Commercial Court provides guidance on “serious irregularity” and confirms arbitral tribunal has jurisdiction to determine contractual rights and obligations in light of criminal conduct

In the recent decision of Interprods Ltd v De La Rue International Ltd [2014] EWHC 68 (Comm), the English Commercial Court dismissed the challenges under sections 67 and 68 of the Arbitration Act 1996 (the Act) against an arbitral award. In this case, the arbitrator held that the defendant (De La Rue) had been entitled to terminate agency agreements with the claimant (Interprods) and was not obliged to pay outstanding commission to it in circumstances where a representative of Interprods had allegedly stated that such commission would be used to pay bribes.

Interprods challenged the award under: (i) section 67 of the Act on the basis that the arbitrator had lacked jurisdiction to make the award in question; and (ii) section 68 of the Act on the basis that there had been serious irregularities in the making of the award.

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