Following the reform of the Arbitration Law, most existing arbitral institutions must re-register and obtain a permit from the government to administer disputes in Russia before November 1 2017. The International Commercial Arbitration Court at the Russian Chamber of Commerce and Industry has used this opportunity to enhance significantly its previous rules governing international and domestic arbitration.
One of the most praised changes introduced by the recent arbitration law reform concerns the arbitrability of so-called 'corporate disputes'. The Russian Arbitration Association (RAA) was the first Russian arbitral institution to develop and release for public consultation draft arbitration rules for corporate disputes. While some institutions have already followed suit and many more will do so, the RAA's draft rules provide a better idea of what arbitral proceedings in corporate disputes could look like.
The New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards requires state courts to respect arbitration agreements and refer parties to arbitration if one of them so requests. While the convention is silent on when a party must make the request, national legislation usually fills this gap. From a Russian law perspective, a recent case demonstrates once again that the timing of raising jurisdictional objections before the state courts is of key importance.
Recent amendments to the Arbitrazh Procedural Code introduced a mandatory pre-litigation procedure in the hope that many cases will be resolved before the disputes escalate. Although it is unclear whether the new rules apply to the enforcement of arbitral awards, there are strong indications in favour of a conservative interpretation. Parties may want to play it safe and take steps to comply with the new pre-trial procedures.
A recent decision from the commercial bench of the Supreme Court has reopened the question of whether an agent must be specifically authorised to enter into an arbitration agreement or whether the general authority to conclude contracts on behalf of the principal is sufficient. It previously seemed to be settled court practice that no special authority was needed. However, the recent ruling makes the position less certain.
The president recently signed two bills effecting the reform of arbitration law in Russia, which had been in the works for more than two years. Among other things, the reform introduces changes in relation to the rules governing arbitration agreements, the types of dispute that can be put to arbitration and proceedings to set aside and enforce arbitral awards.
The Russian Arbitration Association (RAA) was formed in 2013 with a view to promoting arbitration – both domestic and international – in Russia. To achieve this goal, the RAA has now developed and adopted two sets of arbitration rules and created a database of arbitrators with backgrounds in Commonwealth of Independent States and Eastern Europe-related matters.
From around 2011 the Supreme Arbitrazh Court began to develop the concept of 'objective impartiality' of arbitral institutions in a line of cases, holding that awards issued by tribunals acting under the auspices of arbitral institutions affiliated with a party to the dispute are contrary to Russian public policy. However, a recent Constitutional Court decision may signal a departure from this judicial trend.
The Supreme Court recently issued a ruling effectively confirming that an arbitration clause can be challenged separately and independently of the underlying contract. While the idea that an arbitration agreement is subject to relevant provisions of contract law is by no means new, allowing challenges to arbitration agreements in state courts may have unwelcome and far-reaching consequences.
The progress of the Ministry of Justice's bills to reform Russian arbitration law has stalled. A recent statement of the Legal Directorate of the Administration of the Russian President criticised the bills on a number of counts, including their potentially negative impact on Russia's standing as a seat for international arbitration. These comments generally follow those made by the Presidential Council for Codification of Civil Law.
The Supreme Arbitrazh Court recently published two resolutions in cases which arguably provide guidance as to the arbitrability of disputes arising from contracts with a high concentration of public elements. While both cases concern domestic – rather than international – arbitration, they touch on the public interest implications of arbitrability, the validity of arbitration agreements and public policy in general.
In early 2014 the Ministry of Justice published for public consultation various draft laws relating to the reform of arbitration legislation. The consultation process has now been completed and revised drafts issued. While the proposed amendments mostly concern the domestic arbitration regime, several changes are of importance to both international arbitration institutions and users.
While the Russian courts are known to be overly formal when it comes to the analysis of arbitration clauses, two recent cases may signify a move towards a more arbitration-friendly interpretation of parties' agreements and a greater respect for parties' desire to arbitrate.
The presidium of the Supreme Arbitrazh Court recently issued a practice review that, although largely dedicated to cross-border litigation questions, is nonetheless of interest to arbitration practitioners in that it both sets out the principles of granting interim measures in support of foreign arbitral proceedings and leaves open the question of whether unilateral option dispute resolution clauses are valid in Russia.
The Supreme Arbitrazh Court has issued Resolution 831/12, reaching a conclusion on the invalidity of alternative (asymmetrical) arbitral clauses. The resolution will have a significant impact on practice despite the fact that it does not completely resolve the issue of the validity of arbitration selection as a means of dispute resolution in alternative arbitral clauses.
A landmark Constitutional Court ruling is a significant step towards a greater and more secure role for international and domestic arbitration in Russia, as it ends a lengthy debate concerning the arbitrability of real estate disputes, at least for the purposes of domestic arbitration.
The Rules on Impartiality and Independence of Arbitrators are a testament to the increasing maturity of arbitration in Russia. Their promulgation has been seen as a timely response to numerous attempts to derail proceedings by challenging arbitrators on spurious grounds, often at the eleventh hour.
In a landmark case the Supreme Arbitrazh Court considered an application for interim relief in aid of London Court of International Arbitration arbitral proceedings and raised no arguments against interim measures in support of international arbitration proceedings. This represents a step forward in securing the interests of parties arbitrating abroad - a typical issue in international deals with Russian parties.
Until now, mediation proceedings in Russia have been theoretically available, but relatively rare. However, following several years of debate regarding the need for alternative dispute resolution, new legislation has been promulgated that finally provides a clear legal basis for mediation proceedings.
The Federal Arbitrazh Court of the Moscow District has issued a cassation judgment confirming the validity of an optional jurisdiction clause. The court's approach indicates a less formalistic attitude than is normally seen in the Russian courts and represents a significant step towards the adoption of international arbitration practices in Russia.