Happy to share my first contribution to Yearbook on Commercial Arbitration. Brandford LLC v. SL Graphika LLC (А31-3491/2014) might be interesting to those who seeks the enforcement and recognition of an arbitral award rendered in a CIS country. Russian courts reminded that the 1992 Kiev Treaty on the Manner of Resolving Disputes in the Area of Commercial Activity does not apply to the recognition and enforcement of foreign arbitral awards.
The right to be heard in adversarial proceedings in international commercial arbitration has its own scope and limitations. In a recent decision of a Russian state court, the Arbitrazh Court of the Omsk region clarifies it.
On 29th July 2015 the Supreme Court of Russia reveals the decision on the issue whether or not a court grants the recognition and enforcement of an arbitral award against a debtor who is in the process of liquidation or the arbitral award should be conferred initially in accordance with special liquidation provisions. Continue reading “Russia: Application of the New York Convention and liquidation of a debtor”
Since the 60s. of the last century the Union of Soviet Socialist Republics (USSR) was a member of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention) but on December 26, 1991 the Soviet Union collapsed.
Almost immediately after of the dissolution of USSR this fact was used as an attempt to object to the enforcement and recognition of several arbitration awards rendered by arbitration against a company domiciled the Russian Federation.
The Supreme Court of Russia confirms an old approach of the abolished Supreme Commercial (Arbitrazh) Court – a dispute arising out of a government (municipal) contract could not be resolved by arbitration. A state court should resolve the dispute (The resolution of the Presidium of the Supreme Commercial (Arbitrazh) Court dated 28.01.2014 case № 11535/13).
The public policy exception to the enforcement of arbitral awards has traditionally been applied very narrowly, for example, where a failure to vacate the award would violate the due process rights of the participants. However a recent case illustrates the contrasting approaches of the Swedish and Russian courts in this regard. In a recently published article I discuss both the Swedish and Russian court rulings and consider the implications for both freedom of contract and arbitration as a method of dispute resolution in each jurisdiction.
Background: The claimant, a foreign-company, applied to a court for an application for the recognition and enforcement of the judgment of the High Court of Justice of England. The defendant, a company domiciled in Russia, objected and alleged that defendant had not notified him of litigation. Moreover, the defendant thought if the agreement between Russia and the United Kingdom of Great Britain and Northern Ireland on recognition and enforcement of judgments of its states is absent, the court should dismiss the application.
At the end of 2013 the Supreme Commercial Court of Russia put an end in a series of similar disputes concerning enforcement of the LCIA awards. The approach of Russiancourts to the enforcement issue looks controversial. The case sagain demonstrated how a broad interpretation of «public policy» may effect arbitration with Russians` parties.
In April 2013, the Supreme Commercial (Arbitrazh) Court of Russia ruled that any punitive damages claimed for breach of contract must be proportionate to the value of the contract (or part thereof) or else an application for enforcement of an arbitral award ordering the payment of such punitive damages will be rejected. Mikhail Samoylov, Senior Associate at KIAP Attorneys at Law, discusses the court’s ruling and considers whether the Russian courts may take a similar approach to the enforcement of international arbitration awards.