Support for international arbitration against Russian counterparties
International arbitration remains a key mechanism for protecting the interests of foreign companies in disputes with Russian counterparties. The specialists at KDpartners handle arbitration proceedings in jurisdictions across Europe and Asia, develop legal strategies, coordinate interactions with arbitration centers, and ensure the enforcement of decisions both within and outside of Russia.
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- When is International Arbitration Applied Against Russian Companies?
- Risks and Limitations in Arbitration with Russian Parties
- Conducting International Arbitration Against a Russian Counterparty
- Recognition and Enforcement of Arbitration Awards Against Russian Companies
- Services of KDpartners
When is International Arbitration Applied Against Russian Companies?
International arbitration is used to resolve commercial disputes between companies from different jurisdictions if the parties have entered into an arbitration agreement. In dealings with Russian counterparties, arbitration clauses are often included in supply contracts, agency agreements, service contracts, and other foreign economic documents.
It is possible to appeal to international arbitration if the contract explicitly states the parties' consent to submit the dispute to a specific arbitration institution. Such clauses must be in writing and specify the applicable rules and the place of arbitration.
In practice, the following arbitration centers are most commonly used in disputes with Russian companies:
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International Court of Arbitration at the International Chamber of Commerce (ICC, Paris);
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London Court of International Arbitration (LCIA, London);
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Singapore International Arbitration Centre (SIAC, Singapore);
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Vienna International Arbitral Centre (VIAC, Vienna);
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Hong Kong International Arbitration Centre (HKIAC, Hong Kong);
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Arbitration Institute of the Stockholm Chamber of Commerce (SCC, Stockholm);
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International Commercial Arbitration Court at the Russian Chamber of Commerce and Industry (ICAC, Moscow);
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Russian Arbitration Centre (RAC, Moscow);
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China International Economic and Trade Arbitration Commission (CIETAC);
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Shanghai International Arbitration Centre (SHIAC, Shanghai);
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Beijing Arbitration Commission (BAC, Beijing).
The choice of arbitration jurisdiction depends on the industry, the scale of the deal, enforcement risks, and the political-legal context. In all cases, it is necessary to evaluate not only the legal strength of the clause but also potential obstacles to its enforcement.
Risks and Limitations in Arbitration with Russian Parties
Conducting an arbitration proceeding against a Russian company involves a number of legal and practical risks related to existing restrictions.
Since 2020, Articles 248.1 and 248.2 of the Arbitration Procedural Code of the Russian Federation have been introduced, establishing the exclusive jurisdiction of Russian arbitration courts for disputes involving Russian entities subject to sanctions or in cases where the case cannot or is difficult to be heard in a foreign jurisdiction. In such circumstances, a Russian court may declare the arbitration clause inapplicable and prohibit the continuation of the proceedings in international arbitration.
Furthermore, Russian courts may issue an order prohibiting the continuation of the dispute in international arbitration (anti-suit injunction). In the event of non-compliance, compensation can be demanded or measures can be applied to the assets of the foreign party within Russia.
These provisions apply in the presence of foreign economic sanctions and in cases involving specific industry sectors (energy, logistics, IT, defense contracts). As a result, even when an arbitration clause formally exists, there is a risk of it being blocked in practice.
Foreign companies must assess the risks of challenging the arbitration clause in Russia in advance and develop alternative strategies for protecting their interests.
Conducting International Arbitration Against a Russian Counterparty
Preparation for arbitration begins with an analysis of the arbitration clause, applicable law, and the procedure for dispute resolution stipulated by the contract. A legal position is formed, taking into account the specific circumstances and potential jurisdictional objections.
Evidence includes contractual documents, business correspondence, payment confirmations, acts, technical conclusions, and other materials. If necessary, experts from the relevant industry are engaged.
When choosing an arbitration institution, the rules, language of proceedings, composition of arbitrators, and location of arbitration are evaluated. Typical venues for disputes involving Russian companies include ICC, LCIA, SCC, SIAC, VIAC, HKIAC, and PCA.
Under Articles 248.1–248.2 of the Arbitration Procedural Code and sanctions restrictions, parallel proceedings in Russian courts may be possible. This requires preparing procedural defense against claims of invalidating the arbitration clause and presenting the position on the international arbitration’s jurisdictional competence.
Recognition and Enforcement of Arbitration Awards Against Russian Companies
The recognition and enforcement of foreign arbitration awards in Russia are governed by the 1958 New York Convention, to which the Russian Federation is a party. The basis for enforcement is a petition to the arbitration court at the location of the debtor or their assets. The petition must include the original award, the arbitration agreement, and their certified translations.
A Russian court may refuse to recognize an arbitration award on a limited number of grounds outlined in Article V of the Convention and Article 36 of Federal Law No. 382-FZ. These include improper notification of the party, violation of Russian public policy, exceeding the arbitrator’s jurisdiction, or the inadmissibility of the dispute for arbitration.
In cases involving a Russian party under sanctions or claims invoking Article 248.1 of the Arbitration Procedural Code, additional objections may arise aimed at blocking enforcement.
If the debtor’s assets are located outside of Russia, the award may be enforced in another jurisdiction, based on its domestic law and international commitments. In the EU, UK, UAE, Switzerland, and a number of other countries, the practice of enforcing awards against Russian companies remains stable, but may be supplemented with measures to protect against Russian court blockages.
Services of KDpartners
The specialists at KDpartners assist in international arbitration disputes against Russian counterparties at all stages. We develop arbitration strategies taking into account applicable law, analyze arbitration clauses, prepare legal positions, and assemble evidence.
We represent clients in cooperation with local partners in the jurisdictions of arbitration institutions, including ICC (Paris), LCIA (London), SCC (Stockholm), SIAC (Singapore), VIAC (Vienna), HKIAC (Hong Kong), PCA (The Hague), and also at ICAC under the Russian Chamber of Commerce and Industry (Moscow).
We coordinate the filing of statements, participate in proceedings, ensure the preparation of procedural and supplementary documents, and interact with arbitrators and secretariats.
An additional area of focus is supporting the recognition and enforcement of arbitration awards within Russia and abroad, including preparing procedural motions, representing clients in Russian courts, and liaising with enforcement authorities.
Services are provided in Russian, English, and Chinese.
Successful cases
Examples of legal solutions tailored to the specifics of the request, industry and jurisdiction.
Non‑payment under a supply contract for construction materials
Situation
A supplier company faced a refusal by the buyer to pay for the last batch of materials, citing "defects" in the products as the reason.
Solution
Specialists of the company analyzed the terms of the contract, sent a claim, and gathered evidence that the goods had been accepted without any remarks. After negotiations with the management of the counterparty, a reconciliation report and a debt repayment schedule were signed.
Result
Payment was received in full, and court proceedings were avoided.
Construction contract dispute at the ICAC at the RF CCI
Situation
The contractor demanded payment for additional work that had not been agreed upon by the customer.
Solution
Lawyers specializing in arbitration cases prepared the customer’s legal position, submitted an expert technical opinion, and demonstrated that the claimed expenses were not included in the approved estimate.
Result
The arbitration dismissed the contractor’s claim, confirming the validity of the client’s position.
Violation of a distribution agreement (arbitration at HKIAC)
Situation
A Russian company violated the distributor’s exclusive rights by entering into contracts with other partners.
Solution
Specialists in international arbitration gathered evidence of the violation and represented the client’s interests at the Hong Kong International Arbitration Centre (HKIAC).
Result
The arbitration found that the agreement had been violated and awarded compensation for damages. The decision was subsequently recognized and enforced in Russia.
Enforcement of an arbitral award
Situation
After receiving a court decision, the debtor did not perform its obligations and transferred assets to affiliated structures.
Solution
Lawyers specializing in enforcement proceedings secured a freeze on the debtor’s assets and accounts receivable and initiated proceedings to hold the affiliated persons jointly and severally liable.
Result
The court decision was enforced in full, and the claimant received the amount including interest.
Recognition of an international arbitral award in Russia
Situation
A foreign company applied for recognition and enforcement of an ICC arbitration award for the recovery of damages from a Russian partner.
Solution
A team of specialists in private international law prepared an application for recognition of the award, legalised the documents, and proved compliance with the terms of the 1958 New York Convention.
Result
The Russian arbitration court granted the application, and the arbitral award was successfully enforced.
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FAQ
When can international arbitration be initiated against a Russian counterparty under an existing contract?
Can a Russian court prevent arbitration proceedings with a Russian counterparty in an international arbitration?
Which international arbitration institutions are most commonly used in disputes with Russian companies?
How to enforce an international arbitration award against a Russian counterparty in Russia?
Is it possible to enforce an international arbitration award against a Russian company abroad?
How can the risk of Russian procedural restrictions in international arbitration with a Russian counterparty be minimized?
Can international arbitration be initiated against a Russian counterparty if they refuse to fulfill the contract?
What documents are required to file a claim in international arbitration against a Russian company?
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