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  • Current trends – Arbitration in Central Asia

    Current trends – Arbitration in Central Asia

    Rashid and Charles discussed the dispute-resolution landscape in Central Asia, from differences in jurisdiction and enforcement between states to the rise of construction and renewable-energy claims, and the overlap between commercial and investor-state cases. They also touched on headline matters around the Kashagan and Karachaganak oil fields, using them to illustrate recurring themes such as delay and cost-overrun claims on megaprojects, and the practicalities of enforcing against state-linked counterparties.

    Rashid also shared insights from his career as a dual-qualified UK and Kazakh practitioner and spoke about the growth of the AIFC (Astana International Financial Centre) as a credible regional forum offering English law-based dispute resolution for foreign investors.

    As a London dispute-resolution boutique focused on cross-border matters, Eldwick Law is proud to contribute to thoughtful discussion in this area and to support the legal community’s engagement with a fast-evolving region.

  • Orders against third parties in arbitration

    Orders against third parties in arbitration

    A commentary on s.44 of the Arbitration Act 2025

    Confusing, unsatisfactory, inconsistent. These are some of the words that could be used to describe Section 44 of the Arbitration Act 1996 (“s.44”) just last year. With the Arbitration Act 2025 coming into force in August 2025, reforms have been introduced which aim to enhance efficiency and maintain England and Wales as a leading arbitration destination.

    S.44 Powers Pre-Arbitration Act 2025

    Confusion regarding s.44 stemmed from the fact that s.44(1) did not clarify how far the powers of the court extended. Three major cases relating to s.44 only served to further muddy the waters. The first case, Cruz City v Unitech [2014] EWHC 3704 (Comms), revolved around whether the court could grant an interim injunction against a third party under s.44(2)(e). The High Court concluded that the power did not extend to non-parties and denied the injunction. Similar attempts to apply s.44(2)(b) were equally unsuccessful in DTEK Trading SA v Morozon [2017] EWHC 1704.

    However, in the Court of Appeal case of A and B v C, D and E [2020] EWCA Civ 409, the Court held that s.44(2)(a) – the taking of the evidence of witnesses – was applicable to third parties. The reasoning of Flaux LJ was partially influenced by the fact that it is often rare for a witness to be a party to the arbitration.

    Changes to s.44

    S.44 seeks to clarify any uncertainty with a concise amendment, specifically to s.44(1): “whether in relation to a party or any other person”. The inclusion of ‘any other person’ clarifies that the court now has the power to make orders against uninvolved third parties in support of an arbitral award.

    As regards what orders the court may make, s.44(2) lists them as: 44(2)(a), Taking of the evidence of witnesses

    • 44(2)(b), Preservation of evidence
    • 44(2)(c)(i), Inspection, photographing, preservation, custody or detention of property subject of the proceedings
    • 44(2)(c)(ii), Samples, observation or experiment of property subject of the proceedings
    • 44(2)(d), Sale of any goods subject of the proceedings
    • 44(2)(e), Granting of an interim injunction or appointment of a receiver

    The court’s power to make interim injunction orders against non-parties should serve as a warning to those connected to any arbitral dispute.

    Future Development of s.44

    The Arbitration Act 2025 provides useful clarification on s.44. The conditions in which the court might make orders against third parties are yet to be determined and could likely come down to a case-by-case basis. Third parties’ retention of the full right of appeal under s.44(7) will also likely result in increased litigation as non-parties seek to prevent courts from imposing costly orders upon them. The door has now been opened for direct parties of arbitral proceedings to access orders and evidence previously denied. The dynamic between direct and indirect parties is likely to shift to a more adversarial one as direct parties seek evidence (inter alia) from indirect parties.

    Conclusion

    While the full consequences of s.44 reforms are yet to be seen, this is undoubtedly the beginning of a new era of court involvement in arbitral proceedings. Courts now have the authority to grant a wide variety of orders against third parties. However, the willingness and situations where the courts will grant these orders are yet to be seen and will be an area for case law development.

    Therefore, when arbitral proceedings are being commenced, parties both directly and indirectly involved should be attentive to the rights and obligations that they may have. Swift, decisive action will be vital in protecting their interests and ensuring a favourable outcome.

  • How to Remove a Company Director for Mismanagement

    How to Remove a Company Director for Mismanagement

    Can a company remove a director for mismanagement in the UK?

    Yes. Under UK company law, you can remove a company director for mismanagement but doing so requires a strategic, well-documented approach to minimise risk and ensure compliance with the Companies Act 2006.

    Director mismanagement may include:

    • Breaching statutory directors’ duties.
    • Failure to manage commercial and regulatory risks.
    • Lack of strategic leadership or competence.
    • Breach of fiduciary obligations.
    • Poor financial oversight or misuse of company funds.

    In my experience, once the relationship between a director and other board members deteriorates, trust is difficult to rebuild. Many companies wait too long to seek legal advice, increasing the chance of reputational and operational harm. If legal advice is sought early, non-litigious routes like negotiation or mediation may preserve company value and reduce tension.

    When trust is lost entirely, the business may have no option but to proceed with formal removal, especially if shareholders are concerned about corporate governance, investor confidence, or regulatory scrutiny.

    What are the legal grounds for removing a director in England and Wales?

    Removal by ordinary resolution (section 168 Companies Act 2006)

    Shareholders can remove a director by passing an ordinary resolution with a simple majority (51%). To begin the process, members must serve a Special Notice at least 28 days before the shareholder meeting.

    The director:

    • Must be given formal notice.
    • Can submit written representations in support of their position.
    • Has the right to speak at the meeting.

    The company is also required to file Form TM01 with Companies House once the director is removed.

    Court-ordered removal

    If the company has evidence of unfair prejudice under section 994 Companies Act 2006, the shareholders may apply to court for relief. If successful, the court can order the removal of the director. However, the courts rarely grant this remedy unless the Claimant’s can show serious misconduct or abuse of power.

    Voluntary resignation

    Provided the company’s Articles of Association, Shareholders’ Agreement, and the Director’s Service Agreement allow it, a director may resign voluntarily. No notice period is typically required, although contractual obligations may still apply.

    The process: how to remove a director for mismanagement

    To remove a company director for mismanagement, follow these steps:

    1. Review company documents
      Examine the Articles of Association, Shareholders’ Agreement, and Directors’ Service Agreement. These may specify grounds and procedures for removal.
    2. Serve Special Notice (28 days)
      Give the company at least 28 days’ notice before the shareholder meeting. The notice must detail the proposed removal and be formally delivered to the company.
    3. Inform the director and consider their submissions
      The director has a right to submit written arguments and attend the meeting. Their representations should be read out if they cannot be circulated.
    4. Pass an ordinary resolution
      If more than 50% of shareholders vote in favour of removal, the resolution passes.
    5. File Form TM01 with Companies House which removes the director from the official register.

    Risks of improperly removing a director

    Removing a director for mismanagement is not without legal and reputational risk.

    Employment law consequences

    If the director is also an employee, dismissal may trigger an unfair dismissal claim. To avoid liability, the removal must fall within one of the five fair reasons for dismissal:

    • Capability or qualifications.
    • Conduct.
    • Redundancy.
    • Illegality (continued employment breaches the law).
    • Some other substantial reason (SOSR).

    A formal process with clear documentation is essential.

    Reputational damage and investor concern

    Poorly handled removals can raise alarm bells for:

    • Customers
    • Partners
    • Staff
    • Investors

    To minimise fallout, document:

    • Financial mismanagement or breaches of fiduciary duty.
    • Internal complaints or whistleblowing.
    • Shareholder concerns.
    • Correspondence between the director and board.

    Taking early legal advice and keeping a full paper trail will protect the company’s legal position and public image.

    FAQs

    Can a company director be removed without their consent in the UK?

    Yes. Under section 168 of the Companies Act 2006, shareholders can remove a director via ordinary resolution, even if the director does not agree.

    Is mismanagement a valid reason to remove a director in the UK?

    Yes. Mismanagement may constitute a breach of statutory duties or fiduciary obligations. It may also amount to a fair reason for dismissal if the director is also an employee.

    Can a director bring a claim after being removed?

    Yes. If the director is an employee, they may bring a claim for unfair dismissal or breach of contract. Shareholder-directors may also claim unfair prejudice if removal was part of broader exclusion tactics.

    What documents do I need to remove a director properly?

    Key documents include:

    • Articles of Association
    • Shareholders’ Agreement
    • Director’s Service Agreement
    • Board minutes
    • Form TM01 for Companies House
    Is legal advice necessary to remove a director in the UK?

    Strongly recommended. Removal has legal, commercial, and reputational consequences. A solicitor can guide you through the correct process and reduce risk.

    Getting Legal Help

    To find out more about how our Company Law Solicitors can help you with removing a director or any other company law matter, please call us on +44 (0) 203972 8469 or email us at mail@eldwicklaw.com.

    Note: This article does not constitute legal advice. For further information, please contact our London office.

  • ISDS Readiness: How States Can Take Control Early in Investor Disputes

    ISDS Readiness: How States Can Take Control Early in Investor Disputes

    Lead Agency & External Counsel

    Host states can improve their internal dispute-management processes by designating lead agencies that are competent and technically capable of handling investor claims and liaising with the relevant state organs. This internal team or lead agency should have sufficient capacity to coordinate all parts of the dispute process, including the identification and engagement of external counsel. At the outset, it is advisable that the lead agency obtain an independent, third-party assessment early on. This should cover the merits of (i) a jurisdictional challenge, (ii) the prospects of success of any defence, and (iii) potential settlement options.

    For states facing multiple claims across sectors as wide-ranging as mining, energy, construction, and hospitality, and disputes that involve anything from alleged breaches of agreements to regulatory actions impacting particular investments, a centralised body is necessary. This ensures that incoming disputes, often many at once, are handled harmoniously and with sufficient coordination among state organs, local governments, and various political actors. Unlike companies, the size and bureaucratic makeup of a state make it far more costly and time-consuming to coordinate common steps in the dispute resolution process, such as identifying and preparing fact witnesses and experts, devising case theory, and handling media issues.

    Similar challenges arise when engaging external counsel, as law firms often need to liaise with multiple branches of government at both the state and local levels. Lead agencies can serve as effective liaisons between different state entities and external counsel.

    A ‘Whole-of-government’ approach

    A key part of internal preparation for ISDS is ensuring the involvement of relevant state entities and individuals with sufficient decision-making authority and capacity to support the state’s defence. This requires what is often referred to as a ‘whole-of-government’ approach, meaning a coordinated, unified response across various arms of government when handling disputes brought by foreign investors. Over the past decade, this approach has gained traction as states face increasingly complex and costly disputes and seek to protect their regulatory space while minimising potential liability under investment treaties. Consistent communication and cooperation between state entities and departments can help to identify potential claims before they arise, thus allowing states more time to prepare and gather necessary resources.

    Canada offers a clear example of the benefits of a whole-of-government approach through its experience with NAFTA Chapter 11 claims. In response to several ISDS cases, Canada established a centralised legal defence system led by its Trade Law Bureau, which coordinates across federal departments and provincial governments. This model has enabled consistent legal strategy, effective inter-agency communication, and active treaty management, positioning Canada as a leader in implementing the whole-of-government approach within investor-state arbitration.

    Document Collection

    Document preservation and collection are essential for investor-state arbitration. Gaps in a state’s document collecting system can lead to the permanent loss of valuable evidence, evidence which could have been relied upon to build a legal strategy. This loss of key documents can induce the tribunal to make adverse inferences against the state because the missing content would have supported the opposition’s claims.

    Collecting documents early and systematically helps states get a clear picture of the dispute, understand how likely it is to escalate, and stay ahead of key deadlines. It also makes it easier to follow the steps required under investment treaties, contracts, or local laws. Without a proper system, states can be unprepared when arbitral proceedings are launched.

    However, document collection is rarely straightforward. In most cases, relevant documents are dispersed across government departments and agencies, each with its filing systems, document retention policies, and levels of institutional memory. Some possess intact, well-ordered archives, while others have partial records or no standardised preservation procedures. This fragmented landscape significantly adds to the challenge of piecing together a coherent and comprehensive record of evidence.

    Recognising these challenges, some governments have taken proactive steps to strengthen their institutional frameworks for document management. While soon to be abandoned, the Energy Charter Treaty provides a guide that emphasises the importance of preparedness and transparency when addressing investment disputes. Reflecting these principles, Saudi Arabia has established the Committee for the Settlement of Disputes with Foreign Investors, established under the Foreign Investment Act. This committee is responsible for document collecting for arbitration proceedings. These responsibilities include coordination with relevant government ministries and state agencies, centralisation of information to form a unified and coherent response, gathering of documents to assist legal teams (whether internal or external), and conducting due diligence to verify the authenticity and relevance of documents being submitted in arbitration.

    These examples show just how valuable it is to invest in strong systems for collecting and managing documents. When states build these practices into their processes, they not only strengthen their position in arbitration but also send a clear message to foreign investors: they take transparency, legal certainty, and the rule of law seriously.

    Counterclaim

    States often prefer to systematically object to jurisdiction as an initial tactic, viewing it as a means to delay proceedings and, at times, to shift responsibility onto a subsequent government. However, this approach can blind the state to other potential remedies down the line—one of the most powerful being the counterclaim.

    While the availability of counterclaims will depend on the wording and scope of the treaty’s dispute resolution provision under which the tribunal’s jurisdiction is established, counterclaims can significantly level the playing field. They help address the asymmetry inherent in the state’s constant position as respondent in ISDS proceedings and can provide valuable settlement leverage. Counterclaims also serve as an effective tool to ensure that multiple proceedings relating to the same facts are not resolved in different forums, reducing the risk of inconsistent outcomes.

    Although states may pursue claims against investors in separate proceedings before local courts, where possible and relevant, counterclaims in the ISDS proceedings themselves should be treated as a primary recourse to promote procedural equality. Accordingly, states should consider the potential for counterclaims as early as upon receiving the notice of arbitration, ensuring they can be effectively integrated into the broader defence strategy.

    Funding

    As a preventative measure, states should allocate a portion of their national or ministerial budgets not only for legal costs but also for potential settlements of ongoing or foreseeable investor-state disputes. While attractive in theory, budget allocation for ISDS remains a complex and often politically sensitive process, particularly in states facing internal party divisions or oversight from supranational bodies. The recommendation to retain legal counsel early, combined with the reality of escalating legal costs in large and complex arbitrations, makes this even more challenging. Unexpected expenses may arise during arbitration, particularly if counterclaims are brought, further complicating the funding landscape for states.

    Given these challenges, time becomes the most valuable resource for states that expect potential ISDS claims or have received a notice of dispute. Delays in securing funds can hinder a state’s ability to retain experienced counsel, engage experts, and develop a coherent case strategy from the outset. Proactive financial planning also enhances the state’s ability to engage in the appointment of arbitrations and early settlement discussions when appropriate. Requesting and securing funding early can be the difference between mounting an effective defence and being caught unprepared.

    Conclusion

    As ISDS evolves, so too must the attitude of states, taking a more proactive and modern approach. The myth that states are inherently disadvantaged overlooks how early preparation, institutional coordination, and effective planning can affect outcomes. By embracing a whole-of-government approach, improving document systems, preparing for counterclaims, and securing early funding, states not only minimise legal risk but also reinforce investor confidence in their government.

  • ICC, LCIA and HKIAC – Governing Law, Seat Selection, Efficiency

    ICC, LCIA and HKIAC – Governing Law, Seat Selection, Efficiency

    Choice of Governing law

    The data from the ICC over the past three years confirms the preference for English and Welsh governing law in international arbitration. A steady and consistent use of English law has been reported, with 125 cases governed by it in 2024, maintaining its primary position. In contrast, the use of U.S. law has seen a gradual decrease, from 81 cases in 2023 to 69 in 2024 and Swiss law, which featured prominently in 2023 with 83 cases, fell from the top ranks in 2024 after recording 53 cases in 2022. This comparative trend reflects a global appeal of the English legal system’s respect for party autonomy, especially for parties that seek predictability in decisions. Party autonomy refers to the freedom of contracting parties to determine the terms of their agreement, which is fostered by an objective interpretation of contracts by the English courts. By giving priority to the express terms of the contract and avoiding reliance on extrinsic evidence, the choice of English and Welsh governing law is more attractive to international parties for its legal certainty and protection of agreed terms.

    Seat Choice

    There has also been a slight shift in seat selection within ICC arbitrations in favour of the United Kingdom. In 2024, the UK overtook France as the most selected seat, with 96 cases compared to France’s 91. This is a reversal of the previous year where France led with 99 cases against the UK’s 85. This upward trajectory continues from 2022, when the UK was selected in 74 cases. Since the introduction of the Arbitration Act 1996, the UK has established a reputation for judicial non-interference. English judges generally refrain from intervening in the conduct of arbitral proceedings and are supportive in enforcing final awards, creating a legal environment that reinforces the finality and integrity of arbitration.

    Lengths and delays of Proceedings

    The average duration of ICC arbitration proceedings has remained relatively stable over the past three years, typically concluding within 26 to 27 months. In 2024, the average duration was 26 months, consistent with 2022 and slightly improved from 27 months in 2023. However, data on procedural delays indicates some growing inefficiencies. In 2024, 75 cases experienced delays exceeding two months, compared to 49 cases in 2023 and 29 cases in 2022, showing an upward trend in longer delays despite the stable overall duration.

    Despite the rising number of delays there has been reform enacted to streamline the arbitral process. This is exhibited by the ICC’s 2021 Rules, which introduced stricter time limits for arbitrators to render awards, including financial penalties such as reduced fees if deadlines are not adhered to. While these measures aim to encourage efficiency and meet procedural deadlines, they appear to have limited de facto impact.

    A key factor that could be contributing to the worsening of delays, despite the changes in promoting efficiency, is the phenomenon of due process paranoia. This occurs when tribunals adopt an overly cautious approach to avoid challenges to final awards based on procedural unfairness. This has led to arbitrators granting repeated procedural requests from parties, particularly at late stages, which undermines both efficiency and equal treatment. As seen in cases like Jaguar Energy and Anwar Siraj, courts generally support tribunals’ procedural decisions and reject weak due process challenges. However, the inflated perception of risk continues to affect case management, enabling actions that prolong proceedings and increase delay.

    Changes in Asian regional distribution

    The ICC data also reveals subtle changes in the regional distribution of parties involved in arbitrations, including a gradual decline in participation from Central and West Asia. In 2022, parties from this region accounted for 11% of the caseload, rising to 12.7% in 2023 before falling to 10% in 2024. This downward trend may reflect the development and appeal of regional arbitration centres, such as the Dubai International Arbitration Centre (“DIAC”) and the Qatar International Court and Dispute Resolution Centre, which offer geographically closer and often more cost-effective alternatives. Conversely, North and West European parties continued to dominate, rising from 28.8% in 2023 to 30.2% in 2024. These figures suggest a rebalancing of global arbitration activity, with European parties consolidating their presence and some Asian and Middle Eastern parties exploring arbitration locally.

    Future changes

    Looking to the future, English law will continue to dominate arbitration proceedings. As for seat preference, the recent enactment of the Arbitration Act 2025 introduces a series of targeted reforms that modernise and enhance the efficiency of the arbitration process in England. Tribunals have been given new powers to summarily dispose of claims; the Act has provided clarification of court authority over third parties, codification of emergency arbitrator enforcement, and stricter procedures for challenging awards. These reforms, in combination with England’s commercial jurisprudence and pro-arbitration judiciary will likely further increase the appeal of English law and London as the seat of arbitration.

    Comparative Analysis

    HKIAC

    The 2024 statistics reveal that the ICC maintains a broader global presence compared to HKIAC. Parties to ICC arbitrations came from 145 countries, whereas HKIAC involved parties from 34 jurisdictions, primarily from Asia and offshore hubs such as Mainland China, Hong Kong, and the Cayman Islands. While both institutions conduct most arbitrations in English, HKIAC maintains a significant portion in Chinese (15.9%) or bilingually (4.3%), reflecting its regional orientation.

    The choice of governing law further illustrates the difference between the HKIAC’s more local appeal in comparison to the global attractiveness of the ICC. In 2024, ICC arbitrations involved over 100 different legal systems, with English law as the dominant choice. HKIAC cases, while involving 15 governing laws, primarily applied Hong Kong law, followed by English and Chinese law, reinforcing its alignment with the Greater China commercial bubble. Overall, the ICC shows greater international diversity, whereas HKIAC displays its appeal for tackling Asia-based party disputes.

    LCIA

    English and Welsh law continues to dominate as the governing law in both LCIA and ICC arbitrations. However, recent statistical reports suggest that there has been a decline in its choice. At the LCIA, the choice of English law has gradually declined: from 85% of arbitrations in 2022 to 83% in 2023, and down to 78% in 2024. Likewise, English law was chosen in 125 (15%) new cases for ICC proceedings in 2024, this represents a decline from 131 cases in 2023. This drop may indicate that while London remains a preferred seat, parties are increasingly opting for other governing law provisions.

    Conclusion

    The 2024 data confirms that English law and London remain central to international arbitration, despite minor declines in usage. Their continued dominance stems from the legal consistency, party autonomy, and enforcement-friendly environment they offer. The Arbitration Act 2025 is expected to strengthen this position further by modernising English arbitration and improving procedural efficiency.

    While institutions like HKIAC and DIAC are increasing in popularity regionally, the ICC maintains a broader international presence, accommodating a wider range of legal systems and parties. The LCIA’s gradual diversification in governing law choices signals growing openness but still reflects the appeal of English law.

    Overall, the trends indicate that jurisdictions offering legal clarity, efficient procedures, and judicial support will remain at the forefront of global arbitration. England’s proactive legal reforms and arbitration-friendly stance ensure it continues to lead in this evolving landscape.

  • Recognition for Rashid Gaissin in Lexology Index Energy 2025

    Recognition for Rashid Gaissin in Lexology Index Energy 2025

    Link to Rashid’s Lexology page: https://www.lexology.com/firms/eldwick-law/rashid_gaissin

  • Can Shareholders Claim For Unfair Prejudice?

    Can Shareholders Claim For Unfair Prejudice?

    By involving a solicitor early on, there is a greater chance of resolving matters through mediation, negotiation, or other non-court dispute resolution methods.

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    What Is Unfair Prejudice?

    Under section 994 of the Companies Act 2006, company members can bring a claim of unfair prejudice if they can prove:

    • That the company is being run, or has been run, in a way that unfairly harms the interest of its members (including the person making the complaint); and/or
    • That something the company has done, plans to do, or has failed to do is, or would be, unfairly harmful to those interests.

    It is crucial to note that the petitioner must prove, on the balance of probabilities, that there was prejudice and that it was unfair.

    In Loveridge v Loveridge [2020] EWCA Civ 1104, the Court of Appeal ruled a minority shareholder cannot normally complain of conduct which falls within the company’s constitution unless they can show certain rules under the constitution have been breached or those rules have been used in a way contrary to good faith.

    What are some examples of unfair prejudice to minority shareholders?

    Unfair prejudice to minority shareholders can include:

    • Not distributing dividends.
    • Creating more shares in the company (share dilution) without a shareholder resolution.
    • Inappropriately removing the auditor of the company.
    • Mis-valuing a particular class of members’ shares.
    • Prioritising a director’s personal interests over the company’s success.
    • Non-compliance with the company’s articles of association.
    • Directors inappropriately dealing with company assets.
    • Withholding information, especially company accounts and reports.

    Unfair prejudice was held not to exist where:

    • The majority shareholders refusing to buy shares in the company from the minority, or sell shares to the minority.
    • Commercial mistakes or management incompetence or a dispute regarding the commercial direction of the company.
    • Good faith amendments to the company’s Articles to include drag along provisions which could force the sale of the minority’s shares.

    Can an unfair prejudice petition relate to future conduct by majority shareholders?

    This is one of the most common questions clients ask us, and fortunately, the answer is yes.

    For example, if the directors propose a change in the company’s share structure or changing the composition of the board, it is often easier and more effective to make a petition under section 994 seeking an injunction than trying to deal with the event after it happens.

    What relief can the Court provide if my unfair prejudice claim succeeds?

    Under section 996 of the Companies Act 2006, if you can prove unfair prejudice, the Court has the power to grant the following relief:

    • Grant an injunction to refrain the company from doing the act complained of or to do something the petitioner wants done (based on the petition).
    • Allow civil proceedings to be brought in the name and on behalf of the company.
    • Prohibit any alterations to the company’s Articles without the leave of the Court.
    • Order the compulsory purchase of the minority’s shares by the majority at a price set by the Court. This is the most common remedy sought by petitioners.

    The Courts will refuse to make a compulsory purchase order if doing so would be disproportionate to the prejudice you have suffered. Your petition may also be struck out if remedies are available via the Articles or Shareholders’ Agreement and there is evidence you tried to bypass those remedies by bringing a section 994 petition.

    How does the Court calculate the share price if it orders compulsory purchase?

    In most cases, our clients will seek an order for the purchase of shares at a price based pro rata on the value of the company on the valuation date. This is different to the market or commercial valuation of the petitioner’s shares, which will usually involve applying a substantial ‘full’ minority discount to the pro rata figure. For obvious reasons, the majority shareholders ordered to purchase the shares will want the valuation based on market value.

    The method of valuation is decided on a case-by-case basis and depends on the nature and extent of the unfair prejudice. The Court can use other valuation methods aside from the pro-rata valuation or valuation subject to minority discount.

    The Court will also determine the valuation date. As a starting point, the date of the share purchase order will be applied. In some cases, it is in our clients’ best interests to argue for a different date, for example if majority shareholders have diverted business or assets from the company to reduce its value. It may also be advantageous to argue, in cases where our clients were part of the initial investors in the company, that a quasi-partnership existed. This means our clients had an expectation of participating in the management and profits of the company. If the Court finds a quasi-partnership exists, they will not apply a minority discount to the shares if a majority buy-out is ordered.

     

    Final words

    Believing you have been unfairly prejudiced by the acts or omissions of majority shareholders can be frustrating and infuriating, especially if you helped build the company from the beginning. Getting legal advice sooner rather than later can help to resolve the dispute via non-court methods such as mediation and negotiation. In our experience it is extremely rare for unfair prejudice disputes to reach court. In most cases, most people are keen to resolve matters as quickly, cost-effectively, and stress-freely as possible. Getting early legal advice is the best way to achieve this.

    To discuss any points raised in this article, please call us on +44 (0) 203972 8469 or email us at mail@eldwicklaw.com.

    Note – This article does not constitute legal advice. For further information, please contact our London office.

  • Foreign Investment In Syria – Sanctions FAQs

    Foreign Investment In Syria – Sanctions FAQs

    Introduction

    Following the fall of the Assad regime, the United States, European Union, and United Kingdom have taken initial measures to start easing sanctions on Syria in order to allow it to rebuild its political framework, infrastructure, and economy. The lifting of these sanctions is, however, conditional on the new Syrian government demonstrating a commitment to protecting religious and ethnic minorities and ending support to designated terrorist groups.

    To help you understand the current situation in Syria, we have created a list of frequently asked questions on what happens now that the sanctions have been lifted.

    Is Syria open to foreign investment now that sanctions have been lifted?

    Yes. Following the announcement that Donald Trump was lifting sanctions, Syrian Finance Minister Yisr Barnieh told reporters:

    “Syria today is a land of opportunities, with immense potential across every sector-from agriculture to oil, tourism, infrastructure, and transportation.

    “We envision a central role for the private sector in the new Syrian economy. The finance ministry’s role is not to spend indiscriminately or act as a regulatory enforcer over businesses, but rather to enable and support growth.”

    Mr Barnieh also stated that the Government was taking the necessary steps to modernise the economy, thin-out the bloated public sector, and overhaul the country’s financial management.

    However, research shows that investor confidence in rebuilding countries ravaged by war depends a lot on how fast humanitarian needs are dealt with. Those looking to inject foreign direct investment (FDI) in post-war nations tend to avoid areas still struggling with violence and political instability. One way to measure stability is the amount of foreign aid being sent. Although the US has frozen all foreign aid, to date, the UK Government has pledged £160 million in aid to support Syria’s “recovery and stability” and the EU has pledged €2.5 billion.

    What kind of foreign investment does Syria need?

    Almost every part of Syria’s infrastructure has been destroyed by war and needs rebuilding. Water, roads, public transport, telecommunications, electricity, finance, agriculture, industry– the options are almost endless.

    Saudi Arabia’s GO Telecom has recently signed an agreement with the Syrian government to help rebuild the country’s digital infrastructure. In early June, a high level delegation from Syria travelled to Qatar to discuss investment opportunities and enhanced cooperation between the two countries.

    What type of due diligence needs to be undertaken by companies looking to invest in Syria?

    Companies must be alive to the fact that not all US, EU, and UK restrictions have been lifted. This is particularly the case with people and entities that are still supporting the Assad regime and for certain sectors such as chemical weapons and cultural heritage products.

    Syria is still struggling with a humanitarian crisis, with around 90% of the population living below the poverty line. Safety must be the first priority for any company looking to send staff to Syria with a view to scope out opportunities.

    What tax incentives are available for foreign investors in Syria?

    Mr Barnieh has stated that Syria will have the lowest tax burden in the region. No details have yet been provided, but on 2 June 2025, trading resumed on the country’s stock exchange following a six-month closure. The Finance Minister told the state-run news agency SANA that the stock exchange “will operate as a private company and serve as a genuine hub for Syria’s economic development, with a strong focus on digital”.

    What legal protections exist for foreign investors in Syria?

    With sanctions only recently beginning to be lifted, the Syrian government has an enormous challenge ahead of it to create an environment that is attractive to and protects the interests of foreign investors. At the time of writing, Syria’s banking system has not yet been overhauled. They do not have access to SWIFT (Society for Worldwide Interbank Financial Telecommunication), have little liquidity, and the regulatory environment is extremely opaque. This alone means investors risk being caught up in money laundering and other financial crimes if they do not undertake extensive due diligence. These are all issues the Government is clearly motivated to address in order to increase investor confidence as well as encourage those who fled the country during the war to return and help rebuild.

    Wrapping up

    If you wish to invest in Syria, it is crucial you seek legal advice to ensure you do not breach UK sanction policies and manage the considerable risks that come with the plethora of investment opportunities. Our dual-qualified, multi-lingual lawyers can provide expert legal advice and representation if you have any questions regarding the lifting of sanctions against Syrian entities and/or investing in Syria.

    To make an appointment with one of our lawyers, please call +44 (0) 203972 8469 or email us at mail@eldwicklaw.com.

  • Case Study: Papel Payment Services Provider LLC v Monitox Limited

    Case Study: Papel Payment Services Provider LLC v Monitox Limited

    Background 

    In 2023, Papel Payment Services Provider LLC, a Dubai based company, and Monitox Limited, a company registered in Scotland, entered into a supply of services contract. This contract included explicitly stated that it was to be governed by the law of the UAE and that the courts of the Emirate of Dubai were to have exclusive jurisdiction to settle all disputes or claims arising out of the contract. 

    Papel’s relationship with Monitox worsened, prompting Papel to end their service supply contract. Afterward, Papel sent two invoices to Monitox requesting payment. When Monitox did not settle these invoices, Papel pursued recovery by applying for a payment order and securing a judgment from the Dubai Commercial Court of First Instance. 

    Papel then sought a “decree conform” order from the Court to enforce the Dubai judgment against Monitox in Scotland. For such an order to be granted, the Court must be satisfied that the original judgment was not obtained through fraud and that the initial legal action resulting in the foreign judgment was properly served. Even if the original case was undefended, a decree conform action can still be challenged. Additionally, common law defences – often grounded in public policy – may be raised and will be carefully considered by the Court on their individual merits. 

    The issue before the Court was whether the judgment obtained by Papel violated Scots law principles of natural justice. Monitox contended that it had not been given a fair opportunity to challenge the payment order that resulted in the judgment. The Court considered evidence from both parties, including expert testimony from a UAE-based lawyer regarding UAE law. 

    In making its decision, the Court examined the legal process under UAE law relevant to this case. Evidence was presented showing that the procedure used by Papel was established under UAE law to offer a “swift and efficient” means for creditors to recover undisputed debts. To utilise this process, the following conditions must be satisfied: 

    1. The debt must be for a fixed amount and must have been unequivocally acknowledged by the debtor; 
    1. A demand for payment must be served on the debtor specifying exactly what is due to be paid and allowing a period of 5 days for the debtor to make payment. Service of this notice is to be by an official server of documents in the UAE, Tableegh and whilst the notice is in Arabic, it may be translated if Arabic is not the recipient’s first language. Service may be made by a variety of means, including by email; and 
    1. If no payment is made within the 5 days, the creditor can apply to the Court for a payment order against the debtor, and this is to be granted by the Court within three days. The application for the payment order is written in Arabic, is not translated and is not required to be served on the debtor. 

    The payment demand was sent to Monitox by Tableegh via email, which included a telephone number and was written in Arabic. The email contained a PDF of the demand along with an English translation. Although a Monitox employee received the email, the Court of Session accepted evidence that the employee did not open the PDF and therefore did not read the demand. Since the debt remained unpaid, Papel applied to the Dubai Commercial Court of First Instance for a payment order, which was granted three days later. Papel emailed the payment order to Monitox on October 5 and 13, 2023. The second email included a partial English translation; however, this translation incorrectly stated a sum significantly higher than the amount awarded by the Court in the payment order. There was no English translation of the section informing Monitox of its right to file a grievance or appeal. Additionally, the order was published in a local Arabic-language newspaper. 

    Papel argued that the Court should grant the order allowing enforcement of the judgment against Monitox in Scotland. They compared the UAE’s fast-track debt recovery process to Scotland’s summary diligence procedure, which allows creditors to enforce deeds or contracts registered for execution without first obtaining a court decree. Papel maintained that Monitox had ample opportunity to dispute the debt but failed to do so, and that the Dubai procedure used to secure the payment order was fair. Therefore, Papel contended that the enforcement order should be granted in Scotland. 

    Conversely, Monitox argued that it had not received adequate notice of the UAE proceedings before the payment order was issued, constituting a breach of natural justice. As a result, Monitox asserted that the Scottish Court should refuse to grant the enforcement order sought by Papel. 

    The Decision 

    The Court agreed with Monitox. They found that there had been a breach of natural justice due to the way in which the payment order was obtained by Papel. Although Papel technically gave Monitox notice of the payment order on three occasions, the first notice was entirely in Arabic. The second notice included some English, but it misstated the amount ordered to be paid and omitted any English explanation of the right to appeal or the relevant deadlines. Additionally, payment order was advertised only in Arabic in a newspaper unlikely to be accessed by anyone connected to Monitox. As a result, the Court found that Papel’s service of payment order on Monitox in October 2023 was insufficient. 

    The Court decided that there was a breach of natural justice, as Monitox was not given any real chance to present its defence in the UAE. Therefore, Papel was not entitled to the order sought to make Monitox pay the due payments and the action was disposed of by the Court. 

     What does this decision mean for award/judgment enforcement between the UAE and the UK? 

    This decision highlights just how tricky it can be to enforce foreign judgments, especially between countries like the UAE and the UK, which have very different legal systems and ideas of justice. The Scottish Court of Session made it clear that for a foreign judgment to be enforced in Scotland, it must meet basic standards of fairness under Scots law. In this case, the Court found that Monitox hadn’t been given a real chance to challenge the payment order from the UAE – partly because they weren’t properly notified and faced language barriers. 

    The case also shows that differences in legal procedures can have a big impact on enforcement. The UAE’s fast-track debt recovery process is built for speed and efficiency, but it may not meet the UK’s stricter standards for fairness and due process. So even if a judgment is perfectly valid under UAE law, it could still be blocked in the UK if it clashes with the UK’s idea of what a fair legal process looks like. 

    For businesses and lawyers working across the UAE and UK, the key takeaway is this: just because you win a judgment in one country doesn’t mean it will automatically be enforced in the other. It’s crucial to ensure that legal proceedings – from how documents are served to giving parties a fair chance to respond – meet the standards of the country where you want the judgment enforced. 

  • UK-MEA Legal Collaboration in a Changing Global Landscape

    UK-MEA Legal Collaboration in a Changing Global Landscape

    The Architecture of UK-MEA Legal Collaboration 

    The opening panel brought together senior practitioners from both regions. Speakers such as Dr. Habib Al Mulla, Fatima Balfaqeeh, and Luke Tucker Harrison focused on the operational realities of cross-border relationships. 

    Central to the conversation was the strength of local boutiques – their deep-rooted local expertise, cultural fluency, and absence of language barrier with courts. These qualities are increasingly important in the contexts of litigation and arbitration. Yet, collaborating with larger international firms comes with its pros and cons. While they offer top-tier training, branding, and global transaction capabilities, boutiques often face challenges of subordination and frequent conflicts. 

    Dr. Al Mulla offered a practical view informed by experience: having merged his firm with Baker Mckenzie in 2013 and split in 2022, he underlined the importance of mutual respect, structured role assignment, and consistent relationship-building as key factors to a successful joint venture. 

    Free-Zone Courts: The DIFC Model 

    The DIFC Courts were highlighted as a prime example of legal hybridity. Their opt-in jurisdiction, alongside a growing scope for arbitration and mediation, is blurring the boundaries between traditional litigation and ADR. These mechanisms allow parties outside the UAE to contract into a system grounded in English common law – a unique blend that continues to attract global businesses. 

    Building Legal Infrastructure for the Future 

    The second panel, moderated by Brandon Malone, explored how strategic legal partnerships can strengthen commercial ties between London and the MEA. Speaker including Robert Stephen, Prof. Dr. Tarek Riad, and Dr. Marian Kaldas emphasised the role of the institutional capacity-building, arbitration-friendly policy reforms, and regulatory sophistication. 

    Arbitration’s Ascendance in Dubai 

    One of the main trends highlighted was the evolution of Dubai as a hub for arbitration. The panel noted how the Dubai International Arbitration Centre (DIAC) is leveraging the legacy of the London Court of International Arbitration (LCIA) to enhance its credibility and efficacy. New DIAC rules were credited with making arbitration in Dubai more flexible and internationally respected. 

    DIAC’s increasing caseload year after year underscores Dubai’s multilingual arbitration competency. The new mediation rules, launched in 2023, mark a deliberate pivot toward alternative dispute resolution (ADR) models. 

    Technology, AI, and the New Legal Professional 

    The final panel focused on innovation and leadership in legal practice. Moderated by Sarah Malik, speakers explored how digitisation, AI, and customised legal tech solutions are altering law firm dynamics. 

    An emphasis was put on the fact that AI will augment, not replace, legal professional – automating tasks like document review while enabling strategic legal analysis. The 2023 DIFC AI guidelines now promote transparency, human verification, and responsible date use. 

    There was also a call on academic institutions to integrate AI and legal tech into the legal curriculum to ensure graduates are workforce-ready. 

    Conclusion 

    The Lawyers’ Advocates forum affirmed that legal collaboration between the UK and MEA is not just aspirational – it is actively unfolding. Whether through institutional arbitration, strategic law firm alliances, or tech-driven innovation, the legal landscape is encouraging transnational integration. 

    For firms in or with MEA jurisdictions, success will hinge on cultural fluency, institutional agility, and a shared commitment to legal excellence across borders.