Arbitrability of Corporate Disputes in Russia: To Be or Not to Be

Abstract

This paper discusses the possibility of adjudication by arbitration of corporate disputes, including disputes arising from shareholders' agreements. The article analyzes the relevant Russian legislation and court practice and contrasts it to the approaches of common law jurisdictions to these issues.

Currently, the transfer of corporate disputes to arbitration in Russia involves substantial risks for the participants in these disputes. In many cases, the Russian state commercial courts take the position that corporate disputes are not ‘arbitrable’ since the state commercial courts have exclusive jurisdiction over such disputes.

In common law jurisdictions, by contrast, corporate disputes (particularly those disputes arising out of shareholders’ agreements) may be referred to arbitration and be adjudicated according to a foreign law as chosen by the parties. Only in a few cases will the jurisdiction of arbitral tribunals be denied and the dispute resolution clauses and the provision of the chosen applicable law be ignored: if such is contrary to public policy or the mandatory rules of corporate law, or if it violates the rights of third parties.

Keywords: Russia, arbitration, jurisdiction, commercial disputes, shareholder agreements

JEL Classification: F21, K33, K40