Bribery and Russia-Related Arbitration

Abstract

This Article highlights the problem of bribery in resolving commercial disputes with Russian parties and shows how bribery can potentially affect arbitration proceedings.

Russia’s accession to the OECD Anti-bribery Convention prompted a number of legislative changes, which strengthened criminals and administrative liability for bribery offences. However, the civil law consequences of bribery remain the same – contracts concealing bribery are void as a matter of Russian law. There is no clear answer under Russian law as to validity of contracts procured by means of bribery.

Russian law as well as laws of other jurisdictions recognise the concept of separability of arbitration agreement. In other words, even if the underlying contract is void or terminated, the arbitration agreement in most cases remains in force and allows a tribunal to assert jurisdiction.

In theory, if bribery affected the contract, that could also lead to a refusal to enforce such award as contrary to public policy. But in practice, this is unlikely to happen because domestic courts are usually reluctant to reconsider the merits of arbitral awards in most jurisdictions.

Keywords: arbitrability, corruption, bribery, public policy, arbitration, Russia, CIS, Russian law, English Law, UK Bribery Act, OECD

JEL Classification: F21, K33, K40