The conference officially began with a detailed panel discussion on “Unsettled Legal Doctrines” namely, Iura Novit Curia, Precedent and Res Judicata in international commercial arbitration.
The panel was moderated by Mr. Kevin Nash, Director General, LCIA, London, and empanelled by esteemed professionals namely, Dr. Alexander Milionis, Attorney, Niedermüller, Lichtenstein; Ms. Eleni Lentziou, Senior Associate, CGA, Nicosia; Mr. Christodoulos Christodoulou, Senior Associate, Chrysostomides Advocates, Nicosia; Mr. Kyriakos Pittas, Partner, Soteris Pittas, Limassol.
Read Part 1 Here: Walking the tightrope between procedural fairness and judicial initiative: Cyprus Arbitration Day 2026 Unpacks Iura Novit Curia
In the second part of the panel discussion, Mr. Christodoulos Christodoulou and Mr. Kyriakos Pittas delved into the applicability and relevance of precedent and res judicata in arbitration.
Panel 1: Unsettled Legal Doctrines — Precedent and Res Judicata
Introducing the topic, Mr. Kevin Nash noted that while arbitration generally does not recognize binding judicial precedent, prior court judgments still matter through doctrines such as res judicata, public policy considerations, and enforcement challenges.
Mr. Kyriakos Pittas
At the outset, Mr. Pittas began by emphasizing that arbitral tribunals are structurally independent from national court systems and are not part of a hierarchical judicial framework. Consequently, arbitration generally does not recognize binding precedents in the traditional judicial sense. However, he stressed that arbitration is not isolated from national legal systems, rather tribunals are indirectly constrained by external legal orders, particularly through the doctrine of res judicata, public policy considerations, and judicial review during enforcement. Therefore, the debate is therefore less about judicial authority and more about “finality and legal effect.”
Res Judicata in International Arbitration:
Mr. Pittas explained that res judicata is widely recognized internationally as a mechanism to ensure the finality of judgments. While national courts typically apply their own domestic law to determine the scope of res judicata, arbitration presents a more complex scenario because tribunals operate across multiple legal systems simultaneously, and the rules governing may vary considerably. This creates a “conflict of laws problem,” where the central issue is not whether res judicata applies, but rather which legal system governs the scope and effect of the doctrine.
He added that in international arbitration, the determination of “conflict of rules” that apply to res judicata depends on whether the doctrine is classified as a substantive matter or a procedural one.
Means of Applicability:
Referring to the recommendations issued by the International Law Association in its 72nd Conference (2006), which proposed treating the positive effect of the prior judgment as substantive and the negative effect as procedural. However, he argued that this distinction was unpredictable because the positive effect of the res judicata might have procedural or substantive nature depending on the content.
He further argued against the viability of both approaches. Neither the comparative law approach wherein different national laws are compared to determine the generally accepted res judicata principles, nor the recognition approach wherein an international arbitrator examines whether the prior court judgment in question is capable of being recognized at the seat of arbitration.
Thereafter, Mr. Pittas mentioned a suggested “transnational conflict of laws rule,” under which tribunals would apply the res judicata rules of a prior judgment under such rules of law agreed upon by the parties, or in the absence of such agreement, the tribunal shall apply the law of that State where the prior judgment was issued. He stated that this approach aimed to enhance predictability, respect national legal systems, and avoid complex characterization disputes.
Nevertheless, he cautioned that such an approach may:
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Transcend the national laws of the seat of arbitration regarding recognition and enforcement of foreign judgments
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Transcend public policy considerations, especially of the prior judgment in question
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Underestimate enforcement-stage divergence and the possibility of inconsistent outcomes across jurisdictions.
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Case Study: Saipem S.p.A. v. People’s Republic of Bangladesh1:
Illustrating the well-known case of Saipem v. Bangladesh, Mr. Pittas explained that in this case, Saipem initiated ICC arbitration proceedings in Bangladesh against a state-owned entity. During the arbitration proceedings, the Bangladesh Supreme Court revoked the ICC tribunal’s authority to conduct proceedings by granting injunction to the State. Despite this decision, the ICC proceeded with the arbitration, essentially under a transnational approach, treating the Bangladeshi court decision as abusive.
The resulting arbitral award, passed in favour of Saipem, was later declared “non-existent” by the Supreme Court due to the revocation of ICC’s authority. Aggrieved, Saipem pursued bilateral investment treaty arbitration before International Center for Settlement of Investment Disputes, which found that Bangladesh’s judicial actions amounted to illegal expropriation.
Thus, according to Mr. Pittas, the case demonstrates that even transnational approaches cannot eliminate enforcement-stage conflicts, particularly where public policy concerns and competing judicial systems intervene.
“If we were to move away from the traditional conflict of laws approach, the use of a transnational approach to govern issues such as that of res judicata is not perfect because considerations of public policy as well as other considerations that may arise at the enforcement stage will still be extremely relevant.”
In his concluding observations, he suggested that a practical solution could be to adopt transnational rule but warned that this might not prevent the obstacles that may arise at the enforcement stage and their predictability. He also remarked that, “Usually, court judgments issued in proceedings parallel to the arbitration are often less about obtaining substantive relief and more about manufacturing future procedural objections which can be used at the enforcement stage.”
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Thus, he stated that the challenge for international arbitration is to manage this procedural fragmentation across the competing systems before enforcement even occurs.
Taking the discussion forward, Mr. Nash asked Mr. Pittas about how parties strategically use court proceedings and res judicata arguments to complicate or derail arbitration or block enforcement of awards. In response to this, Mr. Pittas mentioned a few common tactics:
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Initiating parallel court proceedings to obtain judgments before the arbitration to alter argue on the point of res judicata or in later raise it in enforcement proceedings.
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Challenging the validity or scope of arbitration agreements before domestic courts.
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Relying on annulment proceedings before the seat of arbitration under Article 5(1)(e) of the New York Convention.
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Filing insolvency proceedings to argue that claims subject to the arbitration should be adjudicated by the relevant insolvency courts.
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Obtaining anti-arbitration injunctions in supportive jurisdictions.
He also suggested some countermeasures:
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Carefully drafted arbitration agreements with a good arbitration-friendly seat,
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Choosing reputable arbitral institutions with good track record,
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Relying on the doctrine of kompetenz-kompetenz, which permits tribunals to determine their own jurisdiction.
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Anti-suit injunctions remain available in certain jurisdictions.
Mr. Christodoulos Christodoulou
Opening his remarks, Mr. Christodoulou began by clarifying that arbitral precedent, unlike common law systems governed by the doctrine of stare decisis, arbitration lacks a hierarchical judicial structure in which lower courts are bound by decisions of superior courts. Each arbitral tribunal is constituted independently for specific disputes, one tribunal is not superior to another, and there is no general appellate system harmonizing arbitral awards. Thus, arbitration does not recognize binding precedent within the meaning of stare decisis.
In the absence of formal precedent, he argued that prior arbitral awards function as persuasive authority. He explained that tribunals might consider earlier awards because they address similar legal questions, contain carefully reasoned analysis, or reflect accepted arbitral practice. He remarked that “arbitral precedent is not mechanical repetition. It is about disciplined engagement with prior arbitral reasoning. The tribunal remains independent, but it does not decide in a vacuum. If prior tribunals have addressed the same or similar issue, that reasoning forms part of the arbitral context in which the later tribunal operates.”
“A prior award may guide a later tribunal, not because it is binding, but because it is useful.”
According to Mr. Christodoulou, tribunals should engage openly with earlier awards. If they follow previous or depart from previous reasoning, they should provide justification. This process strengthens coherence, predictability, stability, and credibility in international arbitration.
Commercial Arbitration vs. Investment Arbitration
Drawing a comparison between international commercial and investment arbitration, he noted that international commercial arbitration demonstrates only cautious and nuanced use of precedent. Referring to an older survey, he stated that out of approximately 190 ICC awards, only around 15 percent cited prior arbitral decisions, primarily on jurisdictional issues, procedural matters, governing law, and choice of law. Substantive legal issues were rarely relied upon and usually used with national court decisions, institutional rules, or scholarly writings.
On the other hand, Mr. Christodoulou investment arbitration presents a much clearer example of persuasive precedent because awards are often public and treaty standards recur across disputes. Tribunals are repeatedly called to interpret similar treaty standards like fair and equitable treatment, expropriation, legitimate expectations, necessity, and non-discrimination. Thus, precedents naturally become a part of the material cited by the parties.
He added that in sports arbitration and domain name disputes, it made sense to mention precedents because rules recur, decisions are publicly accessible, and adjudicators confront similar legal problems. Under such conditions, precedents develop naturally and almost inevitably.
Argentina Necessity Cases:
As a practical illustration, he discussed the well-known Argentine financial crisis arbitrations under the United States—Argentina BIT, namely CMS Gas Transmission Company v. The Republic of Argentina2 and LG&E Energy Corp. v. The Republic of Argentina3. Although both disputes arose from substantially similar factual circumstances involving Argentina’s financial crisis and measures affecting the gas distribution sector, the tribunals reached different conclusions regarding Argentina’s “state of necessity” defense. In CMS, the tribunal rejected the defense, but in LG&E, the tribunal partially accepted it and excused Argentina’s liability for an 18-month period.
According to Mr. Christodoulou, the significance of these cases lies not in requiring identical outcomes, but in demonstrating that tribunals confronting similar factual and legal questions should engage with earlier reasoning and explain any departures from it.
“The value of persuasive arbitral precedent is not forced uniformity, but reasoned consistency.”
Value of Arbitral Precedent:
Drawing from the aforesaid, he identified three principal benefits of persuasive precedent:
1. Consistency: Arbitration is decentralized, with tribunals constituted case-by-case and arbitrators drawn from diverse legal traditions. While some divergence is acceptable, unexplained divergence risks undermining confidence in arbitration. Thus, precedents help by encouraging tribunals to reason in writing with prior awards.
2. Predictability: Commercial parties choose arbitration for neutrality, expertise, flexibility, confidentiality, and enforceability and not for legal unpredictability. This consistency is created when tribunals engage with precedents.
3. Credibility: Arbitration gains legitimacy when tribunals engage coherently with prior reasoning and explain both adherence and departure from earlier awards.
Transparency and Accessibility of Awards
Noting the value of precents, Mr. Christodoulou underscored that the principal obstacle to the development of meaningful arbitral precedent was the lack of access to arbitral awards. Without publication, arbitral reasoning develops privately and in fragmented fashion, creating broader legitimacy concerns for the arbitration system.
He suggested that transparency served as a legitimizing function. In this regard, he mentioned a few institutional approaches to transparency such as, the International Chamber of Commerce had moved toward greater publication of awards, the London Court of International Arbitration remained strongly confidentiality-based, the Hong Kong International Arbitration Centre had a more balanced middle-ground approach, and ICSID reflected a stronger transparency trend.
He underscored that these developments matter because they create the practical conditions for persuasive arbitral precedents. At the same time, this progress could not come at the expense of legitimate confidentiality. Thus, the balanced approach, he suggested, was “controlled transparency,” including anonymized awards, redacted awards, delayed publication, and publication of summaries.
“The point is not to expose commercial secrets. The point is to prevent arbitral law from developing invisibly.”
Thus, Mr. Christodoulou concluded by saying that though arbitration precedents don’t exist as stare decisis, it does have persuasive jurisprudence which promotes consistency, predictability, development of arbitral doctrines, and credibility.
Taking over from Mr. Christodoulou, Mr. Nash raised concerns regarding the risk of tribunals relying on publicly available awards that may not accurately reflect broader arbitral practice, particularly when many awards remain confidential.
In response, Mr. Christodoulou reiterated the importance of controlled transparency mechanisms that preserve confidentiality while allowing legal reasoning to enter public discourse.
Thus, the first panel of Cyprus Arbitration Day ended with a call for balanced approaches, relook at our doctrines, procedural coherence, and cross-jurisdictional dialogue as arbitration continues to evolve globally.
1. ICSID Case No. ARB/05/07
2. ICSID Case No. ARB/01/8
3. ICSID Case No. ARB/02/1