International Arbitration Newsletter - December 2018 | Regional Overview: Asia Pacific

AUSTRALIA

Australian biotech loses SIAC arbitration against Indian lab

Australian biotech company Phosphagenics has lost a US$300 million SIAC claim against Mylan Laboratories, an Indian subsidiary of US-based Mylan Incorporated, over the development of a medicine designed to treat skin and bloodstream infections.

The underlying dispute concerns TPM-daptomycin, a formulation aimed at treating skin and bloodstream infections, and the agreement entered into by both parties for research and licensing of the product in 2011 and 2012. The Australian company accused Mylan of breaches of the agreements as well as fraudulent or negligent misrepresentations, breaches of confidence and unjust enrichment.

CHINA

Fifteen Chinese law firms appointed on panel for Belt and Road

China’s Ministry of Commerce has announced its appointment of 15 Chinese law firms to make up  a panel to provide advice on the structuring of Chinese overseas investment, relevant laws and regulations and arising issues. This appointment was based on a tender and bid evaluation process.

HONG KONG

Hong Kong Court remittes back irregular HIAK award

In a judgment dated 9 October 2018, the Hong Kong Court of First Instance has partially remitted an HKIAC award in a construction dispute to a sole arbitrator for reconsideration.

The underlying dispute, whose parties remain secret, engaged in a construction contract incorporating general conditions of contract in the Hong Kong standard form contract, including a regime requiring notification of claims for loss and expense before such claims are filed. It also included an arbitration agreement providing for domestic arbitration under HKIAC rules in Hong Kong. 

Following a dispute, two arbitrations were commenced and consolidated before a sole arbitrator, but opponents request the award to be set aside on grounds that the tribunal had exceeded its powers or failed to conduct arbitral proceedings in accordance with the parties’ agreed procedure.In her ruling, the judge said the award was marred by serious irregularity

PAPUA NEW GUINEA

Oil companies to file arbitration on gas dispute against Papua New Guinea

Spain’s Repsol and its Australian partner Horizon Oil have filed a notice of intent to arbitrate against Papua New Guinea in a dispute under a gas development agreement, as required under Papua New Guinea’s Claims By and Against the State Act 1996.

The dispute relates to the state’s alleged attempt to terminate a US$300 million agreement for the development of a gas and condensate field, based in the country’s Western Province.After repeatedly expressing frustration about the rate of progress with the project, Papua New Guinea submitted a notice in March this year signalling its intent to cancel petroleum development and pipeline licences it had issued for the Stanley field in 2014.

TURKMENISTAN

Turkmenistan to start arbitration in potash plant dispute

The Turkmenistan President has announced that the state will begin arbitration against Belarusian company Belgorkhimprom alleging delays in the construction of a US$1 billion potash fertiliser plant.

The dispute relates to a series of contractual claims based on Belgorkhimprom’s alleged failure to meet the construction schedule for the plant, while Belarusian officials have accused the state of failing to pay for completed construction work. It is unclear where the dispute will be heard and under what rules.

UZBEKISTAN

Uzbekistan held liable in Turkish gas market seizure claim

An ICSID tribunal has found Uzbekistan to be liable in a case brought by Turkish electrical services company Federal Elektrik Yatırım and three other claimants under the 1992 Turkey-Uzbekistan bilateral investment treaty and the Energy Charter Treaty over the seizure of its investment in the country’s domestic gas market and alleged human rights abuses.

The dispute relates to a series of contracts signed by the investors with the Uzbek state entities to upgrade the country’s domestic gas market to a metered system.

In the treaty claim, Federal Elektrik accused the Uzbek government of effectively taking control of the joint venture and its assets in the country in early 2011 and arresting the venture’s chief executive Asım Kayan, who is also a party to the claim.