Private arbitration courts will only be allowed for NCOs – amendments to the draft law

Mikhail Chugunov, Advocate of the Law Firm "YUST", commented for the Pravo.ru portal on the preliminary results of corrections to the draft laws on private arbitration for the second reading: private arbitration courts will be created only under non-commercial organizations, and only courts will have the right to dissolve them; but it is yet unclear which courts.

Mikhail Chugunov believes that the provision on creation of private arbitration courts by NCOs only “will hardly produce any serious difficulties by itself”. The advocate says: “Its preparation was aimed at resolving the problem of “pocket” private arbitration courts created not for the purpose of helping to settle commercial disputes in a just and prompt manner but for the purpose of ensuring the awards that the interested party wanted. The provision does not solve this problem. It doesn’t matter which organizations will be obliged to establish private arbitration courts. If such a court was established under a limited liability company, the founders of the company or their affiliated persons are now fully able to found an NCO and to establish a “pocket” private arbitration court under it”.

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