Published on July 22nd, 2014 | by Maria Psarra0
International public policy and suspension of enforcement of an ICC award on the grounds of corruption
DECISION NUMBER: 595/2014
COURT: Court of Appeal of Athens
LEVEL: Appellate Court
PUBLISHED IN: T.N.P. ISOKRATIS (D.S.A.)
A. FACTS OF THE CASE
The proceedings before the International Court of Arbitration of the International Chamber of Commerce (hereinafter ICC) related to a contract for supply of security systems, commonly known as C4I, for the Olympic Games held in Athens in 2004. The contract was concluded between the Hellenic Republic and the ‘Contractor’, a foreign company which has its seat in the US. Immediately after the conclusion of the contract, the Contractor subcontracted the execution of the most functional and economically important part of the project, corresponding to 71% of the total project budget, to a Greek subsidiary – the ‘Subcontractor’ – of a German engineering and electronics conglomerate company (Siemens). The performance of the contract did not progress smoothly. Specifically, the project was not completed on time, resulting, under the pressure of lack of time, to the acceptance of certain subsystems for use during the Olympic Games, despite the initial commitment of the contractor to deliver the project as a whole. Finally, by a series of amendments to the contract the delivery day was set on 29-10-2008, i.e. after the lapse of more than four years after the Olympic Games.
Finally, at the request of the Contractor, the dispute that arose was resolved by the ICC. Τhe arbitral tribunal rejected the plea of nullity of the contract raised by the Hellenic Republic pursuant to a) Law 2957/2001 (Government Gazette A 260/12.11.2001) for the ratification of the Council of Europe Civil Law Convention on Corruption, signed in Strasbourg on 4 November 1999, (b) in accordance with Articles 147 and 149 Civil Code, (c) in accordance with Articles 174, 178 and 179 of Civil Code and (d) pursuant to Law 5227/1931 “on intermediaries” and by a final decision on 02.07.2013 partially upheld the claims of the Contractor and ordered the Hellenic Republic to pay the Contractor the total amount of 39,818,595 euros (the rest of the amount due for the execution of the contract, compensation and VAT) plus statutory interest from the service of the award.
In the light of the above, the Hellenic Republic filed to the Court of Appeal of Athens an application for suspension of execution of the 2-7-2013 (CASE – ICC) final decision of the ICC, pending the decision on the application for annulment that the Hellenic Republic had filed before the said Court, invoking, among others, that the execution of the arbitral award is contrary tointernational public policy.
C. LEGAL BASIS