Arbitration May Be the Answer for Your Commercial Dispute

When you started your business venture in Russia, you did not plan on ending up in court over a dispute with a vendor, customer, or supplier. However, when you find yourself in such a situation, you need to understand all of your legal options. While most business disputes fall under the jurisdiction of the state arbitrazh court, foreign investors have the option of taking their dispute to a private arbitration tribunal located either in the Russian Federation or abroad. Arbitration is a less formal process than a court hearing and may save you valuable time and resources. We explain your options when considering arbitration to settle your dispute.

International Commercial Arbitration Court (ICAC)

Because an arbitration proceeding is not part of the state or federal court system, those seeking arbitration may use any arbitration tribunal—including private, ad hoc, and institutional tribunals—located in Russia or abroad. You may seek arbitration for a wide range of business disputes, but not for tax or customs disputes, bankruptcy proceedings, or any other dispute that falls under the jurisdiction of the state arbitrazh court. For many foreign investors, the International Commercial Arbitration Court of the Russian Federation Chamber of Commerce and Industry (ICAC) is the best choice to handle your business dispute.

The ICAC is a highly respected body in Russia and throughout the world for international dispute resolution. It is well organized and very efficient. As long as all parties involved have agreed in the arbitration clause to arbitration by the ICAC, the proceedings can move forward. The ICAC hears arguments in Russian, but may also hold hearings in other languages using interpreters if all parties agree. Documents may be submitted to the ICAC in English without translation.

Other advantages offered by the ICAC to foreign investors include:

  • It is well-established and has had many years of experience settling international disputes.
  • The arbitrators are usually professors of law or officers of legal departments of international trade organizations and are knowledgeable and objective.
  • The tribunal acts quickly and is less expensive than other legal options.
  • Findings are enforceable through the Russian court system.

Findings of the ICAC, or any other arbitration tribunal, are considered final and are not eligible for appeal as most court decisions are, unless certain very specific conditions are met. Grounds for appeal of an arbitration tribunal finding include:

  • The arbitration clause is found to be invalid.
  • The proceedings violated a major requirement of the law.
  • The grounds for dispute fall within another court’s jurisdiction.
  • The finding violates Russian law.

If any of these conditions are met, the complainant must file a motion with the state arbitrazh court within three months of the date the decision was reached by the arbitration tribunal.

Enforcement of an Arbitration Award

The ICAC and other arbitration tribunals do not have the authority to enforce their own findings. Findings of the ICAC will be enforced in Russia by the state arbitrazh court. Findings of foreign tribunals will only be enforced in Russia if the judgment has been recognized by a Russian court through an international treaty or based on reciprocity with the foreign state. When it is important to your business that the findings be subject to enforcement in Russia, your best bet is to have the arbitration proceeding conducted in Russia so that it will have the backing of the Russian courts.

Jus Privatum Can Help You Make the Call

Even when you choose arbitration, you will need the legal advice of a law firm with experience in Russian commercial law. The business attorneys at Jus Privatum will review your dispute and advise you as to the best venue for pursuing justice. If arbitration, whether through the ICAC or another tribunal, is the best option for you and your business, we will help you take the next steps. Contact us through the link on this page to get started.

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