On 4 October 2021, the Judicial Committee of the Privy Council delivered its heavily anticipated and, since then, much celebrated judgement in Broad Idea International Ltd v Convoy Collateral Ltd/Convoy Collateral Ltd v Cho Kwai Chee [2021] UKPC 24. With its judgment, the majority of the Privy Council formally rejected a long-established principle set by previous authorities, most notably, in the leading case, The Siskina (Owners of Cargo Lately Laden on Board) v Distos Copmania Naviera SA [1979] AC 210 (“The Siskina”) and has ultimately widened the territorial reach of the power vested in the common law Courts to issue freezing injunctions.

In short, the judgement confirmed that when a common law Court has personal jurisdiction over a party, it further has power to grant a freezing injunction against that party in aid of foreign proceedings so as to assist the enforcement of a prospective or an existing foreign judgment.

Although the power of the BVI Court to grant a freezing injunction in the above combination was first recognised in Black Swan Investment ISA v Harvest View Ltd (BVIHCV 2009/399) (unreported) 23 March 2010, and even if in fact, several orders of the Black Swan kind were issued by the BVI courts in many high value cases for almost a decade, the principle was nonetheless overruled by the Eastern Caribbean Court of Appeal. It held that Black Swan was wrongly decided in reliance on the reasoning followed in the The Siskina which provided that the granting of a freezing injunction is contingent on the existence of substantive domestic proceedings.

In light of the Court of Appeal's decision, the BVI’s relevant legislation was swiftly amended so as to confer jurisdiction to the BVI Court to grant freestanding injunctive relief.


The appellant applied ex parte to the Commercial Court of the Eastern Caribbean Supreme Court in the BVI for freezing injunctions against C, a Hong Kong resident and a former director of the appellant, and the first respondent, a BVI company whose assets were allegedly beneficially owned by C, in support of anticipated proceedings against C in Hong Kong. The Court initially granted both the freezing injunctions and gave permission to serve the claim form on C, out of the jurisdiction. Nevertheless, both orders were subsequently set aside by the Court of Appeal.

The Court of Appeal held that the relevant Civil Procedure Rule (EC CPR r 7.3(2)(b)[1]) did not empower the BVI court to authorise service of the claim form on a defendant outside the jurisdiction where a freezing injunction was the only relief sought and the order against C was set aside on this ground. In relation to the first respondent, the Court of Appeal decided to set aside the order on the grounds that, under common law, a domestic court had no power to grant a freezing injunction against a party over which it had personal jurisdiction when no substantive claim had been made in domestic proceedings against that party and that, in any event, there was insufficient evidence to establish that the first respondent was merely holding assets to which C was beneficially entitled.

The Appeal before the Privy Council considered mainly two issues: (a) whether the BVI Court has jurisdiction to authorise service on a defendant outside the jurisdiction of a claim form in which a freezing injunction is the only relief sought pursuant to the relevant Civil Procedure Rules and (b) whether the BVI court, having personal power over a party, has power to grant a freezing injunction against that party to assist enforcement through the court’s process of a prospective or existing foreign judgment.

Service out of the jurisdiction

In respect to the first issue, the Privy Council dismissed the appellant’s appeal and upheld the Court of Appeal’s decision that the relevant EC CPR did not permit service on a defendant outside the jurisdiction where a freezing injunction was the only relief sought.

In reaching this decision, the Privy Council considered that the relevant EC CPR was materially similar to the rules considered and applied in the The Siskina and Mercedes-Benz AG v Leiduck [1996] A.C. 284, [1995] 7 WLUK 307. Although the decisions were not binding upon it, the Privy Council declined to deviate from them without a compelling reason. In the Council’s view, departing from a settled interpretation of the rule would have repercussions beyond the BVI as it could potentially cause uncertainty about the effect of the similar rules in other jurisdictions.

The Court’s power to grant a freezing injunction

The Privy Council also upheld the decision not to issue a freezing order against the first defendant but disagreed with the position taken by the Court of Appeal in finding that the BVI courts had no power to grant a free-standing freezing injunction to assist the enforcement of a foreign judgment. The order against the first respondent could not be supported on the facts of the case as there was no evidence that they did not beneficially own the assets.

Following an extensive review of the applicable case law and the evolution of injunctive relief, the Privy Council recognised that the principle set in The Siskina, namely that a freezing injunction was ancillary to a cause of action, was decided at a time when the practice of granting freezing injunctions was yet to mature and that the law and practice have shifted in many other ways since then. The Court of Appeal’s decision to overturn Black Swan was wrong and according to the majority, the restrictions on the court’s power to grant interim injunctions imposed by The Siskina, were both undesirable in modern day international commerce and legally unsound. Lord Leggatt (providing the judgment of the majority) observed that the developments in the practice of granting injunctions (both freezing and other kinds) illustrate the ability of courts with equitable powers to modify existing practice. This flexibility is crucial if the law and its procedures are to keep abreast of changes in society, such as, the ease and speed with which money and other financial assets can be moved around the world, the globalization of commerce and economic activity and resulting growth of cross – border dispute resolution, as well as, the growth in the use of offshore companies.

His Lordship also highlighted that the essential purpose of a freezing injunction is to prevent the right of enforcement from being rendered ineffective by the dissipation of assets against which the judgment could otherwise be enforced. This is described as the "enforcement principle" and according to Lord Leggatt, once the principle is appreciated, there is no reason to link the grant of an injunction to the existence of a cause of action, in the sense of a claim for substantive relief.

Lord Leggatt concluded by summarising the current test for granting a freezing injunction. A court with equitable and/or statutory jurisdiction to grant injunctions, where it is just and convenient to do so, has power to grant a freezing injunction against a party over whom the court has personal jurisdiction provided that:

(i) the applicant has already been granted or has a good arguable case for being granted a judgment or an order for the payment of a sum of money that is or will be enforceable through the process of the court;

(ii) the respondent holds assets (or will take steps to reduce the value of assets) against which such a judgment could be enforced; and

(iii) there is a real risk that, unless the injunction is granted, the respondent will deal with such assets (or take steps to diminish their value) in a way that is not in line with the ordinary course of business hindering the availability or value of the assets and eventually leaving the judgement unsatisfied.

The judge further explained that:

(i) The principle applies equally to a foreign judgment or an award capable of enforcement in the same way as a judgment of the domestic court using the court’s enforcement powers.

(ii) There is no requirement that the judgment should be a judgment against the respondent.

(iii) There is no requirement that proceedings in which the judgment is sought should yet have been commenced nor that a right to bring such proceedings should yet have arisen. The court need to be satisfied, with sufficient degree of certainty, that a right to bring proceedings will arise and that proceedings will be brought (whether in the domestic court or before another court or tribunal).

Consequences of the judgment and possible implications on the Cypriot Courts

The Privy Council’s decision represents a landmark development in the law of injunctions, especially for common law jurisdictions, such as Cyprus, which have not enacted specific legislation permitting the issuance of injunctive relief in aid of foreign proceedings.

The statutory power of Cypriot Courts to issue injunctions derives from section 32 of the Court of Justice Law of 1960 (Law 14/60). Cypriot Courts have jurisdiction to issue injunctive relief (and/or appoint an interim receiver) in all cases, in which it appears to the Court just and convenient to do so, provided that: (a) there is a serious issue to be tried, (b) there is a probability that the applicant is entitled to relief and (c) it would be difficult or impossible for justice to be served at a later stage if the injunction is not issued. The balance of convenience has to also be in favour of the Applicant.

Additionally, Cypriot Courts have the power to issue injunctive relief in aid of foreign proceedings on the basis of various international conventions, multinational and bilateral treaties between Cyprus and other countries, where the substantive proceedings are pending.

In relation to legal proceedings pending before Member States of the European Union, Cypriot Courts have power to issue provisional, including protective, measures (provided that the requirements of section 32 above are satisfied) even if the courts of another Member State have jurisdiction as to the substance of the matter, according to article 35 of the Regulation (EU) No 1215/2012 (recast). Section 9 of the International Commercial Arbitration Law of 1987 (Law 101/1987) also provides Cypriot Courts with discretion to issue injunctions at any time before or during the arbitral proceedings.

It is an established rule that Cypriot Courts have broad discretion to issue different kinds of injunctions pursuant to section 32 of the Law (see Seamark Consultancy Services Ltd a.o. ν. Lasala a.o (2007) 1 S.C.J 162, Avila Management Ltd a.o ν. Stepanek a.o (2012) 1 S.C.J. 1403). However, despite the fact that Cypriot Courts have issued, in the absence of substantive proceedings, numerous disclosure orders against innocent parties, as well as, Chabra orders against non-cause of action defendants, they have nevertheless denied to grant freezing injunctions in instances where the substantive proceedings were pending before a non – EU Member country. In these particular instances, Cypriot Courts followed the reasoning in The Siskina as well as the fact that there was no specific statutory provision conferring such power upon the Cypriot Courts[2].

The recent judgement provides a persuasive authority which is expected to be followed by Cypriot Courts in future proceedings, a development which will be most welcomed. Broad Idea provides the prospects to successfully dispel anachronistic and impractical restrictions previously imposed and followed by Cypriot Courts and unequivocally reinstate the breadth of power they already hold.

Agathi Zervou


This update does not constitute legal advice.

[1] The EC CPR rule 7.3(1)(b), allows a claim form to be served out of the jurisdiction “if a claim is made … for an injunction ordering the defendant to do or refrain from doing some act within the jurisdiction.”


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