No one disputes in today’s world that corruption is “contrary to international public policy.” This has had an impact on international arbitration, where parties are increasingly invoking corruption as a defence to contractual claims. Despite this trend, there is little commentary or jurisprudence to indicate what the consequences of a successful corruption defence should be, whether there are limits to the defence and, if so, where these limits lie. Arbitral tribunals thus face a dilemma: where corruption is present in the procurement or performance of a commercial contract, should tribunals invoke public policy considerations and deny relief to the claimant, or should they nevertheless recognise, in appropriate circumstances, that the equities may demand that the claimant may be granted some form of relief, absent which the respondent would be unjustly enriched?
This article appeared in the 2014 edition of The International Comparative Legal Guide to: International Arbitration; published by Global Legal Group Ltd, London.