Article V(1)(e) of the New York Convention provides that the courts of a contracting state may refuse to enforce a Convention award if the defendant proves that it has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made.

On 28 April 2009, the Amsterdam Court of Appeals rendered its well known judgment allowing Yukos Capital to enforce a number of ICAC arbitral awards against Rosneft in the Netherlands, despite the awards having been set aside in Russia. In short, the Amsterdam Court of Appeals decided in Yukos that:

By an arbitral award of 31 March 2011, an ICAC arbitral tribunal sitting in Moscow ordered the Russian steel conglomerate, OJSC Novolipetsky Metallurgichesky Kombinat (NLMK) to pay Nikolai Viktorovich Maximov (Maximov) RUB 8.9 billion, as balance of the price for purchasing 50% (plus one share) in Maxi-Group, and costs. Maximov secured payment by effecting an attachment of NLMK´s shares in the Dutch company, NLMK International BV. In May 2011, Maximov applied to the Amsterdam District Court for leave to enforce the arbitral award in the Netherlands. However, in June 2011, the Moscow Arbitrazh Court set aside the arbitral award. This decision prompted the Amsterdam District Court to refuse enforcement of the arbitral award on 17 November 2011.

On 16 January 2012, Maximov filed an appeal at the Amsterdam Court of Appeals on the grounds that:

The Russian Federal Court and the Russian Supreme Court both upheld the decision to set aside the arbitral award, on 10 October 2011 and 20 January 2012 respectively (see Legal update, Russian courts consider corporate disputes to be non-arbitrable).

On 18 September 2012, the Amsterdam Court of Appeals rendered an interim judgment. While the case is, in many respects, identical to the Yukos case, the Court of Appeals appears to have applied a different standard in this case.

The Court of Appeals held that enforcement of a foreign arbitral award can be refused on the basis of Article V(1)(e) of the New York Convention, even if recognition of the foreign setting aside decision has not, and will not, be requested.

As to the fact that the setting aside was subject to appeal when the Amsterdam District Court decided to recognise it, the Court of Appeals held that Article V(1)(e) of the New York Convention does not require the setting aside to have res judicata effect.

The Court of Appeals went on to hold that enforcement of an annulled arbitral award should be refused under Article V(1)(e) of the New York Convention, unless the setting aside is the result of an unfair trial. While the Court of Appeals expressed grave concern over the state of the Russian judiciary, it held that this exception can only be established by "sufficiently specific indications" that this particular setting aside procedure was unfair. The Court of Appeals suggested, with reference to the decision of the European Court of Human Rights in Pellegrini v Italy, that even if the setting aside proceedings were unfair, enforcement of the award should still be refused if it is plausible that the arbitral award would have been set aside even if the proceedings had been fair.

In order to ascertain whether the setting aside proceedings were fair, the Court of Appeals ordered expert evidence on Russian arbitration and procedural law.

Although this decision is similar to the Yukos case, in that they both involve Russian arbitral awards set aside by the same judge (Shumilina) of the Moscow Arbitrazh Court, there are a number of noteworthy differences in the approach taken by the Amsterdam Court of Appeals in this latest decision.

The Court of Appeals in this instance held that the recognition of the setting aside judgment does not need to be requested and that the full ambit of recognition standards does not have to be considered. By comparison, in Yukos, the court held that the Netherlands enforcement judge was not obliged to refuse enforcement of an arbitral award if the setting aside decision could not be recognised in the Netherlands, on the basis of international private law rules.

Furthermore, the Court of Appeals decided in the Yukos case that the Russian setting aside judgments could not be recognised in the Netherlands because it was likely that the judges were partial or dependent. It also held that direct evidence of such circumstances was not required. However, in this case, the court held that "sufficiently specific indications" are required to apply such an exception and that even unfair foreign setting aside proceedings may result in refusal of enforcement of the arbitral award on the basis of Article V(1)(e) of the New York Convention.