U.S. Court Affirms Annulled Arbitration Award

On August 2, 2016, in Corporación Mexicana De Mantenimiento Integral, S. De R.L. De C.V. v. Pemex-Exploración Y Producción, the United States Court of Appeals for the Second Circuit, confirmed an international arbitration Award issued in Mexico even though the Award was annulled by the courts in the seat of the arbitration. The Court confirmed the Award because “giving effect to the subsequent nullification of the award in Mexico would run counter to United States public policy and would… be repugnant to fundamental notions of what is decent and just.” The Mexican court’s annulment of the Award was based on “retroactive legislation that cancels existing contract rights” that “amounted to [‘an unconstitutional’] taking of private property without compensation for the benefit of the government.”