By 14 February, 2011 0 Comments Read More →

Challenging Jurisdiction of Arbitral Tribunals in Russian Courts

Justice Anton Ivanov

It is not possible to challenge in state courts decisions on jurisdiction of arbitral tribunals constituted in accordance with the Russian Federal Law ‘On Arbitration Tribunals’. That is the ruling of the Presidium of the Supreme Commercial (Arbitrazh) Court published the Court’s web site earlier this year.

The issue was whether it was possible to challenge jurisdictional decisions of Russian domestic arbitration tribunals. In its ruling, the Supreme Commercial Court distinguished between two types of awards. One type is awards rendered by tribunals in Russia established in accordance with the Federal Law ‘On Arbitral Tribunals’. The other type encompasses awards under the Federal Law ‘On International Commercial Arbitration’.

The Federal Law ‘On Arbitral Tribunals’ provides for regulations of domestic arbitration tribunals. The Federal Law ‘On International Commercial Arbitration’, on the other hand, deals exclusively with international arbitration proceedings – both in Russia and outside of it and regulates enforcement of foreign arbitration awards.

The Court explained that according with Article 235.1 of the Code of Commercial Procedure there are only two situations when parties may challenge jurisdictional decisions of arbitration tribunals. First, when this right is stipulated by international treaty. Second, when such right is provided by federal law.

The Court noted that there was no international treaty applicable to Russian domestic arbitration proceedings under the Federal Law ‘On Arbitral Tribunals’. Moreover, the court noted that there could be no such treaty in principle. The law itself does not provide for such right either. Therefore, it was concluded that it was not possible to challenge in Russian commercial courts decisions on jurisdiction of domestic arbitration tribunals.

It was also explained by the Court that although it was not possible to challenge the domestic arbitral tribunal jurisdictional rulings in separate proceedings, the parties may refer to lack of competence with the arbitral tribunal during the proceedings on the enforcement or annulment of arbitral awards. It should be noted that the regime under the Federal Law ‘On International Commercial Arbitration’ is different. Article 16.3 of the Law provides for the right to challenge decisions of arbitral tribunals on jurisdiction by instituting separate proceedings, prior to the enforcement stage.

During his visit to London in October 2010 Justice Anton Ivanov, the chairman of the Russian Supreme Commercial Court, expressed his particular concern about domestic arbitral tribunals which operate in Russia. He mentioned at his lecture at the University College London that these arbitral tribunals, often created under auspices of large companies, are not truly independent and often fail to follow a proper procedure. That affects recognition and enforcement of awards rendered by such tribunals. The same concerns were raised by him at an ICC arbitration conference in Moscow on December 2010. There he explained that these critical remarks do not extend to arbitration courts established by chambers of commerce (such as, for example, ICAC at the Russian Chamber of Commerce and Industry).

The text of the ruling is available in Russian at the Court’s web site.

Yaraslau Kryvoi

About the Author:

Prof Yarik Kryvoi, MCIArb is the founder and co-editor of the CIS Arbitration Forum. He is the Senior Research Fellow in International Economic Law and Director of the Investment Treaty Forum at the British Institute of International and Comparative Law (BIICL). He holds law degrees from Harvard, Moscow and St Petersburg. He has been teaching and practicing international arbitration in Russia, the United States and England for over ten years and is listed as arbitrator by several arbitration institutions. Prof Kryvoi also served as a Co-Chair of the International Courts Committee of the American Bar Association's Section of International Law. He also serves a tutor at the Chartered Institute of Arbitrators in London. See full profile at kryvoi.net.

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