The law of the Russian Federation “On International Commercial Arbitration” (No. 5338-1), approved by the Supreme Soviet of the Russian Federation on ­7 July 1993, was enacted on 14 August 1993 (“the 1993 Law”).

The 1993 Law:

• consolidated the law applicable to arbitration procedures;
• reformed the status of the International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation (“the ICAC”) to reflect its international status;
• supplemented the existing legislation with special norms on international arbitration procedures;
• amended the existing legislation to incorporate commercial arbitration provisions contained in various international agreements to which the Russian Federation is a party; and
• resolved various commercial arbitration issues that were not until then regulated by legislation.

The preamble to the 1993 Law states that the legislature recognised the usefulness of arbitration as a method for the resolution of disputes arising from international trade and the need for comprehensive regulation of international commercial arbitration in the Russian Federation. The 1993 Law was drafted taking into account the arbitration provisions contained in:

• international agreements to which the Russian Federation is a party; and
• the 1985 UNCITRAL Model Law.

The 1993 Law has two Appendices, which set out the statutes of the two leading Russian arbitration institutions, the ICAC and the Maritime Arbitration Commission at the Chamber of Commerce and Industry of the Russian Federation (“the MAC”):

• Appendix 1 contains the “Statute on the Court of International Commercial Arbitration at the Chamber of Commerce and Industry of the Russian Federation”; and
• Appendix 2 contains the “Statute on the Maritime Arbitration Commission at the Chamber of Commerce and Industry of the Russian Federation”.

Prior to the enactment of the 1993 Law, the “Regulations on the Arbitration Court of the USSR Chamber of Commerce and Industry” (“the Regulations”), as approved by Decree No. 8135-11 of the Presidium of the USSR Supreme Soviet on 14 December 1987, governed proceedings in the Arbitration Court. The Regulations made the Arbitration Court a permanent body of the USSR Chamber of Commerce and Industry, and set out general principles for the proceedings of the Arbitration Court. One of these principles was that the Arbitration Court was to accept any dispute referred to it by a party to a written agreement where such referral was a term of that agreement.

Prior to the enactment of the Regulations, proceedings in the Arbitration Court were regulated by the “Procedural Rules of the Foreign Trade Arbitration Commission of the USSR Chamber of Commerce and Industry”, as approved by the resolution of the USSR Chamber of Trade and Industry on 25 June 1975 and enacted on 1 August 1975. The Regulations stipulated that the USSR Chamber of Commerce and Industry was to approve new procedural rules for the Arbitration Court, but such rules were never in fact approved.

Appendix 1 to the 1993 Law provides, inter alia, that the ICAC is the legal successor to the Arbitration Court of the USSR Chamber of Trade and Industry.

The Arbitration Rules of the ICAC, which the Chamber of Commerce and Industry of the Russian Federation developed in accordance with Appendix 1 of the 1993 Law (“the ICAC Rules”), remain the most frequently used institutional arbitration rules in Russia. The ICAC Rules are based on the 1976 UNCITRAL Arbitration Rules, and were adopted on 1 May 1995. The new version of the ICAC Rules was adopted on 18 October 2005.

Other arbitration courts are attached to a number of regional and local chambers of commerce and industry, such as the Arbitration Court at the St. Petersburg Chamber of Commerce and Industry.

From 1922 onwards, commercial disputes between domestic parties and state enterprises had to be settled by the newly created state “arbitrazh” tribunals; these were neither courts in the proper sense of the term nor an arbitration system, but consisted of quasi-judicial panels of adjudicators. Foreign trade disputes, however, were resolved by arbitration, and two specialised permanent arbitration bodies were established in Moscow: in 1930, the Maritime Arbitration Commission was set up, followed in 1932 by the Foreign Trade Arbitration Commission (renamed the Arbitration Court of the USSR Chamber of Trade and Industry in 1987, and then the ICAC in 1993), which dealt with all non-maritime international trade disputes. Only special State-controlled trading enterprises could engage in foreign trade, and these enterprises alone had access to arbitration.

In addition to this system for resolving East/West trade disputes between Soviet foreign trade enterprises and parties from non-communist countries, the 1972 Moscow Convention introduced a compulsory international arbitration scheme for all disputes arising between the State trading enterprises of the Member States of the Council for Mutual Economic Assistance (COMECON).

Since 1991, far-reaching legal reforms have been implemented, including some in the area of dispute resolution. The state arbitrazh courts were reformed into courts of law proper, and now also have jurisdiction to hear foreign trade disputes. The law relating to domestic arbitration was updated by the 1992 Provisional Regulations, which permitted domestic parties to refer their private disputes for resolution to a private arbitral tribunal in Russia. In 2002, the Provisional Regulations were rescinded, effectively being replaced by the Federal Law On Arbitration Tribunals in the Russian Federation (No. 102-FZ) (“Russian Arbitration Law”). The Russian Arbitration Law took effect on 27 July 2002.

The 1993 Law was introduced to make international commercial arbitration in Russia more acceptable to foreign parties, in particular, in relation to inward investment and foreign trade disputes. The 1993 Law was therefore based on the internationally recognised standard of the 1985 UNCITRAL Model Law.

Scope of application
Article 1 (1) of the 1993 Law provides that the 1993 Law shall apply to international commercial arbitration if the place of arbitration is within the Russian Federation. However, some of the provisions of the 1993 Law also apply to disputes where the place of arbitration is outside the Russian Federation; these provisions include:

• Article 8 (stay of court proceedings in favour of arbitration);
• Article 9 (court applications for interim protective measures in support of arbitration proceedings); and
• Articles 35 and 36 (recognition and enforcement of arbitral awards).

It follows from the wide definition of “arbitration” in Article 2 of the 1993 Law that its provisions apply not only in relation to ICAC- or MAC-administered arbitrations, but also permit ad hoc arbitrations and arbitrations organised under the rules of other permanent arbitration institutions, such as the ICC Court of Arbitration in Paris.

As indicated above, the 1993 Law does not apply to purely domestic arbitrations, which are presently governed by the 2002 Russian Arbitration Law. This chapter on Arbitration in the Russian Federation will focus primarily on international commercial arbitration under the 1993 Law. Some important provisions in the ICAC Rules will also be highlighted.

The Russian Arbitration Law is more developed than the 1992 Provisional Regulations. For example, the Law has an introductory chapter on arbitration costs, an arbitrator’s duty of confidentiality and a procedure for challenging an arbitral award. The Russian Arbitration Law governs arbitration courts located domestically and permits both institutional and ad hoc arbitration. It does not apply to international commercial arbitration. An institutional domestic arbitration tribunal must hear a case in accordance with its rules, unless otherwise agreed by the parties. An ad hoc hearing is to be conducted under rules agreed by the parties. Subject to compliance with certain legal requirements, practically any Russian registered entity or association has a right to set up an institutional arbitration court.

General principles
Some of the more important provisions of the 1993 Law provide that:

• no court interference in the arbitral process may take place except as provided for by the 1993 Law (principle of non-intervention by the courts);
• prior to their appointment, and subsequently at any stage of the arbitration, arbitrators must disclose any information that may give rise to justifiable doubts as to their impartiality or independence, and they may be challenged if such doubts exist (principle of impartiality and independence of the arbitral tribunal);
• the parties to a dispute may decide on particular issues relating to the arbitration procedure to be followed and thereby deviate from the provisions of the 1993 Law (where so permitted by the 1993 Law) (principle of party autonomy); and that
• the parties to a dispute must be treated equally and without preference and each party must be provided with an opportunity to present its case (principle of equality of the parties, fairness and due process).

Formal requirements
Article 7 (1) of the 1993 Law defines an arbitration agreement as an agreement by the parties to submit all or certain disputes which have arisen or may arise between them in respect of a defined legal relationship, whether contractual or not, to arbitration. An arbitration agreement may be in the form of a separate agreement or, more usually, will be incorporated as a clause in the main agreement between the parties to which it relates.

Article 7 (2) of the 1993 Law requires an arbitration agreement to be in writing. The following will satisfy the form requirement for the agreement to be in writing:

• an agreement in the form of a document signed by the parties;
• an exchange of letters, telexes, or other means of telecommunication that provides a record of the parties’ agreement;
• an assertion by one party in its Statement of Claim or defence that there is an agreement between the parties to refer any dispute between them to arbitration, that is not denied by the other party; and
• a reference in an agreement to a separate document containing an arbitration clause constitutes an arbitration agreement, provided that the agreement is executed in writing and that the reference to the arbitration clause in the separate document expressly makes that clause part of the agreement.

As with international arbitration, an arbitration agreement executed in writing is required in order to enable parties to refer a dispute to domestic arbitration. Pursuant to Article 5 (4) of the Russian Arbitration Law, parties to a dispute have a right to enter into an arbitration agreement up until the point when a State Court hands down a decision on the merits of the case.

Arbitrability
Article 1 (2) of the 1993 Law provides that the parties may refer the following disputes to international commercial arbitration in their agreement:

• foreign trade disputes resulting from contractual or other civil law relationships, and other forms of international economic relations, if the place of business of at least one of the parties is located outside Russia; and
• disputes between Russian companies with foreign investment, and disputes between participants in such companies, as well as disputes between such entities and other private or public Russian persons.

Paragraph 2 (1) of the ICAC Rules describes the types of disputes that may be referred to ICAC arbitration in similar terms.

However, Article 1 (4) of the 1993 Law clarifies that the abovementioned law forms part of the wider Russian legal framework. The 1993 Law will therefore not apply where a specific legal provision prevents the use of arbitration or imposes an alternative and compulsory dispute resolution method. This relates, for example, to disputes concerning immovable property or land, which fall within the exclusive jurisdiction of the Russian courts.

Furthermore, Article 1 (5) of the 1993 Law provides that, as with all other domestic legislation, international agreements to which the Russian Federation is a party will take precedence over the 1993 Law if and to the extent that such agreements deal with the same subject matter and establish rules which differ from those contained in the 1993 Law or other Russian arbitration legislation.

Under the Russian Arbitration Law, any civil law related dispute may be referred to arbitration unless otherwise specified by federal law.

Separability
Article 16 (1) of the 1993 Law provides that an arbitration clause that forms part of a contract shall be treated as an agreement independent of the other terms of the contract for the purposes of determining the jurisdiction of the arbitral tribunal and the validity of the arbitration agreement. The fact that the main contract may be null and void therefore does not ipso jure entail the invalidity of the arbitration clause. This is an important precondition for the arbitral tribunal’s power to rule on its own jurisdiction (see further below).

Mandatory/non-mandatory provisions
The 1993 Law identifies non-mandatory provisions through wording such as “unless otherwise agreed by the parties” or “the parties are free to agree”, which indicates that the parties to an arbitration agreement have the discretion to make their own arrangements on procedural matters. Any such express provisions in the arbitration agreement between the parties will take precedence over the non-mandatory provisions of the 1993 Law. Where provisions are mandatory, the parties have no discretion to amend them or exclude their application by agreement.

Non-mandatory provisions include, in particular: the power of the arbitral tribunal to order interim protective measures; the issue of notices; the language, place and date of the commencement of proceedings; the number and the procedure for the appointment of arbitrators; and the procedure for the conduct of the arbitration proceedings.

In addition, Article 2 of the 1993 Law provides that, where a provision of the 1993 Law (other than in respect of the law applicable to the substance of the dispute) affords the parties to the arbitration discretion to agree on a particular issue, they may authorise a third party to exercise that discretion. This relates, in particular, to institutional arbitration, where by adopting institutional arbitration rules, the parties confer discretion on the arbitration institution, e.g. the right to appoint the arbitral tribunal on their behalf. Article 2 of the 1993 Law further clarifies that, where the parties are free to agree on a particular issue, they may do so by incorporating specific (institutional or ad hoc) arbitration rules into their agreement by reference, which are then regarded as containing the agreement of the parties.

As with the 1993 Law, rules agreed by the parties may not contradict the mandatory provisions of the Russian Arbitration Law.

Constitution of the arbitral tribunal
Pursuant to Article 10 of the 1993 Law, the parties to an arbitration agreement are free to determine the number of arbitrators. If the parties have not agreed to the number of arbitrators, three arbitrators shall be appointed.

Article 11 (1) of the 1993 Law provides that, unless otherwise agreed by the parties, nobody may be prevented from being an arbitrator on the grounds of his nationality. It is therefore possible to appoint foreign nationals as arbitrators for the purpose of international arbitration proceedings in Russia.

Article 11 (2) of the 1993 Law gives the parties freedom to agree on the procedure for appointing the arbitrators, subject to the default provisions in Articles 11 (4) and (5) of the 1993 Law, which are designed to ensure that an arbitral tribunal may properly be constituted even in the event that one of the parties fails to comply with the agreed procedure (see further below).

Article 11 (3) of the 1993 Law sets out the appointment procedure to be followed in the absence of any such agreement. If the arbitral tribunal is comprised of three arbitrators, each party shall appoint one arbitrator, and the two arbitrators thus appointed shall jointly appoint the third arbitrator. If a party fails to appoint an arbitrator within 30 days of receipt of a request from the other party to do so, or if the two party-appointed arbitrators fail to agree on the appointment of the third arbitrator within 30 days of their appointment, then the President of the Russian Chamber of Commerce and Industry (“the President”) shall make the requisite appointment. The President shall also make the appointment if the parties fail to agree on the appointment of a sole arbitrator.

Article 11 (4) of the 1993 Law addresses the situation where the parties have agreed an appointment procedure in their arbitration agreement, but one of the parties does not comply with the agreed procedure, or where the parties, or the two party-appointed arbitrators, fail to reach agreement, or where a third party (including an arbitration institution) does not fulfil the functions delegated to it in accordance with the agreed procedure. In such circumstances, either party may request the President to take the necessary measures to complete the appointment of the arbitrators, unless the arbitration agreement provides another mechanism for securing an appointment.

Article 11 (5) of the 1993 Law clarifies that any measures taken by the President to complete the constitution of the arbitral tribunal (as outlined above) are not subject to appeal. In appointing an arbitrator, the President shall have regard to the qualifications required of the arbitrator by the agreement of the parties, and to such other considerations as are likely to ensure the appointment of an independent and impartial arbitrator. Moreover, where the President is to appoint either the sole arbitrator or the third arbitrator, the 1993 Law obliges him to take into account whether it is advisable to appoint an arbitrator of a nationality other than those of the parties to the dispute. While this provision gives the President discretion as to the nationality of the sole or third arbitrator, it is general practice for the position of such an arbitrator to be filled with a national of a third country not connected with the dispute or the parties thereto.

The ICAC Rules contain general provisions on arbitrators, the requirements as to their impartiality and independence, and regarding their qualifications, in Paragraph 3. The ICAC maintains an approved list of arbitrators, but persons not included on that list may still be appointed to act as arbitrators in ICAC arbitration proceedings. The formation of the arbitral tribunal is governed by Paragraphs 17–20 of the ICAC Rules. Unless otherwise agreed by the parties, the ICAC Rules provide for an arbitral tribunal to consist of three arbitrators: one arbitrator appointed by each party, and a chairman of the tribunal appointed by the ICAC Presidium. In addition, Paragraph 7 of the ICAC Rules provides for the appointment of a case reporter by the President. The function of the case reporter is to keep the record of the proceedings, participate in the hearings and closed sessions of the tribunal, and execute the orders of the President and the tribunal.

The Russian Arbitration Law sets out that where a dispute is to be heard by a sole arbitrator, he or she is required to have a higher degree in law. Should a dispute be heard by a panel, the panel chairman must hold a higher degree in law. The Russian Arbitration Law permits any uneven number of arbitrators to sit on a panel. As with the 1993 Law, it is a generally accepted rule that three arbitrators are to be appointed in the event that the parties have not agreed otherwise.

The challenge and removal of arbitrators
As mentioned above, an arbitrator is required by Article 12 (1) of the 1993 Law, prior to his appointment as well as from the time of his appointment throughout the arbitration proceedings, to disclose any circumstances that may give rise to reasonable doubts as to his impartiality or independence.

Article 12 (2) of the 1993 Law provides that an arbitrator may only be challenged if grounds exist that give rise to justifiable doubts as to his impartiality or independence, or if he does not have the qualifications required of him by the agreement of the parties.

In order to prevent abuse of the challenge procedure, Article 12 (2) of the 1993 Law further provides that a party may challenge an arbitrator appointed by it, or with its participation, only for reasons that party became aware of after the appointment was made. The Russian Arbitration Law sets out a similar rule.

In addition to these statutory grounds for challenge, the parties are free to agree on additional grounds for challenge.

Pursuant to Article 13 (1) of the 1993 Law, the parties are free to agree on the procedure for the challenge of arbitrators. In the absence of an agreed procedure, Article 13 (2) of the 1993 Law requires the challenging party to inform the arbitral tribunal of the reasons for the challenge in writing within 15 days of the constitution of the arbitral tribunal, or of the date on which such party learned of the circumstances giving rise to the right of challenge, as the case may be. If a challenged arbitrator does not step down voluntarily, or if the other party to the arbitration objects to his removal, the challenge will be decided by the arbitral tribunal.

If an arbitrator is challenged in accordance with either the procedure agreed by the parties or that provided by Article 13 (2) of the 1993 Law, and such challenge is not successful, Article 13 (3) gives the challenging party the right, within 30 days of receiving notice of the decision rejecting the challenge, to request the President to decide on the challenge. The President’s decision is not subject to further appeal. Pending the President’s decision on the challenge, the arbitral tribunal (including the challenged arbitrator) may continue the proceedings and make an award. However, should the challenge subsequently succeed, any such award may be set aside (see further below).

If for any legal or factual reason an arbitrator cannot continue to perform his functions, or if for any other reason an arbitrator fails to fulfil his duties, Article 14 (1) of the 1993 Law provides that his mandate terminates either if he resigns or if he is removed by agreement of the parties. If the parties fail to agree on the removal of the arbitrator, and there remains a controversy in this regard, either party may request the President to intervene and decide on the termination of the arbitrator’s mandate.

Article 14 (2) of the 1993 Law clarifies that an arbitrator may withdraw from office in the event of a challenge under Article 13 of the 1993 Law without such withdrawal being taken to imply acceptance by the arbitrator that valid grounds for a challenge existed.

The challenge procedures in ICAC arbitration proceedings are set out in Paragraph 18 of the ICAC Rules, which also makes provision for the challenge of experts and interpreters on the same grounds as those on which arbitrators may be challenged. Paragraph 19 of the ICAC Rules deals with the termination of an arbitrator’s office for reasons other than doubts as to his independence, impartiality or lack of required qualifications, such as his removal by agreement of the parties, or by the President upon application of a party for failure to fulfil his duties.

The appointment of substitute arbitrators
Pursuant to Article 15 of the 1993 Law, upon the removal or resignation of an arbitrator under Articles 13 or 14 of the 1993 Law or for any other reason, a substitute arbitrator shall be appointed in accordance with the procedure that applied to the appointment of the outgoing arbitrator.

In the event that an arbitrator is no longer able to participate in ICAC arbitration proceedings, Paragraph 20 of the ICAC Rules provides that his position shall be taken by the reserve arbitrator appointed at the time of constitution of the arbitral tribunal, thereby minimising the delay and disruption caused to the proceedings by the need to substitute a member of the arbitral tribunal. Only in the event that such substitution is not possible will a new arbitrator or chairman have to be appointed in accordance with the ICAC Rules.

Arbitrators’ fees and expenses
The 1993 Law does not contain an express provision for the amount and payment by the parties of the arbitrators’ fees and expenses. In ad hoc arbitration proceedings, these are matters for agreement between the parties and the arbitrators. In institutional arbitration proceedings, the amount and procedure for the payment of the administrative fees of the arbitration court, the arbitrators’ fees, and all other arbitration costs and expenses will be set out in the rules and cost schedules of the relevant arbitration institution.

Paragraph 14 (3) and a separate schedule attached to the ICAC Rules set out detailed provisions in the care of ICAC arbitration proceedings (see below for further details).

Competence to rule on its own jurisdiction
Article 16 (1) of the 1993 Law and Paragraph 2 (4) of the ICAC Rules give the tribunal power to rule on its own jurisdiction, including any objections to the existence or the validity of the arbitration agreement. Article 16 (2) of the 1993 Law requires objections to the tribunal’s jurisdiction to be raised no later than at the time of submission of the Statement of Defence. A party is not precluded from raising such objections by the fact that it has appointed, or participated in the appointment of, an arbitrator.

Equally, any argument that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter said to be beyond the scope of the tribunal’s authority arises in the course of the proceedings.

In either case, the tribunal may admit the objection later if it considers the delay in raising it to be justified.

Pursuant to Article 16 (3) of the 1993 Law, the arbitral tribunal may rule on the challenge to its jurisdiction either as a preliminary issue by an award on jurisdiction or in its final award on the merits. If the tribunal determines the issue of jurisdiction by an interim award, either party may, within 30 days of receipt of notice of the ruling, request the competent court (as to which see further below) to rule on jurisdiction. Such a court ruling is not subject to further appeal. Pending the outcome of the court proceedings, the arbitral tribunal may continue the arbitration proceedings and make an award. However, any such award is subject to being set aside if the court subsequently finds that the arbitral tribunal lacked or exceeded its jurisdiction.

Power to order interim measures
Article 17 of the 1993 Law provides that, unless otherwise agreed by the parties, the arbitral tribunal may, at the request of either party, order such interim measures of protection as it considers necessary for securing the claim regarding the subject matter of the proceedings. The arbitral tribunal may require any party to provide adequate security in connection with such measures.

Paragraph 36 of the ICAC Rules contains similar provisions, stating that, at the request of either party, the arbitral tribunal may order such interim measures to secure the claim with respect to the subject matter of the claim as it deems necessary. Such an order may take the form of an interim award. The arbitral tribunal may request a party to provide appropriate security in connection with such measures.

Similar provisions are contained in the Russian Arbitration Law. In addition, the Russian Arbitration Law provides that the fact that a party has filed an injunction motion at the State court cannot be construed as that party waiving its rights to arbitration. An interim measures motion can be filed at a state court where the arbitration tribunal is located or where the property subject to the imposition of such measures is located.

Procedural law
The 1993 Law has been drafted so as to take into account and incorporate legal techniques and provisions both of domestic and international legal and procedural practice.

General procedural principles
The key procedural principles under the 1993 Law have already been referred to above. They include:

• Article 18 of the 1993 Law (Equal Treatment of the Parties), which stipulates that the parties shall be treated equally (without preference) and that each party shall be given a full opportunity to present its case; and
• Article 19 of the 1993 Law (Determination of Rules of Procedure), which (subject to the mandatory provisions of the 1993 Law) gives the parties autonomy to agree on the procedure to be followed by the arbitral tribunal in conducting the proceedings. In the absence of such agreement, the arbitral tribunal may, again subject to the mandatory provisions of the 1993 Law, conduct the proceedings in such manner as it considers appropriate.

The procedure to be followed in ICAC arbitration proceedings is determined by the ICAC Rules. To the extent that the ICAC Rules and the agreement of the parties do not contain any express provision on a particular procedural issue, Paragraph 26 (2) of the ICAC Rules stipulates that the arbitral tribunal shall conduct the proceedings in such a manner as it considers appropriate, and ensure that the parties are treated with equality and that each party is given a fair opportunity to protect his interest.

Commencement of arbitration
Article 21 of the 1993 Law provides that, unless otherwise agreed by the parties, arbitration proceedings in respect of a particular dispute are deemed to commence on the date on which the respondent receives the request from the applicant to refer the dispute to arbitration.

Pursuant to Paragraph 8 (1) of the ICAC Rules, arbitration proceedings are instituted by filing a Statement of Claim with the ICAC.

Loss of right to object
Article 4 of the 1993 Law contains the important general principle of waiver of the right to object: if a party to arbitration proceedings is aware that any of the non-mandatory provisions of the 1993 Law, or any requirement under the arbitration agreement, has not been complied with, and nevertheless proceeds with the arbitration without objecting to such noncompliance immediately, or within the time limit provided by the agreement of the parties for such objection, that party may be deemed to have accepted the noncompliance and to have waived the right subsequently to object under the 1993 Law or the arbitration agreement.

Place and language of arbitration
Pursuant to Article 20 (1) of the 1993 Law, the parties are free to agree the place of arbitration. Failing such agreement, the place of arbitration shall be determined by the arbitral tribunal taking into account the circumstances of the case and the convenience of the parties.

Pursuant to Paragraph 22 (1) of the ICAC Rules, the place of hearings in ICAC arbitration proceedings shall be Moscow, although the parties, or the arbitral tribunal with the agreement of the Executive Secretary of the ICAC (if necessary), may agree to hold hearings and other sessions in a place other than Moscow.

Pursuant to Article 22 (1) of the 1993 Law, the parties are also free to agree on the language or languages to be used in the proceedings. In the absence of such agreement, the arbitral tribunal shall determine the language or languages to be used. Such agreement or determination shall, unless provided otherwise, apply to any written submissions made by the parties, to any hearings, and any awards, decisions or other communications by the arbitral tribunal.

Pursuant to Article 22 (2) of the 1993 Law, the arbitral tribunal may in appropriate circumstances order that any documentary evidence submitted by the parties be accompanied by a translation into the language or languages agreed upon by the parties or determined by the arbitral tribunal.

Paragraph 23 (2) of the ICAC Rules provides that documents (excluding written evidence) submitted by the parties in the arbitration proceedings shall be in the language of arbitration, or in the language of the contract, or in the language of the correspondence between the parties. Written evidence shall be submitted in the language of the original document.

Paragraph 23 (1) of the ICAC Rules provides for the hearings to be conducted in the Russian language unless the parties have agreed to conduct the arbitral proceedings in a different language.

Article 21 (1) of the Russian Arbitration Law specifies that cases are to be heard in Russian unless the parties have agreed to the contrary.

Submissions
Article 21 of the 1993 Law does not contain any mandatory requirements as to the form or content of the request for arbitration, but the request should contain all relevant information required to identify the parties to the dispute, the substantive agreement and the circumstances giving rise to the dispute, and the claims submitted to arbitration. In his request for arbitration, the claimant should also nominate his arbitrator (in the case of a tribunal consisting of three arbitrators) or propose an arbitrator for appointment (in the case of a sole arbitrator), and require the respondent to nominate his arbitrator, or to consent to the appointment of the sole arbitrator, as the case may be.

With regard to the further conduct of the arbitration following the constitution of the arbitral tribunal, unless the parties have agreed otherwise as to the required content of their statements of case, Article 23 (1) of the 1993 Law provides that, within the time period agreed on by the parties or determined by the arbitral tribunal, the claimant shall state the facts supporting his claim, the points at issue and the relief or remedy claimed, and the respondent shall state his defence to the claim. The parties may attach to their statements of case the documents that they consider relevant and on which they rely in support of their case, or may include therein a reference to the documents or other evidence which they intend to submit. Unless otherwise agreed by the parties, Article 23 (2) of the 1993 Law permits the parties to amend or supplement their Statements of Claim or Defence in the course of the arbitration proceedings, unless the arbitral tribunal considers such amendment to be too late.

While the provisions on submissions in the 1993 Law are quite general, Paragraph 9 of the ICAC Rules sets out more detailed requirements as to the content of the Statement of Claim to be observed in ICAC arbitration proceedings. A Statement of Claim should include:

• the names and addresses of the parties, telephone and fax numbers, and e-mail addresses of the parties;
• the claim(s);
• a substantiation of the ICAC’s jurisdiction to hear the dispute;
• a description of the factual and legal basis for the claim and a reference to the supporting evidence;
• the amount of the claim(s);
• the full names of the arbitrator (and of a reserve arbitrator) nominated by the claimant or a request for the President to make these appointments;
• a list of the documents attached to the Statement of Claim; and
• the claimant’s signature.

If a Statement of Claim does not meet the above requirements, Paragraph 11 of the ICAC Rules requires the Executive Secretary of the ICAC to invite the claimant to remedy the defects within a specified time period not exceeding, as a rule, one month of the date on which such invitation is received. If the claimant fails to remedy the defects and insists on the consideration of the case on the basis of the original Statement of Claim, then the ICAC may decide either to accept the case for referral to an arbitral tribunal or to terminate the proceedings.

Paragraph 12 (1) of the ICAC Rules provides that upon receipt of a Statement of Claim the Executive Secretary of the ICAC shall notify the respondent thereof and shall forward to the respondent copies of the Statement of Claim and of the supporting documentation attached thereto. At the same time, the Executive Secretary of the ICAC shall invite the respondent to submit his response to the Statement of Claim (supported by relevant evidence) within 30 days of receipt by him of the copy of the Statement of Claim.

Paragraph 13 of the ICAC Rules entitles the respondent within the same 30-day period to bring a counterclaim or claim a right of set-off, provided that there is an arbitration agreement covering such a claim or set-off along with the demands of the principal claim. The arbitral tribunal may take into consideration counterclaims or claims for a set-off made at a later point in the proceedings, but the respondent faces the risk of such claims being rejected on the grounds of delay or being burdened with the additional costs occasioned by such delay. A counterclaim or claim for the purpose of a set-off must meet the same requirements as to form and content as the principal Statement of Claim.

Within a shorter time period of 15 days of the receipt of a notice from the ICAC, the respondent shall notify the ICAC of the full names of the arbitrator and reserve arbitrator chosen by him, or request the President of the ICAC to make these appointments on his behalf.

Pursuant to Paragraph 29 (1) of the ICAC Rules, the Chairman of the tribunal shall review the state of preparation of the case and, to the extent necessary, shall take such further steps as may be required to prepare the case for examination, including by obtaining additional written explanations, evidence, or other additional documents from the parties. The Chairman shall also determine the time limits within which such further steps must be taken.

Paragraph 30 (1) of the ICAC Rules provides that either party may amend its claim or defence before the hearing is completed. The arbitral tribunal may disallow such amendments if they are made too late or would cause undue delay. The arbitral tribunal may allow an amendment notwithstanding that it may cause delay, but in such circumstances the tribunal may impose the additional costs caused thereby on the party making the amendment.

Service and filing of documents
With regard to service and notification of written communications generally, Article 3 of the 1993 Law requires such written communications to be delivered to the addressee personally at his place of business, permanent residence or mailing address, and they are deemed to have been received by him on the day of such delivery. If none of these addresses can be established upon reasonable enquiry, the communication is deemed to have been received upon delivery by registered letter or other means which provides a record of the attempt to deliver it to the addressee’s last known place of business, permanent residence or mailing address.

The ICAC Rules also contain detailed provisions on filing and service of documents in Paragraphs 15 and 16. Generally, service of documents in ICAC arbitration proceedings will be effected through the conduit of the ICAC Secretariat.

Oral hearings and written proceedings
Article 24 (1) of the 1993 Law provides that, subject to any contrary provision in an arbitration agreement, the arbitral tribunal has authority to decide whether to hold oral hearings for the presentation of evidence or for oral argument, or whether the proceedings should be conducted only on the basis of the documents and other materials submitted by the parties. However, unless the parties have agreed that no oral hearings shall be held (‘documents only’ arbitration), the arbitral tribunal shall hold such hearings at an appropriate stage in the proceedings if so requested by a party. Article 24 (2) of the 1993 Law requires that the parties be given sufficient advance notice of any hearing or other meeting of the arbitral tribunal for the purpose of taking evidence.

Paragraph 32 (1) of the ICAC Rules envisages that the tribunal shall hold a hearing to enable the parties to present and argue their case in the light of the evidence presented in the proceedings. Paragraph 32 (2) of the ICAC Rules requires that the parties be notified of the place and time of a hearing so as to afford them at least 30 days to prepare for and appear at the hearing. However, the parties may agree on shorter notice periods. The tribunal may hold further hearings if the circumstances so require. Pursuant to Paragraph 34 of the ICAC Rules, the parties may authorise the arbitral tribunal to settle the dispute on the basis of written materials only without holding a hearing. However, the arbitral tribunal may settle the dispute on the basis of written documents in the absence of agreement between the parties to this effect if neither of the parties requests an oral hearing to be held.

The 1993 Law does not require the arbitral tribunal to keep formal minutes of the arbitration proceedings. Paragraph 33 of the ICAC Rules provides that minutes of arbitration hearings must be kept and that such minutes must, inter alia, contain a description of the proceedings at the hearing. Both parties have the right to review these minutes. At the request of either party, the arbitration court may amend or change the minutes if it considers the request to be justified.

Default by parties
Unless otherwise agreed by the parties, Article 25 of the 1993 Law provides that if, without showing sufficient cause:

• the claimant fails to submit his Statement of Claim within the time period agreed by the parties or determined by the arbitral tribunal, the arbitral tribunal shall terminate the proceedings;
• the respondent fails to submit his defence to the claim within the time period agreed by the parties or determined by the arbitral tribunal, the arbitral tribunal shall continue the proceedings without treating such failure in itself as an admission by the respondent of the claimant’s allegations; and
• a party fails to appear at a hearing or to produce documentary evidence, the arbitral tribunal may continue the proceedings and make an award on the basis of the evidence before it.

Paragraph 32 (4) of the ICAC Rules equally gives the arbitral tribunal in ICAC arbitration proceedings discretion to continue the proceedings and make an award in the event that a party who has been duly notified of the hearing fails to appear, but the provision also permits a defaulting party to request the arbitral tribunal in writing to adjourn the proceedings for good reason. Confidentiality

The 1993 Law does not contain an express confidentiality provision. However, Paragraph 25 of the ICAC Rules imposes an obligation on the arbitrators, case reporter, experts and Secretariat to keep confidential any information that becomes known to them about a dispute that forms the subject matter of ICAC arbitration proceedings.

In addition, Paragraph 32 (1) of the ICAC Rules clarifies that the arbitration hearings shall be conducted in private, unless the arbitral tribunal with the consent of the parties permits the attendance of persons not participating in the proceedings.

Pursuant to Article 22 of the Russian Arbitration Law, an arbitrator may not disclose information made known to him in the course of arbitration without the permission of the parties or their successors. Paragraph 2 of this Article contains a particularly important rule that an arbitrator cannot be called as a witness in respect of information made known to him in the course of arbitration.

Evidence
The 1993 Law contains only limited provisions on the subject of evidence. Generally, each party will have to prove the facts on which it relies in support of its claim or defence by the usual means of evidence, which include documents, real evidence, witnesses and expert opinions.

In accordance with Article 19 (2) of the 1993 Law, unless otherwise agreed by the parties, the arbitral tribunal has the power to determine the admissibility, relevance, materiality and weight of the evidence submitted by the parties.

Article 24 (3) of the 1993 Law requires that any documents, statements or other information provided by one party to the arbitral tribunal must also be communicated to the other party.

In Article 26, the 1993 Law contains provisions specifically dealing with experts appointed by the arbitral tribunal. Unless otherwise agreed by the parties, Article 26 (1) of the 1993 Law gives the arbitral tribunal the power to:

• appoint one or more experts to report to it on specific issues determined by the arbitral tribunal; and to
• require a party to provide the expert with any relevant information or to produce (or provide access to) documents, goods or other property for inspection.

Pursuant to Article 26 (2) of the 1993 Law, unless otherwise agreed by the parties, the expert shall after delivery of his report, at the request of a party or if the arbitral tribunal considers this necessary, participate in a hearing where the parties have the opportunity to put questions to him or to present their own expert witnesses to give evidence on the points in issue.

Paragraph 31 (1) of the ICAC Rules expressly requires each party to prove the circumstances on which it relies in support of its pleaded case. The arbitral tribunal may request a party to submit additional evidence. The arbitral tribunal may, at its discretion, order the conduct of an expert examination, request the submission of evidence by third parties and summon and hear witnesses. In ICAC arbitration proceedings too, the arbitrators are free to evaluate the evidence according to their convictions.

Paragraph 16 (2) of the ICAC Rules provides that the Secretariat shall provide copies of all documents submitted by a party to the ICAC to the other party. The parties shall also receive expert reports and other documentary evidence on which the award may be based.

Third-party intervention
In Paragraph 28, the ICAC Rules contain an express provision for the joinder of third parties to the arbitration proceedings. Such joinder is possible with the consent of the parties and the written consent of the third party proposed to be joined to the proceedings. The request for joinder of a third party must be made before the time period for the respondent to reply to the statement of claim has expired.

The 1993 Law contains no express provision on the participation of third parties in the proceedings, and joinder of the third parties is therefore only possible in ad hoc arbitration proceedings if so agreed by the parties and with the consent of the third party.

Choice of law
In 2002, the third part of the Russian Civil Code containing rules on conflict of laws (the “Civil Code”) was introduced. Article 1186 of the Civil Code sets out rules for defining the governing law where the breakdown in relations involves a “foreign element”. According to Article 1186, the relevant existing legislation will be used to establish the governing law by international commercial arbitrators (i.e. Russian international treaties and the 1993 Law). The Civil Code defines the procedure for construction of foreign law and sets out the principal conflict of laws rules. Article 28 of the 1993 Law sets out how the law applicable to the substance of the dispute is to be determined. Article 28 (1) of the 1993 Law requires the arbitral tribunal to decide the dispute in accordance with the law chosen by the parties as applicable to the substance of their dispute. Any reference to the law or legal system of a State shall be construed as directly referring to the substantive law of that State and not to its conflict of laws rules.

Article 28 (2) of the 1993 Law provides that, in the absence of a choice of law by the parties, the arbitral tribunal shall apply the law determined by it in accordance with the conflict of laws rules which it considers applicable. Under Article 1211 of the Civil Code, should the parties fail to choose the governing law, the law of the country where a main executor under a contract is located shall be applied.

This introduces an element of uncertainty for the parties, because their substantive rights and obligations may differ substantially depending on the applicable law. It is therefore always preferable for the parties (and for the tribunal) to include an express choice of law provision in their agreement. This will, furthermore, assist the parties (or the appointing authority) to identify and appoint arbitrators with the requisite legal knowledge from the outset of the proceedings and to the greatest possible extent.

Article 28 (3) of the 1993 Law further requires the arbitral tribunal in all cases to decide in accordance with the terms of the underlying agreement between the parties and to take into account the trade customs applicable to the particular transaction in issue in the proceedings.

Pursuant to Paragraph 26 (1) of the ICAC Rules, the same principles apply to the determination of the law applicable to the substance of the dispute in ICAC arbitration proceedings.

Remedies
Neither the 1993 Law nor the ICAC Rules define the remedies that the arbitral tribunal has the power to grant; but equally the 1993 Law and the ICAC Rules do not limit or otherwise restrict the orders which an arbitral tribunal may make. In accordance with the general procedural rules applicable in the Russian Federation, an arbitral tribunal may allow or disallow a claim in full or in part, order the payment of a sum of money or the transfer of property, or oblige the respondent to perform certain acts or prevent him from performing certain acts.

Interest
The 1993 Law does not contain any provision for payment of interest on monetary claims. The arbitral tribunal has the power to award interest if the underlying agreement between the parties or the law applicable to the substance of the dispute so provides. Article 395 of the Civil Code provides for payment of statutory interest in certain circumstances. The interest rate is determined from time to time by the Central Bank of the Russian Federation but may be varied by the court depending on the circumstances of the case.

Decisionmaking by the tribunal
Unless otherwise agreed by the parties, Article 29 of the 1993 Law requires the decisions of an arbitral tribunal consisting of more than one arbitrator to be made by a majority of its members. Procedural issues may be decided by the presiding arbitrator if so authorised by the parties or by the other members of the arbitral tribunal.

Paragraph 38 (2) of the ICAC Rules provides that if a decision cannot be made by a majority of the arbitrators, then it shall be made by the presiding arbitrator. An arbitrator who does not agree with the majority ruling (or the ruling of the presiding arbitrator) may state his view in a written dissenting opinion, which shall be attached to the arbitral award.

Paragraph 24 of the ICAC Rules contains a provision on the duration of arbitral proceedings and requires the arbitral tribunal to take measures ensuring, as far as possible, that such proceedings be completed within 180 days of the formation of the arbitral tribunal. While in practice that may not always be achievable in more complex commercial disputes, the provision serves as a useful guideline and encourages the tribunal to conduct the proceedings speedily and efficiently. Although the 1993 Law does not contain a provision requiring the proceedings to be completed within a certain time period, arbitrators in ad hoc arbitration proceedings are in principle bound by the same duty to pursue and conclude the proceedings without undue delay; the arbitrators may otherwise risk termination of their mandate by the parties or, at the request of a party, by the President.

Adjournment of hearing and stay of proceedings
Paragraph 35 of the ICAC Rules authorises the arbitral tribunal in ICAC arbitration proceedings to adjourn or stay the proceedings, where necessary through a procedural ruling, at the request of the parties or on its own initiative. It is submitted that, in ad hoc arbitration proceedings under the 1993 Law, the arbitrators have authority to take the same steps on the basis of their general procedural powers.

Form, content and effect of the award
Article 31 (1) of the 1993 Law provides that an arbitration award shall be made in writing and shall be signed by the arbitrator or arbitrators. If the arbitral tribunal consists of more than one arbitrator, the signatures of a majority of the arbitrators suffice, provided that an explanation is provided for the omission of any signatures.

Pursuant to Article 31 (2) of the 1993 Law, an arbitration award must state the reasons on which it is based, whether the claim is allowed or disallowed, the amount of the arbitration fees and costs, and their allocation between the parties. Article 31 (2) of the 1993 Law further requires the award to be dated and to state the place of arbitration as agreed by the parties or determined by the arbitral tribunal. The award will be deemed to have been made at that place. A signed copy of the award shall be delivered to the parties pursuant to Article 31 (4) of the 1993 Law.

Pursuant to Paragraph 38 of the ICAC Rules, the arbitral tribunal shall declare the proceedings closed and proceed to making an award when all the facts relating to the dispute have been sufficiently clarified. The award shall be made in a closed session of the arbitral tribunal with a majority of votes. If a majority cannot be reached, the Chairman of the tribunal shall make the award.

The required content of the award is set out in detail in Paragraph 31 of the ICAC Rules.

Settlement
If the parties settle their dispute in the course of the arbitration proceedings, Article 30 (1) of the 1993 Law and Paragraph 41 (1) of the ICAC Rules require the arbitral tribunal to terminate the proceedings and, if so requested by the parties and the arbitral tribunal does not object, to record the settlement in the form of an award on agreed terms. Article 30 (2) of the 1993 Law and Paragraph 41 (2) of the ICAC Rules clarify that an award on agreed terms shall state that it is an award and comply with the requirements as to form and content of an award. Such an award on agreed terms has the same status and effect as any other award on the merits of the case.

Termination of proceedings
Pursuant to Article 32 (1) of the 1993 Law, the arbitral proceedings are terminated either by a final award or by an order of the arbitral tribunal.

Article 32 (2) of the 1993 Law provides that the tribunal shall make an order terminating the arbitral proceedings when:

• the claimant withdraws his claim, unless the respondent objects and the arbitral tribunal recognises that he has a legitimate interest in obtaining a final settlement of the dispute;
• the parties agree to terminate the proceedings; or
• the arbitral tribunal finds that the continuation of the proceedings has for any other reason become unnecessary or impossible.

While the mandate of the arbitrators terminates with the termination of the arbitral proceedings, Article 32 (3) of the 1993 Law states that this leaves unaffected the tribunal’s standing to make a correction or interpretation of the award, or an additional award, or to resume the proceedings in cases where the matter is referred back to the tribunal by the court in setting-aside proceedings.

Paragraphs 37 and 44 of the ICAC Rules similarly provide for the termination of the proceedings either through the final award on the merits or through an order for termination of the proceedings which must comply with the same requirements as a final award on the merits.

Costs
In accordance with Article 31 (2) of the 1993 Law, the fees and costs of the arbitration must be assessed and allocated as between the parties in a costs order forming part of the arbitration award. There is not yet an established practice in ad hoc arbitration proceedings pursuant to which the winning party may claim reimbursement of all or part of its costs of legal representation and other expenses, although arbitral tribunals in practice sometimes exercise their discretion in relation to such claims upon application of a party and make an award for reimbursement of costs and expenses. However, even in circumstances where the tribunal makes a costs award to this effect, it is unlikely for a party to recover its actual costs and expenses in full.

Pursuant to Paragraph 14 of the ICAC Rules, the amount of the registration and arbitration fees, the procedure for their payment, their allocation as between the parties, and the procedure for covering the other costs of the arbitration proceedings are established in the Schedule on Arbitration Fees and Costs attached to the ICAC Rules.

Paragraph 39 of the ICAC Rules requires the arbitral tribunal in its award to assess the amount of the arbitration costs and fees in the case and to determine their apportionment as between the parties.

In summary, the registration fee in ICAC arbitration proceedings is currently a flat rate fee of USD 1,000, whereas the arbitration fees, which cover the general expenses of the ICAC and its Secretariat but also include the arbitrators’ fees, are calculated on a sliding scale, depending primarily on the amounts of the claim and of any counterclaim. An arbitration fee of USD 2,600 shall be charged if the amount of a claim does not exceed USD 10,000. Arbitration fees for claims in excess of USD 10,000,000 are to be paid as follows: USD 74,600, plus 0.12% of the amount over USD 10,000,000. The arbitration fees and other additional costs of the ICAC (such as expert witness or translators’ fees, travelling expenses, etc.) shall be borne by the losing party, or apportioned between the parties pro rata depending upon their respective success or failure if a claim or counterclaim succeeds only in part. In addition, the winning party is entitled to reimbursement of its reasonable legal costs and expenses (including the cost of legal representation) from the losing party.

Correction and interpretation of the award
Pursuant to Article 33 (1) of the 1993 Law, each party has the right, within 30 days of receipt of the award (unless another period of time has been agreed upon by the parties) to request the arbitral tribunal to correct any errors in computation, any clerical or typographical errors or any errors of a similar nature. If so agreed by the parties, the arbitral tribunal may also give an interpretation of a specific point or part of the award. The request for correction or interpretation of the award must be made with notice to the other party. Article 33 (2) of the 1993 Law gives the arbitral tribunal the power to correct the award on its own initiative within 30 days of the date of the award.

If the arbitral tribunal considers the request to be justified, it shall make the correction or give the interpretation within 30 days of receipt of the request. Any such correction or interpretation shall form part of the original award. Article 33 (4) of the 1993 Law gives the arbitral tribunal discretion to extend the time period within which to make the correction, interpretation or additional award if necessary.

Unless otherwise agreed by the parties, each party shall further have the right pursuant to Article 33 (3) of the 1993 Law, within 30 days of receipt of the arbitral award, to request the arbitral tribunal to make an additional award on claims presented in the arbitral proceedings but omitted from the award. The request must be made with notice to the other party. If the arbitral tribunal considers the request to be justified, it shall render an additional award within 60 days.

Pursuant to Article 33 (5) of the 1993 Law, the rules as to the form and content of the arbitral award also apply to the correction or interpretation of the original award or to an additional award.

Paragraph 43 of the ICAC Rules sets out the rules on correction, interpretation or making of an additional award in ICAC arbitration proceedings.

The jurisdiction of the courts
Article 5 of the 1993 Law states the important principle of non-intervention by the courts, i.e. that in matters governed by the 1993 Law, the courts shall not intervene in arbitration proceedings except where expressly so provided by the 1993 Law.

In addition, Article 6 (1) of the 1993 Law confers authority for the exercise of most functions in support of the arbitral process on the President rather than on the courts; this reinforces the position of arbitration as essentially a private and autonomous dispute resolution process. Nevertheless, in certain clearly-defined circumstances, the availability of court assistance remains necessary to ensure the effectiveness of arbitration as a dispute resolution mechanism.

Stay of court proceedings
Article 8 (1) of the 1993 Law requires a court in which an action is brought in a matter which is the subject of an arbitration agreement to stay the proceedings at the request of a party and refer the parties to arbitration, unless it finds that the arbitration agreement is null and void, inoperative or incapable of being performed. The request shall be made no later than when the relevant party submits its first statement on the substance of the dispute.

Article 8 (2) of the 1993 Law further provides that, if court proceedings are commenced in relation to matters which are covered by an arbitration agreement, arbitration proceedings may nevertheless be commenced or continued, and an arbitration award may be made, pending the decision of the court on the issue of jurisdiction.

Preliminary rulings on points of jurisdiction
As mentioned above, if the arbitral tribunal makes a preliminary ruling upon a party’s request pursuant to Article 16 of the 1993 Law that it has jurisdiction, Article 16 (3) of the 1993 Law gives the parties the right to request the competent court to rule on the issue of jurisdiction. However, the arbitral tribunal may continue the proceedings and make an award pending the request to the court.

Furthermore, as mentioned above, the court will determine the issue of jurisdiction pursuant to Article 8 (1) of the 1993 Law if court proceedings are commenced and the other party invokes an arbitration agreement regarding the subject matter of the court proceedings.

Interim protective measures
While the arbitral tribunal has the power pursuant to Article 17 of the 1993 Law to order interim measures unless otherwise agreed by the parties, Article 9 of the 1993 Law clarifies that it is not incompatible with an arbitration agreement for a party to request a court, before or during arbitral proceedings, to order interim measures of protection, or for a court to grant such measures. The court will decide in accordance with the general principles of Russian procedural law whether to grant interim protective measures in support of an arbitration claim.

Paragraph 36 (4) of the ICAC Rules provides that if a party has requested a competent court to order interim protective measures in a matter which is the subject of ICAC arbitration, and the court has granted such measures, that party shall immediately inform the ICAC thereof.

Obtaining evidence and other court assistance
An arbitral tribunal, or a party with the consent of the arbitral tribunal, may request the competent court to provide assistance in obtaining evidence for use in the arbitration proceedings pursuant to Article 27 of the 1993 Law. The court may execute such request on the basis of the general Russian procedural rules on taking and securing evidence.

Arbitration awards are not subject to appeal under the 1993 Law. Article 34 (1) of the 1993 Law states that recourse to a court against an arbitral award may be made only through an application for setting the award aside in accordance with Article 34 (2) and (3) of the 1993 Law.

Pursuant to Article 34 (2) of the 1993 Law, an arbitral award may only be set aside if the party making the application establishes that:

• one of the parties to the arbitration agreement was under some legal incapacity, or the arbitration agreement was invalid under the law chosen by the parties as the governing law of the agreement, or, in the absence of such choice, under the laws of the Russian Federation;
• a party was not given proper notice of the appointment of an arbitrator, or of the arbitration proceedings, or was for some other reasons unable to present its case;
• the award was made with respect to a dispute which was not covered by the arbitration agreement, or does not fall within the terms of the submission to arbitration, or contains decisions on matters beyond the scope of the arbitration agreement; however, if the decision on matters submitted to arbitration can be separated from those not so submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside;
• the constitution of the arbitral tribunal or the arbitration procedure was inconsistent with the arbitration agreement between the parties, unless such agreement was in conflict with a mandatory provision of the 1993 Law, or in the absence of an agreement, was not in accordance with the provisions of the 1993 Law; or

if the court finds that:

• the subject matter of the dispute was not capable of settlement by arbitration proceedings under the laws of the Russian Federation; or
• the arbitral award is inconsistent with the public policy of the Russian Federation.

Article 40 of the Russian Arbitration Law provides that an arbitration award may be challenged within three months of the party receiving its award as long as the arbitration agreement does not state that the award is final. As with the 1993 Law, the Russian Arbitration Law sets out an exhaustive list of grounds for setting aside an arbitral award.

Article 34 (3) of the 1993 Law provides that an application for setting aside an arbitral award must be made within three months of the date of receipt of the award by the party making the application. If a request for correction or interpretation of the award, or for an additional award, has been made to the arbitral tribunal, that three-month time period commences from the date on which that request has been disposed of by the arbitral tribunal (by rejecting the request or by making the correction, interpretation or additional award).

Article 34 (4) of the 1993 Law gives the court discretion to suspend the setting-aside proceedings in appropriate circumstances at the request of a party for a specified period of time in order to provide the arbitral tribunal with an opportunity to resume the arbitration proceedings or to take such other steps as may remove the grounds for setting aside the award.

The procedures for challenging and enforcing arbitration awards were updated as the new procedural codes took effect. On 1 September 2002, the new Arbitrazh Procedural Code became effective, followed by the new Civil Procedural Code on 1 February 2003. The Arbitrazh Procedural Code governs proceedings at the arbitrazh courts, which generally hear business-related disputes whereas the Civil Procedural Code regulates proceedings in the common courts, which are mostly in charge of disputes concerning individuals. Common courts also have jurisdiction over certain economic disputes providing they do not fall within the jurisdiction of the arbitrazh courts.

The new codes now contain detailed regulations for challenging and enforcing domestically rendered arbitral awards, and recognition and enforcement of foreign arbitral awards.

Under Article 232 of the Arbitrazh Procedural Code, a foreign arbitration award may be challenged on the grounds set out by an international treaty and the 1993 Law.

The 1993 Law does not draw a distinction between the recognition and enforcement of domestic and foreign arbitral awards, or the grounds on which they may be refused. Article 35 (1) of the 1993 Law provides that, regardless of the country in which it was made, an arbitral award shall be recognised as binding and, upon application in writing to the competent court, shall be enforced in Russia.

Article 35 (2) of the 1993 Law requires the application to be supported by the authenticated original award and arbitration agreement, or by certified copies thereof. If either of these documents is made in a foreign language, certified translations into the Russian language must also be provided.

Recognition and enforcement of an arbitral award may only be refused on the grounds set out in Article 36 (1) of the 1993 Law which correspond to the grounds on which an award may be set aside, namely:

• one of the parties to the arbitration agreement was under some legal incapacity, or the arbitration agreement was invalid under the law chosen by the parties as the governing law of the agreement, or, in the absence of such choice, under the laws of the country where the award was made;
• the party against whom the award was made was not given proper notice of the appointment of an arbitrator, or of the arbitration proceedings, or was for some other reason unable to present its case;
• the award was made with respect to a dispute which was not covered by the arbitration agreement, or does not fall within the terms of the submission to arbitration, or contains decisions on matters beyond the scope of the arbitration agreement; however, if the decision on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be recognised and enforced;
• the constitution of the arbitral tribunal or the arbitration procedure was inconsistent with the arbitration agreement between the parties, or in the absence of an agreement, was not in accordance with the laws of the country where the arbitration took place;
• the award has not yet become binding on the parties or has been set aside or suspended by a court of the country in which (or under the laws of which) that award was made; or

if the court finds that:

• the subject matter of the dispute was not capable of settlement by arbitration proceedings under the laws of the Russian Federation; or
• the arbitral award is inconsistent with the public policy of the Russian Federation.

Prior to the enactment of the new 2002 Arbitrazh Procedural Code, the 1988 USSR Regulations on Recognition and Enforcement of Foreign Court Decisions and Arbitral Awards (the “1988 Regulations”) governed the procedural aspects concerning the recognition and enforcement of foreign judgments and awards. Provisions of the 1988 Regulations will now apply only to the extent that they are in compliance with the new codes. The new Arbitrazh Procedural Code contains a rule that foreign court decisions and arbitration awards are to be recognised and enforced in Russia if one of Russia’s international treaties or federal laws requires it. Russia is a signatory to the 1958 New York Convention on Recognition and Enforcement of Foreign Arbitration Awards (the “1958 New York Convention”). Recognition and enforcement of foreign arbitral awards in Russia is conducted in accordance with the 1958 New York Convention. Due to the fact that Russia has still not ratified or entered into bilateral treaties for enforcement of foreign commercial judgments with some of its leading business partners (e.g. Great Britain, the U.S.A., Canada, etc.), it is practically impossible to gain recognition and enforcement for a foreign court decision in Russia. This is yet another reason for referring disputes to international arbitration rather than to the courts of the relevant foreign State.

Article 36 (2) provides that, if in the country in which an award is granted, a local court application has been made to set aside or suspend that award, then the court where recognition or enforcement is sought may, if it considers it appropriate, adjourn its decision until the challenge has been heard. Alternatively, it may also order the other party to provide security upon application by the party seeking recognition or enforcement of the award.

Pursuant to Article 6 (2) of the 1993 Law, preliminary rulings on jurisdiction and applications for setting aside arbitral awards are dealt with by the Supreme Courts of the Russian Republics, the territorial, regional or city courts, or the court of the autonomous region or area where the arbitration proceedings take place. Other court assistance, including taking evidence for use in arbitral proceedings, interim protective measures, and the recognition and enforcement of arbitral awards, are performed by the competent courts identified in the 2002 Arbitrazh Procedural Code. Since 1 December 2001, Russia has been a signatory to the 1965 Hague Convention on the Service Abroad of Judicial and Extra-Judicial Documents in Civil or Commercial Matters. Russia is also a party to the 1970 Hague Convention on the Taking of Evidence Abroad in Civil or Commercial Matters.

Arbitration applications must be made in accordance with the general provisions of the procedural laws of the Russian Federation.

There is a long tradition in Russia of resolving international commercial disputes by arbitration. In the form of the 1993 Law, Russia has adopted a modern framework for such arbitrations which follows the internationally recognised standard set by the UNCITRAL Model Law. The law relating to domestic arbitrations has also been updated, and Russian arbitration institutions have been modernised. Today, most commercial disputes involving foreign parties or concerning foreign direct investment in Russia are dealt with by way of private arbitration rather than through the Russian court system. This may be an indication that arbitration in Russia is increasingly accepted as meeting the demands of the modern business world.

CMS, Russia
Gogolevsky b., 11
119019 Moscow, Russia


Sergey Yuryev
T +7 495 258-5000
F +7 495 258-4001
E sergey.yuryev@cmslegal.ru