THE AUTHOR<\/strong>: Since the enactment of the so-called Lugovoy Law in 2020, Russian<\/a> courts have been increasingly assertive in retaining jurisdiction over disputes involving Russian parties. The Lugovoy Law (Federal Law No. 297-FZ \u201cOn Jurisdiction of the Courts of the Russian Federation\u201d) was introduced as part of Russia\u2019s legislative response to international sanctions. It grants Russian commercial courts exclusive jurisdiction over disputes where a Russian party is subject to restrictive measures, where foreign proceedings are deemed \u201cunfriendly,\u201d or where a foreign jurisdiction or arbitral forum is considered inaccessible to Russian litigants due to sanctions. In effect, the law allows Russian parties to bypass foreign dispute resolution clauses and bring proceedings before domestic courts, even if the contract provides otherwise.<\/p>\n\n\n\n In practice<\/a>, the Lugovoy Law has often been used to justify refusing enforcement of foreign jurisdiction or arbitral clauses in disputes involving Russian parties, particularly where they appear as defendants and seek to avoid foreign proceedings. Over the past years, several rulings demonstrated a pro-Russian stance: courts have held that arbitration agreements with foreign institutions are unenforceable if they \u201cdeprive\u201d Russian parties of judicial protection or if the arbitration is deemed inaccessible due to sanctions.<\/p>\n\n\n\n Yet, despite this trend, Russian courts still sometimes take a balanced approach where the parties\u2019 contractual intent is clear. The recent ruling of the Arbitrazh Court of Primorsky Krai in Case No. \u041051-22733\/2024<\/a> delivered on September 16, 2025, is a notable example. The court, faced with ambiguous wording in the arbitration clause, nevertheless upheld the arbitration agreement and referred the parties to arbitration in South Korea<\/a>.<\/p>\n\n\n\n The claimant Renal TMT Inc., a South Korean company, filed a debt recovery claim against AO RK Primorez, a Russian respondent, before a Russian commercial (arbitrazh) court. The underlying contract contained a dispute resolution clause providing that disputes would be referred to \u201can arbitration court at the claimant\u2019s place of location.\u201d<\/p>\n\n\n\n The wording was problematic for several reasons:<\/p>\n\n\n\n The respondent raised an objection to jurisdiction, arguing that the dispute was subject to arbitration under the contract and therefore could not be heard by the Russian court.<\/p>\n\n\n\n The Arbitrazh Court acknowledged the interpretative difficulties but placed emphasis on the parties\u2019 common intention to submit disputes to arbitration rather than litigation.<\/p>\n\n\n\n In reaching its conclusion, the Arbitrazh Court expressly relied on the guidance of the Supreme Court of the Russian Federation in Plenum Resolution No. 53 of 10 December 2019 (\u201cOn the performance by Russian courts of functions of assistance and control in relation to arbitral proceedings and international commercial arbitration\u201d). As the court recalled, under paragraph 16 of Plenum No. 53, when determining whether to leave a claim without consideration on the basis of an arbitration agreement, a Russian court must examine whether there are clear indications that the agreement is invalid, unenforceable, or has ceased to be in force, or that the dispute is not capable of being resolved by arbitration.<\/p>\n\n\n\n
Rinat Gareev, <\/strong>Legal Counsel at Whitecliff Management<\/strong><\/p>\n\n\n\n
\n\n\n\nBackground of the Dispute<\/strong><\/h2>\n\n\n\n
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The Court\u2019s Reasoning<\/strong><\/h2>\n\n\n\n
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