A New Arbitration Institution Established in Belarus

Siarhiei Balashenka – chairman of the new Belarus arbitration institution

The Chamber of Arbitrators under the Union of Lawyers is a new institutional arbitration forum established in Belarus this year. The Union of Lawyers is the biggest Belarusian jurists professional association that unites all representatives of the legal profession – from law students and paralegals to judges.

The Belarusian Chamber of Commerce and Industry (BelCCI) established the first in the new independent history of Belarus arbitration institution in 1994. That was done even before the adoption of the national law on international arbitration in 1999. Until now, that institution was pretty busy (resolved more than 600 cases) but was often criticized for being slow.

After almost 15 years of “monopoly” of the International Arbitration Court under BelCCI the Union of Lawyers of the Republic of Belarus has established an alternative forum. Despite the general legal framework – the Act on International Arbitration Court of the 1999 the rules of a new court (hereinafter – Rules) contain several provisions which need to be addressed in more detail.

38 of the Rules reflect Article 28.3 of the UNCITRAL Model Law on International Commercial Arbitration (1985) on a dispute settlement ex aequo et bono. The parties need to expressly consent to such settlement. Belarusian law on international arbitration has not implemented this provision of the Model Law, but this provision of the Rules is a certainly a positive development.

“E-justice” system in new arbitration court

The main novel of the Rules is the ability to use elements of the so-called “e-justice” system. The concept of “e-justice” is set forth neither in The Rules, nor in current legislation. However, it is specified that the parties may “agree otherwise”. The use of “e-justice” is accepted by the parties and the arbitration court if the Statement of Claim contains claimant’s email address and Defendant indicates the details of its email in the Statement of Defense. In fact, it means that claimant and defendant agree to send and receive all procedural and other documents during arbitration proceedings (including claims, notices and orders of the arbitration court and other written documents) through delivery of their electronic copies to a specified e-mail addresses.

Evidential problems of e-justice in arbitration

Despite the increased role of electronic communications in the modern jurisprudence reasonability of introducing “e-justice” into an international arbitration process is highly questionable because of the following reasons:

1) there is a risk of inconsistency of the decision rendered in the framework of “e-justice” with a public policy of the country in which this decision will be enforced;

2) it is an accepted fact that perceive the text from the screen is worse than from a printed sheet of paper. Who will bear the cost of printing large volumes of information by the arbitrators?;

3) how to solve the problem of incompatibility of electronic documents involved into procedural electronic “circulation”?

4) how to solve the problem of delivery confirmation sabotage by the defendant while receiving documents in electronic form, if the defendant initially agreed to “e-justice?”. Practically, such proceedings can be blocked by the defendant at any stage;

5) the possibility of studying the reliability of the evidence is extremely low, and the possibility of falsification of electronic documents is very high;

6) sending of documents of the case and online proceedings involve a risk of loss of confidentiality.

Other possible problems in Rules

It is rather strange that Part 2 of Article 30 of the Rules sets forth that the arbitral tribunal cannot accept the change or addition to a claim (including counterclaim) if it will result in an unjustified increase of duration of the proceedings. An increase of duration of the proceedings is primarily a problem for the claimant, who covers all procedural expenses, so what’s the difficulty for the court?
Paragraph 3 of the Rules states that “copies of the decision to be handed over to the parties against receipt, or sent them registered letters with return receipt requested within a week”. It is unclear from what moment in time a given week period should be calculated.

A clear violation of the principle of confidentiality of arbitration (article 3 of the “Act on International Arbitration Court”) is a norm of paragraph 1 of Article 45 of the Rules, whereby on default of decisions of the Arbitration Court, at the request of the Claimant its Panel may report it to any of business partners listed by the defendant, as well to chambers of commerce, other business organizations and media.

The Rules does not contain any indication whether the arbitration fee will cover the claim of reimbursement of the Claimant’s legal aid expenses. The statement of claim is filed after the payment of registration fee (paragraph 3 of Article 21 of the Rules), but the meaning of the registration fee and its size is not defined by the Rules.

Despite all this shortcomings, establishment of a new arbitration institution is certainly a welcome development for parties wishing to avoid domestic courts or the BelCCI arbitration forum.

The rules of the The Chamber of Arbitrators under the Union of Lawyers in Russian are available here.

Ales Danilevich
Belarusian State University

About the Author:

Dr Aliaksandr Danilevich is a partner at Danilevich & Volozhinets law office in Minsk, Belarus. He has a Ph.D. in law from Belarusian State University. He is an associate professor at the department of International Private and European law of the Belarusian State University in Minsk, where he teaches Private International Law, International Arbitration and International Transport law. See full profile.

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