State Responsibility and Environmental Regulation (Australia) A Crocodonian busi

Question

State Responsibility and Environmental Regulation (Australia)

A Crocodonian business firm chartered an airplane owned by the Republic of Crocodonia to fly cargo to Country U. The cargo was a load of crocodile skins that are legal to own and sell in Crocodonia but that are considered contraband in Country U. The business firm, knowing this, mislabeled the cargo as cowhides. When the plane landed in Country U, Counry U's Contraband Enforcement Agency seized both the plane and its cargo. The cargo was destroyed and the plane was sold in accordance with a Country U anti-racketeering statute. The government of Crocodonia was incensed. It sent a diplomatic message to Country U protesting that its national honor had been sullied by Country U's actions. Crocodonia and Country U are parties to an Arbitration Treaty, and they agree to submit the dispute to arbitration. Crocodonia seeks compensation for the airplane and, on behalf of the Crocodonian business firm, compensation for the destroyed cargo. What will the arbitration tribunal decide? Discuss.

Explanation / Answer

The juridiction of arbitral tribunal enables them to determine for itself whether an arbitration agreement is valid and also whether the tribunal has been properly constituted under applicable law, and what matters are to be determined by the arbitration under the agreement.
Though provisions relating to appeals vary widely between different jurisdictions, but most legal systems recognise the right to appeal .
Since the case came forward to the arbitration tribunal was a fraud, or otherwise being procured in a way contrary to public policy, the tribunal can either ;
- Decide to go in favour of country U and charge a penalty from Crocodonia government.
- Urge country U to return their cargo,and charge any amount from them, since Crocodonia
did fraud.

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