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On 2 December 2021, the Supreme Court of Russia (“Supreme Court“) ruled that Russian entities are not obliged to prove limited access to justice in foreign arbitration in order to refer disputes to Russian state arbitrazh courts. The mere fact that such Russian entities are subject to any sanctions should be enough for that purpose.

The Supreme Court stressed the following:

  1. Any sanctions imposed on a Russia entity already give rise to justifiable doubts as to the impartiality of foreign judges/arbitrators toward such Russian entity.
  2. An anti-suit injunction does not prevent a foreign entity from filing an action in a Russian court.
  3. A unilateral declaration of will of a Russian sanctioned entity is sufficient to give exclusive jurisdiction over the dispute with its participation to Russian arbitrazh courts.

At the same time, within the framework of the same case, the Supreme Court indicated that if a foreign state, on the territory of which a trial or arbitration proceedings take place, does not impose sanctions against a Russian entity that is a part of a dispute, then the arbitration clause is valid, and there are no grounds for referring a dispute to the courts of the Russian Federation.

Author

Danila Kryuchkov is an Intern in Baker McKenzie Moscow office.

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