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What are the validity requirements for an arbitration agreement?
Arbitration agreements must be in writing. Article 7 of the International Arbitration Law (as amended) has broadened the written form requirement to include not only a document signed by all parties, or an exchange of letters but also, among other things, electronic communications and exchange of statements of claim and defence.
An arbitration agreement is void if it was entered into by a party which lacked the capacity to do so. Under Article V(1)(a) of the New York Convention, the capacity of the parties to enter into an arbitration agreement shall be assessed based on the law applicable to them. The capacity of a Russian party to enter into an arbitration agreement will be assessed under Russian law. When dealing with a Russian party, it is advisable to thoroughly check the capacity of its representatives to enter into the arbitration agreement (eg, whether respective power of attorney has been validly issued and whether the respective actions have been approved by necessary management bodies).
Under Russian law, an arbitration agreement may be held void if it:
- was obtained through fraud or duress;
- was concluded because of hardship or mistake; or
- is contrary to the law or public morals.
An arbitration agreement may also be held incapable of being performed - which relates primarily to the clarity of the arbitration agreement (eg, whether the arbitral institution has been unambiguously defined). Historically, relatively minor mistakes in the arbitration agreement have been sufficient for Russian courts to conclude that the agreement was incapable of being performed. Over the last decade, the Russian courts have taken a more balanced approach to this issue, but occasionally demonstrate the older formalistic approach. Article 7(9) of the International Arbitration Law expressly requires that any doubts in interpretation of an arbitration agreement be resolved in favour of its validity and capability of being performed.
Enforcement of agreements
How are arbitration agreements enforced in your jurisdiction? What is the attitude of the national courts towards arbitration agreements?
Under Article 8 of the International Arbitration Law, the Russian court seized of a matter that is subject to an arbitration agreement shall, at the request of a party, refer the parties to arbitration, unless it finds that the arbitration agreement is null and void, inoperative or incapable of being performed.
Accordingly, to enforce an arbitration agreement, the Russian courts will verify that:
- the dispute falls within the scope of the arbitration agreement;
- the arbitration agreement has been made in a proper form, the subject matter is arbitrable and the agreement is not null and void, inoperative or incapable of being performed, and
- one of the parties has requested enforcement of the arbitration agreement by no later than submission of its first statement on the substance of the dispute.
Article 7(12) now stipulates that, by default, an arbitration agreement contained in a contract also covers disputes relating to termination and invalidity of that contract.
Can an arbitral tribunal with its seat in your jurisdiction consolidate separate arbitral proceedings under one or more contracts, and, if so, in what circumstances?
This issue is not addressed by national laws, international treaties or the International Commercial Arbitration Court Rules.
In such circumstances, it may reasonably be expected that Russian tribunals and courts will likely consider the issue cautiously and conservatively, focusing on whether the affected parties have manifested their consent to consolidation.
Choice of law
How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?
Under Article 28 of the International Arbitration Law, the tribunal will follow the rules of law chosen by the parties. Failing any designation by the parties, the tribunal shall apply the law determined by the conflict of laws rules which it considers applicable. In practice, the International Commercial Arbitration Court usually refers to Russian conflict of laws rules. The International Arbitration Law contains no provision permitting an arbitral tribunal to decide ex aequo et bono or asamiable compositeur.
Are there any provisions on the separability of arbitration agreements?
Article 16(1) of the International Arbitration Law provides that an arbitration clause should be treated as independent of other terms of the contract and invalidity of the contract shall not in itself entail the invalidity of an arbitration clause. The Russian courts usually give due regard to the separability principle. However, some deviations have occurred.
Are multiparty agreements recognised?
Neither national laws nor international treaties address this issue as a general matter. Articles 7(7) and 7(8) of the amended International Arbitration Law specifically allow arbitration agreements to be incorporated in organised trading rules or clearing facilities rules or charters of private companies with fewer than 1,000 shareholders. The International Commercial Arbitration Court Rules allow for joinder by consent and contain provisions for choosing arbitrators in multiparty proceedings.
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