In the recent judgment of TAX v FDQ, the BVI Court of Appeal provided guidance on the granting of anti-suit arbitration injunctions and the Court's supervisory jurisdiction over arbitrations commenced in the BVI.
Background
The applicant/appellant, TAX, and the respondent, FDQ, entered into a license agreement in 2018 and further agreed that any disputes arising out of the agreement would be arbitrated in accordance with the BVI Arbitration Act 2013. Their relationship subsequently broke down and on 21 January 2021, TAX initiated arbitration proceedings in the BVI (the 1st Arbitration).
The Final Award of the 1st Arbitration was handed down on 21 February 2023. On 23 March 2023, FDQ filed a Fixed Date Claim Form in the BVI High Court, seeking to challenge the Final Award by way of appeal. On the same date FDQ also filed a notice of application in the High Court for leave to appeal several points of law. The leave has been granted but the appeal is yet to be heard.
FDQ's Fixed Date Claim Form was heard in December 2023. On 25 June 2024, Mr Justice Wallbank ordered that the Final Award be set aside (the Setting Aside Order). In his judgment, Mr Justice Wallbank indicated that by setting aside the Final Award, this will give the parties opportunity to refer their disputes to a differently constituted tribunal if they so wish. TAX has since obtained leave to appeal the Setting Aside Order. The appeal also remains to be heard.
On 21 July 2025, FDQ started a new arbitration in the BVI (the 2nd Arbitration) with identical subject matter, factual background and issues as the 1st Arbitration.
On 29 July 2025, TAX applied to the BVI Court of Appeal for an interim injunction to restrain FDQ from pursuing the 2nd Arbitration.
Key legal issues
At the heart of this appeal is whether it is just and convenient to grant interim injunctive relief to restrain FDQ from pursuing the 2nd Arbitration while two appeals are pending.
The Court's starting point is that it may, in the exercise of its equitable jurisdiction and discretion, grant interim injunctive relief where satisfied that it is just and convenient to do so.
While acknowledging the policy imperatives in the Act against judicial interference in arbitration proceedings, the Court reiterated well-established case law, that the Court retains the power to prevent abuse of process in the conduct of Court or arbitral proceedings. It would exercise those powers of control only if necessary, and would do so judicially, not to interfere with an arbitration, but rather to restrain a party from abusing the process of a Court or arbitral tribunal or using either forum in an oppressive or unconscionable manner. This principle applies whether the arbitration is domestic or foreign.
Applying the above principles, the Court was be satisfied that it was just and proper to grant an interim injunction, subject to an undertaking in damages based on the following findings:
1. There are two pending appeals before the Court in relation to the 1st
2. Parties agree that the issues to be determined on appeal are similar to some of the issues that will arise in the 2nd Arbitration, including construction and meaning of the license agreement and liability.
3. If the 2nd Arbitration advances at the same time as the appeals, those issues would be considered in parallel.
4. By executing the arbitration agreement, the parties have agreed that the BVI is the seat of arbitration and that the Act is applicable, thereby submitting them to all stages of the arbitration process including any appeals that may be pursued under the Act. The 1st Arbitration will only conclude after the determination of the two appeals.
5. By attempting to pursue the 2nd Arbitration while the 1st Arbitration is in train, FDQ will cause duplication of efforts, expenditure and resources, which would run contrary to the overriding objective of the BVI Civil Procedure Rules (Revised Edition) 2023.
6. More fundamentally, such a course is manifestly...