English courts have demonstrated a willingness to grant anti-suit injunctions restraining parties from pursuing or continuing proceedings before Russian courts, where doing so would breach a binding arbitration agreement. The UK Supreme Court's 2024 decision in UniCredit v RusChemAlliance confirmed the jurisdictional and equitable basis on which such relief can be sought, even in circumstances involving significant geopolitical complexity. For international businesses and investors facing the threat of Russian proceedings, understanding this remedy – its scope, its limitations, and the risks that accompany it – is essential before any strategic decisions are made.
Why Anti-Suit Injunctions Have Become a Critical Tool
Since the onset of heightened geopolitical tensions involving Russia, a notable pattern has emerged in commercial disputes: Russian counterparties, or entities subject to Russian jurisdiction, have initiated or threatened to initiate proceedings before Russian courts, often in direct contradiction of arbitration clauses specifying London, Paris, or other Western seats. This creates an acute problem for creditors and contractual counterparties who have carefully negotiated dispute resolution mechanisms into their agreements.
The anti-suit injunction – an equitable remedy issued by the English High Court restraining a party from commencing or continuing foreign proceedings – has become one of the primary weapons available to those seeking to preserve the integrity of their arbitration agreements. The remedy does not purport to bind the foreign court itself; it operates in personam, meaning it compels the respondent, rather than the foreign tribunal, to desist. Its force depends entirely on the court's ability to reach the respondent and, ultimately, on the enforceability of any consequential measures.
If your business is facing a situation in which a counterparty has commenced proceedings in Russia in breach of an arbitration clause, or where such a risk appears imminent, early legal advice is critical. You are welcome to contact us at info@ferrazwhitmore.com or through our contacts page to discuss the options available in your specific circumstances.
The Legal Framework: Jurisdiction and Equitable Grounds
The English courts' jurisdiction to grant anti-suit injunctions in support of arbitration is grounded primarily in section 37 of the Senior Courts Act 1981, which confers a broad power to grant injunctions where it is just and convenient to do so. In the arbitration context, section 44 of the Arbitration Act 1996 provides an additional statutory basis, allowing the court to grant interim relief in support of arbitral proceedings. The two routes are not mutually exclusive, and the court's choice of jurisdictional basis carries practical consequences for the conditions that must be satisfied.
Beyond jurisdiction, the applicant must demonstrate that:
- there is a valid arbitration agreement to which the parties are bound;
- the respondent has commenced or threatens to commence proceedings in a foreign court in breach of that agreement;
- England and Wales is an appropriate forum to grant the relief (which may turn on the governing law of the arbitration agreement, the seat of arbitration, or the respondent's connection to the jurisdiction); and
- the balance of convenience and justice favours the grant of the injunction.
Courts will also consider whether damages would be an adequate remedy, though in most arbitration-clause cases the answer is no: the very purpose of the agreed forum is being subverted, and monetary compensation cannot easily replicate access to the chosen dispute resolution mechanism.
UniCredit v RusChemAlliance: What the Supreme Court Decided
The UK Supreme Court's 2024 ruling in UniCredit v RusChemAlliance is the leading authority on the grant of anti-suit injunctions in the Russian proceedings context. The case involved bonds governed by English law, with ICC arbitration clauses specifying Paris as the seat – yet RusChemAlliance had initiated proceedings before Russian courts. UniCredit sought an anti-suit injunction from the English High Court.
The Supreme Court's judgment addressed a number of important questions that had generated uncertainty in the lower courts and among practitioners. Most significantly, the Court confirmed that the English courts can grant anti-suit injunctions in support of foreign-seated arbitrations, provided the arbitration agreement is itself governed by English law. This is a consequential holding: it extends the reach of English equitable relief beyond cases where London is the seat, anchoring jurisdiction in the governing law of the arbitration clause rather than the place of arbitration.
The decision also engaged with the difficulties created by the current sanctions environment. RusChemAlliance is a Russian entity, and considerations relating to the Office of Financial Sanctions Implementation (OFSI) and the broader UK sanctions framework are therefore relevant to how parties may engage with or enforce orders in such cases. The interplay between sanctions compliance and the mechanics of litigation – including the ability to instruct English lawyers – formed part of the factual and procedural backdrop of the case.
For a detailed discussion of the fallout from this decision and its practical consequences for creditors and counterparties, see our dedicated alert: UniCredit v RusChemAlliance – Anti-Suit Injunction Fallout (United Kingdom).
Open Questions and Interpretive Challenges
Notwithstanding the clarity that the Supreme Court's ruling provides on jurisdiction, a number of open questions remain for practitioners navigating this terrain.
Enforceability against Russian entities. An anti-suit injunction operates in personam. Where the respondent has no assets in England, no ongoing business here, and no meaningful exposure to English court processes, the practical leverage of the order is limited. Enforcement mechanisms – including contempt of court proceedings and the potential seizure of assets within the jurisdiction – require the respondent to have something at stake in England. Asset-freezing orders (sometimes called Mareva injunctions) can be sought in parallel where assets are identifiable, but this depends on locating and preserving those assets before they are dissipated.
Sanctions compliance and legal privilege. Parties wishing to litigate against Russian entities must navigate the UK sanctions regime carefully. The FCA and OFSI both issue guidance on what activities require licences. Acting for or against a designated person, or facilitating the provision of legal services, may engage sanctions provisions in ways that require specific authorisation. This is not merely a procedural footnote: it affects the ability of solicitors and barristers to accept instructions, and the ability of clients to pay for legal services without inadvertently triggering a sanctions breach.
The governing law question. The Supreme Court's analysis in UniCredit v RusChemAlliance turned significantly on the governing law of the arbitration agreement. Where this is not English law – for instance, where the contract as a whole and the arbitration clause are governed by the law of a third country – the English court's ability to grant the injunction may be more constrained. Parties should review their contracts carefully to determine whether the arbitration clause itself has been given a separate governing law.
Parallel proceedings and the risk of conflicting orders. Russian courts have, in certain cases, issued their own anti-suit injunctions or orders restraining parties from pursuing foreign proceedings. This creates the possibility of directly conflicting orders binding the same party in different jurisdictions simultaneously. The CPR does not provide a ready-made mechanism for resolving such conflicts, and parties may find themselves in a situation where compliance with one order necessarily involves breach of another.
Practical Impact: Debt Recovery, Unpaid Invoices and Asset Enforcement
For creditors dealing with unpaid invoices, outstanding debt, or a counterparty that has defaulted on a payment obligation, the Russian proceedings problem takes on a specific character. A Russian counterparty may commence proceedings in Russia seeking a declaration that nothing is owed, or claiming that the underlying contract has been frustrated by sanctions or force majeure events. Simultaneously, the creditor may be pursuing debt collection through English arbitration or litigation.
In this scenario, an anti-suit injunction sought promptly from the English High Court can be a decisive step in preserving the arbitration process and preventing a Russian court from issuing a judgment that might be used to complicate enforcement elsewhere. The payment order mechanism available in English courts, and the broader civil enforcement framework under the CPR, can work in tandem with injunctive relief to secure the creditor's position.
Late payment interest, contractual penalties, and other monetary claims do not disappear because a counterparty commences foreign proceedings. However, the enforceability of any eventual English award or judgment against a Russian entity will depend on the location and nature of its assets. Companies House records, banking relationships, and shareholdings in non-Russian subsidiaries may all be relevant to enforcement planning. Our debt recovery services in the United Kingdom cover the full lifecycle of these claims, from initial demand through to post-judgment enforcement.
Where a counterparty is insolvent or at risk of insolvency, the analysis shifts further. Cross-border insolvency proceedings, the recognition of foreign insolvency orders, and the ranking of creditors in restructuring scenarios each raise distinct issues. Our bankruptcy and restructuring practice in the United Kingdom addresses these overlapping concerns.
If you are a creditor or investor dealing with a counterparty that has initiated or threatened Russian proceedings in breach of an arbitration clause, we encourage you to reach out for an initial discussion. Write to us at info@ferrazwhitmore.com or visit our contacts page.
Strategic Recommendations for International Clients
Based on the current state of the law and the practical realities of the enforcement landscape, the following considerations are relevant to any client navigating this area.
- Act promptly. Anti-suit injunctions are more easily obtained before the foreign proceedings are well advanced. Courts are more reluctant to grant relief where a respondent has already obtained a foreign judgment, and delay can be treated as acquiescence. As soon as a party becomes aware of Russian proceedings or their threat, legal advice should be sought without delay.
- Audit the arbitration clause. Before applying for relief, review the arbitration agreement carefully: its governing law, the seat, the chosen institution, and any conditions precedent to arbitration. Weaknesses in the clause may undermine the application.
- Map the respondent's assets. The practical force of an anti-suit injunction depends on enforcement leverage. Identify any assets that the respondent holds in England or in jurisdictions that will recognise English orders.
- Check the sanctions position. Before instructing lawyers and before any substantive steps, confirm that the proposed actions are consistent with the UK sanctions regime. OFSI licences may be required; acting without them carries serious criminal and regulatory risk.
- Consider parallel interim relief. An asset-freezing order may be sought alongside an anti-suit injunction where there is a real risk of dissipation of assets. The two applications can often be made on the same without-notice basis in urgent circumstances.
- Anticipate the enforcement challenge. Even a successful anti-suit injunction and arbitral award will require enforcement. Develop an enforcement strategy early, identifying jurisdictions where the counterparty has economic exposure.
Cross-Border Implications and the Broader Landscape
The English courts' approach to anti-suit injunctions does not exist in isolation. Other Western jurisdictions have grappled with similar questions, and the responses have not been uniform. French courts, for instance, have historically been more cautious about anti-suit relief, though French-seated arbitrations have their own protective mechanisms. The position in civil law jurisdictions within the European Union is further complicated by the legacy of the West Tankers jurisprudence and the treatment of arbitration agreements under the Brussels Recast Regulation – questions that post-Brexit England is no longer bound by in the same way.
England's departure from the EU has, paradoxically, given the English courts greater flexibility in granting anti-suit injunctions against EU-domiciled parties who bring proceedings in EU member state courts. The reciprocal constraints that once applied under the Brussels regime no longer bind English judges. In the Russian context, this is less directly relevant, but the broader point – that English courts have re-asserted their equitable jurisdiction in this area – is significant for forum selection decisions going forward.
The Arbitration Act 1996 is itself under review, and reform proposals have considered, among other things, whether to codify and clarify the courts' powers in relation to foreign-seated arbitrations. Any legislative changes that emerge from this process may affect the framework described in this article. Clients with long-term contracts containing arbitration clauses are advised to monitor developments and to seek advice if uncertainty arises about the applicability of future changes to their existing agreements.
Outlook
The tension between Russian courts and Western arbitral institutions is unlikely to diminish in the near term. If anything, the pattern of Russian entities seeking to use domestic court proceedings to frustrate arbitration clauses or to obtain anti-enforcement injunctions of their own may intensify as commercial disputes arising from the events of recent years work their way through the dispute resolution system. The English courts' confirmation in UniCredit v RusChemAlliance that anti-suit relief is available even for foreign-seated arbitrations governed by English law is a significant development that strengthens the position of creditors and arbitration claimants.
At the same time, the limits of the remedy should not be underestimated. An injunction that cannot be enforced provides limited protection in practice. The most effective strategies will combine injunctive relief with careful asset identification, proactive engagement with the sanctions compliance framework, and a realistic appraisal of where and how an eventual award can be turned into recoverable value.
Ferraz & Whitmore advises international clients on cross-border dispute resolution strategy, debt recovery and enforcement in the United Kingdom and across multiple jurisdictions. If you are considering an application for an anti-suit injunction, dealing with an unpaid invoice or seeking to enforce an arbitral award against a Russian counterparty, our team is available to discuss your position. Contact us at info@ferrazwhitmore.com or via our contacts page.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.