ICC Arbitral Award — Enforcement Against Chinese SOE

Background: A European engineering consortium obtained an ICC arbitral award of $18.5 million against a Chinese state-owned enterprise in a construction dispute. The SOE resisted payment, challenging the award on multiple grounds including arbitrability and public policy.

Challenge: The debtor was a centrally-administered state-owned enterprise with significant political connections. It mounted an aggressive defense, arguing that enforcement would violate Chinese public policy because the underlying project involved national infrastructure.

Strategy: We filed the enforcement application with the Beijing No. 4 Intermediate People’s Court. Our submissions meticulously distinguished between mandatory Chinese regulatory rules (which do not constitute public policy under New York Convention jurisprudence) and genuine public policy concerns. We simultaneously conducted asset tracing and identified significant receivables owed to the SOE by provincial government entities.

Outcome: The court rejected all of the SOE’s objections and granted enforcement. We successfully attached the government receivables, recovering the full award amount plus accrued interest over twelve months through structured payments.

Significance: The case reinforced China’s pro-enforcement stance under the New York Convention, even against politically connected state-owned entities.