On March 24 2011 the Supreme Arbitrazh Court issued a resolution that proposes a draft law to amend the Arbitrazh Procedure Code and the Tax Code. The draft law would amend the procedural rules in the arbitrazh (ie, commercial) courts for examining cases under simplified proceedings.

As a rule, if a plaintiff's claims are not disputed or are admitted by the defendant, or if the amount at issue is negligible, the case may be considered according to a simplified procedure. The time limits for the various procedural stages are shortened and the parties are not summoned to a court hearing.

The main proposals in the draft law are as follows:

  • Statements of claim and all other case documents, including the parties' evidence, would be submitted to, and stored on, the internet site of the relevant arbitrazh court. Only the parties would have access to these materials.
  • In simplified proceedings, cases would be heard by a single judge within two months of the statement of claim being submitted - as it stands, the law provides for the statement of claim to be examined within one month.
  • Simplified proceedings would apply to claims with a value of up to Rb300,000 for legal entities and Rb100,000 for individual entrepreneurs, compared to the existing thresholds of Rb20,000 and Rb2,000.

A number of new categories of case would be eligible for the simplified procedure where the value of the claim is no greater than Rb100,000. This would apply to:

  • claims that challenge individual regulatory acts or the decisions of authorities in the performance of their public functions, to the extent that such challenges entail claims for payment or recovery of money, or recovery of the claimant's property;
  • claims relating to a person's liability under administrative legislation, if the offence in question is punishable only by an administrative fine;
  • claims that challenge decisions by administrative authorities, if the offence in question is punishable only by an administrative fine; and
  • claims to recover compulsory payments and penalties.

Proceedings would be conducted under the simplified procedure, irrespective of the value of the claim, where the claims in question are based on:

  • documents filed by the plaintiff that establish monetary obligations to which the defendant has admitted, but which remain unperformed;
  • documents confirming contractual debt; or
  • a claim, executed by a notary, against a bill of exchange which is in arrears, has not been accepted or has no date for acceptance.

The draft law is likely to be passed soon, as it is one of the measures for implementing Presidential Order Pr-3520 of December 5 2010, which seeks to alleviate the burdens on the court system.

The draft law takes account of the EU small claims process, which came into force on January 1 2009, and would bring Russian court procedure closer to western European standards.

At present, the arbitrazh courts examine significant numbers of cases in which the value of the claim is well below the thresholds in the draft law. Often, the situation and the applicable law are simple, but the cases are subject to the general procedural rules, which are inappropriate for such routine disputes.

The amendments would allow the courts to deal with various types of case more easily. This would translate into lower costs for the parties in dispute, which would be able to dispense with court hearings and view case documents by remote access. The time limits in certain types of case would also be reduced.

For further information on this topic please contact Denis Bykov or Roman Serb-Serbin at Pepeliaev Group's Moscow office by telephone (+7 495 967 0007), fax (+7 495 967 0008) or email ([email protected] or [email protected]).