International Commercial Arbitration and Russian-Argentine Relations - International Law Office

International Law Office

Arbitration - Argentina

International Commercial Arbitration and Russian-Argentine Relations

March 26 2009


On December 9 2008 the Argentine Chamber of Commerce (CAC) and the Chamber of Commerce and Industry of the Russian Federation (ICAC) signed an agreement to make the resolution of disputes that may arise in bilateral commerce and other economic relations easier. This includes investments between individuals or legal entities domiciled in both countries.

Under the agreement, both chambers have undertaken to recommend that (i) parties include arbitral clauses in commercial contracts, and (ii) the institutional arbitration of the Centre of Mediation and Commercial Arbitration of the CAC (CEMARC) and that of the ICAC be agreed, a choice that will be defined depending on whether the defendant's domicile is in Argentina or Russia.

Unlike Argentina, since July 1993 Russia has had in force an Arbitration Law that is primarily based on the United Nations Commission on International Trade Law Model Law. Furthermore, similar to the CEMARC Rules, the ICAC Rules, released in 2006, are based on the International Chamber of Commerce Rules of Arbitration.(1)

When writing arbitral clauses, the following law differences should be taken into account: (i) the scope of arbitrability of certain matters; and (ii) the consequences of the lack of choice under the ICAC Rules of the seat of arbitration and language (ie, Moscow must be the seat of arbitration - with its consequent arbitration laws - and Russian must be the language of the arbitration).

Since Russia adopted its new procedural court (the Arbitrazh Court) in September 2002, the rules of which are applicable to international arbitration, the Arbitrazh Court has had exclusive jurisdiction to hear all proceedings related to international commercial arbitration.(2)

With regard to the recognition and enforcement of awards, although both countries are signatories of the New York Convention 1958, legal opinion has set forth certain trends of judges in both jurisdictions to revise the merits of awards, which violate international conventions previously agreed by the parties.

Both chambers have agreed to provide organizational assistance, including premises and administrative support services for ad hoc arbitration proceedings in both countries,(3) as well as to coordinate meetings to discuss issues related to the development of the agreement with regard to the laws of both countries and the activities of different institutional arbitration centres.

For further information on this topic please contact Mario L Turzi or María Laura Velazco at Marval O'Farrell & Mairal by telephone (+54 11 4310 0100) or by fax (+54 11 4310 0200) or by email (mlt@marval.com.ar or mlvel@marval.com.ar). The Marval O'Farrell & Mairal website can be accessed at www.marval.com.ar.

Endnotes

(1) In October 2008 the International Chamber of Commerce Court created a management team for Eastern European cases, headed by Galina Zukova.

(2) Between 1995 and 2002 concurrent jurisdictions between courts with general jurisdiction and arbitrazh courts with jurisdiction to hear commercial arbitration matters co-existed and created contradictory legal opinions and, subsequently, uncertainty.

(3) Even though the Russian Arbitration Law provides enough support to parties to allow ad hoc arbitrations, parties rarely choose this kind of ad hoc arbitration since state courts do not have enough experience to render judicial assistance to arbitration (for further details please see the Overview (September 2008)).


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