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Stockholm Arbitration Report (SAR)

Preview Page SAR 2001 - 2

Subject matters:
(1) Universal succession under Kazakh law.
(2)Validity of an arbitration agreement following a universal succession.
(3) Service of a request for arbitration and procedural documents, with a Kazakh company.

Findings:
(1) A rule laid down for the protection of creditors in the Civil Code of the Republic of Kazakhstan (“RK Civil Code”), could not be invoked by a debtor claiming that a proper transfer had not taken place due to failure to respect such rule.
(2) A universal successor is bound by an arbitration agreement entered into by the company being taken over, prior to the succession.
(3) Service of the request for arbitration by a private attorney-at-law with the vice president of the Kazakh company through a visit to the company is a valid notification of the commencement of the arbitration. Service of further documents with the company’s reception personnel was considered valid notification.

Parties:
Claimant: Transnational Company Kazchrom (“Kazchrom”) (Kazakhstan)
Respondents: 1. AIOC Resources AG, in liquidation (“AIOC”) (Sweden)
2. Mr Edward Moran (“Moran”) (USA)

Place of court proceedings: Stockholm, Sweden

Applicable law: The Swedish Arbitration Act of 1929

Excerpts below follow an unofficial translation of the proceedings in the Stockholm District Court and the Svea Court of Appeals.