Application of the New York Convention in Russia has been challenged due to the dissolution of USSR

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.

Thus, Fronline sought the enforcement and recognition in Russia at least of three arbitration awards rendered on November 28, 1991 against V/O Eksporthleb by arbitration (the seat of arbitration was reported to be London).

The cases were considered by the Moscow City Court. The main ground for of the defendant’s objection to the enforcement and recognition mentioned was that the Russian Federation is not a member of the New York Convention because Russia has never ratified the Convention.

The court rejected the objection. The Court declared Russia is the assignee of USSR. The Court referred to Article 12 of the Agreement on Establishing the Commonwealth of Independent States declares the parties to the Agreement, in particular Russia, guarantee the fulfillment of international obligations arising for them from the treaties and agreements of the former USSR.

Since, as it has been mentioned by the Court, there were no grounds enumerated in Article V of the Convention and the claimant complained according to Article IV of the Convention, the Moscow City Court granted the enforcement and recognition of all the three arbitration awards (the rulings of the Moscow City Court dated 23 January 1992 in cases 3-53/3-92; 3-54/3-92; 3-55/3-92).

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Application of the New York Convention in Russia has been challenged due to the dissolution of USSR

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