Navigating Russian Foreign Arbitration System

Russian into English Arbitration Interpreting Services

We’ve blogged about the role of online legal translation and language interpreting services in international arbitration. When it comes to foreign investment in Russia, one of the greatest challenges one faces is enforcing a contract when either a deal falls apart or a breach of contract occurs. For the most part, the reasons for this challenge can be attributed to the legacy of Soviet-era corruption and a lack of an effective arbitration and court infrastructure.

The arbitration system in Russia occurs in the third-party court (treteiskii sud), which is made up of a number of arbitration and dispute resolution institutions. However, because of the lack of efficiency in the system, many foreign investors – and Russian parties – opt to take claims to a foreign arbitration venue (London, Paris, New York, etc). The reason is simple: these venues offer more concrete principles of arbitration law. On the other hand, Russian commercial law lacks precedent and is therefore difficult to predict. The Russia system also does not recognize such basic Western-concepts as representations, warranties and indemnities.

Because of this state of flux in Russian law, it is wise for foreign investors to utilize certified Russian to English interpreters and choose a specified foreign law to govern any contracts. If an investor opts to use Russian law, there is also an issue of enforcement. For example, an international arbitration award issues inside Russia can be reversed by a Russian court. Further, all arbitration awards must be enforced by the Russian court, meaning enforcement is never guaranteed until a court order is granted. Even with a court order, the enforcement process is complex. As a foreign investor operating in a foreign language-speaking country, it is essential to have Russian into English translations of all judgments – particularly foreign judgments. Or, one can simply do as many Russians do and skip the arbitration process for the more simplified route of taking traditional legal action.



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