🇷🇺🇸🇬 A US$500 million SIAC award is recognized in Russia. A Russian cassation court has upheld a lower court's decision recognizing the US$500 million SIAC award in Russia. The award was issued in favour of a sanctioned Russian engineering group against Vietnam’s national oil and gas company (Case No. А40-20468/2024, decision dated 23 December 2024).

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🇷🇺 A Russian court has ruled that Russian counter-sanctions do not exempt a party from fulfilling its contractual obligations nor prevent the recognition and enforcement of foreign arbitral awards within Russia.

An arbitral creditor (a foreign company) sought the recognition and enforcement of an foreign arbitral award in Russia. The award was rendered under the Rules of the Baltic Court of Arbitration (the Republic of Latvia 🇱🇻). A party against whom the award was made (a Russian company) opposed enforcement and referred to the Russian Presidential Decrees on counter-sanction measures. The Russian company argued that the arbitral creditor originates from an 'unfriendly' country, and therefore, enforcement would be contrary to Russian public policy.

On December 28, 2024, the court rejected the objection raised by the Russian company. It held that Russian counter-sanctions measures neither relieve contractual obligations nor prevent the recognition and enforcement of foreign arbitral awards in Russia. Consequently, the court recognized and enforced the arbitral award (Case No А56-28968/2024). #Latvia

📌 The approach in case А56-28968/2024 aligns with the Hiperion case, in which the Supreme Court of Russia held that Russian counter-sanction measures do not constitute a barrier to the enforcement of an arbitral award (See the post dated December 18, 2024).

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In brief, a Russian court has recognized and enforced:

- an arbitral award rendered under the Rules of the International arbitration court at the Belarusian 🇧🇾 Chamber of Commerce and Industry (Case No А40-268283/2024, the decision dated December 26, 2024). #Belarus

- a court decision rendered by the Bukhara Regional Court of the Republic of Uzbekistan 🇺🇿 (Case No А40-224991/2024, the decision dated December 23, 2024). #Uzbekistan

- a court decision rendered by the Specialized Interdistrict Economic Court of Kostanay Region of the Republic of Kazakhstan 🇰🇿 (Case No А76-37007/2024, the decision dated December 17, 2024). #Kazakhstan

A Russian court refused the recognition and enforcement of a court decision rendered by the Specialized Interdistrict Economic Court of Kyzylorda Region of the Republic of Kazakhstan 🇰🇿. The court found that the defendant was not duly notified on the court proceedings in Kazakhstan (Case No А27-21432/2024, the decision dated December 18, 2024). #Kazakhstan

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📖 A few years ago, my colleagues and I contributed to a book titled Recognition and Enforcement of Foreign Arbitral Awards in Russia and Former USSR States, published by Wolters Kluwer.

Good news:

The book has now been added to the library of the International Tribunal for the Law of the Sea (ITLOS). It is also available in the libraries of the United Nations Commission on International Trade Law (UNCITRAL), the Peace Palace, and the International Court of Justice (ICJ).

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In brief, a Russian court 🇷🇺 has recognized and enforced:

- a court decision rendered by a court of the Republic of Kazakhstan 🇰🇿 (Case No А40-209265/2024, the decision dated January 15, 2025). #Kazakhstan

- a court decision rendered by a court of the Republic of Belarus 🇧🇾 (Case No А40-205209/2024, the decision dated January 14, 2025). #Belarus

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📌 Once again, Russian counter-sanctions do not obstruct the enforcement of arbitral awards in Russia.

In case А32-25587/2024, a foreign company from the Netherlands 🇳🇱 sought to enforce an arbitral award issued against a Russian company. The seat of arbitration was in Russia 🇷🇺.

A court of first instance refused to enforce the award. The court, inter alia, referred to Russian counter-sanctions measures as grounds to deny enforcement.

A court of cassation disagrees with the lower court's approach.

⚖️ The court of cassation emphasizes:

(1) there are exhaustive grounds for refusing enforcement of arbitral awards with its seat in Russia; and

(2) Russian counter-sanctions measures do not constitute a barrier to the enforcement of arbitral awards in Russia.

Thus, by its decision dated January 27, 2025, the court of cassation revoked the ruling of the court of first instance; the case is to be reconsidered (decision in case А32-25587/2024 of 27 January 2025). #Netherlands

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📌 A notice of court proceedings delivered via a messenger service is improper.

In practice, foreign courts (such as those in Kazakhstan 🇰🇿 and Uzbekistan 🇺🇿) notify Russian parties of court proceedings via Telegram, WhatsApp.

When foreign court decisions are submitted to Russia 🇷🇺 for recognition, Russian courts refuse (may refuse) to recognize them, citing improper notification on the court proceedings.

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📘 The Review of Russian court practice on arbitration and cross-border litigation for the first half of 2024 is now available in English.

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📌 Lugovoy Law. A cassation court, in case No. А42-3659/2024, states that the "Lugovoy Law" is not applicable to the recognition and enforcement of foreign arbitral awards. Therefore, an applicant cannot rely on the "Lugovoy Law" when seeking an anti-enforcement injunction before a Russian court (the decision of February 10,2025). #Lugovoy

The approach is in line with the decision of the Russian Supreme Court in case No. 309-ЭС21-6955 (1-3) of December 9, 2021. 📑

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PESA lost its attempt to enforce a €55 million SCC award in Russia. The Supreme Court of Russia, in its ruling dated February 17, rejected PESA's cassation appeal for reconsideration of the case (PESA v UralTransMash, Case No А60-24839/2024).

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📌 The 'Lugovoy Law,' which allows Russian individuals and companies to bring disputes before Russian courts and enables those courts to block parallel arbitration or legal proceedings abroad, does not apply to foreign companies. As a result, foreign companies cannot rely on this law. #Lugovoy

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UPD. 🇷🇺🇰🇿 An appeal court has confirmed that a decision of the Court of the Astana International Financial Centre (AIFC Court) does not fall within Article 54 of the Convention on Legal Aid and Legal Relations in Civil, Family, and Criminal Matters (Chisinau, October 7, 2002) or Article 409 of the Civil Procedure Code of the Russian Federation.

By its decision dated February 21, 2025, the appeal court rejected the appeal against decisions of the Altai Regional Court dated November 1, 2024, which had denied an application for the recognition and enforcement of the AIFC Court's decisions in two cases.

The applicant may file a cassation appeal before a cassation court and subsequently before the Supreme Court of the Russian Federation.

📑 See the decisions of the 5th Appeal Court of General Jurisdiction dated February 21, 2025, in case N 66-139/2025 and in case N 66-140/2025, in Russian. #Kazakhstan

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📘 The Review of Russian court practice on arbitration and cross-border litigation for the second half of 2024 is now available. It is currently only available in Russian. // To those wishing to join us, welcome!

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Vietnam’s national oil and gas company has lost its cassation appeal before the Russian Supreme Court.

In Case No. А40-20468/2024, the lower courts had recognized a US$500 million SIAC award in Russia.

On March 12, 2025, the Russian Supreme Court rejected the company's cassation appeal for reconsideration of the case.

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🇷🇺🇨🇳 An application for the recognition and enforcement of a court judgment issued by a Chinese court in Russia must comply with Article 17 of the Treaty Between the People’s Republic of China and the Russian Federation on Judicial Assistance in Civil and Criminal Matters.

In Case No. A56-120092/2023, a Chinese company sought the recognition and enforcement of a court judgment issued by a Chinese court in the Russian Federation.

On March 17, 2025, a Russian court discontinued the proceedings. As noted by the court, the Chinese company's application did not comply with Article 17 of the Treaty Between the People’s Republic of China and the Russian Federation on Judicial Assistance in Civil and Criminal Matters (signed in Beijing on June 19, 1992), which governs the recognition and enforcement of judgments and came into force on November 14, 1993.

According to Article 17 of the Treaty, an application for recognition and enforcement must be submitted to the court that rendered the judgment. That court is then responsible for transmitting the judgment to a court in the other Contracting Party’s country.

Therefore, in this case, the Chinese company should have applied to a Chinese court, not a Russian court. Consequently, the Russian court discontinued the proceedings. #China

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🇷🇺🇨🇭On March 11, 2025, a Russian court recognized and enforced a Swiss arbitral award (Case No. А40-221290/2023). This is good news. However, in doing so, the court referred, inter alia, to the 'Lugovoy Law'—a point that remains unclear. If the court lacked effective jurisdiction over the case, the 'Lugovoy Law' does not provide a strong basis for establishing such jurisdiction. Well, let's see if the case proceeds further. #Lugovoi #Switzerland

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The Russian Constitutional Court may consider whether the “Lugovoy Law” complies with the Russian Constitution. The applicant argues that the “Lugovoy Law” breaches the Constitution by granting Russian courts jurisdiction to block arbitration through anti-arbitration injunctions in both “friendly” and “unfriendly” countries. According to the applicant, the “Lugovoy Law” should not restrict arbitration in “friendly” jurisdictions. #Lugovoy

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🇷🇺🇩🇪 A Germany-based company filed a legal action in a Russian court. However, the court declined jurisdiction and referred the parties to their chosen court—a German court (Case No. А66-19469/2024). Notably, this is not the first instance in which a foreign company has unsuccessfully attempted to override a forum selection clause by invoking case law on the 'Lugovoy Law.' #Germany #Lugovoy

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🇷🇺🇩🇪 UPD. In case No. А56-49800/2024, a cassation court overturned the lower court's decision that had recognized a German court ruling in Russia, and referred the case back to the lower court for reconsideration.

The cassation court noted that the lower court should examine whether there was an actual contractual relationship between the parties and whether a Russian presidential decree on counter-sanctions should be applied. #Germany

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