belarus - sorainen 2. belarus - country report... · “overall, after the [2014] reform unified...
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BELARUSrecent developments
Alexey Anischenko
28 February 2019
Dispute Resolution in CIS-Related Business Transactions
Frankfurt
Some facts about Belarus
➢ Population 9,481,100 (on 207.600 sq.km)
➢ GDP decline in 2015-2016, modest growth in 2017-2018
➢ Devaluation in 2014 (30%), denomination in 2016 (0000)
➢ Around 5 % inflation in 2017-2018
➢ Slightly negative foreign trade balance (positive in services)
➢ “Uberisation” of economy (High-Tech Park)
➢ 38th place in WB Doing Business 2018 (24th in Enforcing Contracts, but only 68th in Resolving Insolvency)
➢ State dominance in the economy, civil legal system, “inquisitorial” process
➢ Party to NYC, CISG, ICSID, DTTs and BITs with main trade partners (including most of EU members states)
➢ NOT [yet] a WTO member (expected in 2020)
➢ Faced first three investments claims in 2018 (UNCITRAL, ICSID AF, ICSID)
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Statistics – state courts
978
681743
450
0
200
400
600
800
1000
1200
Claims filed Claims upheld
Disputes with foreign parties
2017 2018
3
Statistics – state courts
54
4847
42
0
10
20
30
40
50
60
Applications filed Applications granted
Applications for enforcement of foreign judgements/awards
2017 2018
4
Statistics – arbitration (caseload)
9187
105
94
0
20
40
60
80
100
120
Commenced Resolved
IAC at the BelCCI
5
Statistics – arbitration (domestic vs international)
76
11
2017
International (76) Domestic (11)
86
9
2018
International (86) Domestic (9)
6
Statistics – arbitration (foreign parties)
38
42
2017
Claimants Respondents
28
59
2018
Claimants Respondents
7
Statistics – arbitration (geography, 2017)
8
1
1
1
1
1
1
1
1
1
1
1
2
2
2
2
3
4
5
11
Poland
Ukraine
Azerbaijan
Mozambique
Austria
Mongolia
Italy
Canada
UAE
Romania
Qatar
Germany
Uzbekistan
Kazakhstan
Turkey
Latvia
China
Lithuania
Russia
RESPONDENTS
1
1
1
1
1
1
2
2
3
3
6
8
8
Singapore
Moldova
Estonia
Bosnia and…
British Virgin Islands
Czech Republic
Germany
USA
China
Ukraine
Poland
Lithuania
Russia
CLAIMANTS
Statistics – arbitration (geography, 2018)
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1
1
1
1
1
1
1
1
1
1
1
2
2
2
3
4
17
18
Latvia
Poland
UK
Netherlands
Azerbaijan
Northern Macedonia
Serbia
Czech Republic
Turkey
Romania
Estonia
Germany
Ukraine
Transnistrian Moldovan…
Switzerland
Lithuania
China
Russia
RESPONDENTS
1
1
1
1
2
2
2
3
3
5
7
Moldova
Uzbekistan
Czech Republic
Austria
UK
Lithuania
Germany
Poland
Latvia
Ukraine
Russia
CLAIMANTS
Status quo
▪ “Overall, after the [2014] reform unified court system is able to serve its
purpose, while certain optimisation of the caseload allows moving
forward – improve the quality and effectiveness of justice.”
V.O. Sukalo, Chairman of the Supreme Court of Belarus
25 February 201910
So where to solve your conflict in Belarus?
ArbitrationMediation Litigation
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Mediation
▪ Natural response to heavy caseload (1000+ cases per judge per year)
▪ Enforceability of settlement agreements reached in mediation
▪ Financial incentives
▪ The only effective way to resolve corporate disputes
▪ Low public awareness and business culture
▪ Lack of qualified mediators
▪ Law on Mediation, 2013
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Litigation
▪ Cheap
▪ Fast
▪ Low corruption
▪ Interim measures
▪ Focus on documentary evidence
▪ 3 levels of appeal, but low chances to overrule the 1st instance
▪ Financial incentives to use simplified proceedings and conciliation
▪ More difficult to litigate against state and state-owned companies
▪ Code on Commercial Procedure, 1998 (2004 edition)
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Arbitration
▪ Arbitration-friendly environment▪ More expensive and slower that state courts, though much cheaper and
generally faster than foreign alternatives▪ Few local arbitrators and counsel with international experience
▪ Specifics of arbitration law, rules and local practice in relation to:
✓conduct of proceedings (no PO1/ToR/PT, several 1 day hearings, often postponed at short notice, focus on documentary evidence, etc.) ✓appointment of foreign arbitrators✓mandatory bifurcation if jurisdictional objection raised✓scrutiny by the IAC Chairman ✓cession/assignment of arbitration agreement
▪ Law on International Arbitration, 1999 (UNCITRAL Model Law based)
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Few tips to consider
▪ Mind state courts as good alternative (particularly in straightforward
cases and when “fast-track” options are available)
▪ If Belarusian law is unavoidable – mitigate with international law (e.g.
CISG) and lex mercatoria (e.g. Incoterms, FIDIC, UNIDROIT Principles)
▪ Work on settlement (either through direct negotiations or mediation)
before rushing to the courts
DON’T SAVE ON LOCAL COUNSEL
– hire experienced one☺15
More information
▪ www.pravo.by – National Legal Internet Portal
▪ www.court.by – Supreme Court of the Republic of Belarus
▪ www.minjust.by – Ministry of Justice of the Republic of Belarus
▪ www.iac.by – International Arbitration Court at the BelCCI
▪ http://newyorkconvention1958.org/ – 5 NYC cases
▪ Case Law on UNCITRAL Texts (CLOUT) – 18 CISG cases
▪ World Arbitration Reporter (WAR) - Second Edition
National reports on Belarus (volume 1)
and IAC at the BelCCI (volume 2)
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ESTONIA
Pärnu mnt 15
10141 Tallinn
phone +372 6 400 900
LATVIA
Kr. Valdemāra iela 21
LV-1010 Riga
phone +371 67 365 000
LITHUANIA
Jogailos 4
LT-01116 Vilnius
phone +370 52 685 040
BELARUSul Internatsionalnaya 36-1220030 Minskphone +375 17 306 2102
www.Sorainen.com
Thank you!
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+375 (29) 6210801