Cypriot case law from December 2024 onwards has raised important issues of international law, offering significant guidance on international jurisdiction, enforcement of foreign arbitral awards, and state immunity.
1st Decision – Crystal System Group & Dovigo Canzio Maria Giuseppe v Uniformis Consulting S.R.L, Avram Constantin Daniel, Irini Theocharous
(Limassol District Court, 02.12.2024, Action No. 832/2023 – Interim Judgment)
• Subject Matter: Two independent agreements – Service Provision Agreement (21.12.2018) and Call Option Agreement (02.01.2019). The defendant requested referral to arbitration under clause 11.
• Conflicting dispute resolution clauses:
· Clause 11: Referral of the dispute to arbitration.
· Clause 12: Exclusive jurisdiction of Cypriot courts.
· Clause 10.1: Severance clause referring to a “court or administrative body” (not arbitration) to determine invalidity of any clauses.
• Legal framework: Article 8(1) of Law 101/87 – the Court must refer to arbitration only if the arbitration clause is valid, operative and enforceable.
• Findings:
· Orders permitting service outside jurisdiction do not create res judicata.
· The Court retains authority to examine the validity and enforceability of an arbitration clause.
· The request for stay and referral to arbitration was rejected. Arbitration and exclusive jurisdiction clauses must be read together; neither automatically prevails.
· Clauses 10.1, 11 and 12 were found to coexist harmoniously, revealing a shared intention to grant exclusive jurisdiction to the Cypriot Courts for all disputes arising from the agreement. The arbitration clause was optional and alternative, applicable only if both parties mutually agreed to arbitrate – which they had not.
2nd Decision – Marbale Universal Corp & Victor A. Pichugov v Alexey N. Ananiev et al.(Cyprus Court of Appeal, 08.01.2025, Civil Appeal No. 32/2024)
• Subject Matter: Enforcement of three LCIA arbitral awards totaling approximately USD 101 million and GBP 1.19 million. The District Court had dismissed the application for non-compliance with Article IV(1)(b) of the New York Convention.
• Findings:
· The Court of Appeal overturned the lower court’s excessive formalism, holding that a certificate by an English solicitor confirming inspection of the originals, combined with a notarial certification, met Article IV requirements.
· The Convention does not demand undue rigidity — its aim is to facilitate enforcement, not obstruct it through procedural formalism.
· The case was remitted for examination of remaining objections (e.g. insolvency in Russia, public policy).
· The notion of a “duly certified copy” must be interpreted functionally, shifting the burden to the respondent to show valid refusal grounds under Article V.
3rd Decision – Allison Fashion v Republic of Cyprus (Supreme Constitutional Court, 12.05.2025, Case No. 28/2020)
• Subject Matter: Lease of private premises by the Republic for a public service. The issue was whether the contract was public or private/commercial in nature.
• Finding:
· By majority, the Supreme Constitutional Court held it was a private/commercial transaction (acta jure gestionis), despite serving a public purpose.
· The Republic acted as a private contracting party and could not invoke state immunity. Acts of a commercial nature by the State fall under private law and the jurisdiction of the courts.
• This ruling is relevant for enforcement of arbitral awards against states, where state immunity is often raised as a defence. The next (4th) Decision is relevant to this.
4th Decision – Gardabani Holdings B.V. v Georgia (Nicosia District Court, 14.07.2025, General Application No. 5/2022)
• Subject Matter: Recognition and enforcement of a foreign arbitral award (SCC Award) of USD 18.6 million in favour of a foreign company and against the State of Georgia.
• State’s Objections: Pending annulment proceedings in Sweden; award being “partial”; non-commercial nature of the dispute; public policy violation due to parallel ICSID proceedings.
• Findings:
· The award was binding and enforceable under the lex arbitri, even if partial, as it conclusively determined liability and damages.
· The sale of shares in an energy company constituted an acta jure gestionis, so Georgia could not invoke state immunity.
· A parallel ICSID process does not bar enforcement; the New York Convention does not expand Article V exceptions.
· Result: Order for recognition and enforcement granted.
5th Decision – Robert Joseph Gereige v Credit Libanais S.A.L (Limassol District Court, 16.09.2025, Action No. 406/2023)
• Subject Matter: Claim for USD 10 million arising from a fixed deposit in a Lebanese bank. The bank relied on an exclusive jurisdiction clause in Beirut and invoked forum non conveniens.
• Jurisdiction: The Court found that service in Cyprus through an authorized representative (Article 352, Cap. 113) validly established jurisdiction. No leave for out-of-jurisdiction service was required.
• Foreign jurisdiction clause: Applying The Eleftheria and The Fehmarn, the Court reaffirmed that such clauses create a strong presumption for stay, not an absolute rule.
• Forum non conveniens: Applying the Spiliada test, the Court acknowledged Lebanon’s closer factual link to the dispute but accepted that systemic corruption, judicial strikes, capital controls, and lack of access to justice in Lebanon justified Cyprus as the proper forum. The right of access to justice prevails over contractual foreign jurisdiction clauses when compelling evidence shows an inability to secure a fair trial abroad.
Overall Conclusions
• Jurisdiction and access to justice: The right to a fair trial overrides contractual foreign jurisdiction clauses when the foreign forum is ineffective.
• Pro-enforcement bias: Cypriot courts consistently support the New York Convention, applying a narrow interpretation of Article V and a functional approach to Article IV.
• State immunity: Cannot shield states acting as private commercial entities or those having accepted arbitration.
• Arbitration vs judicial jurisdiction: Cypriot courts reaffirm their authority to review the validity, operability, and enforceability of arbitration clauses before ordering a stay.