HKIAC in Russia
On 4 April 2019 the Russian Council for the Development of Arbitration ("Council") recommended that The Hong Kong International Arbitration Centre ("HKIAC") be granted permission to function as a permanent arbitral institution ("PAI") under Article 44(3) of the Federal Law No. 382-FZ dated 29 December 2015 on Arbitration in the Russian Federation, as amended by, among others, the Federal Law No. 531-FZ dated 27 December 2018 ("Federal Law").
Following the Russian arbitration reform introduced in September 2016, institutional arbitrations seated in Russia and arbitrations concerning certain types of corporate disputes in respect of Russian companies can only be submitted to a PAI as defined in the Federal Law.
The requirement for a foreign arbitral institution to acquire the status of a PAI is that the institution must possess a "widely recognized international reputation" which is assessed based on a set of criteria adopted by the Ministry of Justice.
As a PAI, HKIAC will become the first international arbitral institution authorised to administer (i) international disputes seated in Russia; (ii) disputes between parties from any special administrative region as defined under Russian law or disputes arising from agreements to carry out activities in any such region; and (iii) the following types of corporate disputes in respect of a legal entity in Russia (Article 45(7) and (7.1) of the Federal Law and Article 225.1 of the Russian Arbitral Procedure Code):
"disputes concerning the ownership of stocks, shares in the charter capital of business companies and partnerships, share contributions by the members of production cooperatives, their encumbrance and the exercise of rights, arising from them", such as disputes arising out of share purchase agreements;
"disputes arising from agreements between the participants of a legal entity concerning the management of that legal entity including disputes arising from corporate agreements", such as disputes arising out of shareholders' agreements; and
"disputes arising from the activities of registrars of placement owners, regarding the registration of rights to stocks and other securities, the exercise of their rights and discharge of other obligations, provided by federal law in connection with the distribution and (or) circulation of securities, by the registrar of placement owners".
Under the Federal Law, certain other corporate disputes such as derivative claims may only be administered by institutions with PAI status and special rules for corporate disputes. HKIAC does not currently have special rules for corporate disputes. Nor does HKIAC have a separate division in Russia which, in addition to PAI status, is a requirement for a foreign arbitral institution to administer domestic arbitrations.
The HKIAC Administered Arbitration Rules are available in the Russian language and 35 Russian-speaking arbitrators are listed on HKIAC's various panels of arbitrators. With its status as a PAI under Russian law, HKIAC is committed to providing its dispute resolution services to a broad range of Russia-related disputes in accordance with the Federal Law.