The minimum local contract doctrine

The Swiss Federal Court has heard[1] an application by a corporation domiciled in Guernsey for the attachment of real estate, located in Switzerland, belonging to the Republic of Uzbekistan. Uzbekistan has opposed the application claiming sovereign immunity.

The Applicant argued that its title, an award by a tribunal sitting in Paris, was sufficient to authorize attachment since all the requirements under the New York 1958 Convention existed.

The case has gone from the District Court up to the Supreme Court.

That Court has rejected the application, on the ground that - even the requirements for enforcement of a foreign award are governed by the New York Convention - as to the merits of the application - the issue of admissibility of such an application and therefore of jurisdiction was governed, under art. III of that Convention, by the law of the place where its enforcement was sought.

The Court concluded that, under Swiss law, jurisdiction on such applications exists only if there is a minimum domestic connection of the legal relationship in issue with the Swiss territory, a requirement which in that dispute was not existing.

The application was then dismissed.

 

[1] By judgment 27 September 2018, BGE-5A 942/2017.

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