Ukraine - Baker and McKenzie International Arbitration Yearbook 2014-2015
Originally from Baker and McKenzie International Arbitration Yearbook 2014-2015
A. LEGISLATION, TRENDS AND TENDENCIES
The ICSID Convention, ratified in 2000, continues to take priority over national legislation in Ukraine. The Decree On Issues on Selection of Candidates for Appointment as Representatives from Ukraine to be Included in the Conciliators’ List and the Arbitrators’ List of ICSID, adopted on April 2, 2013, remains in force.
A.2 Trends and Tendencies
In general, Ukraine is becoming friendlier towards arbitration. The arbitration community is working on legislative amendments to reduce the number of cases before the courts considering recognition and setting aside of arbitral awards, as well as interim measures in support of arbitration.
B.1 Burden of Proving Grounds for Refusal of Recognition of Arbitral Award
In late 2012, a global technological company filed an application with the Ukrainian courts requesting the recognition and enforcement of an arbitral award rendered by the Vienn International Arbitral Centre (“VIAC”) against a Ukrainian debtor. The courts of all three instances refused to satisfy the application on the ground that the Applicant had failed to prove that the Respondent had been properly notified of the arbitration proceedings. The courts noted that this was the obligation of the Applicant, by virtue of provisions of the Code of Civil Procedure of Ukraine. The Applicant appealed the case to the Supreme Court, which accepted the appeal and remanded the case for reconsideration to the Supreme Commercial Court. The Supreme Court noted that the lower courts had wrongly applied provisions of the Code of Civil Procedure to the proceedings, where in fact the New York Convention should have been applied due to the principle of supremacy of international treaties ratified by the Ukrainian parliament over domestic legislation. The Supreme Court noted that the New York Convention expressly shifts the burden of proof as to notice of arbitration proceedings from the party seeking recognition and enforcement of the award on to the party raising objections to such recognition and enforcement. This is a landmark decision of the Supreme Court, which finally resolves the long-standing controversy in Ukrainian litigation practice regarding which party must satisfy the burden of proof to establish grounds for refusal of recognition and enforcement of an arbitral award.