In Ameropa AG v Havi Ocean Co. LLC, (S.D.N.Y. February 16, 2011), the plaintiff, Ameropa AG, a Swiss Company with a US subsidiary, and the defendant, Havi Ocean, a UAE company, entered a contract to buy and sell sulphuric acid originating in Iran. Havi Ocean breached the contract and, pursuant to the arbitration clause in the contract, Ameropa sought relief in the Arbitration Tribunal of the Hamburg Chamber of Commerce in Germany. The tribunal ruled in favour of Ameropa and ordered Havi Ocean to pay damages. After Havi Ocean's appeal was rejected, the tribunal ordered it to also pay Ameropa's attorney fees for the appeal.

Ameropa unsuccessfully sought enforcement of the award in the UAE and subsequently sought enforcement in the Southern District of New York under the Federal Arbitration Act (FAA). The FAA provides that courts can refuse to enforce awards as specified in the New York Convention. The Convention allows recognition and enforcement of an award to be refused if it would be "contrary to the public policy" of the country.

In response to Ameropa's motion to confirm and enforce the award, Havi Ocean filed a motion for discovery. It alleged that Ameropa's US subsidiary may have been involved in a transaction with Iran, which would violate US sanctions against Iran, making enforcement of the award contrary to US public policy. Havi Ocean offered no basis for its allegation that the US subsidiary was involved in the transaction.

The court rejected Havi Ocean's argument, primarily because there was no basis for the allegations and even if there had been, this would not defeat the enforcement of the award. The public policy exception applies only when enforcement of an award violates the "most basic notions of morality and justice." A violation of US sanctions is a violation of national policy, not public policy. When awards conflict with sanctions, they are still enforceable. After rejecting Havi Ocean's argument, the court granted Ameropa's motion to confirm and enforce the arbitration award.

This case illustrates how US courts narrowly construe the public policy exception for refusing to enforce arbitral awards. Courts are committed to promoting international arbitration that efficiently settles disputes and avoids lengthy litigation.