On
25 April 2019, the Hong Kong International Arbitration Centre (HKIAC)
became the first foreign arbitral institution to be granted permission
to function as a permanent arbitral institution (PAI) under Russia’s
Federal Law on Arbitration dated 29 December 2015 No. 382-FZ.
HKIAC's
PAI status has significant consequences under Russian law. First, it
means that HKIAC is authorised to administer certain types of Russian
disputes that other institutions are not; namely, certain Russian
corporate and procurement disputes. HKIAC may also administer certain
Russian domestic disputes. Second, parties to HKIAC-administered
arbitrations seated in Russia may (i) benefit from Russian court
assistance in obtaining evidence; and (ii) exclude certain aspects of
court oversight; options that are not available if the arbitration is
administered by an international arbitral institution without PAI
status. For international arbitrations seated in Russia, HKIAC
administration ensures compliance with Russian law for the
enforceability and validity of the award.
The
Vienna International Arbitration Centre (VIAC) was also awarded PAI
status on 4 July 2019, making HKIAC and VIAC the only foreign arbitral
institutions with PAI status.
Recognising
that users would benefit from clarification in respect of some areas of
Russian law, on 10 February 2020, HKIAC and VIAC submitted a Joint
Request for Certain Clarifications to the Russian Ministry of Justice
and Council for the Development of Arbitration at the Russian Ministry
of Justice (Council)(Joint Request, available by clicking "Read More"). The Joint Request
sought clarifications in respect of issues concerning: (i) corporate
disputes; (ii) procurement disputes; (iii) domestic disputes; (iv) the
differences between arbitrations administered by a PAI and ad hoc
proceedings; and (v) the consequences of a PAI administering an
arbitration that it is not authorised to administer.
On
27 May 2020, the Council issued its response to the Joint Request
(Response, Russian and unofficial English translation are available by clicking "Read More"). It reflects the opinion of the Working Group No. 2 on
Foreign Arbitral Institutions of the Council. It does not bind courts
or other government bodies considering particular disputes.
Professor Anton Asoskov of Lomonosov Moscow State University, member of the Council and HKIAC's Council, said:"The position of the Council's
Working Group on Foreign Arbitral Institutions is an authoritative
interpretation of the law on arbitration issued within the Council's
mandate to summarise arbitration law enforcement practice. Despite its
non-binding character, it will serve as a guiding tool for arbitral
institutions, parties as well as arbitral tribunals in Russia-related
arbitral proceedings.”
Sarah Grimmer, HKIAC Secretary-General, commented:"In our study of PAI status we came across several issues under Russian law that were being asked by many users. We were happy to join forces with VIAC to formulate
the Joint Request and grateful to receive a timely response from the
Council. These documents contain clarifications of some of the most
widely asked questions in this area and will serve as excellent
reference materials for the community.”
HKIAC
will hold two webinars on Developments in Russia: HKIAC's PAI Status
One Year On on 17 June 2020 in English and on 15 July
2020 in Russian (registration links available by clicking “Read More”).
For more information, please click "Read More".