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In October 2017, the Supreme Court issued its judgment in Taurus Petroleum v SOMO  UKSC 64. The judgment laid down important principles for enforcement of international arbitration awards, especially in regards to Letters of Credit.
So what options are available to you when enforcing? Well, in England, a multitude of options (each with their own benefits/risks) are available. These include:
In Taurus Petroleum, the Supreme Court approved the issuance of a TPDO for a foreign arbitration award against a Letter of Credit issued in favour of the debtor that had an English issuing bank (position would be the same if there was also an English confirming bank), even where the LoC in question was payable into a foreign bank account.
However, a TPDO against a Letter of Credit will not be granted if it is issued/confirmed: (1) by a foreign bank; (2) a foreign branch of an English bank; (3) Overseas branch of foreign bank that also has an English branch; (4) Foreign entity in a banking group that also included English entities in the wider group.
The judgment should now make it possible to enforce arbitral awards against Letters of Credit issued or confirmed by English banks, even where they are payable into an overseas account. Now for the next hurdle: tracking down the letters of credit!
This blog post is based on a talk given to the Club’s claims handlers by Alistair Wooder, counsel at 20 Essex Street.
The Link to the judgement can be found here