Practical Law updated the article by Maxim Kulkov and Sergey Lysov

Russian Ministry of Justice promulgates Regulation on establishment of permanent arbitral institutions in Russia. As part of the enactment of the recently adopted Law N 382-FZ “On Arbitration” (see Legal update, Russian President approves amendments to arbitration law), the Russian Ministry of Justice has promulgated Regulation On a Council for Development of Arbitration Laws, prescribing the procedure for granting permission to establish permanent arbitral institutions. All existing arbitral institutions will have to abide by the Regulation if they wish to continue operations in Russia and there will be a one year transition period in which they will be able to do so before their activity will be restricted.

In accordance with the Regulation, the Ministry of Justice will form a special council for the development of arbitration (Council). The Council will consist of approximately 20-40 individuals, including government authorities (constituting no more than a third of total Council members), and representatives of associations of entrepreneurs and legal academic communities. The primary function of the Council will be to consider requests from non-commercial organisations to establish arbitral institutions.

Requests should be accompanied by draft arbitration rules, a list of arbitrators together with their written consent and other documents specified in the Regulation. Notably, arbitrators will not be able to act permanently in more than three arbitral institutions simultaneously.

If a request complies with the formal requirements, the Council has the authority to recommend that the Government approve it. Decisions in this respect are to be made by majority.

The composition of the Council, including the Chairman of the Board, his deputies and the Secretary of the Board, are to be approved by a separate order of Russia’s Ministry of Justice.

It is expected that the Regulation will come into force simultaneously with the new legislative amendments, which is on 1 September 2016.

This article has been published by Practical Law Arbitration on 18 of May 2016.