adopted that approach in revising the Rules. To this end, the tribunal may, for example, order duplicative proceedings taken in another forum terminated or stayed by a respondent state until further notice. In numerous cases, the Iran–US Claims Tribunal granted measures ordering a party to stay duplicative Iranian court proceedings.24

(p. 519) The function of protection of the arbitral process itself can also be seen in the Chevron v Ecuador arbitration. In the Chevron arbitration, initiated under a bilateral investment treaty, the claimant investor alleged that an adverse domestic court judgment was rendered in violation of international law principles of due process guaranteed under the treaty. It sought interim measures to avoid enforcement of the judgment pending the resolution of the arbitration. The tribunal granted that request in a series of decisions. In its Second Interim Award of February 16, 2012, the tribunal, pointing to its “mission (required under the arbitration agreement) efficaciously and fairly to decide the parties dispute” ordered the “Respondent (whether by its judicial, legislative or executive branches) to take all measures necessary to suspend or cause to be suspended the enforcement or recognition” of the judgment.25

(c)  Preserve assets for possible satisfaction of award

Under subparagraph (c), the tribunal may order interim measures that would preserve “assets out of which a subsequent award may be satisfied.” An award would be worthless if a party after spending significant time in arbitral proceedings were to find that the assets against which the award was to be executed have been dissipated or moved out of the jurisdiction.26 An order in Paushok and Mongolia directing a party to refrain from seizing or obtaining a lien on the assets of the other party pending decision of the dispute is an example of a tribunal confronted with such a situation.27 The travaux préparatoires of the 2006 Amendments to the UNCITRAL Model Law show an intention to include preservation of assets in a broad sense within the functional scope of interim measures.28 The Working Group debated whether the words “securing funds” should be added after “assets,” but ultimately concluded that it was already encompassed in the language of subparagraph (c) and thus unnecessary.29

(d)  Preserve evidence

Subparagraph (d) places a special emphasis on the protection and conservation of evidence that may be relevant and material to the resolution of the dispute.30 This topic brings together two controversial topics: the appropriate scope of interim measures and the production of documents. The travaux préparatoires of the 2006 Amendments to the UNCITRAL Model Law indicate that “while the view was expressed that in certain legal systems subparagraph (d) was superfluous, the text was considered important as the preservation of evidence was not necessarily dealt with to a sufficient extent by all domestic rules of civil procedure.”31 There was dissent, however. Some, concerned with the scope of production, (p. 520) believed that the reference to evidence that “may be relevant and material” was too broad.32 Others concerned with the scope of interim measures argued that inasmuch as Article 19(2) of the Model Law provides that the arbitral tribunal possesses the power to determine the admissibility, relevance, materiality and weight of any evidence, the tribunal “should not be requested to prejudge the relevance and materiality of evidence at the stage of a granting of an interim measure.”33 Importantly, however, these concerns were in the minority and the content of subparagraph (d) was adopted as part of Article 17 of the Model Law and later as part of Article 26 of the 2010 Rules.34 Notably, the drafters of the Rules also recognized that a request of measures for the preservation of evidence is somewhat different from the other categories of measure, and that this difference therefore necessitated Article 26(4) of the Rules, which permits the tribunal discretion to ease the requirements listed in Article 26(3) for the issuance of such measures.35

(3)  Conditions for the ordering of interim measures—Article 26(3)

Article 26(3) lists three substantive and cumulative conditions that must be satisfied for the issuance of interim measures.36 The paragraph replicates the provisions contained in the 2006 Amendments of the Model Law.37 These conditions are not explicit under the 1976 Rules. However, the conditions likely were similar in practice under the 1976 Rules38 and the articulation of these conditions in the 2010 Rules will likely influence the manner in which tribunals exercise their discretion under the 1976 Rules in the future. The 2008 Paushok order granting interim measures under the 1976 Rules draws significantly upon aspects of Article 17 of the Model Law.39

During the drafting of the 2006 Amendments to the Model Law it was debated whether the conditions should be formulated (1) as obligations binding on the requesting party, (2) (p. 521) as criteria to be applied by the tribunal when determining whether or not to grant interim measures or (3) as conditions that need to be satisfied by the requesting party.40 The last approach was followed. The initial language suggested that the requesting party “should furnish proof that … ”41 However, it was determined that different legal systems have different standards of proof and therefore a neutral42 formulation was preferred whereby the requesting party should only have to satisfy the tribunal of certain conditions.43 In Paushok, the Tribunal granting interim measures under the 1976 Rules wrote: “it is incumbent upon Claimants to demonstrate that their request is meeting the standards internationally recognized as pre-conditions for such measures.”44

The following subsections discuss the three conditions set forth in Article 26(3) as well as the possibility that the parties by mutual agreement may agree on further conditions.

(a)  A likely harm not adequately reparable by an award of damages

Under subparagraph (a), the requesting party must satisfy the tribunal that “harm not adequately reparable by an award of damages is likely to result if the measure is not ordered … ” The travaux préparatoires of the 2006 Amendments to the UNCITRAL Model Law illustrate the difficulties that were faced and the care that was ultimately used in selecting the language for subparagraph (a).

The intention behind subparagraph (a) is to identify “a particular type of harm occurring in a situation where, even at a preliminary stage when all the facts of the dispute were not before the tribunal, it could be shown that the requesting party should be protected against harm that could not be remedied by an award of damages.”45 The drafters of Article 17 of the Model Law grappled extensively with how to phrase this intent. Initially the drafters considered defining harm as “irreparable,” but it soon appeared that the term “irreparable” potentially set too high a barrier to measures since monetary damages arguably can remediate many alleged forms of harm.46 Similarly, it was concluded that the words “substantial harm” could be remedied by way of substantial damages and adds an unnecessary element (p. 522) of quantity to the condition.47 Among the several other alternatives considered were: “harm that cannot be adequately compensated or that cannot be compensated by an award of money”; “damage that is difficult to repair”; “harm that cannot be compensated”; “important harm which cannot be compensated by damages”; “inevitable harm”; “unavoidable harm”; or “serious harm.”48 In the end, the words “harm not adequately reparable by an award of damages” were adopted. As discussion of the 2006 Amendments to the Model Law indicates: “that proposal addressed the concerns that irreparable harm might present too high a threshold and would more clearly establish the discretion of the arbitral tribunal in deciding upon the issuance of an interim measure.”49

The application of this test can be seen in the Paushok arbitration. The dispute involved validity of the windfall profit tax and the levying of a fee for the import of foreign workers imposed by the Government of Mongolia. The Tribunal was of the view that the possibility of monetary compensation is not always sufficient to bar a request for interim measures. In that context the Tribunal held that the measures requested must be necessary, as shown by likely ‘substantial’ (but not ‘irreparable’) prejudice to the requesting party.50

(b)  An appropriate balance of likely harms

Under subparagraph (a), the requesting party must satisfy a second test that “such harm substantially outweighs the harm that is likely to result to the party against whom the measure is directed if the measure is granted.” This test represents a balance of hardships. As discussed above, the first test for a likely “harm not adequately reparable by an award of damages” already requires the tribunal to weigh the likely harm to the party requesting the measure. This second test requires that the tribunal also consider the hardships posed for the other party by the granting of such measure. The central condition of this second test somewhat disfavors the granting of measures by stating that the threat of possible harm from not granting the measures must not only outweigh, but substantially outweigh, the harm that the party against whom the measure is being sought will suffer from its issuance.

(c)  A reasonable possibility of success on the merits

Subparagraph (b) states that there must be “a reasonable possibility that the requesting party will succeed on the merits of the claim.” It also provides: “The determination on this possibility shall not affect the discretion of the arbitral tribunal in making any subsequent determination.” Thus, subparagraph (b) requires that the tribunal have both a reasonable possibility of possessing jurisdiction over the claim and a reasonable possibility that the substance of the claim is meritorious.

The implicit requirement that the tribunal have jurisdiction over the parties before ordering interim measures is a question that has generated considerable legal writing and caused practical problems for various international courts and tribunals.51 On the one hand, a party may have legitimate objections to an arbitral tribunal’s ordering interim (p. 523) measures against it if it is unclear whether the tribunal ultimately has jurisdiction to grant the relief sought. On the other hand, the very purpose of interim measures serving as a means of conservation and protection of parties’ rights could be forfeited if such measures were postponed pending a full jurisdictional determination. In recent years, the Iran–US Claims Tribunal, still a principal source of practice for UNCITRAL Rules, adopted what is known as the “prima facie test.”52 The prima facie test was likewise adopted in Paushok.53 Under this test, although the tribunal may not order interim measures in the absence of jurisdiction over the merits of the case, considerations of urgency dictate that a prima facie showing of jurisdiction is sufficient and necessary54 at the stage that interim measures are requested.

Although at the stage of interim measures an arbitral tribunal should not be overly concerned with the merits of the case, a party whose case is clearly without merit should not be granted a request for interim measures. For the tribunal in Paushok, this requirement meant that:

the Tribunal need not go beyond whether a reasonable case has been made which if the facts alleged are proven, might possibly lead the Tribunal to the conclusion that an award could be made in favor of Claimants. Essentially, the Tribunal needs to decide only that the claims made are not, on their face, frivolous or obviously outside the competence of the Tribunal.55

Finally, two notes of practice. First, when the challenged action prima facie poses little prejudice to the rights of the petitioner, the arbitral tribunal should consider carefully the intent behind the request for interim measures. A request for interim measures may be made in bad faith to delay the proceedings or harass the opposing party. A manifestly abusive request should be rejected quickly.56 Second, it is important that the tribunal make clear that the issuance of interim measures does not prejudice subsequent determinations. Interim measures are temporary and are meant only to preserve the rights of the parties pending a final award.57 Therefore, the fact that the tribunal granted the requesting party an interim measure does not mean that the final award will be in favor of the requesting party.58

(p. 524) (d)  Further conditions imposed by the agreement of the parties

Article 26(3) imposes three conditions on the awarding of interim measures. A separate question is whether the parties fixing the powers of the tribunal can through their mutual agreement impose further conditions or restriction on the power to award interim measures. This is particularly relevant in investor–state arbitration where some bilateral investment treaties specifically limit the power of tribunals to order interim measures. This issue arose specifically in the EnCana Corp v Ecuador arbitration where the tribunal noted that Article XIII(8) of the Canada–Ecuador bilateral investment treaty provided in relevant part: “A tribunal may not order attachment or enjoin the application of the measure alleged to constitute a breach of this Agreement.” The tribunal ultimately did not need to address the effect of this limitation.59

(4)  Conditions relaxed for the preservation of evidence—Article 26(4)

Article 26(4) provides that with regard to a request for an interim measure under paragraph 2 (d) for the preservation of evidence, “the requirements in paragraphs 3 (a) and (b) shall apply only to the extent the arbitral tribunal considers appropriate.” The Working Group for the 2006 Amendments to the UNCITRAL Model Law noted that it is not always appropriate that the requesting party satisfy the tribunal of conditions listed in paragraph (3).60 It was emphasized that paragraph 4 only potentially lessens (as “appropriate”) the conditions stated in paragraph (3) for the preservation of evidence. As a result, tribunals should always take the conditions set forth in Article 26(3) into account when determining whether an interim measure should be granted.61 Article 26(4) simply allows some discretion in the application of those requirements when the request aims at the preservation of evidence.

(5)  The form (award or order) in which interim measures are granted

Article 26 of the 2010 Rules does not carry forward a sentence of the 1976 Rules that reads: “Such interim measures may be established in the form of an interim award.”62 Thus, the form in which interim measures are issued is not discussed in Article 26 of the 2010 Rules. As discussed in relation to Article 34, however, arbitral tribunals under the 2010 Rules continue to possess, as they did under the 1976 Rules, broad authority to issue “separate awards on different issues at different times,” a phrase that clearly includes awards of interim measures.63 Further, interim measures issued as “awards” are generally thought to be more enforceable than “orders,” as the New York Convention refers only to “awards.”64 To the (p. 525) same end, some legal systems require that an interim measure be issued in the form of an award before it is recognized and enforced.65

Not all UNCITRAL delegates supported the granting of interim measures in the form of an award, however. They argued that an “award” is a decision of the tribunal only on the substance of the dispute,66 and that granting interim measures in the form of an award that is “final” goes against the idea that interim measures are “temporary” and ordered “prior to the issuance of the award.”67 In our opinion, this view is overly formalistic and, even then, not supported by the discussions within the Working Group. It continues to be generally accepted that the granting of interim measures can be made in the form of an award.

(6)  Tribunal's power to modify, suspend or terminate interim measures—Article 26(5)

Under Article 26(5), the tribunal has the power to modify, suspend or terminate any interim measure it has issued. The tribunal can do so at the request of a party or on its own initiative.68

Under the corresponding provision of the 1976 Rules, a chief factor in determining when a tribunal may revise interim measures is whether the measure has been granted as an “Award” or an “Order.” Unlike an order, an award granting interim measures is “final” and cannot be subject to revision.69 The award may be superseded in effect on its terms or by a subsequent award, but the initial award is not itself revised. As noted above, the Working Group charged with revising the Rules followed the approach taken in the 2006 Amendments to the Model Law70 to suppress the distinction between “Award” and “Order” in the making of interim measures. Therefore, Article 26 simply states that all interim measures granted by the tribunal can be modified, suspended or terminated.71 But given that, as explained above, interim measures may still be granted in the form of an award, the question remains as to how interim measures are to be modified.

When the tribunal should modify, suspend or terminate an interim measure is not addressed by Article 26. One commentator explains, correctly in our view, that the determination necessarily takes place at a later time and that the tribunal analyzes the question of modification in (p. 526) the light of new elements and circumstances.72 Indeed, the drafters of the 2006 Amendments to the Model Law considered adding the phrase “in light of additional information or a change of circumstances” to paragraph 5. This additional language was rejected, however, as it was felt to be “superfluous” and restrictive of the arbitrator's decision to grant interim measures.73 The Working Group noted that “it was not clear whether the power to modify or terminate an interim measure should only be recognized when the conditions for granting the interim measure were no longer met or whether the tribunal should have full discretion in this regard.”74 Some argued that the tribunal should only have the discretion to modify, suspend or terminate an interim measure in exceptional circumstances.75 To respect the consensual nature of arbitration76 it was also strongly felt that if the tribunal could act upon its own initiative it should be required to inform the parties.77 Those in favor of allowing the tribunal to act argued that it was important especially in cases where an interim measure was granted on erroneous or fraudulent grounds.78 As a compromise, Article 26(5) reads: “ … or in exceptional circumstances and upon prior notice to the parties, on the arbitral tribunal's own initiative.”

Article 26(5) specifically lists several actions the tribunal can take: modification, suspension or termination. (Actions such as “amending” an interim measure were deliberately left out and considered inappropriate.79) The right for the tribunal to modify, suspend or terminate an interim measure of course only applies to measures granted by the tribunal itself and not to interim measures issued by other tribunals or courts.80

(7)  Security for the costs of interim measures—Article 26(6)

Article 26(6) authorizes the tribunal to require that the requesting party provide appropriate security for potential costs in connection with an interim measure.81 The 1976 (p. 527) UNCITRAL Rules contain a similar provision in Article 26(2). It is possible that a decision to order interim measures will prove to be wrong in light of further information or the final disposition of the rights and duties of the parties. In that case, the party subject to interim measures may have suffered, through no fault of its own, considerable inconvenience in the form of attendant costs. During the discussions on amending the Model Law, some argued in favor of making the provision of security mandatory to guarantee that the party against whom interim measures are granted will not suffer harm.82 This position was not followed as it was said to be uncommon in practice.83 The possibility of requiring that both the requesting party and any other party provide security in connection with the interim measure was also raised.84 However, this was neither included in the final draft of the 2006 Amendments to the Model Law nor in the 2010 UNCITRAL Rules. Therefore, the ordering of security is at the tribunal's discretion.85 The drafters of the 2006 Amendments to the Model Law noted that requiring security did not need to take place before the interim measure is issued, but rather can be requested at a later time.86

(8)  Disclosure by any party of any material change—Article 26(7)

Under Article 26(7), the tribunal may require any party to disclose any material change in the circumstances on which the interim measure was requested or granted. Given that an interim measure is only temporary and does not constitute a final award, the tribunal has the discretionary power to ensure that the interim measure remains justified. The issue whether the communication of any material change should also be communicated to the other party was raised in the travaux préparatoires to the 2006 Amendments to the Model Law. However, such a requirement was not included either in the Model Law or in the 2010 UNCITRAL Rules.87 Although not expressly addressed, the tribunal may wish to (p. 528) explicitly require that notice of any material change be communicated to the other party as well.88

(9)  Liability for costs and damages—Article 26(8)

Users of the UNCITRAL Rules should be aware that under Article 26(8) the arbitral tribunal has the discretion to hold the “requesting party liable for any costs and damages caused by the measure to any party if the tribunal later determines that, in the circumstances then prevailing, the measure should not have been granted.” Article 26(8) concludes that the tribunal “may award such costs and damages at any point during the proceedings.”

Article 26(8) should be read along with Article 26(6) whereby the tribunal has the power to require that the requesting party provide appropriate security in connection with interim measures. The difference between Article 26(6) and Article 26(8) is that liability for costs and damages does not arise in connection with the impact of the interim measure, but because of the lack of justification for the measure.

While drafting Article 26(8), the Working Group expressed the concern that the provision could be interpreted as holding the requesting party liable for costs and damages if in the end that party lost the arbitration.89 However, it was agreed that the final award should not be an essential element in determining whether to hold the requesting party liable for costs and damages.90 As a result, it was suggested that the requesting party should be held liable for costs and damages when the tribunal determines that the interim measure “should not have been granted” or “was not justified.”91

Given that different legal systems have different approaches to holding a party liable for costs and damages, the Working Group discussed whether the conditions triggering liability for costs and damages should be dealt with under applicable law.92 However, it was decided that the tribunal should have the discretionary power to establish liability.

(p. 529) It is important to note that the tribunal can hold the requesting party liable “at any point during the proceedings.” This should be understood as meaning that the determination may take place at any time during the proceedings, and not only during the period immediately following the measure.93 It arguably also suggests that a party becoming aware of continuing damage could request the tribunal to retain jurisdiction so as to determine liability for continuing costs and damages even after a final award as to the original dispute has been issued.

(10)  Relations between the arbitral tribunal and municipal courts in issuing interim measures—Article 26(9)

An arbitral tribunal may be precluded from granting interim measures by mandatory norms of local law that reserve such powers to the courts. Much more common, however, are domestic laws allowing concurrent jurisdiction between the arbitral tribunal and municipal courts.94 The interim measures powers of municipal courts and arbitral tribunals thus may complement each other.

The possibility of cooperation between municipal courts and the arbitral tribunal in issuing interim measures is envisaged by Article 26(9), which provides that “a request for interim measures addressed by one party to a judicial authority shall not be deemed incompatible with the agreement to arbitrate, or as a waiver of that agreement.” This provision is identical to Article 26(3) of the 1976 Rules.95

Where mandatory norms of applicable national law preclude the arbitral tribunal from ordering interim measures, Article 26(9) guarantees that a party requesting a court to enact such measures does not thereby violate the arbitration agreement. Thus Article 26(9) makes clear that by resorting to courts for interim measures a party does not lose the right to demand arbitration and does not become subject to suit for breach of its agreement to arbitrate.96

Moreover, where the powers of the arbitral tribunal and courts to order interim measures may coexist, Article 26(9) also recognizes that even if the arbitrators are competent to act, a party may legitimately “prefer to approach the court instead of addressing himself to the arbitral tribunal.”97 Such a choice may be preferable because a “judicial authority” may provide the only adequate means to address the alleged prejudice. The interim measures powers of municipal courts thus may supplement those possessed by the arbitral tribunal. Article 26(9) allows the parties to approach courts both at the place of arbitration and elsewhere.

Nothing in Article 26(9) should suggest, however, that tribunals are not preferable to municipal courts. Arbitral tribunals may be as effective, if not more so, in issuing interim (p. 530) measures in support of arbitration. First, the coercive force of a court is often unnecessary when the tribunal issues interim measures as parties will often comply with them voluntarily, often to avoid antagonizing the arbitral decision makers who have not ruled on the merits yet. Second, unlike courts, arbitrators are familiar with the underlying facts of the dispute, and it is usually easier for the arbitrator to entertain requests for relief in the language and under the applicable law chosen by the parties.98

The statement in Article 26(9) that resort to a municipal court for interim measures is not incompatible with the agreement to arbitrate does not mean that the order resulting from such an act may not be considered incompatible with the proceedings.99 For example, interim measures sought by one party before a municipal court may be viewed by the other party as prejudicial to its interests, and the second party may then seek from the tribunal interim measures to stop the actions of the first party. Article 26(9) does not state that interim measures ordered by a court necessarily prevail over conflicting measures deemed appropriate by the tribunal. Such prevalence can hardly be denied orders issued by a court of the place of arbitration, but where “the court involved is of a state other than the place of arbitration … then the tribunal quite likely is not subordinated to that court by municipal law and, therefore, is not constrained from considering contrary interim measures.”100 The Iran–US Claims Tribunal shared this conclusion in the Behring case, insofar as the Tribunal, in one of its own interim measure awards, acknowledged that a US court may order “interim measures not in conflict with this Award.”101

(11)  Issuance of preliminary orders

It can take time for a tribunal to make a decision regarding interim measures. In some circumstances, the tribunal may be called upon to grant preliminary measures (sometimes termed “protective measures”) to address the possibility of harm until a decision on interim measures can made. It is possible that these measures could be taken ex parte, although the extent of present day communications tend to ensure that the other party is somewhat involved.

Neither Article 26 of the 2010 Rules nor corresponding Article 26 of the 1976 Rules mentions the tribunal's power to make preliminary orders. However, Article 17 of the 2006 Amendments to the Model Law explicitly grants an arbitral tribunal the authority to grant preliminary orders.102 Given that Article 26 of the 2010 Rules used Article 17 as a point of departure, one would expect that preliminary orders would be addressed in the 2010 Rules. (p. 531) The absence of a provision addressing preliminary orders reflects the fact that it was highly controversial in the context of Article 17 of the Model Law and only narrowly adopted. Although for almost the entire process of the revision of the Rules it appeared that a provision on preliminary orders would be included, the drafters, reprising the controversy during the Model Law, debated at length whether or not to include a similar provision in Article 26. In the very last session, it was removed. In this section, we review the arguments made, but we stress that the silence of Article 26 on this point is inconsequential in our view. Preliminary orders were granted in the context of the Iran–US Claim Tribunal and have been granted since 2006 under the 1976 Rules in the context of two investment arbitrations extracted in section 2(C).103

On the one hand, those in favor of granting the tribunal the power to order preliminary measures argue that many legal systems allow a party to obtain temporary injunctions without informing the other party of such a request where the court is satisfied that informing the other party would undermine the effectiveness of the temporary injunction.104 A party against whom the order would be directed might dispose of the evidence or remove the assets from the jurisdiction if given advance notice that such a measure was being sought.105 Furthermore, it was noted that arbitrators issue preliminary orders in practice and that including a paragraph was strongly recommended to provide guidance to arbitrators.106 Excluding a reference to preliminary orders from the UNCITRAL Rules, it was argued, could lead to a misimpression that Article 26 disallows such orders.107

On the other hand, it was argued that preliminary orders are contrary to the essence of arbitration where each party should be heard.108 It was noted that the inclusion of preliminary orders in Article 17 of the Model was controversial109 and should not be included in the UNCITRAL Rules directed to parties, rather than legislatures, as this would risk undermining their wide acceptability.110

Throughout the discussion, the Working Group was generally in favor of including a provision dealing with preliminary orders111 and it drafted many different versions of a paragraph taking into account all arguments.112 There even was offered as a compromise (p. 532) that the paragraph additionally indicate that a tribunal would not be able to grant preliminary orders if it is located in a legal system prohibiting preliminary orders.113

However, the final draft of the 2010 UNCITRAL Rules is silent on the subject of preliminary orders.114 In our opinion, tribunals clearly possess such a power as is apparent in their issuance in the Paushok and Chevron arbitrations. Moreover, although the 2010 UNCITRAL Rules are silent as to the power of a tribunal to issue preliminary measures, it is presumed that a party may potentially seek preliminary orders in the courts of the seat of arbitration.115

(12)  Comparison to the 1976 UNCITRAL Rules

The 2010 Rules differ significantly from the 1976 Rules with respect to interim measures both in detail and the level of discretion afforded the tribunal. Article 26 of the 2010 Rules is more detailed because it tracks Article 17 of the Model Law that was amended significantly in 2006 in response to the need to clarify the scope of the tribunal's authority to order interim measures.116 Whether the practice under the different versions of the Rules will differ significantly is not clear at this point and will depend largely on how arbitrators utilize the discretion afforded them under the 1976 Rules. In all likelihood, the detail of the 2010 Rules will come to influence the way discretion is used under the 1976 Rules.

In adopting Article 17 of the Model Law as the point of departure, Article 26 was dramatically expanded117 and now regulates interim measures in greater detail than most other sets of arbitration rules.118 As a result, the language and concepts in both the Model Law, as amended, and in the 2010 Rules are very similar. The Working Group favored the approach in Article 17 of the Model Law (providing specifically worded guidance) rather than the approach of Article 26 of the 1976 Rules (framing the rules in broad and conceptual terms). Some delegates believed that these changes were necessary to provide “guidance and legal certainty to arbitrators and parties” unfamiliar with the use of interim measures in the context of international arbitration.119 Others argue that these changes are confusing and diminish the flexibility of arbitration.

Article 26 now contains nine paragraphs, whereas Article 26 of the 1976 UNCITRAL Rules contained three paragraphs.

Article 26(1) is identical to corresponding Article 26(1) of the 1976 Rules. The only difference is that this rule is held in one paragraph whereas under the 1976 UNCITRAL Rules it is a part of paragraph 1.

(p. 533) Article 26(2) contains elements that are not present in Article 26 of the 1976 Rules. It provides a definition of an interim measure, and the distinction between “Order” and “Award” contained in Article 26(2) of the 1976 Rules is removed. Article 26(2) offers four types of interim measure a tribunal may order, whereas Article 26(1) of the 1976 Rules contained two examples. However, both lists of examples were clearly intended to be non-exhaustive.

Article 26(3) poses the conditions a party must satisfy to obtain interim measures. No similar express provision exists under the 1976 Rules. Under the 1976 Rules, similar conditions were articulated as criteria to guide a tribunal's use of its discretion.

Article 26(4) potentially lessens the conditions contained in Article 26(3) that a requesting party must satisfy to “preserve evidence that may be relevant and material to the resolution of the dispute.” No similar express provision exists under the 1976 Rules.

Article 26(5) gives the tribunal the power to modify, suspend or terminate an interim measure. No similar express provision exists under the 1976 Rules, although some view the distinction contained in Article 26(2) of the 1976 Rules between interim measures issued as “Awards” or “Orders” as bearing on how the tribunal is to approach modifying, suspending or terminating an interim measure.

Article 26(6) is slightly different from the second sentence of corresponding Article 26(2) of the 1976 Rules. The words “may require” replace “shall be entitled to require.” The words “the requesting party” were added as well as “in connection with the measure.”

Article 26(7) grants the tribunal the power to request the disclosure by any party of any material change in the circumstances on the basis of which the interim measure was requested or granted. No similar express provision exists under the 1976 Rules.

Article 26(8) grants the tribunal the discretionary power to hold the requesting party liable for costs and damages caused by an unnecessary interim measure at any point during the proceedings. No similar express provision exists under the 1976 Rules.

Article 26(9) is identical to corresponding Article 26(3) of the 1976 Rules.

C. Extracts from the Practice of Investment Tribunals

EnCana Corp and Government of Ecuador, Interim Award (January 31, 2004) (LCIA administered, 1976 UNCITRAL Rules, Canada-Ecuador BIT):

  1. 5. The Claimant seeks interim measures of protection pursuant to Article 26 of the [1976] UNCITRAL Rules and Article XIII(8) of the Canada-Ecuador Agreement for the Promotion and Reciprocal Protection of Investments, concluded on 29 April 1996 (the BIT). Specifically, it seeks measures to prevent freezing of assets of EnCana subsidiaries and its legal representative pending resolution of the dispute by the present Tribunal.

  2. 10. Two different provisions are potentially relevant to an order for interim measures of protection in the present case, Article 26 of the [1976] UNCITRAL Rules and Article XIII(8) of the BIT. As a specific provision applicable to investments by Canadian corporations in Ecuador, Article XIII(8) must prevail over the general power in Article 26 of the [1976] UNCITRAL Rules.

  3. 11. Article XIII(8) provides:

    “A tribunal may order an interim measure of protection to preserve the rights or a disputing party, or to ensure that the tribunal's jurisdiction is made fully effective, including an order to preserve evidence in the possession of control of a disputing party or to protect the tribunal's jurisdiction. A tribunal may not order attachment or enjoin the application of the measure alleged to constitute a breach of this Agreement. For purposes of this paragraph, an order includes a recommendation.”

  4. (p. 534) 12. Under Article 26 of the [1976] UNCITRAL Rules, by contrast, there is no exclusion of interim measures enjoining “the application of the measure alleged to constitute a breach of this Agreement”. [quote of rule deleted.]

  5. 13. In the Tribunal's view, three conditions ought in principle to be met before interim measures are established, whether under Article XIII(8) of the BIT or Article 26 of the UNCITRAL Rules. First, there must be an apparent basis of jurisdiction. Second, the measure sought must be urgent. Third, the basis for establishing provisional measures must be that otherwise irreparable damage could be caused to the requesting party.

  6. 14. In the present circumstances the Tribunal is satisfied that the measures taken give rise to a situation of urgency. They involve the freezing of accounts and the attempted attachment of substantial sums which are in dispute. The second condition is accordingly fulfilled.

  7. 15. Turning to the third condition, it is necessary to consider separately the measures taken against AEC, the EnCana subsidiary, and those taken against Mr. Bustamante, the Respondent's legal representative in Ecuador.

  8. 16. As to the measures taken against AEC, in the light of the information before it the Tribunal must proceed on the basis that the measures of enforcement are taken by the IRS within the framework of Ecuadorian law in order to recover back monies said to have been wrongly paid out by way of VAT refunds. The Tribunal notes that according to the Respondent, it is open to the parties against whom the measures have been taken to challenge them in the Ecuadorian tax courts or within IRS's administrative processes, on grounds which are independent of the resolution of the underlying issues in dispute in the present proceedings.

  9. 17. AEC is not a Canadian corporation and is not a party to the present arbitration. On the other hand it is part of the EnCana group, a substantial Canadian concern, and it appears that in bringing the present proceedings EnCana is seeking to protect the interests of its subsidiaries. In the circumstances the measures taken by the IRS are no doubt inconvenient, but they are open to challenge before the tax courts of Ecuador, which have shown themselves to be independent of the IRS in decisions so far reached. Ultimately any inconvenience can be addressed by AEC (or EnCana on behalf of AEC) paying the amounts in dispute. The question whether the amounts are actually due is not prejudged by the measures themselves, and would not be prejudged by the return of the amounts refunded. Eventually, if jurisdiction is upheld, it would be open to this Tribunal to provide redress to the Claimant for any losses suffered by enforcement action taken in breach of the BIT, including by payment of interest on sums refunded. In these circumstances there is no necessity to order the withdrawal of IRS's measures against AEC in order to protect the rights at stake in this arbitration from irreparable harm.

  10. 18. The position with the measures taken against Dr. Bustamante is not necessarily the same. Circumstances could be imagined where measures of enforcement taken against the legal representative of a party would amount to a form of harassment or an attempt to limit or deny the exercise of due process rights, thereby raising issues under the BIT. Even if the substantive dispute concerned taxation measures within the meaning of Article XII(l), this would not necessarily exempt such conduct from the scope of the BIT, in particular Article II. But the Tribunal is not persuaded, in the light of the information provided to it, that this is the case here. Action has been taken against Mr Bustamante as the general representative of AEC in Ecuador and not by reason of his acting for EnCana or its subsidiaries in relation to the dispute. The measures were taken within the framework of general provisions of Ecuadorian law, and it is open to Mr. Bustamante to challenge them before the Ecuadorian courts. Since these measures too appear to have been taken by way of enforcement action in relation to the VAT refund in dispute, there is no reason to treat them any differently than the measures taken against AEC.

  11. 19. In these circumstances the Tribunal is not persuaded that there is any necessity for the measures requested in terms of protecting the rights claimed by EnCana in the present proceedings. This finding is in no way intended to prejudge any issue that may arise before the Ecuadorian courts as to the measures taken.

  12. (p. 535) 20. Accordingly the Tribunal need not decide whether there is an apparent basis for jurisdiction in respect of EnCana's underlying claim, or whether the power to establish interim measures is constrained by Article XII(l) or XIII(8) of the BIT, even if there is apparent jurisdiction over the dispute as such.

Sergei Paushok, et al and Government of Mongolia, Temporary Restraining Order (March 23, 2008) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Russia-Mongolia BIT) (reprinted in the Tribunal's Order on Interim Measures, September 2, 2008, para 16):

  1. 1. Taking into account the undertaking already given, Respondent shall refrain from seizing or obtaining a lien on the assets of Claimants and shall allow Claimants to maintain their ordinary business operations;

  2. 2. Claimants shall immediately sign an undertaking not to move assets out of Mongolia nor to take any action which would alter in any way the ownership and/or financial interests of the Claimants with respect to their assets in Mongolia, without prior notice to and agreement of Respondent;

  3. 3. Claimants shall, within seven days, provide Respondent with a complete list of their assets in Mongolia;

  4. 4. The issue raised by Respondent of the provision of security by Claimants shall be dealt with at the time of the consideration of the Request for Interim Measures;

  5. 5. The briefing schedule for any issue related to Claimants’ interim measures application shall be decided in a separate procedural order by the Tribunal, after consultation with the Parties.

    Pending its decision on interim measures, the Tribunal urges the Parties to refrain from any action which could lead to further injury and aggravation of the dispute between the Parties.”

Sergei Paushok, et al and Government of Mongolia, Order on Interim Measures (September 2, 2008) (Ad Hoc Proceeding, 1976 UNCITRAL Rules, Russia-Mongolia BIT) reprinted in (November 2008) 23 Mealey's Intl Arb Rep, B-1:

II - General Comments

  1. - The applicable rules

  2. 34. The Tribunal wishes to point out, first, that this case is taking place under the [1976] UNCITRAL Arbitration Rules. The powers of the Tribunal relating to interim (or provisional) measures are set in Articles 15(1), 26(1) and 26(2) of those Rules … :

  3. - What is the subject-matter of the dispute

  4. 37. The subject-matter of the dispute is the validity under the Treaty of the Windfall Profit Tax and of the levying of a fee for the import of foreign workers imposed by Respondent. In their Notice of Arbitration of November 30, 2007, Claimants request declaratory relief based on Articles 3(1) and 4 of the Treaty as well as damages, interest and costs. And, in their Statement of Claim filed on June 27, 2008, Claimants request declaratory relief with regard to those two types of measures as contrary to Articles 2, 3 and 4 of the Treaty; in addition, they claim damages, interest and costs to be determined by the Tribunal.

  5. 38. The Parties have spent some considerable time arguing the issue of disputed rights in this case. These matters will be dealt with in the section of this Order dealing with imminent danger of prejudice.

  6. - Interim measures not to be granted lightly

  7. 39. It is not contested that interim measures are extraordinary measures not to be granted lightly, as stated in a number of arbitral awards rendered under various arbitration rules. Even under the discretion granted to the Tribunal under the [1976] UNCITRAL Rules, the Tribunal still has to deem those measures urgent and necessary to avoid “irreparable” harm and not only convenient or appropriate.

  8. - Evidentiary Burden

  9. (p. 536) 40. In requests for interim measures, it is incumbent upon Claimants to demonstrate that their request is meeting the standards internationally recognized as pre-conditions for such measures.

  10. III - the Criteria Guiding the Tribunal

  11. 45. It is internationally recognized that five standards have to be met before a tribunal will issue an order in support of interim measures. They are (1) prima facie jurisdiction, (2) prima facie establishment of the case, (3) urgency, (4) imminent danger of serious prejudice (necessity) and (5) proportionality.

  12. 46. In addressing the first two criteria, the Tribunal wishes to make it clear that it does not in any way prejudge the issues of fact or law which may be raised by the Parties during the course of this case concerning the jurisdiction or competence of the Tribunal or the merits of the case.

  13. - Prima facie jurisdiction

  14. 47. The International Court of Justice described the interpretation to be given to this standard in the Case Concerning Military and Paramilitary Activities in and Against Nicaragua:

    “(O)n a request for provisional measures the Court need not, before deciding whether or not to indicate them, finally satisfy itself that it has jurisdiction on the merits of the case, or, as the case may be, that an objection to jurisdiction is well founded, yet it ought not to indicate such measures unless the provisions invoked by the applicant appear, prima facie, to afford a basis on which the jurisdiction of the court might be founded;”

  15. - Prima facie establishment of the case

  16. 55. At this stage, the Tribunal need not go beyond whether a reasonable case has been made which if the facts alleged are proven, might possibly lead the Tribunal to the conclusion that an award could be made in favor of Claimants. Essentially, the Tribunal needs to decide only that the claims made are not, on their face, frivolous or obviously outside the competence of the Tribunal. To do otherwise would require the Tribunal to proceed to a determination of the facts and, in practice, to a hearing on the merits of the case, a lengthy and complicated process which would defeat the very purpose of interim measures.

  17. - Urgency

  18. 59. The Tribunal is not called upon to rule on that overall situation but taking cognizance of it helps the Tribunal in understanding whether the condition of urgency alleged by Claimants can be met in the present case.

  19. 62. The Tribunal is aware of preceding awards concluding that even the possible aggravation of a debt of a claimant did not (“generally” says the City Oriente case cited below) open the door to interim measures when, as in this case, the damages suffered could be the subject of monetary compensation, on the basis that no irreparable harm would have been caused. And, were it not for the specific characteristics of this case, the Tribunal might have reached the same conclusion, although it might have expressed reservations about the concept that the possibility of monetary compensation is always sufficient to bar any request for interim measures under the [1976] UNCITRAL Rules. But those specific features point not only to the urgency of action by the Tribunal but also to the necessity of such action in the face of an imminent danger of serious prejudice.

  20. - Imminent danger of serious prejudice (necessity)

  21. 68. The Tribunal does not agree with Respondent that Claimants are merely requesting damages, as is clearly demonstrated by the text of their request for relief. Moreover, the possibility of monetary compensation does not necessarily eliminate the possible need for interim measures. The Tribunal relies on the opinion of the Iran-U.S. Claims Tribunal in the Behring case (p. 537) to the effect that, in international law, the concept of “irreparable prejudice” does not necessarily require that the injury complained of be not remediable by an award of damages. To quote KP. Berger who refers specifically to Article 26 of the UNCITRAL Rules:

    “To preserve the legitimate rights of the requesting party, the measures must be “necessary”. This requirement is satisfied if the delay in the adjudication of the main claim caused by the arbitral proceedings would lead to a “substantial” (but not necessarily “irreparable” as known in common law doctrine) prejudice for the requesting party.”18

  22. 69. The Tribunal shares that view and considers that the “irreparable harm” in international law has a flexible meaning. It is noteworthy in that respect that the UNCITRAL Model Law in its Article 17A does not require the requesting party to demonstrate irreparable harm but merely that “(h)arm not adequately reparable by an award of damages is likely to result if the measure is not ordered, and such harm substantially outweighs the harm that is likely to result to the party against whom the measure is directed if the measure is granted”.

  23. 76. Claimants have raised another argument in support of their request for interim measures on the basis that, in this case, the Tribunal would have reasons to believe that Claimants would encounter serious difficulties in having enforced an award which would be rendered in their favor. They allege in particular the modest financial means of Respondent as well as some recent political turbulence in Mongolia. The Tribunal does not believe that such allegations are sufficient to justify the ordering of interim measures in this case. The Tribunal should not presume that Respondent will not honor its international obligations, if an award is to be eventually rendered against it and nothing in the allegations made by Claimants is of such substance as to justify a different stand.

  24. 78. While it is true that Claimants would still have a recourse in damages and that other arbitral tribunals have indicated that debt aggravation was not sufficient to award interim measures, the unique circumstances of this case justify a different conclusion. In particular, while not putting in doubt the value of the undertaking of Respondent not to seize or put a lien on GEM's assets, the Tribunal believes that it is preferable to formalize that commitment into an interim measures order.

  25. - Proportionality

  26. 79. Under proportionality, the Tribunal is called upon to weigh the balance of inconvenience in the imposition of interim measures upon the parties.

  27. 90. Article 26 of the [1976] UNCITRAL Rules does not mandate any specific type of security. An escrow account is not the exclusive measure of protection from which Respondent could benefit Different measures with equivalent results can also be considered. The Tribunal is retaining one such measure: the provision of a bank guarantee having the same effect.

    ON THE BASIS OF THE ABOVE, THE TRIBUNAL THEREFORE ORDERS AS FOLLOWS

    Claimant's application for interim measures of protection under Article 26 of the [1976] UNCITRAL rules is granted in accordance with the terms and subject to the conditions below:

  28. 1. Payment to the Respondent of the Windfall Profit tax owing by GEM (including interest and penalties) is suspended until the Tribunal has ruled on the merits of the Claimant's request for relief.

  29. 2. Taking note of the undertaking previously made by Respondent on March 19, 2008 and confirmed at the Hearing, Respondent shall refrain from seizing or obtaining a lien on the assets of GEM and other assets of Claimants in connection with the WPT owing to Respondent or from directly or indirectly taking any other action leading to the same or similar effect, except in accordance with the Tribunal's Orders, and shall allow GEM and Claimants to maintain their ordinary business operations in Mongolia.

  30. (p. 538) 3. Following their previous undertaking in that regard on Marche 26, 2998, Claimants shall not move assets out of Mongolia, nor take any action which would alter in any way the ownership and/or financial interests of Claimants with respect to their assets in Mongolia, without prior notice to and agreement of Respondent. Sale and pledges of gold are authorized provided the funds thus obtained are used for the ordinary business operations of GEM. Under no circumstances should such funds be used for other purposes; in particular, no transfer of funds or assets of any kind should be made outside of Mongolia (except for deposit into the escrow account under the conditions described below) or to any of the Claimants or any person, corporation or business related to them, without Respondent's agreement.

  31. 4. Claimants shall provide gradually increasing security as described below. The Tribunal may increase of decrease the security for good cause shown premised on the evolution of GEM’S business. Claimants shall submit for approval by the Tribunal, within twenty days of the present Order, a detailed proposal, which will have been discussed with Respondent, concerning the implementation of one of the following measures of protection which they will have selected:

    1. a. An escrow account in an internationally recognized financial or other institution outside Mongolia and Russia and acceptable to the Tribunal;

    2. b. The provision of a bank guarantee to the same effect and under the same conditions from an internationally recognized financial or other institution outside Mongolia and Russia and acceptable to the Tribunal.

      If Respondent is not satisfied with the arrangement proposed by Claimants, the Tribunal will issue the appropriate order upon request by one of the Parties.

  32. 5. The cost of the escrow account shall be borne equally by Claimants and Respondent but can be made part of the claim for compensation by each Party.

  33. 6. Claimants shall deposit in the escrow account (if such is the option retained), on the first working day of each month following the establishment of that account, the sum of US$2 million, until a final award is rendered in the present case or until the sum in the escrow account has reached 50 percent of the total amount of the accrued WPT claimed by Respondent, including interest and penalties, whichever comes first. The monies deposited in the escrow account may be invested in financial instruments of high liquidity. The decision regarding the scope of the security is adopted by majority, Dr. Horacio A. Grigera Naon being of the view that tax penalties should be excluded from the determination or calculation of the security.

  34. 7. Claimants may use the income resulting from the sale of gold by GEM for deposit into the escrow account, provided that, in no circumstance, such transfer would result in a reduction of shareholders’ equity in GEM below the sum of MNT 31,578,323,602.35 mentioned at line 2.3.20 of the Balance Sheet of the Financial Statements of December 31, 2007 (after inclusion in the liabilities of the company the amount of WPT payable at that time—but not actually paid—of MNT 35,241,117,548.00 mentioned at line 2.1.1.12). Each such transfer shall be preceded by an affidavit signed by Director S.V. Paushok and the Chief Accountant of GEM confirming that fact and sent to Respondent and the Tribunal.

  35. 8. If, instead of the escrow account, the bank guarantee option is retained, arrangements to the same effect shall be put into place.

  36. 9. Claimants shall, every six months, provide Respondent with a complete list of their assets in Mongolia.

  37. 10. The scope of this Order does not extend beyond the subject-matter of this dispute and does not prevent Mongolia, after due consideration in good-faith of the Tribunal's direction under paragraph 11 below, from exercising its rights against GEM or Claimants in matters unrelated to this dispute, including taxes owing in other respect than the Windfall Profit Tax.

  38. 12. The Parties shall refrain, until a final award is rendered in this case, from any action which could lead to further injury and aggravation of the dispute between the Parties.

  39. 13. The Tribunal reserves for later consideration its decision on costs arising from these proceedings.

  40. (p. 539) 14. The Temporary Restraining Order is terminated

  41. 15. The Tribunal reserves the right to amend or revoke the present Order at any time during the proceedings, upon request by one of the Parties demonstrating the need for such action. In particular, failure by Claimants to timely provide or maintain the required security could lead to the immediate revocation of the present Order.

[Footnote] 18. Berger, KP, International Economic Arbitration, in Studies in Transnational Economic Law, vol. 9, Kluwer Law and Taxation Publishers, Deventer, Boston,1993 at p.336.

Chevron Corp, et al and Republic of Ecuador, Order on Interim Measures (May 14, 2010) (PCA administered, 1976 UNCITRAL Rules, US-Ecuador BIT), at 5:

THE TRIBUNAL ORDERS AS FOLLOWS:

  1. 1. Until further decision the Tribunal takes, pursuant to Article 26(1) of the [1976] UNCITRAL Rules, the following interim measures up to and including the next procedural meeting beginning on November 22, 2010:

    1. (i)  The Claimants and the Respondent are both ordered to maintain, as far as possible the status quo and not to exacerbate the procedural and substantive disputes before this Tribunal, including (in particular but without limiting howsoever the generality of the foregoing) the avoidance of any public statement tending to compromise these arbitration proceedings;

    2. (ii)  The Claimants and the Respondent are both ordered to refrain from any conduct likely to impair or otherwise adversely affect, directly or indirectly the ability of the Tribunal to address fairly any issue raised by the Parties before this Tribunal;

    3. (iii)  The Claimants and the Respondent are both ordered not to exert, directly or indirectly, any unlawful influence or pressure on the Court addressing the pending litigation in Ecuador known as the Lago Agrio Case;

    4. (iv)  The Claimants and the Respondent are ordered to inform the Tribunal (in writing) of the likely date for the issue by the Court of its judgment in the Lago Agrio Case as soon as such date becomes known to any of them;

    5. (v)  The Respondent is ordered to communicate (in writing and also by any other appropriate means) the Tribunal's invitation to the Court in the Lago Agrio Case to make known as a professional courtesy to the Tribunal the likely date for the issue by the Court of its judgment in the Lago Agrio Case; and, to that end, the Respondent is ordered to send to the Court the full text in Spanish and English of the Tribunal's present order; and

    6. (vi)  The Respondent is ordered to facilitate and not to discourage, by every appropriate means, the Claimants’ engagement of legal experts, advisers and representatives from the Ecuadorian legal profession for the purpose of these arbitration proceedings (at the Claimants’ own expense).

  2. 2. This Order is and shall remain subject to modification in the light of any future event, upon the Tribunal's own motion or upon any Party's application, particularly in the light of any new development in the Lago Agrio Case and the issue of the Court's judgement in such Case; and any of the Parties may apply to the Tribunal for such modification upon 24 hours’ written notice.

  3. 3. This Order is made strictly without prejudice to the merits of the Parties’ procedural and substantive disputes, including the Respondent's jurisdictional and admissibility objections and the merits of the Claimants’ claims.

Chevron Corp, et al and Republic of Ecuador, Order for Interim Measures (February 9, 2011) (PCA administered, 1976 UNCITRAL Rules, US-Ecuador BIT), at 3–4:

THE TRIBUNAL NOW DECIDES:

  1. (A)  As to jurisdiction, the Tribunal records that it has not yet determined the Respondent's challenge to its jurisdiction (as recorded in the fourth preamble to its Order of January 28, (p. 540) 2011). Nonetheless, for the limited purpose of the present decision, the Tribunal provisionally assumes that it has jurisdiction to decide upon the Claimants’ Second Application for Interim Measures on the ground that the Claimants have established, to the satisfaction of the Tribunal, a sufficient case for the existence of such jurisdiction at this preliminary stage of these arbitration proceedings under the written arbitration agreement invoked by the Claimants against the Respondent under the Treaty between the United States of America and the Republic of Ecuador concerning the Encouragement and Reciprocal Protection of Investment (the “BIT”), incorporating by reference the 1976 UNCITRAL Arbitration Rules (the “UNCITRAL Rules”);

  2. (B)  The Tribunal notes that: (i) Article 26 of the UNCITRAL Rules permits a tribunal, at the request of a party, to take interim measures (established in the form of an order or award) in respect of the subject-matter of the parties’ dispute; (ii) Article 32(1) of the UNCITRAL Rules permits a tribunal to make (inter alia) an award in the form of a final, partial or interim award; (iii) Article 32(2) of the UNCITRAL Rules provides that any award is final and binding on the parties, with the parties undertaking to carry out such award without delay; and (iv) Articles VI.3(6) of the BIT provides (inter alia) that an award rendered pursuant to Article VI.3(a)(iii) of the BIT under the UNCITRAL Rules shall be binding on the parties to the dispute, with the Contracting Parties undertaking to carry out without delay the provisions of any such award and to provide in its territory for its enforcement;

  3. (C)  As to form, the Tribunal records that, whilst this decision under Article 26 of the UNCITRAL Rules is made in the form of an order and not an interim award, given the urgency required for such decision, the Tribunal may decide (upon its own initiative or any Party's request) to confirm such order at a later date in the form of an interim award under Articles 26 and 32 of the UNCITRAL Rules, without the Tribunal hereby intending conclusively to determine the status of this decision, one way or the other, as an award under the 1958 New York Convention.

  4. (D)  As to the grounds for the Claimants’ Second Application, the Tribunal concludes that the Claimants have made out a sufficient case, to the Tribunal's satisfaction, under Article 26 of the UNCITRAL Rules, for the order made below in the discretionary exercise of the Tribunal's jurisdiction to take interim measures in respect of the subject-matter of the Parties’ dispute;

  5. (E)  Bearing in mind the Respondent's several obligations under the BIT and international law, including the Respondent's obligation to carry out and provide for the enforcement of an award on the merits of the Parties’ dispute in these arbitration proceedings (assuming this Tribunal's jurisdiction to make such an award), the Tribunal orders:

    1. (i)  the Respondent to take all measures at its disposal to suspend or cause to be suspended the enforcement or recognition within and without Ecuador of any judgment against the First Claimant in the Lago Agrio Case; and

    2. (ii)  the Respondent's Government to inform this Tribunal, by the Respondent's legal representatives in these arbitration proceedings, of all measures which the Respondent has taken for the implementation of this order for interim measures; pending further order or award in these arbitration proceedings, including the Tribunal's award on jurisdiction or (assuming jurisdiction) on the merits;

  6. (F)  … ;

  7. (H)  The Tribunal decides further that the Claimants shall be legally responsible, jointly and severally, to the Respondent for any costs or losses which the Respondent may suffer in performing its obligations under this order, as may be decided by the Tribunal within these arbitration proceedings (to the exclusion of any other jurisdiction);

  8. (I)  This order shall be immediately final and binding upon all Parties, subject only to any subsequent variation made by the Tribunal (upon either its own initiative or any Party's request); and

  9. (J)  This order, as with the earlier order of January 26, 2011, is made by the Tribunal strictly without prejudice to any Party's case as regards the Tribunal's jurisdiction, the Claimants’ First Application made by letter dated December 12, 2010, the Respondent's opposition to such First Application, and to any claim or defence by any Party as to the merits of the Parties’ dispute.

(p. 541) Chevron Corp, et al and Republic of Ecuador, First Interim Award (January 25, 2012) (PCA administered, 1976 UNCITRAL Rules, US-Ecuador BIT), at 16–17:

THE TRIBUNAL NOW MAKES THIS FIRST INTERIM AWARD AS FOLLOWS:

  1. 1. Pursuant to Paragraph (C) of its Order dated February 9, 2011 and upon the following terms, the Tribunal confirms and re-issues such Order as an Interim Award pursuant to Article 26 and 32 of the [1976] UNCITRAL Arbitration Rules, specifically Paragraph (E) of such Order; namely (as here modified):

  2. 2. Bearing in mind the Respondent's several obligations under the BIT and international law, including the Respondent's obligation to carry out and provide for the enforcement of an award on the merits of the Parties’ dispute in these arbitration proceedings (assuming this Tribunal's jurisdiction to make such an award), the Tribunal orders:

    1. (i)  the Respondent to take all measures at its disposal to suspend or cause to be suspended the enforcement or recognition within and without Ecuador of any judgment against the First Claimant in the Lago Agrio Case; and

    2. (ii)  the Respondent's Government shall continue to inform this Tribunal, by the Respondent's legal representatives in these arbitration proceedings, of all measures which the Respondent has taken from the implementation of this Interim Award;

      pending the February Hearing's completion and any further order or award in these arbitration proceedings,

  3. 3. This Interim Award is and shall remain subject to modification (including its extension or termination) by the Tribunal at or after the February Hearing; and, in the meantime, any of the Parties may also apply to the Tribunal for such modification upon 72 hours’ written notice for good cause shown;

  4. 4. This Interim Award is made strictly without prejudice to the merits of the Parties’ substantive and order procedural disputes, including (but not limited to) the Parties’ respective applications to be heard at the February Hearing;

  5. 5. This Interim Award shall take effect forthwith as an Interim Award, being immediately final and binding upon all Parties as an award subject only to any subsequent modifications hearing provided, whether upon the Tribunal's own initiative or any Party's application; and

  6. 6. This interim Award although separately signed by the Tribunal's members on three signing pages, constitutes an “interim award” signed by the arbitrators under Article 32 of the [1976] UNCITRAL Arbitration Rules.

Chevron Corp, et al and Republic of Ecuador, Second Interim Award (February 16, 2012) (PCA administered, 1976 UNCITRAL Rules, US-Ecuador BIT), at 2–4:

THE TRIBUNAL NOW MAKES THIS SECOND INTERIM AWARD AS FOLLOWS:

  1. 1. The Tribunal determines that: (i) Article 26 of the [1976] UNCITRAL Rules (forming part of the arbitration agreement invoked by the Claimants under the Treaty) permits this Tribunal, at the request of a Party, to take interim measures (established in the form of an order or award) in respect of the subject-matter of the Parties’ dispute; (ii) Article 32(1) of the UNCITRAL Rules permits this Tribunal to make (inter alia) an award in the form of an interim award; (iii) Article 32(2) of the [1976] UNCITRAL Rules provides that any award by this Tribunal is final and binding on the Parties, with the Parties undertaking to carry out such award without delay; and (iv) Articles VI.3(6) of the Treaty provides (inter alia) that an award rendered by this Tribunal pursuant to Article VI.3(a)(iii) of the Treaty under the [1976] UNCITRAL Rules shall be binding on the parties to the dispute (i.e. the Claimants and the Respondent), with the Contracting Parties (i.e. here the Respondent) undertaking to carry out without delay the provisions of any such award and to provide in its territory for its enforcement;

  2. (p. 542) 2. The Tribunal determines further that the Claimants have established, for the purpose of their said applications for interim measures, (i) a sufficient case as regards both this Tribunal's jurisdiction to decide the merits of the Parties’ dispute and the Claimants’ case on the merits against the Respondent; (ii) a sufficient urgency given the risk that substantial harm may befall the Claimants before this Tribunal can decide the Parties’ dispute by any final award; and (iii) a sufficient likelihood that such harm to the Claimants may be irreparable in the form of monetary compensation payable by the Respondent in the event that the Claimants’ case on jurisdiction, admissibility and the merits should prevail before this Tribunal;

  3. 3. Bearing in mind the Respondent's several obligations under the Treaty and international law, including the Respondent's obligation to carry out and provide for the enforcement of an award on the merits of the Parties’ dispute in these arbitration proceedings and the Tribunal's mission (required under the arbitration agreement) efficaciously and fairly to decide the Parties’ dispute by a final award, the Tribunal hereby orders:

    1. (i)  the Respondent (whether by its judicial, legislative or executive branches) to take all measures necessary to suspend or cause to be suspended the enforcement and recognition within and without Ecuador of the judgments by the Provincial Court of Sucumbíos, Sole Division (Corte Provincial de Justicia de Sucumbíos, Sala Unica de la Corte Provincial de Justicia de Sucumbíos) of January 3, 2012 and of January 13, 2012 (and, to the extent confirmed by the said judgments, of the judgment by Judge Nicolás Zambrano Lozada of February 14, 2011) against the First Claimant in the Ecuadorian legal proceedings known as “the Lago Agrio Case”;

    2. (ii)  in particular, without prejudice to the generality of the foregoing, such measures to preclude any certification by the Respondent that would cause the said judgments to be enforceable against the First Claimant; and

    3. (iii)  the Respondent's Government to continue to inform this Tribunal, by the Respondent's legal representatives in these arbitration proceedings, of all measures which the Respondent has taken for the implementation of its legal obligations under this Second Interim Award;

    until any further order or award made by the Tribunal in these arbitration proceedings;

  4. 4. The Tribunal determines that the Claimants shall be legally responsible, jointly and severally, to the Respondent for any costs or losses which the Respondent may suffer in performing its legal obligations under this Second Interim Award, as may be decided by the Tribunal within these arbitration proceedings (to the exclusion of any other jurisdiction); and further that, as security for such contingent responsibility the Claimants shall deposit within thirty days of the date of this Second Interim Award the amount of US$50,000,000.00 (United States Dollars Fifty Million) with the Permanent Court of Arbitration in a manner to be designated separately, to the order of this Tribunal;

  5. 5. The Tribunal dismisses the application made by the Respondent to vacate its order for interim measures of February 9, 2011;

  6. 6. The Tribunal's existing orders for interim measures (as recited in the First Interim Award) and the First Interim Award shall continue to have effect subject to the terms of this Second Interim Award;

  7. 7. This Second Interim Award is and shall remain subject to modification at any time before the Tribunal's final award in these arbitration proceedings; and, in the meantime, any of the Parties may also apply to the Tribunal for such modification upon seventy-two hours’ written notice for good cause shown, including any material change in the legal or factual circumstances prevailing as at the date of the Hearing;

  8. 8. This Second Interim Award is made strictly without prejudice to the merits of the Parties’ substantive and other procedural disputes, including the Respondent's objections as to jurisdiction, admissibility and merits;

  9. 9. This Second Interim Award shall take effect forthwith as an Interim Award, being immediately final and binding upon all Parties as an award subject only to any subsequent modification as herein provided, whether upon the Tribunal's own initiative or any Party's application; and

  10. (p. 543) 10. This Interim Award, although separately signed by the Tribunal's members on three signing pages constitutes an “interim award” signed by the three arbitrators under Article 32 of the [1976] UNCITRAL Arbitration Rules.

D. Extracts from the Practice of the Iran–US Claims Tribunal

(1)  Tribunal Rules (1983), Article 26(1)

Ford Aerospace and Communications Corp and Government of Iran, et al, Award No ITM 16-93-2 (April 27, 1983), reprinted in 2 Iran-US CTR 281, 282 (1983-I):

It appears from the copy of the summons received by Ford Aerospace, that the claim filed against it by the Government of Iran before the General Court of Tehran, is identical to the counterclaim previously filed with the Tribunal in this case.

However, it is provided in paragraph 2 of Article VII of the Claims Settlement Declaration that “claims referred to the Arbitral Tribunal shall, as of the date of filing of such claims with the Tribunal, be considered excluded from the jurisdiction of the Courts of Iran, or of the United States, or any other court. The subject matter of the Counter claim is thus excluded from the jurisdiction of the Courts of Iran from the date the Counterclaim was filed with this Tribunal unless and until this Tribunal decides that is has no jurisdiction over it.

Accordingly, the request for a stay of proceedings in Iran must be granted as an interim measure, even though this Tribunal has not yet decided whether it has jurisdiction, in this case.

For the foregoing reasons,

The Tribunal Awards as follows:

The Government of the Islamic Republic of Iran is requested to seek a stay of the proceedings before the General Court of Tehran, pending termination of the proceedings before the Iran-United States Claims Tribunal.

Rockwell Intl Systems, Inc and Islamic Republic of Iran, Ministry of Defence, Award No ITM 20–430–1 (June 6, 1983) at 4–5, reprinted in 2 Iran-US CTR 369, 371 (1983–I):

As to the contention that the Tribunal does not have power to grant the interim relief sought by Rockwell, the Tribunal notes that the Full Tribunal concluded in its interim Award No ITM 13–388-FT in the Case E-Systems, Inc. and The Government of the Islamic Republic of Iran, Case No 388, that the Algiers Declarations leave the Government of Iran free in principle to initiate claims before Iranian Courts even where the claim would have been admissible as a counter-claim before the Tribunal. However, in that Interim Award it is also stated that the tribunal has an inherent power to issue such orders as may be necessary to conserve the respective rights of the parties and to ensure its jurisdiction and authority are made fully effective. It is also stated that any award to be rendered in the case by the Tribunal, which was established by inter-governmental agreement, will prevail over any decision inconsistent with it rendered by Iranian or United States courts.

The consistent practice of the Tribunal indicates that this inherent power is in no way restricted by the language in Article 26 of the Tribunal Rules. Further, the Government of Iran and the Government of the United States have agreed in the Algiers Declarations to confer upon this Tribunal jurisdiction over certain claims. It follows that both governments are under an international obligation to comply with any decisions rendered by the Tribunal pursuant to this agreement.

For the foregoing reasons,

The Tribunal requests the Government of the Islamic Republic of Iran to take all appropriate measures to ensure that the proceedings before the Public Court of Tehran be stayed, pending determination of the proceedings in the present case before the Iran-United States Claims Tribunal.

(p. 544) RCA Global Communications, Inc and Islamic Republic of Iran, Award No ITM 30–160–1 (October 31, 1983) at 5, reprinted in 4 Iran-US CTR 9, 11–12 (1983–III):

It follows from the Interim Award by the Full Tribunal in the Case E- Systems, Inc. and The Government of the Islamic Republic et al., Case No 388, Award No ITM 13–388-FT, that the Tribunal has an inherent power to issue such orders as may be necessary to conserve the respective rights of the Parties and to ensure that the Tribunal's jurisdiction and authority are made fully effective. In order to achieve this end the Tribunal has the power in its discretion to order a Party to stay proceedings before a domestic court, if such proceedings may lead to decisions that are inconsistent with decisions made in proceedings before the Tribunal.

However, in the instant case the proceedings before the domestic court concerns a dispute arising out of a separate contract, and it involves a Party which is not a Party in the case before the tribunal. The alleged interrelationship between the two cases is not quite clear. Therefore, quite apart from the questions as to whether the Tribunal has power to request the Government of Iran to vacate the judgment entered in the Tehran Court and whether there would be any point in ordering the Government to stay the proceedings in a case which appears to be closed, in the exercise of its discretion the Tribunal does not find sufficient reasons to grant the present request.

Avco Corp and Iran Aircraft Industries, Case No 261, Chamber Three, Order of January 27, 1984:

On 28 November 1983, Respondent Iran Aircraft Industries requested that the Tribunal issue an interim order prohibiting the sale of “its property with AVCO Corporation”.

In its submission of 30 December 1983, the Claimant asserts that no sale of any of the goods in question is planned to take place before 1 January 1985. Relying on this assertion, the Tribunal need not now take a decision with regard to the request for interim measures of protection.

The Tribunal notes that this decision does not prevent the Party which has made the request from making a fresh request in the same case on new facts.

Islamic Republic of Iran and United States of America (Case Nos A/4 and A/15), Award No ITL 33-A-4/A-15(III)-2 (February 1, 1984) at 2, 5, reprinted in 5 Iran-US CTR 131, 133 (1984–I):

Within the framework of Claims Nos A–4 and A–15 (III) filed with the Tribunal by the Government of the Islamic Republic of Iran against the Government of the United States of America, seeking the restitution to the Claimant of immovable and movable properties of the Iranian Embassy and Consulates located in the United States, and damages for an alleged breach by the Respondent of its obligations in this respect under the Declaration of the Government of the Democratic and Popular Republic of Algeria of 19 January 1981, the Claimant submitted on 20 December 1983 a Request for an interim measure to prevent the Government of the United States of America from auctioning the movable properties of the Iranian Embassy and Consulates in the United States and to cancel any transaction entered into pursuant to such auctions.

In an Order filed on 18 January 1984, Chamber Two of the Tribunal, which had been appointed to deal with this request by Presidential Order No 17 of 5 January 1984, held that the circumstances as presented to the Tribunal at the time were not such as to require the exercise of its power to order the requested interim measure of protection, as these circumstances did not appear to create a risk of an irreparable prejudice, not capable of reparation by the payment of damages. In this Order it was further noted that this decision did not prevent the Party which had made the request from making a fresh request based on new facts.

The Tribunal holds that the circumstances, as they are now presented to it, are such as to require the exercise of the Tribunal's power to order an interim measure of protection, pending the decision of the Full Tribunal in cases A-4 and A-15.

(p. 545) The Tribunal urgently requests the Government of the United States of America to take all necessary and appropriate measures to prevent the sale of Iran's diplomatic and consular properties in the United States which possess important historical, cultural, or other unique features, and which, by their nature, are irreplaceable.

Bendone-Derossi Intl and Islamic Republic of Iran, Award No ITM 40–375–1 (June 7, 1984) at 3–4, 6, reprinted in 6 Iran-US CTR 130, 131–132, 133 (1984–II):

In an appropriate case, an international tribunal will grant interim measures of protection before determining its jurisdiction over the merits of the claim, provided that it is satisfied that there is, at least, a prima facie showing that it has jurisdiction over the substantive claim. This test was most recently applied by the International Court of Justice in its Order of 10 May 1984 in Military and Paramilitary Activities in and against Nicaragua (Nicaragua v. United States of America), Provisional Measures, I.C.J. Reports 1984, 169, 179. The Court stated, at paragraph 24 of the Order:

[O]n a request for provisional measures the Court need not, before deciding whether or not to indicate them, finally satisfy itself that it has jurisdiction on the merits of the case, or, as the case may be, that an objection taken to jurisdiction is well-founded, yet it ought not to indicate such measures unless the provisions invoked by the Applicant appear, prima facie, to afford a basis on which the jurisdiction of the Court might be founded.

Without prejudice to the final determination of the jurisdictional issue, the Tribunal is not at present satisfied that it appears, prima facie, that there exists a basis on which it can exercise jurisdiction over the present claim.

The request of the Respondent for an Order granting interim measures of protection is denied.

Atlantic Richfield Co and Islamic Republic of Iran, Award No ITM 50–396–1 (May 8, 1985) at 4–6, reprinted in 8 Iran-US CTR179, 181–182 (1985–I):

NIOC requests the Tribunal to issue an Order requiring the Government of the United States of America and Atlantic Richfield to take all appropriate measures to ensure that the latter accepts the applicability of the Algiers Declarations, and to withdraw the writs of attachment obtained in the United States Courts, or, in the alternative, an order requiring Atlantic Richfield to withdraw Case No 396 from the Tribunal.

In its Comments filed on 15 February 1985, the Government of the United States of America asserted that since it was not a party to Case No 396, no relief could be sought against it.

Atlantic Richfield also filed Comments on 15 February 1985, in which it contended that there was no necessary contradiction in its respective arguments before the New York Court and the Tribunal because the legal basis on which the attachment had been obtained, that of beneficial ownership of the money in the account, did not depend on whether LAPCO was deemed to be an entity controlled by Iran. Nor was there any inconsistency present in the different claim it had made before the Tribunal for breaches of international law. Atlantic Richfield further argued that as long as the New York Court proceedings remained suspended and the account blocked, there was no prejudice to either party and no risk of inconsistent rulings.

The Tribunal holds that, as to the claim for interim relief against the Government of the United States of America, it cannot grant the relief sought because the Government of the United States of America is not a party to Case No 396. The Tribunal notes, however, that the subject-matter of the present request is before the Full Tribunal as part of Case A-15, and the present decision in no way prejudices the eventual outcome of that Case.

As to the relief sought against Atlantic Richfield, the Tribunal does not consider that there exists any threat of grave or irreparable damage to NIOC, or to the Tribunal's jurisdiction, such as to justify the granting of interim measures. On the contrary, the preservation of the status quo appears to be assured by the continued blocking of the LAPCO account and the suspension of the New York Court proceedings pending the Tribunal's determination of the present case.

(p. 546) Atlantic Richfield admits that it is “true that [it] has resisted transfer of the funds in the LAPCO bank account to Iran on the ground that LAPCO was not an entity controlled by Iran for purposes of the transfer order.” While this may indicate the existence of a contradiction between the position taken by Atlantic Richfield respectively as Claimant in the present case and as Plaintiff in the New York court proceedings, this is not per se relevant to the question of whether the grant of interim relief is appropriate. Nor is it necessary for the Tribunal to make any decision on this point at the present stage of the proceedings. It is rather an issue to be considered by the Tribunal as part of the merits of Case No 396.

For the foregoing reasons,

The request of the Respondent NIOC for interim relief against Atlantic Richfield and the Government of the United States of America is denied.

Component Builders, Inc and Islamic Republic of Iran, Award No ITM/ITL 51–395–3 (May 27, 1985) at 6, 12–13, 14–15, reprinted in 8 Iran-US CTR 216, 220, 225–26 (1985–I):

One requirement for the issuance of interim measures is that there be, at least prima facie, a basis on which the jurisdiction of the Tribunal might be founded.

The Full Tribunal has ruled that the Tribunal has “an inherent power to issue such orders as may be necessary to conserve the respective rights of the Parties and to ensure that this Tribunal's jurisdiction and authority are made fully effective,” E-Systems Inc. and The Islamic Republic of Iran, Interim Award No 13–388-FT (4 February 1983) at 10, 2 Iran-US CTR 51, 57. It has exercised such power to require a stay to Tehran court proceedings pending completion of Tribunal action where “it is obvious that the claim initiated before the Iran Court had been admissible as a counter-claim before the Tribunal”, even though no counter-claim had been asserted. E-Systems at 7, 2 Iran-US CTR at 55.

Moreover, the Full Tribunal has ruled “that once a counter-claim has been initiated before the Tribunal, such claim is excluded from the jurisdiction of any court”. E-Systems at 9, 2 Iran-US CTR at 5, relying on Article VII(2) of the Claims Settlement Declaration.

Examination of the suit filed by Bank Maskan and of Claim 1 and 2 filed by Claimants before this Tribunal also makes clear that both actions seek to adjudicate the same issues. Claimants allege that they have satisfactorily performed under the Contract and under Claim 1 seek monies due and payable by the terms of the Contract and by Claim 2 seek monies allegedly owing as a result of Bank Maskan's failure to fulfill its duties under the Contract. Bank Maskan on the other hand alleges that Claimants’ performance was unsatisfactory and seeks the refund of advance payments, damages “representing costs for repairing defects in the grading of terrace floors, roof facades, etc.,” and damages “representing costs of repainting”. Indeed, Bank Maskan's Statement of Defence, in responding to Claims 1 and 2, repeatedly supports its pleas with reference to the lawsuit in Tehran (see Bank Maskan Statement of Defence at 68, 69, 71, 72 and 74).

The Tribunal therefore concludes, as the Full Tribunal did in E-Systems, that in order “to conserve the respective rights of the Parties and to ensure that this Tribunal's jurisdiction and authority are made effective,” it is appropriate that interim measures requiring a stay of the proceedings in the Public Court of Tehran be issued in this case. As the Tribunal noted in Aeronutronics Overseas Services, Inc. and The Islamic Republic of Iran et al., Interim Award No 47–158–1 (14 March 1985) at 5, Respondent Iran “has … assumed an international obligation to take whatever steps may be necessary to comply with” this Interim Award.

Behring Intl, Inc and Islamic Republic Iranian Air Force, Award No ITM/ITL 52–382–3 (June 21, 1985) at 49–50, 53–54, reprinted in 8 Iran-US CTR 238, 273, 275–76 (1985–I):

In support of their request for an Interim Award ordering, inter alia, Claimant to release their property from its New Jersey warehouse. Respondents contend that they will suffer irreparable injury if such relief is not granted. Respondents allege as follows:

(p. 547) Respondents’ properties are stored under conditions wholly unsuited to the maintenance and preservation of the delicate electronic equipment, computers and aircraft spare parts … worth scores of millions of dollars. The properties are deteriorating rapidly, and the damages incurred by Respondents are irreparable, since some of the properties are irreplaceable. In addition, there are now strong indications that some items of properties are missing from Claimant's warehouse. It is manifest now that the only reason Claimant seeks to retain custody of the properties is to use that custody as a leverage to extract from Respondents a total relinquishment of their counter-claims for losses incurred as a result of Claimant's negligence and wilful breach of its duties as a warehouseman.

Applying these standards, the Tribunal determines that the conservation of both the goods and the rights of the Parties requires that the Respondents’ property be transferred to an alternate location. Accordingly, we grant the request for interim measures, subject to the conditions set forth below.

The Tribunal first finds that Respondents’ property must be removed from its present location in the annex portion of Claimant's Edison, New Jersey warehouse facility in order to prevent unnecessary damage and/or deterioration. The conditions under which the goods are presently stored are inadequate to conserve and protect them and irreparable prejudice to Respondent's asserted rights may result if they are not transferred to a more appropriate facility.42 The Tribunal made this finding in its Interim Award of 22 February 1985 and reaffirms that conclusion.

A definition of “irreparable prejudice” is elusive; however, the concept of irreparable prejudice in international law arguably is broader than the Anglo-American law concept of irreparable injury. While the latter formulation requires a showing that the injury complained of is not remediable by an award of damages (i.e., where there is no certain pecuniary standard for the measure of damages, 43 C.J.S. Injunctions § 23), the former does not necessarily so require.

[Footnote] 42. Irreparable prejudice has long been recognized as a basis for ordering provisional relief in international law.

United States of America on behalf and for the benefit of Tadjer-Cohen Associates Inc and Islamic Republic of Iran, Award No ITM 50–12118–3 (November 11, 1985), reprinted in 9 Iran-US CTR 302, 304–05 (1985–II):

  1. 1. On 19 January 1982, the Government of the United States of America filed the present claim on behalf and for the benefit of the Claimant, Tadjer-Cohen Associates, Incorporated (“TCA”). The Claim names as the Respondent the Islamic Republic of Iran (“Iran”), including Bank Rahni Iran (“Bank Rahni”) and seek damages of US $200,222 plus interest for the alleged breach of two contracts entered into between TCSB Incorporated (“TCSB”) and Bank Rahni. The contracts relate to the provision of engineering consultancy services for a project for the manufacture and erection of five hundred prefabricated housing units.

  2. 9. It is evident from the documents in this case that the proceedings before the Public Court of Tehran involve the same contract and work that comprise the subject matter of the claim TCSB assigned to TCA and which is currently before the Tribunal. A decision made in the proceedings before the Public Court of Tehran may lead to decisions that are inconsistent with decisions made in the proceedings before the Tribunal. See RCA Globcom Communications and The Islamic Republic of Iran, Interim Award No ITM 30–160– 1 at 5 (31 October 1983).

  3. 10. The Tribunal is satisfied that there is at least a prima facie showing that it has jurisdiction over the substantive claim pending before it. Such preliminary determination is, however, without prejudice to the Tribunal's final decision on jurisdiction, including any issues relating to the assignment from TCSB to TCA or the forum selection clauses.

  4. 11. The Tribunal ruled in E-Systems, Inc. and The Islamic Republic of Iran, Interim Award No ITM 13–388-FT at 10 (4 February 1983) that “[t]his Tribunal has an inherent power to issue such (p. 548) Orders as may be necessary to conserve the respective rights of the Parties and to ensure that this Tribunal's jurisdiction and authority are made fully effective.”

  5. 12. The Tribunal notes the Respondent's submissions on the requirements of the Civil Procedure Code of Iran. The Government of the Islamic Republic of Iran and the Government of the United States of America, however, having agreed in the Algiers Declarations to confer upon this Tribunal jurisdiction over certain claims, are under an international obligation to comply with any decisions rendered by the Tribunal. See Aeronutronics Overseas Services, Inc. and The Islamic Republic of Iran, Interim Award No ITM 47–158–1 at 5 (14 March 1985).

  6. 13. The Tribunal therefore concludes that the proceedings in the Public Court of Tehran in so far as they relate to TCJSB should be stayed pending termination of the proceedings before the Tribunal.

    INTERIM AWARD For the foregoing reasons,

    THE TRIBUNAL AWARDS AS FOLLOWS:

    The Tribunal requests the Government of the Islamic public of Iran to take all appropriate measures to ensure that the proceedings before the Public Court of Tehran in so far as they relate to T.C.S.B. Incorporated be stayed pending the termination of the proceedings before the Tribunal.

Paul Donin de Rosiere, Panacaviar, SA and Islamic Republic of Iran, Award No ITM 64–498–1 (December 4, 1986), reprinted in 13 Iran-US CTR 193, 194, 196–98 (1986–IV):

  1. 6. The Tribunal has before it two related requests for interim measures of protection. The first is that the Tribunal order Panacaviar to withdraw the action it commenced in the courts of Basel prior to the commencement of the present proceedings, in connection with the same contract. The second, more specific, request is that the Tribunal order Panacaviar to obtain a stay of a “hearing” scheduled to take place in the same legal action in the Basel Court of Appeal on 5 December 1986.

  2. 13. Article 26, paragraph 1, of the Tribunal Rules of Procedure empowers the Tribunal, at the request of either Party, to “take any interim measures it deems necessary in respect of the subject-matter of the dispute … ” Apart from so protecting the physical subject-matter of a case before it, or the rights of the respective parties where appropriate, the Tribunal has also exercised its inherent power to protect its own jurisdiction in cases where the risk of inconsistent decisions in parallel and duplicative proceedings instituted in other fora have rendered this necessary. See, eg, E- Systems, Inc and The Islamic Republic of Iran, Award No ITM 13–388-FT (4 February 1983).

  3. 14. The Tribunal must determine whether interim measures of the type requested are necessary and appropriate for either of the above reasons in the present Case. It does so on the basis of the Parties’ own descriptions of the course and present status of the Basel proceedings, as the only document before the Tribunal in relation to those proceedings is Panacaviar's “Writ” and “Cause of Plaint” filed in 1980 contained in the Respondents’ Rejoinder filed on 28 November 1986.

  4. 16. In deciding whether there are grounds for granting interim relief, the Tribunal can only rely on Panacaviar's more detailed characterization of the nature of the Swiss proceedings, which neither Respondent has challenged. The Tribunal is thus prepared to accept, for the sole purpose of deciding the application for interim relief, that the damage claim filed by Panacaviar in Basel was a necessary ancillary proceeding to its application for an attachment of the bank guarantee. Though that suit is founded on the same allegations of breach of contract that form part of the claim before this Tribunal, the Tribunal accepts the Claimants’ statement that it is not Panacaviar's intention “to obtain a judgment from another court on the merits of the issues before this Tribunal.” Thus, the Tribunal does not find sufficient grounds on the basis of the information presently before it to support the conclusion that the existence of such a suit, (p. 549) commenced before the Statement of Claim was filed in the present Case, and apparently with a view to achieving an entirely different result, constitutes a violation of Article VII, paragraph 2, of the Claims Settlement Declaration so as to justify the grant of interim relief at this time. Should the Respondents later become aware of circumstances which indicate that the Claimants intend to use the Basel proceedings to obtain and enforce a judgment on the merits of the issues before this Tribunal in a manner inconsistent with the limited objective described by them in the present Case, it is open to the Respondents to apply to this Tribunal for interim measures of protection against such actions.

  5. 17. As to the attachment of the BNP bank guarantee obtained by Panacaviar in Basel, the Tribunal considers that its effect is to preserve the status quo as between the parties to the present Case rather than to jeopardize the position of either visa a vis the Tribunal. Such an attachment means, in effect, that Shilat will, for the present, be unable to obtain the proceeds of its demand under the letter of guarantee issued by Bank Etebarate Iran—a demand the legality of which is currently in issue in the proceedings in the Tribunal. That issue can and will be resolved by the Tribunal in due course when it pronounces upon the merits of the respective claim and counter-claim in its final Award.

  6. 18. Thus, the Tribunal can see no risk of grave or irreparable harm resulting to either Party, or to the jurisdiction of this tribunal, which would justify the granting of either of the measures currently sought by Shilat or Iran.

Islamic Republic of Iran and United States of America, Decision No DEC 116-A15(IV) & A24-FT (May 18, 1993), reprinted in 29 Iran-US CTR 214, 218, 220 (1993):

  1. 20. As to the substance of Iran's Request, the Tribunal notes that, under Tribunal precedent, interim relief can be granted only if it is necessary to protect a party from irreparable harm or to avoid prejudice to the jurisdiction of the Tribunal. See Boeing Co., et al., and Government of the Islamic Republic of Iran, Award No ITM 34–222–1, at 4 (17 Feb. 1984), reprinted in 5 Iran U.S. C.T.R. 152, 154 (“Boeing”). The Tribunal has determined that this standard also applies in government-to-government cases. See Islamic Republic of Iran and United States of America, Decision No DEC 85-B1-FT (18 May 1989), reprinted in 22 Iran-U.S. C.T.R. 105, 108 (“Case No B1”).

  2. 21. The Tribunal is not satisfied that Iran has discharged its burden of show that it risks irreparable harm if its Request is not granted. Should the Tribunal eventually determine in Case No A24 that the United States has not complied with its obligations under the Algiers Declarations by allowing the Foremost/OPIC lawsuit to proceed in the United States, the Tribunal can compensate Iran for any damages that the Tribunal finds Iran has sustained by awarding an adequate monetary relief. The Tribunal has previously held that “injury that can be made whole by monetary relief does not constitute irreparable harm.” Case No B1, para 11, supra, 22 Iran- U.S. C.T.R. at 109 (citing Boeing, supra). Although Iran refers to “Foremost's vexatious tactics,” supra, para 9, and alleges that in the proceedings before U.S. courts, it has failed to demonstrate how this would lead to infliction of irreparable harm on Iran.

  3. 22. The issue as to whether there exists a threat to the Tribunal's jurisdiction requires a more intricate analysis. According to Iran's Statement of Claim in Case No A24, Iran seeks, inter alia, a declaratory judgment holding the United States liable for a breach of the Algiers Declaration by allowing the Foremost/OPIC lawsuit to proceed in the United States; an order directing the United States to terminate the Foremost/OPIC lawsuit; and damages to compensate Iran for any losses it may have incurred, as a result of the United States’ breach. Therefore, the Tribunal must determine whether the Tribunal's jurisdiction to arbitrate Iran's claim is prejudiced if its Request is not granted.

  4. 23. In this connection, there are two possibilities. Either the Foremost/OPIC lawsuit in the United States will be decided before the Tribunal issues its decision in Cases Nos A15(IV) and A24, or Foremost/OPIC lawsuit will not have been decided when the Tribunal issues its (p. 550) decision in Cases Nos A15 (IV) and A24. The Tribunal finds that in either event, it will be in a position to render an affective decision upon Iran's claim and, consequently, that there exists no threat to the Tribunal's jurisdiction.

  5. 26. Finally, the Tribunal also notes that an order granting Iran's Request would not operate so as to maintain the status quo pending the Tribunal's decision in Case No A24, as alleged by Iran. Quite the contrary, the interim measures sought by Iran would not operate so as to maintain the status quo the continuing proceedings before the District Court—but would modify that “status quo” by suspending those proceedings. Consequently, should the Tribunal grant Iran's Request, it would, in effect, make an interim judgment in favor of Iran on the merits. Absent compelling reasons for doing so, such as the protection of the Tribunal's jurisdiction or a risk of irreparable damage, Iran's Request cannot be granted. See Behring International, Inc. and Islamic Republic of Iran, et al., Award No ITM 46–382–3 (22 Feb. 1985), reprinted in 8 Iran- U.S. C.T.R. 44 (dismissing the Respondents’ request for interim relief because it would have been “tantamount to awarding Respondents the final relief sought in their counter-claim.”)

(2)  Tribunal Rules (1983), Article 26(2)

RCA Global Communications, Inc and Islamic Republic of Iran, Case No 160, Chamber One, Order of June 2, 1983, reprinted in 3 Iran-US CTR 8 (1983–II):

In a Motion filed with the Tribunal on 6 May 1983 the Claimants have requested the Tribunal to direct the Government of Iran to stay further proceedings regarding a claim filed with the Public Court of Tehran by Iran Insurance Company against RCA Global Communications, Inc. and RCA Global Communications Disc., Inc.

RCA Global Communications, Inc. has been requested to appear before the Public Court of Tehran on 8 June 1983.

In its Order of 12 May 1983 the Tribunal has requested the Respondents to file a Reply to the Claimant's Motion by 23 May 1983, addressing in particular the question as to whether the litigation before the Public Court of Tehran involves any issue that can lead to decisions by the Tribunal inconsistent with decisions by the Public Court of Tehran.

Following a request for an extension submitted by the Deputy Agent of the Islamic Republic of Iran on 23 May 1983, the Tribunal has granted an extension to file said Reply by 1 August 1983.

However, in view of the Claimants’ statement that RCA Global Communications, Inc., has been ordered to appear before the Public Court of Tehran on 8 June 1983 and the Tribunal's inherent power to issue orders to conserve the respective rights of the Parties and to ensure that its jurisdiction and authority are made fully effective, the Tribunal finds it appropriate immediately to request the Government of Iran to move for a stay of the proceedings before the Public Court of Tehran until such time that the Tribunal can make a decision on the Claimants’ request based on the views of both Parties.

For these reasons, the Tribunal requests the Government of the Islamic Republic of Iran to take all appropriate measures to ensure that the proceedings before the Public Court of Tehran be stayed until 15 August 1983.

Questech, Inc and Ministry of National Defence of the Islamic Republic of Iran, Case No 59, Chamber One, Order of March 2, 1984:

  1. 1. Reconsidering the requests made by Claimant in its “Motion to Require Respondent to comply with Interim Award or in the alternative for Sanctions”, the Tribunal holds that such measures as requested under paragraphs A, B, C and D, on page 4 of this Motion are not provided for under the Tribunal Rules.

(p. 551) Behring Intl, Inc and Islamic Republic Iranian Air Force, Award No ITM 46–382–3 (February 22, 1985) at 4–6, reprinted in 8 Iran-US CTR 44, 46, 47–48 (1985–I):

  1. 4. The Tribunal decides that certain interim measures requested by Respondents nonetheless are appropriate at this time to preserve the rights of the Parties pending the Tribunal's final determination concerning its jurisdiction. In this respect, the Tribunal notes in particular that the parties agree that the facility in which the goods are currently stored is inadequate to preserve and protect the goods and the Tribunal deems their removal to a more modern air-conditioned and humidity-controlled facility to be essential to conserve the goods. Accordingly:

    1. (d)  The Tribunal orders that, in accordance with Article 26, paragraph 2 and Article 41, paragraph 2, of the Tribunal Rules, Respondents shall provide an additional $70,000 (for a total deposit outstanding of $100,000) toward the expenses of the expert and costs associated with his work, including the leasing of the full Behring warehouse, to be deposited within 30 days from the date of this Decision (and prior to the actual commencement of inventorying and the other tasks assigned specifically to the expert). This amount shall be remitted to account number 24.58.28.583 (Dollar Account) at Pierson, Heldring and Pierson, Korte Vijverberg 2, 2513 AB The Hague, in the name of the Secretary-General of the Iran-United States Claims Tribunal (Account No II). The account shall be administered by the Secretary-General of the Tribunal, who shall consult with the Tribunal.

      The Tribunal further retains jurisdiction to request from arbitrating parties such other amounts as may be required from time to time in connection with the expert's work, or to decide any disputes which may arise in connection with that work. The Tribunal shall later determine which party will ultimately bear the cost of the expert's work.

United States of America, on behalf and for the benefit of Tadjer-Cohen Associates, Inc and Islamic Republic of Iran, Case No 12118, Chamber Three, Order of August 4, 1986:

Reference is made to the letter of the Agent of the United States submitted on 28 July 1986, and entitled “Notice to Tribunal of receipt of New Summons to Appear before the Tehran Public Court on August 27, 1986.”

Attached to this submission is a copy of a transmittal letter directed to T.S.C.B. Inc. from the Embassy of the Democratic and Popular Republic of Algeria, Interests Section of the Islamic Republic of Iran together with a copy of “Summons No 1227/61” directing T.C.S.B. to appear before Tehran's Public Court No 26 on August 27, 1986 for proceedings concerning the “Claim of Bank Maskan.”

The Tribunal notes that the Interim Award No ITM 56–12118–3 filed on 11 November 1985 remains in force. Therefore it continues to be incumbent on “the Government of the Islamic Republic of Iran to take all appropriate measures to ensure that the proceedings before the Public Court of Tehran in so far as they relate to T.C.S.B. Incorporated be stayed pending the termination of the proceedings before the Tribunal.”

(3)  Tribunal Rules (1983), Article 26(3)

Behring Intl Inc and Islamic Republic Iranian Air Force, Award No ITM/ITL 52–382–3 (June 21, 1985) at 60 (footnotes omitted), reprinted in 8 Iran-US CTR 238, 280 (1985–I):

Nonetheless, the Tribunal may allow for a court of the United States, if and to the extent it deems it appropriate, to take interim measures not in conflict with this Award to safeguard such security interest and stay its order transferring the goods to afford Claimant an opportunity to petition a court of competent jurisdiction for such provisional relief and to implement any order issued by such court. See Article 26(3) of Tribunal Rules. Such cooperation between this international Tribunal and (p. 552) the municipal courts of one of the States Parties to the Algiers Accords is made necessary by the operation of the peculiar jurisdictional provisions of the Accords upon the even more peculiar facts and circumstances of this case. Simply stated, our jurisdiction does not encompass the entirety of the transaction in which the Parties are involved, yet those aspects within our jurisdiction cannot be adjudicated without potentially prejudicing the rights of the Parties in related disputes outside our jurisdiction.

Footnotes:

1  Corresponding Article 26 of the 1976 UNCITRAL Rules provides:

  1. 1. At the request of either party, the arbitral tribunal may take any interim measures it deems necessary in respect of the subject-matter of the dispute, including measures for the conservation of the goods forming the subject-matter in dispute, such as ordering their deposit with a third person or the sale of perishable goods.

  2. 2. Such interim measures may be established in the form of an interim award. The arbitral tribunal shall be entitled to require security for the costs of such measures.

  3. 3. A request for interim measures addressed by any party to a judicial authority shall not be deemed incompatible with the agreement to arbitrate, or as a waiver of that agreement.

2  The Working Group viewed the UNCITRAL Arbitration Rules as one of the most successful instruments of UNCITRAL and therefore cautioned in the travaux préparatoires against any unnecessary amendments or statements being included that would call into question the legitimacy of prior applications of the Rules in specific cases. It was considered that the focus of the revision should be on updating the Rules to meet changes that had taken place over the last thirty years in arbitral practice, not on simply making them more complex. Report of the Working Group on Arbitration and Conciliation on the Work of its Forty-Fifth Session (Vienna, September 11–15, 2006), UNCITRAL, 40th Session, UN Doc A/CN.9/614, at 5, para 16 (2006).

3  The adoption of the long, detailed Article 17 of the Model Law (rather than Article 26 of the 1976 Rules) as the starting point for drafting occurred at the outset of the revision process. Paulsson and Petrochilos in their advisory report to UNCITRAL foresaw the choice, offering both as alternatives: “The current draft Articles 17 … of the Model Law … would serve both those purposes well (see “alternative one” below). Another possibility would be to preserve the existing text of article 26, making limited changes that would be consistent with—but not fully reflect the tenor of—the proposed revision of the Model Law (see “alternative two”).” J Paulsson and G Petrochilos, Revision of the UNCITRAL Arbitration Rules, Report to UNCITRAL Secretariat, (2006) para 206. The general view of the Working Group at the first negotiating session was that the revision should use Article 17 as the point of departure. UNCITRAL, 45th Session, UN Doc A/CN.9/614, n 2, para 105.

4  J Castello, “Generalizing About the Virtues of Specificity: The Surprising Evolution of the Longest Article in the UNCITRAL Model Law,” (2012) 6 World Arb and Mediation Rev 7. See also J Castello, “Unveiling the 2010 UNCITRAL Arbitration Rules,” (2010) 65 Dispute Resolution J 21.

5  However, the Working Group noted that: “The view was expressed that the provisions of Chapter IV A that were of a contentious nature and had previously given rise to diverging views in the Working Group should not be included in the UNCITRAL Arbitration Rules, in order not to endanger their wide acceptability.” UNCITRAL, 45th Session, UN Doc A/CN.9/614, n 2, at 22, para 105.

6  G Petrochilos, “Interim Measures Under the Revised UNCITRAL Arbitration Rules,” (2010) 28(4) ASA Bulletin 878.

7  The following is an example of this dynamic:

A proposal was made that paragraph (2)(c) should be amended expressly to refer to security for costs through an addition of the words “or securing funds” after the word “assets”. Opposition was expressed to that proposal as it could connote that the corresponding provision in the UNCITRAL Arbitration Model Law was insufficient to provide for security for costs. The Working Group agreed that security for costs was encompassed by the words “preserving assets out of which a subsequent award may be satisfied.”

Report on the Working Group on Arbitration and Conciliation on the Work Forty-Seventh Session, UNCITRAL, 47th Session, UN Doc A/CN.9/641, para 48 (2007).

8  See, eg, Paushok (1976 Rules), Order on Interim Measures (applying standards similar to those in 2010 Rules); Chevron Corp (1976 Rules), Second Interim Award, para 2 (same); both reprinted in section 2(C).

9  Report of the Secretary-General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Addendum 1 (Commentary), UN Doc A/CN.9/112/Add.1 (1975), reprinted in (1976) VII UNCITRAL Ybk 166, 176 (“Under paragraph l, the arbitrators have discretion to take such measures, but only if requested by one or both parties.”). See also Report of the United Nations Commission on International Trade Law, 8th Session, Summary of Discussion of the Preliminary Draft, UN Doc A/10017, para 164 (1975), reprinted in (1975) VI UNCITRAL Ybk 24, 40.

10  See D Caron, “Interim Measures of Protection: Theory and Practice in Light of the Iran-United States Claims Tribunal,” (1986) 46 ZaöRV at 465, 466. An updated version of the article can be found in D Caron, The Iran-United States Claims Tribunal and The International Arbitral Process 207–83 (unpublished dissertation, Leiden 1990). Compare Article 46(2) of the 2006 ICSID Additional Facility Rules (“The Tribunal may also recommend provisional measures on its own initiative …”).

11  See Caron, “Interim Measures of Protection,” n 10, 480.

12  However, “it was noted that, even if not directed at a third party, an interim measure may nevertheless affect third persons holding, for example, money or other assets of the party concerned, since they may be obliged to take some action in respect of that property by virtue of the order directed to the party.” Report of the Working Group on Arbitration and Conciliation on the Work of its Thirty-Second Session (New York, June 12–July 7, 2000), UNCITRAL, 32nd Session, UN Doc A/CN.9/468, at 13, para 64 (2000).

13  This provision is more detailed than that provided in the 1976 UNCITRAL Rules. The Secretariat Note on revising the Rules indicates that changes were suggested in Article 26(2) so as to clarify “the circumstances, conditions and procedure for the granting of interim measures, consistent with [Article 17] A of the Model Law….” Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.145 at 12, para 25 (2007).

14  J Paulsson and G Petrochilos, Revision of the UNCITRAL Arbitration Rules, n 3, 198 para 203.

15  UNCITRAL, 40th Session, UN Doc A/CN.9/614, n 2, at 22, paras 104, 105.

16  See Islamic Republic of Iran and United States of America, Decision No DEC 116-A15(IV) & A24-FT (1983 Tribunal Rules) reprinted in section 2(D)(1).

17  The Working Group agreed to add at the end of the chapeau to paragraph (2) the words “including, without limitation,” to emphasize the non-exclusive nature of the list contained in paragraph (2). Report of Working Group II (Arbitration and Conciliation) on the Work of its Fiftieth Session (New York, February 9–13, 2009), UNCITRAL, 42nd Session, UN Doc A/CN.9/669, at 21, paras 92–94 (2009). See also Report of the Working Group on Arbitration and Conciliation on the Work of its Thirty-Ninth Session (Vienna, November 10–14, 2003), UNCITRAL, 39th Session, UN Doc A/CN.9/545, at 8–9, para 21 (2003).

18  See, eg, Chevron Corp (1976 Rules) Order of May 14, 2010, para 1(i)–(iii), reprinted in section 2(C).

19  See Avco Corp and Iran Aircraft Industries (Case No 261) (1983 Tribunal Rules) reprinted in section 2(D)(1).

20  Behring Intl, Inc (1983 Tribunal Rules), reprinted in section 2(D)(1).

21  See Iran and United States (Case Nos A/4 and A/15)(1983 Tribunal Rules) reprinted in section 2(D)(1).

22  Concerns were expressed that the actions to be prevented or refrained from in paragraph (2) (b) could be understood as referring only to prejudice to the arbitral process. To clarify the meaning intended by the drafters of the UNCITRAL Arbitration Model Law, it was suggested to introduce an editorial change to paragraph (2) (b) by inserting “(i)” before the word “current” and “(ii)” before the word “prejudice” so that the situation of “prejudice to the arbitral process” would appear as distinct from “current or imminent harm.” UNCITRAL, 42nd Session, UN Doc A/CN.9/669, n 17, at 21, para 95.

23  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 10, para 26.

24  See, eg, Ford Aerospace (1983 Tribunal Rules), reprinted in section 2(D)(1). See also D Caron, “Interim Measures of Protection,” n 10, 208–9 and Tables I and II 279–82. Note the drafters of the 2006 Amendments to the Model Law debated at length whether Article 17(2) could be interpreted as encompassing a power of an arbitral tribunal to order an anti-suit injunction. Report of the Working Group on Arbitration and Conciliation on the Work of its Fortieth Session (New York, February 23–27, 2004), UNCITRAL, 40th Session, UN Doc A/CN.9/547, at 21–3 para 75–83 (2004). But see, Paul Donin de Rosiere, Panacaviar, SA (1983 Tribunal Rules), reprinted in section 2(D)(1), where the Tribunal declined to issue such an order as no irreparable damage was shown.

25  See Chevron Corp (1976 Rules) Second Interim Award of February 16, 2012, para 3, reprinted in section 2(C).

26  See, eg, discussion in Paushok (1976 Rules), terms and conditions of interim order paras 3–10, reprinted in section 2(C).

27  See Paushok (1976 Rules), terms and conditions of interim order paras 1–3, reprinted in section 2(C).

28  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 10, para 26. See also Sergei Paushok, et al (Interim order) (1976 Rules), para 37, reprinted in section 2(C).

29  UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 10, para 48.

30  See D Kozlowska, “The Revised UNCITRAL Arbitration Rules Seen Through the Prism of Electronic Disclosure,” (2011) 28(1) J Intl Arb 51.

31  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 10, para 27.

32  Report of the Working Group on Arbitration and Conciliation on the Work of its Forty-Third Session (Vienna, October 3–7, 2005), UNCITRAL, 43rd Session, UN Doc A/CN.9/589, at 7, para 28 (2005).

33  UNCITRAL, 43rd Session, UN Doc A/CN.9/589, n 32, at 7, para 28.

34  However, the Working Group observed that the phrase “relevant and material” was already included in the IBA Rules on the Taking of Evidence in International Commercial Arbitration (adopted by resolution of the IBA Council, June 1999), which had been the product of much debate. It was noted that the phrase had taken on a meaning such that the term “relevant” required that the evidence be connected to the dispute and the term “material” referred to the significance of the evidence. In support of its retention, it was said that the phrase was commonly used and understood in international arbitration. UNCITRAL, 43rd Session, UN Doc A/CN.9/589,n 32, at 7, para 29.

35  Article 26(4) of the 2010 Rules provides: “With regard to a request for an interim measure under paragraph 2(d), the requirements in paragraphs 3 (a) and (b) shall apply only to the extent the arbitral tribunal considers appropriate.”

36  Article 26(3) draws on Anglo-common law jurisprudence and more precisely on the judgment of Lord Diplock in American Cynamid v Ethicon, requiring that the applicant for interim protection satisfy the tribunal that (1) there is a real risk of “harm not adequately reparable by an award of damages”; (2) that this harm will outweigh the harm likely to be suffered by the party against whom the measure is directed; and (3) that there is a reasonable possibility of success on the merits. M Skinner et al (eds), “The UNCITRAL Arbitration Rules 2010,” (2011) 7(1) Asian Intl Arb J 76.

37  Article 17A of the Model Law provides: “(1) The party requesting an interim measure under article 17(2)(a), (b) and (c) shall satisfy the arbitral tribunal that: (a) Harm not adequately reparable by an award of damages is likely to result if the measure is not ordered, and such harm substantially outweighs the harm that is likely to result to the party against whom the measure is directed if the measure is granted; and (b) There is a reasonable possibility that the requesting party will succeed on the merits of the claim. The determination on this possibility shall not affect the discretion of the arbitral tribunal in making any subsequent determination.”

38  See EnCana Corp (1976 Rules), especially para 13; and Chevron Corp (1976 Rules) Second Interim Award of February 16, 2012, para 2; both reprinted in section 2(C).

39  See section 2(C).

40  Report of the Working Group on Arbitration and Conciliation on the Work of its Thirty-Sixth Session (Vienna, 4–8 March 2002), UNCITRAL, 36th Session, UN Doc A/CN.9/508, at 15, paras 55–56 (2002).

41  “The party requesting the interim measure should furnish proof that. … ” UNCITRAL, 36th Session, UN Doc A/CN.9/508, n 40, at 13, para 51.

42  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 10–11, para 28.

43  UNCITRAL, 36th Session, UN Doc A/CN.9/508, n 40, at 15, paras 55–56. It was also determined that the “urgency” requirement that is sometimes associated with interim measures should not be a general feature of interim measures but rather that it should be made a specific requirement for granting an interim measure ex parte. Report of the Working Group on Arbitration on the Work of its Thirty-Seventh Session (New York, May 12–16, 2003), UNCITRAL, 37th Session, UN Doc A/CN.9/523, at 13, para 41 (2003).

44  Paushok (1976 Rules), para 40, reprinted in section 2(C).

45  In addition to the loss of a priceless or unique work of art already mentioned at the previous session (UNCITRAL, 36th Session, UN Doc A/CN.9/508, n 40, at 15, paras 55–56; A/CN.9/545, n 17, para. 29), it was explained that “irreparable harm” would occur, for example, in situations such as a business becoming insolvent, essential evidence being lost, an essential business opportunity (such as the conclusion of a large contract) being lost, or harm being caused to the reputation of a business as a result of a trademark infringement. Report of the Working Group on Arbitration on the Work of its Fortieth Session (New York, February 23–27, 2004), UNCITRAL, 40th Session, UN Doc A/CN.9/547, at 13, para 86 (2004).

46  In the view of some delegations, the term should be used only to refer to a truly irreparable damage such as the loss of a priceless work of art. Other delegations referred to the notion of “irreparable damage” as a means of describing particularly serious types of damage that would outweigh the damage that the party against whom the interim measure would be granted could be expected to suffer if that measure was effectively granted. UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 11, para 29. For an opinion demonstrating the barrier of “irreparable,” see Iran and United States (Case Nos A/15 & A/24) (1983 Tribunal Rules) at para 21, reprinted in section 2(D)(1).

47  It was stated that a reference to “substantial harm” would more easily lend itself to balancing the degree of harm suffered by the applicant if the interim measure was not granted against the degree of harm suffered by the party opposing the measure if that measure was granted. UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 13, para 85–86.

48  UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 13, para 87.

49  UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 13, para 89.

50  See Paushok (1976 Rules), esp paras 45, 68, 69; reprinted in section 2(C).

51  See J Sztucki, Interim Measures in the Hague Court: An Attempt at a Scrutiny, (1983) 221–59.

52  See Bendone-Derossi Intl (1983 Tribunal Rules); Component Builders (1983 Tribunal Rules); Tadjer-Cohen Associates (1983 Tribunal Rules); all reprinted in section 2(D)(1). For more examples and further discussion on the Tribunal's practice, see also D Caron, “Interim Measures of Protection,” n 10, 488–90.

53  Paushok (1976 Rules), para 47, reprinted in section 2(C).

54  See Bendone-Derossi Intl (1983 Tribunal Rules); Component Builders (1983 Tribunal Rules); Tadjer-Cohen Associates (1983 Tribunal Rules); all reprinted in section 2(D)(1); see also Chevron Corp (1976 Rules) Order of February 9, 2011, paras A, D; reprinted in section 2(C).

55  Paushok (1976 Rules), para 55, reprinted in section 2(C).

56  The importance of a “prima facie good case as a cornerstone of an application for interim measures can be seen in three rules which complement this requirement”: (1) the power of the tribunal to “modify, suspend, or terminate an interim measure,” in exceptional cases even of its own initiative (Article 26(5)) (2) the possibility that the applicant furnish security as a condition for the granting of the measure sought (Article 26(6)); and (3) the applicant's liability for “costs and damages” to the other party if later in the proceedings it transpires that the measure should not have been granted in the first place (Article 26(8)). G Petrochilos, “Interim Measures Under the Revised UNCITRAL Arbitration Rules,” n 6. See also section 2(D)(2).

57  See discussion of Article 26(2) in section 2(B)(2). See also Tadjer-Cohen Associates (1983 Tribunal Rules) reprinted in section 2(D)(1).

58  UNCITRAL, 37th Session, UN Doc A/CN.9/523, n 43, at 13–14 para 43; UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 12, para 32. See also EnCana Corp (1976 Rules), para 19; Paushok (Interim order) (1976 Rules), para 46; Chevron Corp (1976 Rules) Order of May 14, 2010, para 3; Chevron Corp (1976 Rules) Order of February 9, 2011, para J; Chevron Corp (1976 Rules) First Interim Award of January 25, 2012, para 4; Chevron Corp (1976 Rules) Second Interim Award of February 16, 2012, para 8; all reprinted in section 2(C).

59  EnCana Corp (1976 Rules), para 11, reprinted in section 2(C).

60  UNCITRAL, 43rd Session, UN Doc A/CN.9/589, n 32, at 8, para 32.

61  It was suggested that explanatory material accompanying article 17 could indicate that the fact that the type of measure contained in subparagraph (d) was not subject to paragraph (3) did not mean that an arbitral tribunal would not examine and weigh the circumstances in determining the appropriateness of ordering the measure. UNCITRAL, 43rd Session, UN Doc A/CN.9/589, n 32, at 8, para 33.

62  1976 UNCITRAL Arbitration Rules, art 26(2), first sentence.

63  See Chapter 24.

64  Report of the Working Group on Arbitration and Conciliation on the Work of its Forty-Fifth Session (Vienna, September 10–14, 2007), UNCITRAL, 47th Session, UN Doc A/CN.9/614, at 11, para 51 (2007). “In order to facilitate the enforcement of interim measures taken by the arbitrators pursuant to paragraph l of this article, paragraph 2 authorizes the arbitrators to establish these measures in the form of interim awards.” Report of the Secretary-General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Addendum 1 (Commentary), UN Doc A/CN.9/112/Add.1 (1975), reprinted in (1976) VII UNCITRAL Ybk 166, 176. See Chevron Corp (1976 Rules), Order of February 9, 2011, para C read with Chevron Corp (1976 Rules), 1st Interim Award of January 25, 2012, para 1; both reprinted in section 2(C).

65  UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 20, para 71.

66  UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 20, para 70.

67  The Working Group noted that maintaining the distinction was potentially confusing in the light of Article 26(5), which recognizes the tribunal's power to modify, suspend or terminate interim measures when necessary. UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 11, para 51. See discussion of Article 26(5) in section 2(B)(6).

68  See Paushok (1976 Rules), terms and conditions of interim order para 15; Chevron Corp (1976 Rules) Order of May 14, 2010, para 2; Chevron Corp (1976 Rules) First Interim Award of January 25, 2012, para 4; Chevron Corp (1976 Rules) Second Interim Award of February 16, 2012, para 7; all reprinted in section 2(C).

69  D Caron, Interim Measures of Protection, n 10, 513.

70  G Petrochilos, n 6. The author notes that Article 26(5) is more carefully drafted than a similar provision contained in article 17G of the Model Law.

71  “It was observed that the words ‘whether in the form of an award or another form’ which appeared in article 17(2) of the UNCITRAL Arbitration Model Law had been deleted from the corresponding article in the revised Rules (article 26 (2)). It was explained that, while in the past some practitioners might have used the form of an award for interim measures with a view to enhancing their enforceability, this no longer had much purpose given that the UNCITRAL Arbitration Model Law now contained provisions permitting enforcement of interim measures regardless of the form in which they were issued. As well, it was noted that issuing an interim measure in the form of an award under the Rules could create confusion, particularly in light of article 26 (5) of the Rules, which permitted the arbitral tribunal to modify or suspend an interim measure.” UNCITRAL, 47th Session, UN Doc A/CN.9/641, n 7, at 10–11 para 51. This strong opinion appears to assume that the potential enforcing jurisdiction has adopted the UNCITRAL Model Law. Although many states indeed have legislation based on the 1985 Model Law, only 17, as of 2012, have such laws based on the Model Law, as amended in 2006.

72  G Petrochilos, “Interim Measures Under the Revised UNCITRAL Arbitration Rules,” n 6, page. See also Chevron Corp (1976 Rules) Order of May 14, 2010, para 1(iv)–(v) (The Tribunal can direct the parties to keep it apprised, in writing and otherwise, of later and/or specific circumstances). See further Islamic Republic of Iran and United States of America (Case Nos A/4 and A/15), reprinted in section 2(D)(1), where the Tribunal ultimately granted an interim order which it had formerly declined to grant, while reserving with the party a right to make a fresh application, upon such an application having been made and on showing change of circumstances that would cause the moving party irreparable injury.

73  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 13, para 36.

74  UNCITRAL, 37th Session, UN Doc A/CN.9/523, n 43, at 15, para 51.

75  However, it was suggested that, in order not to leave too much discretion to the arbitral tribunal acting of its own initiative, paragraph (5) should clearly establish that, while under normal circumstances an interim measure could only be terminated or modified at the request of a party, specific circumstances might justify modification or termination of an interim measure by the arbitral tribunal on its own initiative. The Working Group proposed the following language: “The arbitral tribunal may modify or terminate an interim measure of protection at any time upon application of any party or, in exceptional circumstances, on the tribunal's own initiative, upon prior notice to the parties.” UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 14, para 40.

76  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 13–14, para 37.

77  UNCITRAL, 37th Session, UN Doc A/CN.9/523, n 43, at 15, para 50.

78  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 13–14, para 38.

79  As a matter of drafting, it was pointed out that, whereas article 17 bis (4) referred to “termination, suspension or amendment of that interim measure,” paragraph (6) referred to “modify, suspend or terminate an interim measure.” It was agreed that the texts should be aligned. Preference was expressed for the word “modify” instead of “amend.” UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 27, para 101.

80  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 13–14, para 37. It was recalled that the words “it has granted” were inserted to reflect the decision of the Working Group that the arbitral tribunal could only modify or terminate the interim measure issued by that tribunal (A/CN.9/545, para. 41). On that basis, it was agreed that the words “it has granted” should be retained in the provision. UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 27, paras 102, 104.

81  Since the taking of interim measures may entail “costs of arbitration,” paragraph 2 gives arbitrators the power to require security for such costs. Report of the Secretary-General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Addendum 1 (Commentary), UN Doc A/CN.9/112/Add.1 (1975), reprinted in (1976) VII UNCITRAL Ybk 166, 176. It was stressed that the requirement for appropriate security to be given by the party seeking interim measures was crucial for the acceptability of the provision. Report of the Working Group on Arbitration and Conciliation on the Work of its Thirty-Forth Session (New York, May 21–June 1, 2001), UNCITRAL, 34th Session, UN Doc A/CN.9/487 at 19–20, para 67, 68 (2001).

82  UNCITRAL, 36th Session, UN Doc A/CN.9/508, n 40, at 16–17, para 59. A general view emerged that the granting of security should not be a condition precedent to the granting of an interim measure. It was pointed out that article 17 of the Model Law as well as article 26 (2) of the UNCITRAL Arbitration Rules did not include such a requirement. Report of the Working Group on Arbitration and Conciliation on the Work of its Fortieth Session (New York, February 23–27, 2004), UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 25, para 92.

83  UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 25, para 92.

84  UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 25, para 95–96.

85  UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 12, para 33. See Paushok (Interim order) (1976 Rules), para 90, reprinted in section 2(C). See also Questech, Inc (1983 Tribunal Rules) and Behring Intl, Inc (1983 Tribunal Rules), both reprinted in section 2(D)(2).

86  UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 25, para 93.

87  A concern was expressed that paragraph (6) did not require the requesting party to notify the other party of a material change in the circumstances. The Working Group noted that paragraph (3) of Article 24 of the Model Law, as amended, provided that “all statements, documents or other information supplied to the arbitral tribunal by one party shall be communicated to the other party.” Additionally, Article 18 of the Model Law provided that the parties “shall be treated with equality and each party shall be given a full opportunity of presenting his case.” A concern was expressed that duplication of these principles in draft paragraph (6) could be detrimental and that the issue should instead be addressed in a commentary to the Model Law. After discussion, the Working Group agreed that, notwithstanding the obligations set out in Article 24(3) and Article 18 of the Model Law, it would be useful to require expressly in paragraph (6) that all information supplied to the arbitral tribunal by one party pursuant to that paragraph should also be communicated to the other party. UNCITRAL, 39th Session, UN Doc A/CN.9/545, n 17, at 15, para 45.

88  A suggestion was made that while there was a duty to inform the arbitral tribunal of any material changes in the circumstances affecting the granting of the interim measure, there was no sanction if this duty was breached. In response it was agreed that this matter could adequately be dealt with under paragraph (7). On that basis, no decision was made to change the text of paragraph (6). UNCITRAL, 37th Session, UN Doc A/CN.9/523, n 43, at 15 para 49.

89  UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 116, para 29.

90  Settlement of Commercial Disputes: Revision of the UNCITRAL Arbitration Rules, Note by the Secretariat, UNCITRAL, UN Doc A/CN.9/WG.II/WP.154/Add.1 at 10, para 32 (2009). See also UNCITRAL, 40th Session, UN Doc A/CN.9/547, n 45, at 27, para 106.

91  “Some support was expressed for the inclusion of the words ‘should not have been granted’ at the end of the first sentence of paragraph (8), for the sake of consistency with the approach taken in article 17 G of the UNCITRAL Model Law. Other views supported the second option in paragraph (8) that the measure ‘was not justified’, as it was found to better address the situation where a measure was granted in compliance with all conditions, but was later found to cause damages. After discussion, the Working Group agreed to modify the first sentence of paragraph (8), so that it would read as follows: ‘The party requesting an interim measure may be liable for any costs and damages caused by the measure to any party if the arbitral tribunal later determines that, in the circumstances then prevailing, the measure should not have been granted’. [The Working Group] … also observed that similar provisions were found in some national laws and arbitration rules, and served a useful purpose of indicating to the parties the risks associated with a request for an interim measure.” UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 49, para 10. According to one author, it is presumed that liability will be held only if the requesting party obtained an unjustified measure through “incomplete or misleading information.” J Waincymer “The New UNCITRAL Arbitration Rules: An Introduction and Evaluation” (2010) 14 Vindobona J Intl Commercial L and Arb 223.

92  The Working Group suggested the following paragraph: “the arbitral tribunal may rule at any time on claims for compensation of any damage wrongfully caused by the interim measure or preliminary order.” However, the word “wrongfully” was deleted as it could receive a variety of interpretations and created legal uncertainty. UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 117, para 29.

93  UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 118, para 29.

94  See D Donovan, “The Allocation of Authority Between Courts and Arbitral Tribunals to Order Interim Measures: A Survey of Jurisdictions, the Work of UNCITRAL and a Model Proposal,” in A Berg (ed) New Horizons in International Commercial Arbitration and Beyond (2005). Donovan offers a thorough analysis of different countries’ approaches to the relationship between courts and arbitral tribunals with respect to interim measures.

95  UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 52, para 10. “This provision is based on Article IV of the European Convention on International Commercial Arbitration.” Report of the Secretary-General on the Revised Draft Set of Arbitration Rules, UNCITRAL, 9th Session, Addendum 1 (Commentary), UN Doc A/CN.9/112/Add.1 (1975), reprinted in (1976) VII UNCITRAL Ybk 166, 176.

96  D Caron, “Interim Measures of Protection,” n 10, 507.

97  P Sanders, “Commentary on UNCITRAL Arbitration Rules,” (1977) II Ybk Commercial Arb197.

98  J Castello, “Unveiling the 2010 UNCITRAL Arbitration Rules” (2010) 65 Dispute Resolution J 21.

99  D Caron, “Interim Measures of Protection,” n 10, 506.

100  D Caron, “Interim Measures of Protection,” n 10, 506.

101  Reprinted in section 2(D)(3). For further discussion, see Caron, “Interim Measures of Protection,” n 10, 504–8. See also J van Hof, Commentary on the UNCITRAL Arbitration Rules: The Application by the Iran-U.S. Claims Tribunal (1992) 189. An alternate explanation for the Behring Award was that the interim measures granted of US or Iranian courts were displaced expressly by measures granted by the Tribunal because of the international law undertakings of both states. In particular, it arguably is implicit in the third interim measures award in the Behring arbitration that the Iran–US Claims Tribunal believed that although the claimant had the right to apply for interim measures in a US court, those interim measures by virtue of the Algiers Accords could not contradict those of the Tribunal. D Caron, “Interim Measures of Protection,” n 10, 507, 508.

102  Article 17 B of the 2006 Model Law, as amended, provides:

Article 17 B. Applications for preliminary orders and conditions for granting preliminary orders

  1. (1)  Unless otherwise agreed by the parties, a party may, without notice to any other party, make a request for an interim measure together with an application for a preliminary order directing a party not to frustrate the purpose of the interim measure requested.

  2. (2)  The arbitral tribunal may grant a preliminary order provided it considers that prior disclosure of the request for the interim measure to the party against whom it is directed risks frustrating the purpose of the measure.

  3. (3)  The conditions defined under article 17A apply to any preliminary order, provided that the harm to be assessed under article 17A(1)(a), is the harm likely to result from the order being granted or not.

For discussion on ex parte in the 2006 Amendments to the UNCITRAL Model Law, see UNCITRAL, 36th Session, UN Doc A/CN.9/508, n 40, at 13–23, para 51–94 and UNCITRAL, 37th Session, UN Doc A/CN.9/523, n 43, at 19–23, para 77–94.

103  See Paushok (1976 Rules); Chevron Corp (1976 Rules), both reprinted in section 2(C).

104  See J Castello, “Arbitral Ex Parte Interim Relief: The View in Favor” (2003) 58 Dispute Resolution J 60.

105  J Castello, “Arbitral Ex Parte Interim Relief,” n 104.

106  UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 12, para 56.

107  UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 23, para 103.

108  UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 22, para 101.

109  UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 11, para 54.

110  UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 11, para 55; UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 22, para 101.

111  UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 12, para 59 (2007); UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 23, para 105.

112  UNCITRAL, 47th Session, UN Doc A/CN.9/614, n 2, at 11–12, para 53–60. UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 22–5, para 100–112.

113  UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 23–4, para 106.

114  In the end, no comment was made on this and it will be left to the lex arbitri or other jurisdictional bases. J Waincymer, “The New UNCITRAL Arbitration Rules,”n 91.

115  “If the seat is a Model Law state, this would be an application under Art 17. Where preliminary orders are sought from courts of countries other than the seat, it will be a question of whether the law in that country allows for preliminary orders in aid of foreign-seated proceedings. Other than states that have adopted the 2006 text of the Model Law, few states have laws that permit such measures.” M Skinner, et al, “The UNCITRAL Arbitration Rules 2010,” n 36, 76; The view was also expressed that preliminary orders, in certain jurisdictions, were within the competence of municipal courts, and the procedure for granting such orders contained many safeguards that might not be present to the same extent as in the arbitration procedure. UNCITRAL, 50th Session, UN Doc A/CN.9/614, n 2, at 22, para 102.

116  G Petrochilos, “Interim Measures Under the Revised UNCITRAL Arbitration Rules,” (2010) 28(4) ASA Bulletin 878.

117  L Graham, “Interim Measures: Ongoing Regulation and Practices (A View from the UNCITRAL Arbitration Regime),” in A J Berg (ed), 50 Years of the New York Convention: ICCA International Arbitration Conference (2009); G Petrochilos, “Interim Measures,” n 116.

118  G Petrochilos, “Interim Measures,” n 116.

119  J Castello, “Unveiling the 2010 UNCITRAL Arbitration Rules,” (2010) 65 Dispute Resolution J 21.