Republic of India v Vedanta Resources plc

• Jurisdiction: Singapore
• Judge: Sundaresh Menon CJ
• Judgment Date: 12 May 2021
• Neutral Citation: [2021] SGCA 50
• Published date: 18 May 2021
• Docket Number: Civil Appeal No 51 of 2020
• Year: 2021
• Hearing Date: 08 April 2021
• Plaintiff Counsel: Cavinder Bull SC, Lim Gerui, Tan Yuan Kheng (Chen Yuanqing), Estad Amber Joy and Ong Chee Yeow (Drew & Napier LLC)
• Citation: [2021] SGCA 50
• Defendant Counsel: Yeap Poh Leong Andre SC, Poon Kin Mun Kelvin, Koh En Da Matthew and Leong Yu Chan Alyssa (Rajah & Tann Singapore LLP)
• Court: Court of Appeal (Singapore)
• Subject Matter: Courts and Jurisdiction,Abuse of Process,Confidentiality,Collateral purpose,Documents,Court judgments,Arbitration,Declaratory

Steven Chong JCA (delivering the grounds of decision of the court): Introduction

In the proceedings below, the High Court Judge (“the Judge”) identified one of the key issues before him as whether a party in an arbitration who puts a question of law to a tribunal in an investment treaty arbitration and receives an answer which it does not like, can put the same question before a Singapore court (as the seat court) by way of an application for declaratory relief? In his grounds of decision in Republic of India v Vedanta Resources plc [2020] SGHC 208 (“the GD”) at [100]–[101], the Judge answered the question in the affirmative and consequently found that the application was not an abuse of process. Nonetheless, he decided against exercising his discretion to grant the declaratory relief sought by the appellant.

While the Judge was correct in identifying the above issue, in our view, it was in truth the only relevant issue before the court and we arrived at the opposite conclusion, answering the same question in the negative. In short, this determination was dispositive of the appeal as the appellant did not manage to get past the starting gate. There was thus no necessity for us to examine the other issues which the Judge examined below. Although we agreed with the Judge on his ultimate decision in not granting the declaratory relief, we decided it not as a matter of discretion but rather because we found the application to be an abuse of process on several levels. First, although described as an application for declaratory relief, it was in substance a backdoor appeal against the tribunal’s decision. Second, in its effort to conceal the true nature of the application, the appellant claimed that the purpose of the application was to use our decision (if decided in its favour) “as a persuasive tool to ask the [tribunal] to reconsider its orders”. In essence, the appellant was seeking an advisory opinion from this court in order to “persuade” the tribunal to revisit its decision. As we will explain below, this was an illegitimate basis on which to invoke the jurisdiction of the court. Third, this also meant that the application was a blatant violation of the principle of minimal curial intervention.

In dismissing the appeal on 8 April 2021 with brief grounds, we stated that we would issue our detailed grounds in due course. These are our grounds.

The facts The parties and the arbitrations

The appellant is the Republic of India and the respondent is Vedanta Resources plc, a company incorporated in the United Kingdom. The appellant and the respondent are parties to a Singapore-seated investment treaty arbitration commenced by the respondent against the appellant (“the Vedanta Arbitration”).

Another investment treaty arbitration that was relevant to the present appeal was an arbitration seated in the Netherlands commenced on 22 September 2015 by members of the Cairn Group against the appellant (“the Cairn Arbitration”).

The Vedanta Arbitration and the Cairn Arbitration are separate but related arbitrations arising from a set of tax assessment orders issued by the appellant in 2015. Both the Vedanta Arbitration and the Cairn Arbitration were brought under the Agreement between the Government of the Republic of India and the Government of the United Kingdom of Great Britain and Northern Ireland for the Promotion and Protection of Investments (14 March 1994), (entered into force on 6 January 1995) (“the India-UK BIT”). They were administered by the Permanent Court of Arbitration and conducted pursuant to the Arbitration Rules of the United Nations Commission on International Trade Law 1976 (“the UNCITRAL Rules”).

Given the potential overlap between the Cairn Arbitration and the Vedanta Arbitration, the appellant was concerned about the risk of inconsistent findings by the two tribunals. Thus, the appellant sought to implement a regime to permit cross-disclosure of documents between the two arbitrations.

The cross-disclosure regime in VPO 3

In the Vedanta Arbitration, the appellant initially proposed that the UNCITRAL Rules on Transparency in Treaty-based Investor-State Arbitration (“the UNCITRAL Transparency Rules”) be applied. When the respondent was not agreeable to this proposal, the appellant filed an application to the tribunal in the Vedanta Arbitration (“the Vedanta Tribunal”) requesting, in effect, that the Vedanta Tribunal implement the UNCITRAL Transparency Rules. Both parties then made full submissions on this issue to the Vedanta Tribunal.

Having considered the parties’ submissions, the Vedanta Tribunal rendered its decision on the appropriate cross-disclosure regime in Procedural Order No 3 dated 9 May 2018 (“VPO 3”). In developing this cross-disclosure regime, the Vedanta Tribunal considered three sources of law: (a) the UNCITRAL Rules; (b) the India-UK BIT and public international law; and (c) the law of the seat, ie, Singapore law. In relation to the first two sources of law, the Vedanta Tribunal concluded that there was no general obligation of confidentiality under the UNCITRAL Rules and the India-UK BIT, although “there [was] a recognised public interest in investment treaty arbitrations and … an interest in allowing greater transparency of such proceedings”.

In relation to Singapore law, the Vedanta Tribunal cited the High Court’s decision in AAY and others v AAZ [2011] 1 SLR 1093 (“AAY”) and found that an implied obligation of confidentiality applied in every arbitration governed by Singapore procedural law, subject to several exceptions. One such exception was where the public interest or the interests of justice required disclosure. Applying this exception, the Vedanta Tribunal developed a “new independent exception … specifically to cover investment treaty arbitrations”. In the Vedanta Tribunal’s view, such an exception could be applied together with its inherent power under Art 15.1 of the UNCITRAL Rules to “design a confidentiality regime customized for the particular circumstances of the case”. This resulted in the pronouncement of the following cross-disclosure regime: 129.4 The Parties are at liberty to apply (supported by brief reasons) for the disclosure of any specific, identified document to the Cairn Arbitration, after having first consulted the other Party with a view to reaching a mutual agreement on such disclosure and/or any redactions. If a Party makes frivolous, unnecessary, and/or excessive requests for cross-disclosures or if the other Party unreasonably or unjustifiably withholds its consent to a request for cross-disclosure, the Tribunal will take such conduct into account in the allocation of costs, at the appropriate stage of the arbitration. [emphasis in original]

The parties’ conduct following VPO 3

Following the issuance of VPO 3, the appellant applied on two occasions to the Vedanta Tribunal for cross-disclosure of certain documents from the Vedanta Arbitration into the Cairn Arbitration.

First, on 14 May 2018, the appellant applied to disclose the following documents: (a) a decision issued by the Vedanta Tribunal on 27 December 2017 regarding the appellant’s jurisdictional objections (“the Partial Award”); (b) memorials and related materials, with accompanying evidence; and (c) the transcripts of the hearings held in the Vedanta Arbitration relating to the Partial Award. On 21 June 2018, the Vedanta Tribunal issued Procedural Order No 6 (“VPO 6”) allowing only the disclosure of the Partial Award.

Second, on 26 August 2018, the appellant made another application to disclose a portion of the transcript in the Vedanta Arbitration which recorded the parties’ submissions on jurisdiction. This was rejected by the Vedanta Tribunal on 11 September 2018 in Procedural Order No 7 (“VPO 7”).

The application for declaratory relief

On 10 August 2018, after the Vedanta Tribunal had issued VPO 6 and while waiting for the Vedanta Tribunal to issue VPO 7, the appellant filed HC/OS 980/2018 (“OS 980”) in the High Court, seeking the following declarations: 1. A declaration that documents disclosed or generated in [the Vedanta Arbitration] are not confidential or private; 2. A declaration that disclosure of documents disclosed or generated in the Vedanta Arbitration, including the documents set out in the Schedule herein, by the [appellant] in [the Cairn Arbitration] would not be in breach of any obligation of confidentiality or privacy;

…

The decision below

In his decision below, the Judge first rejected the respondent’s preliminary objection that the application amounted to an abuse of process and a collateral attack on VPO 3, VPO 6 and VPO 7 (collectively, “the VPOs”). The Judge reasoned as follows (see the GD at [100]–[101]). Although the UNCITRAL Model Law on International Commercial Arbitration (“the Model Law”) as set out in the First Schedule to the International Arbitration Act (Cap 143A, 2002 Rev Ed) (“IAA”) applied to the Vedanta Arbitration (see the GD at [69]), Art 5 of the Model Law did not preclude the grant of the declaration sought. This was because the declarations did not engage a matter governed by the Model Law and did not amount to inviting the court to intervene in the arbitration. This was especially since the appellant had given the court an undertaking that if the declarations were granted, it would not unilaterally bypass the Vedanta Tribunal to make cross-disclosure of the relevant documents but instead it would rely on the declarations to request the Vedanta Tribunal to reconsider and revise the VPOs (“the Undertaking”) (see the GD at [79]). Furthermore, as the VPOs were procedural in nature, they did not create any issue estoppel. The fact that the relief sought by the appellant restated a question of law which the Vedanta Tribunal had answered in VPO 3 did not make the application in and of itself an abuse of process or an impermissible collateral attack.

However, the...