Versailles Court of Appeal, 6 April 2018, Syndicat Mixte des aéroports de Charente (SMAC) v. Ryanair Designated Activity Company and Airport Marketing Services, no. 17/03565

SMAC, a public company, concluded two contracts with Ryanair Limited and Airport Marketing Services Limited (AMS), two Ireland based companies. These contracts related to the opening of an air route between Angouleme and London and advertising services. Both contracts contained an LCIA arbitration clause.

A dispute being arisen between the parties, Ryanair Limited and AMS initiated arbitration. The sole arbitrator, in a partial award rendered on 22 July 2011, upheld his jurisdiction and declares the clauses valid. He rejected the request of SMAC to suspend the proceeding till the decision of the French administrative courts.

The award obtaining the exequatur on 21 May 2012, SMAC appealed it on 22 June. At the same time, SMAC brought an action before the French Conseil d’Etat to have the partial award annulled or, alternatively, to have it declared neither recognizable nor enforceable in France.

Within the appeal proceedings, the prefect of Paris filed a jurisdictional objection. He pretended that the control of the compliance with rules of public policy cannot fall within the jurisdiction of the judicial courts when the dispute submitted to the arbitration concerned the execution of a public procurement contract.

The court of appeal, in a judgment dated 8 November 2016, declared the objection admissible, concluded to the lack of jurisdiction of the judicial courts and set aside the exequatur. The court refers to the French Tribunal des conflits to decide on the jurisdiction. Ryanair and AMS seize the French Cour de Cassation.

The French Cour de Cassation, in a judgment of 8 July 2015, annulled the appeal’s judgment. It noted that the New York Convention of 10 June 1958 applicable to the exequatur in France of an award made in London prohibited any discrimination between foreign awards and national awards as well as any revision of the merits. Therefore, the court of appeal, which declined the jurisdiction of the judicial courts and overturned the exequatur, violated the convention, which is part of the arbitral legal order.

The parties return before the Versailles Court of Appeal, which leaves the proceedings pending the decision of the French Tribunal des conflits. The French Tribunal des conflits had to answer the following question: “Within the jurisdiction of judicial courts or administrative courts does the enforcement of an award rendered abroad in a dispute born (…) in reference with a contract concluded between a French public company and a foreign company, executed on the French territory and concerning the interests of the international trade but constituting a public market of services (…), fall?”

The French Tribunal des conflits stated, in a judgment of 24 April 2017, that the administrative court had jurisdiction to hear Ryanair’s claims for the exequatur proceeding. It considered that in the case where the contract was subject to the imperative rules of French public law related to the public domain or those which governed the public policy, the set-aside action against the award and the appeal of the exequatur fell within the jurisdiction of the administrative courts.

Versailles Court of Appeal here complies with the position of the French Tribunal des conflits. The Court declares that the judicial courts have no jurisdiction and set aside the exequatur of the partial award.

2018-06-27T22:25:43+00:00 April 6th, 2018|Court of Appeal, Versailles Court of Appeal|0 Comments

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