Originially from: World Arbitration and Mediation Review (WAMR)

Enforcing Foreign Arbitral Awards Against Russian Entities
By Kaj Hobér, a partner at White & Case in Stockholm.
Editor’s note: the following is the first installment of Mr. Hobér’s indepth
analysis of the enforcement of foreign awards in Russia. This
installment describes legislative framework within which awards are
enforced in Russian courts. Future installments will address the assets
available for execution of awards against Russian entities and issues of
piercing the corporate veil and state immunity in arbitrations.
The article is based on a presentation given by Mr. Hobér on October
19, 1992 on the occasion of the 75th Anniversary of the Arbitration
Institute of the Stockholm Chamber of Commerce. Mr. Hober’s
contribution will be published in the Institute’s 1993 Yearbook. Mr. Hober
is also the author of Joint Ventures in the Soviet Union, published by
Transnational Juris Publications.
Beginning in 1987, the system of foreign trade in the former Soviet
Union began to undergo profound changes, changes that had both positive
and negative consequences for Western businesses engaged in trade with
Soviet entities. Among these consequences was an increase in the number
and frequency of commercial disputes.
Traditionally, very few disputes between Soviet foreign trading entities
and Western businesses went to arbitration. Naturally, disputes did occur,
but they were usually settled through negotiations. When arbitrations did
take place and resulted in awards against Soviet parties, the Soviet party
always adhered to the award. 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 number of disputes entering arbitration has
increased significantly. In Stockholm, for example, the Arbitration
Institute of the Stockholm Chamber of Commerce is handling an ever
increasing number of disputes involving Russian entities, both pursuant to
its arbitration rules and in acting as appointing authority in ad hoc
arbitrations taking place in Stockholm.
(Editor’s note: the SCC, the American Arbitration Association, and the
Russian Chamber of Commerce in March established an arrangement to
facilitate the arbitration of US-Russian commercial disputes in Stockholm
under UNCITRAL Rules. See 4 WAMR 59.]