As mentioned above, there were traditionally very few arbitrated disputes in Soviet foreign trade.2 When arbitrations did take place and resulted in arbitral awards, such awards were always adhered to by the Soviet party in case it was on the losing end. In fact, until 1990 there were no known cases where a losing Soviet party did not fulfill the payment obligations in an award. In recent years, however, the situation has changed dramatically. In most cases the arbitral awards are the result of arbitrations arising out of contracts between Western parties and Soviet foreign trade organizations as they existed under the Soviet system of foreign trade. To understand and appreciate the problems facing Western parties today, it is therefore necessary to have a basic understanding of the Soviet system of foreign trade in its previous form.
The organization of Soviet foreign trade had seen little change until January 1, 1987. Radical reforms took effect on that date, however. On that date the first step in the decentralization and liberalization of the foreign trade system was taken by granting foreign trade rights to approximately 70 state enterprises and 21 economic ministries, departments, and state committees. Prior to this reorganization virtually all Soviet foreign trade was conducted through approximately 50 so-called foreign trade organizations subordinated to the USSR Ministry of Foreign Trade.
Table of Contents:
Chapter 2 Background: The Organization of Foreign Trade
(B) The Ministry of Foreign Trade
(C) Foreign Trade Organizations
(D) The Situation Today