On 18 May 2021, the Russian Ministry of Justice granted the status of “Permanent Arbitration Institution” (“PAI”) to the ICC International Court of Arbitration (the “ICC”) and the Singapore International Arbitration Centre (“SIAC”).
This is a major development for users of international arbitration in Russia who will now have access to three of the “top-five most preferred arbitral institutions” in the world, according to the respondents of the 2021 International Arbitration Survey prepared by Queen Mary University of London. Following their successful registration in Russia, the ICC and the SIAC, have joined the Hong Kong International Arbitration Centre (HKIAC) (and the Vienna International Arbitration Centre (VIAC)), which secured similar licenses from the Russian Ministry of Justice in 2019.
Obtaining PAI status will allow the ICC and SIAC to administer institutional international arbitration proceedings (a) with the seat of arbitration in Russia; and (b) arising out of certain “corporate” disputes (in particular, arising out of share purchase agreements). It is therefore now possible to refer a substantial part of disputes arising out of M&A and other transactions with Russian parties to the ICC and SIAC directly, with no recourse to so-called waterfall / cascade arbitration clauses. If there is a cascade arbitration clause in a contract, and the ICC or SIAC are referred to in the clause, these institutions may have automatically become eligible to consider disputes arising out of the contract.