Arbitration Case Study: Derivatives Contract Translation Disputes
A multinational energy corporation encountered arbitration over “force majeure” clause translation discrepancies in cross-border swap agreements. The tribunal ruled the Chinese translation failed to capture jurisdictional nuances of the original English provision, establishing precedent for legal equivalence interpretation in financial instrument translation.
Core Dispute Analysis
The arbitration focused on three dimensions: terminological equivalence in target jurisdictions, evidential weight of industry practices, and translation process documentation. The interpretation of “material adverse change” translation sparked intense debate, with four expert witnesses presenting divergent views on the clause’s judicial boundaries.
Arbitral Precedents
This case established three principles for derivatives translation disputes: primacy of source language, dual legal validation of terms, and comprehensive translation documentation. The award emphasized that ISDA master agreement translations must reference official explanatory memoranda for validation.
