## Facts

- A Mexican investor group (including CITEL) acquired a 49% interest in a Cuban telecommunications company (ETECSA) and undertook related financing and guarantee obligations tied to Cuban debt.
- An Italian telecommunications investor (STET) agreed by subscription and related agreements to buy 25% of CITEL for US$291.2 million, obtaining an indirect interest in ETECSA.
- The agreements contained an ICC arbitration clause; the arbitration was seated in Ottawa and governed by the UNCITRAL Model Law as implemented in Ontario.
- STET commenced ICC arbitration alleging breaches of the investment agreements; the tribunal issued awards in STET’s favor.
- During the arbitration, a disclosure dispute arose concerning confidentiality and production of agreements; STET provided redacted versions, and the tribunal found STET had complied with its disclosure order.
- The Mexican parties applied in Ontario to set aside the awards or, alternatively, to require the tribunal to resume proceedings and conduct a rehearing; STET sought recognition and enforcement.
- The Ontario Superior Court dismissed the set-aside application and enforced the awards; the Mexican parties appealed.

## Issues

1. Whether the tribunal lacked jurisdiction over certain Mexican corporate parties alleged not to be bound by the arbitration agreement.
2. Whether the arbitral procedure, including disclosure rulings tied to confidentiality, rendered the applicants “unable to present [their] case” under Article 34(2)(a)(ii) of the Model Law.
3. Whether recognition or enforcement of the awards should be refused as contrary to Ontario public policy under Article 34(2)(b)(ii).
4. Whether a court may, and should, order the tribunal to resume the proceedings and conduct a rehearing as an alternative to setting aside.

## Decision

- The Ontario Court of Appeal affirmed the Superior Court’s judgment enforcing the awards and refusing to set them aside.
- The court upheld the tribunal’s jurisdiction over the challenged corporate parties.
- The court found no denial of procedural fairness meeting Article 34(2)(a)(ii)’s “unable to present [the] case” standard.
- The court held that enforcement did not violate Ontario public policy.
- The court declined to order a rehearing, emphasizing the limited nature of judicial intervention under the Model Law framework.

## Legal Principles

- Under the Model Law as implemented in Ontario, judicial review of international commercial arbitration awards is confined to narrow, enumerated grounds and does not permit reconsideration of the merits.
- “Unable to present [a] case” (Model Law Article 34(2)(a)(ii)) requires a serious procedural deprivation; disagreement with evidentiary or procedural rulings, without material unfairness, is insufficient.
- A party’s failure to raise timely objections during the arbitration may weigh heavily against later claims that the procedure prevented a fair opportunity to present its case.
- The public policy exception (Model Law Article 34(2)(b)(ii)) is construed narrowly and applies only where enforcement would offend fundamental notions of morality and justice.
- Courts generally lack a broad supervisory role over arbitral procedure and will not order a rehearing absent clear statutory authorization and a qualifying ground for intervention.

## Conclusion

The Court of Appeal confirmed a pro-enforcement approach to international commercial arbitration under the Model Law, holding that alleged procedural and confidentiality-related disclosure complaints did not meet the high threshold for setting aside, that the public policy exception is exceptional, and that courts will not treat set-aside proceedings as an appeal or a vehicle to redo the arbitration.


Corporacion Transnacional de Inversiones, S.A. de C.V. v. Stet Int’l S.p.A., 49 O.R. (3d) 414 (Ont. C.A. 2000)