## Facts

- Southern Pacific Properties Limited (SPP) and the Egyptian General Organization for Tourism and Hotels (EGOTH), a public-sector entity, entered into agreements (1974) to develop two international tourist complexes in Egypt.
- A first agreement was signed by Egypt’s Minister of Tourism “on behalf of Egypt” and did not contain an arbitration clause.
- A supplementary agreement, described as supplementary to the first, contained an ICC arbitration clause; the Minister’s signature appeared with a notation that it was “approved, agreed and ratified” by him.
- After the project failed, SPP commenced ICC arbitration against EGOTH and the Arab Republic of Egypt; Egypt denied it had consented to arbitration.
- The ICC tribunal rejected Egypt’s jurisdiction objection and awarded SPP approximately US $12.5 million, holding EGOTH and Egypt liable.
- SPP sought recognition and enforcement of the award in the Netherlands under the New York Convention; Egypt opposed enforcement under Article V(1)(a), asserting it was not a party to a valid arbitration agreement.

## Issues

1. Whether, for purposes of New York Convention Article V(1)(a), Egypt could deny being a party to the arbitration agreement in the supplementary contract despite the Minister of Tourism’s “approved, agreed and ratified” endorsement.
2. Whether the alleged absence of a valid arbitration agreement between SPP and Egypt required refusal of recognition and enforcement of the ICC award against Egypt in the Netherlands.

## Decision

- The Amsterdam District Court rejected Egypt’s Article V(1)(a) defense and permitted recognition and enforcement of the ICC award against Egypt.
- The court found that Egypt was bound by the arbitration clause in the supplementary agreement.
- The court treated the Minister’s endorsement as legally operative state assent in the transaction’s context, rather than a merely political or internal act.
- The court regarded the arbitral tribunal’s prior determination of jurisdiction as persuasive in assessing the enforcement defenses.

## Legal Principles

- Under the New York Convention, the enforcing court may refuse enforcement under Article V(1)(a) only where there is no valid arbitration agreement binding the resisting party, assessed by objective indicia of consent.
- A state may be treated as a party to an arbitration agreement when an authorized ministerial act approving and ratifying a contract objectively manifests state consent, even if a state instrumentality is the named contracting party.
- In enforcement proceedings, judicial review of arbitral jurisdiction under the Convention is limited to the Article V grounds and is applied restrictively; the court will not revisit the merits and will focus on whether any clear defect negates consent.

## Conclusion

The court enforced the ICC award against Egypt, holding that the Minister of Tourism’s approval and ratification of the supplementary agreement, viewed with EGOTH’s public-sector status and the project’s structure, established Egypt’s consent to the arbitration clause and defeated the Article V(1)(a) objection.


S. Pac. Props. Ltd. v. Arab Republic of Egypt, 10 Y.B. Com. Arb. 487 (Amsterdam Dist. Ct. 1984), reprinted in (1985)