When Arbitration Agreements Are Ignored, English Courts Will Act

Two recent judgments have confirmed that the English courts have wide powers under section 42 of the Arbitration Act 1996 (the Act) to enforce peremptory orders made by arbitral tribunals and that those powers include the power to enforce anti-suit injunctions.

One of the decisions also confirms that those powers extend to anti-enforcement relief preventing the enforcement abroad of foreign judgments obtained in breach of an arbitration agreement.

The Court of Appeal's and Commercial Court's judgments in EuroChem North-West-2 v Tecnimont S.p.A & MT Russia LLC ([2026] EWCA Civ 5 and [2026] EWHC 255 (Comm)) demonstrate yet again that the English courts will use their coercive powers to protect arbitration agreements and safeguard the integrity of London-seated proceedings.

Background

Pursuant to three underlying contracts, the claimants, Tecnimont S.p.A and MT Russia LLC, were engaged by the defendant, LLC EuroChem North-West-2 (NW2), to build an ammonia plant in Russia. Each contract contained an identical dispute resolution clause providing for ICC arbitration seated in London.  Two of the contracts were governed by English law.

Performance was suspended in May 2022 by the claimants, who contended that EU sanctions imposed on Mr Andrey Melnichenko – the individual held by the courts to own and control NW2 – together with export controls on dual-use goods, made it impossible for them to perform their contractual obligations. NW2 disputed this and purported to terminate the contracts in August 2022, alleging breach of contract. The claimants commenced London arbitration the same month. NW2 counterclaimed for approximately €1 billion in damages.

NW2 and its parent companies ultimately commenced proceedings in the Russian courts. They sued for breach of contract and applied for an-anti-arbitration injunction.  They also obtained an interim measures order seizing approximately €103 million of the claimants' assets.

Parties’ positions

The arbitral tribunal made a series of peremptory orders requiring NW2 to withdraw the Russian proceedings and discharge the interim measures order. NW2 ignored all of them.

The claimants applied to the Commercial Court under section 42 of the Act to enforce those peremptory orders. Butcher J granted the relief in November 2025. NW2 appealed to the Court of Appeal.

NW2’s sole ground of appeal was that the court had no power under section 42 to enforce a peremptory order granting anti-suit relief. It argued that sections 41 and 42 of the Act are concerned only with a party’s conduct of the arbitral reference itself, and that the power to make a peremptory order under section 41(5) is qualified by section 41(1), which refers to "a party’s failure to do something necessary for the proper and expeditious conduct of the arbitration."

Anti-suit injunctions, NW2 contended, enforce the negative covenant in the umbrella arbitration agreement not to litigate in another forum, rather than any obligation arising from the reference itself. They are therefore "external" to the reference and can only be granted by the court in the exercise of its inherent jurisdiction under section 37 of the Senior Courts Act 1981.

The claimants (respondents on appeal) supported the reasoning of Butcher J and additionally argued that, if the appeal were allowed, the same relief should be granted under section 37 of the Senior Courts Act 1981, by way of Respondent’s Notice. They also relied on section 41A of the Act (inserted by the Arbitration Act 2025), which confers equivalent powers on emergency arbitrators without any parallel to the qualifying language in section 41(1), arguing that there is no logical basis for the court’s enforcement powers to be narrower in respect of orders made by a full tribunal than those of an emergency arbitrator.

In the subsequent Commercial Court proceedings, the claimants sought further relief from Dame Clare Moulder DBE, this time targeting the Indian and Malaysian enforcement proceedings.

They applied under section 42 to enforce a further peremptory order of the tribunal requiring NW2 to withdraw those enforcement proceedings. In the alternative, and more broadly, they sought anti-enforcement injunctive relief under section 37, in terms mirroring the wider tribunal order in PO 25.

The claimants argued that the court should grant section 37 relief going beyond the scope of the peremptory orders, to forestall any future enforcement proceedings NW2 might bring, without requiring them to return to the tribunal each time for a fresh peremptory order. NW2 chose not to appear at the hearing.

Courts' reasoning

The Court of Appeal’s judgment (Popplewell, Phillips LJJ and May LJ) is an important authority on the scope of section 42 of the Act. The Court dismissed the appeal unanimously, rejecting both limbs of NW2’s argument:

• On the first limb, Popplewell LJ held that section 41(5) is not qualified by section 41(1). Section 41(5) uses the wide and unqualified words "any order or directions" of the tribunal, and section 41(1) is merely permissive and confirmatory of the principle of party autonomy, not a word of limitation. The amendment introduced by the Arbitration Act 2025, adding section 41A for emergency arbitrators in identical terms but without any equivalent to section 41(1), resolved any residual ambiguity. Parliament cannot have intended the court’s enforcement powers to be narrower for full tribunals than for emergency arbitrators exercising the same powers under the same institutional rules.
• On the second limb, the Court held that compliance with a tribunal’s order is always necessary for the proper and expeditious conduct of the arbitration, as section 40(2)(a) of the Act makes plain. Furthermore, anti-suit relief – and particularly anti-anti-arbitration relief of the kind in issue here, which is designed to prevent proceedings aimed at bringing the arbitration itself to a halt – is obviously capable of being necessary for the conduct of the arbitration. The Court also distinguished the Supreme Court’s obiter observations in AES Ust-Kamenogorsk [2013] UKSC 35, noting that those remarks concerned the negative covenant in the umbrella arbitration agreement and the court’s powers under section 44, not the positive obligation to comply with a tribunal’s order enforceable under section 42.

In the Commercial Court, Dame Clare Moulder DBE applied the Court of Appeal’s reasoning to grant relief under section 42 in respect of the Indian and Malaysian enforcement proceedings. She also addressed, for the first time, the relationship between section 42 of the Act and section 37 of the Senior Courts Act in this context.

Declining to exercise the court’s discretion under section 37 in the broader terms sought, she reasoned that the Act establishes a clear statutory framework: the primary route for enforcing tribunal orders is through the peremptory order mechanism, with the court’s role being to give effect to that process rather than to supplant it.

Where further peremptory orders could readily be obtained from a responsive tribunal – as demonstrated by the tribunal’s ability to issue PO 28 within three days of a request – it was not just and convenient to grant wider section 37 relief that would cut across that framework. The appropriate sanction for breach of the existing court orders was contempt proceedings, not a supplementary injunction.

Commentary

These decisions provide helpful and authoritative guidance on three points of practical importance.

• First, section 42 of the Act is a broad and effective tool for enforcing tribunal orders, including interim anti-suit and anti-enforcement orders, and is not confined to orders relating to the internal management of the arbitral reference.
• Second, the Act 2025 amendments, particularly the introduction of section 41A, have reinforced the statutory basis for this conclusion.
• Third, whilst the court retains its general discretion under section 37, it will be slow to exercise that discretion in a manner that goes beyond the scope of the peremptory orders obtained from the tribunal, where the arbitral process itself is functioning effectively and quickly.

Parties and practitioners should take note. Where a counterparty is pursuing parallel foreign proceedings in breach of a London arbitration clause, the English court stands ready to provide robust and expeditious support. But the primary mechanism for that support lies in the arbitral process itself, and parties should engage the tribunal promptly to obtain the necessary peremptory orders.