What is your advice to companies on implementing an effective dispute resolution strategy to deal with conflict, taking in the pros and cons of in-court versus out-of-court methods?
The process of dispute resolution in Ukrainian courts may be generally characterised as not very costly but rather time-consuming. Given the above and bearing in mind that the outcome of the court proceedings would be most certainty enforced by the state enforcement institutions, it is advisable to refer any disputes to the courts. However, should the interested party lack sufficient (preferably written) evidence, we would advise out-of-court dispute resolution methods, including negotiations aimed at reaching the compromise suitable for both of the parties. At the end of the day such strategy may turn out to be the best way to resolve the dispute.
What alternative dispute resolution (ADR) options are available to companies in your region?
In addition to courts, Ukrainian law officially recognises two dispute resolution methods: (1) domestic arbitration and (2) institutional or ad hoc international commercial arbitration.
Generally commercial disputes with few exceptions may be referred to either domestic or international commercial arbitration. Arbitral awards can be enforced in Ukraine pursuant to international treaties, such as the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958), European Convention on International Commercial Arbitration (1961), as well as domestic legislation including the Act of Ukraine “On Arbitral Tribunals.”
Ukrainian law does not stipulate any rules of mediation as dispute resolution method; however, in spite of only voluntary enforcement in practice mediation is more and more frequently used.
How would you describe arbitration facilities and processes in your particular region of focus? Are there any obstacles or challenges to the arbitration process that companies should bear in mind?
The arbitration facilities and process in Ukraine are generally efficient and not too costly. The only possible obstacle may be the tactics of respondent trying to avoid arbitration by referring to Ukrainian courts with claims for invalidation of arbitration agreement, etc, which claims are more or less frequently granted.
What practical issues need to be dealt with when undertaking complex international, multi-jurisdictional disputes in your region? Are such cases traditionally problematic, or are there mechanisms in place to ease the process?
Ukrainian law does not define and recognise the notion of multi-jurisdictional disputes and treats them as a set of separate disputes, which relate to interrelated factual background and legal issues and are heard by Ukrainian and foreign courts and tribunals (depending on the subject-matter and territorial jurisdiction). Due to the above there are no specific mechanisms that ease the consideration of multi-jurisdictional disputes.
When undertaking complex international, multi-jurisdictional disputes, which involves Ukrainian dispute resolution institution, the interested company is free to initiate as many different separate disputes as necessary, some of which may by aimed exclusively at establishing one or more crucial fact. Also the initiating company should bear in mind that any necessary preliminary injunctions with respect to the property on the territory of Ukraine should be issued by Ukrainian dispute resolution bodies. If such injunctions are issued by foreign court or tribunal, they would not be enforceable in Ukraine.
In your experience, what legal and contractual considerations should companies make to address the possibility of encountering future disputes in their commercial activities?
Bearing in mind that any business transaction and activity may trigger commercial dispute, the companies should retain as many documents certifying each step (all payments, transfers, deliveries, etc) in the transaction as possible. Also any agreement and practice established by the parties should be set forth in the form of a written agreement, because in such form above agreements and practices would be recognised by Ukrainian dispute resolution institutions as due and sufficient evidence.
The process of dispute resolution in Ukrainian courts may be generally characterised as not very costly but rather time-consuming. Given the above and bearing in mind that the outcome of the court proceedings would be most certainty enforced by the state enforcement institutions, it is advisable to refer any disputes to the courts. However, should the interested party lack sufficient (preferably written) evidence, we would advise out-of-court dispute resolution methods, including negotiations aimed at reaching the compromise suitable for both of the parties. At the end of the day such strategy may turn out to be the best way to resolve the dispute.
What alternative dispute resolution (ADR) options are available to companies in your region?
In addition to courts, Ukrainian law officially recognises two dispute resolution methods: (1) domestic arbitration and (2) institutional or ad hoc international commercial arbitration.
Generally commercial disputes with few exceptions may be referred to either domestic or international commercial arbitration. Arbitral awards can be enforced in Ukraine pursuant to international treaties, such as the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958), European Convention on International Commercial Arbitration (1961), as well as domestic legislation including the Act of Ukraine “On Arbitral Tribunals.”
Ukrainian law does not stipulate any rules of mediation as dispute resolution method; however, in spite of only voluntary enforcement in practice mediation is more and more frequently used.
How would you describe arbitration facilities and processes in your particular region of focus? Are there any obstacles or challenges to the arbitration process that companies should bear in mind?
The arbitration facilities and process in Ukraine are generally efficient and not too costly. The only possible obstacle may be the tactics of respondent trying to avoid arbitration by referring to Ukrainian courts with claims for invalidation of arbitration agreement, etc, which claims are more or less frequently granted.
What practical issues need to be dealt with when undertaking complex international, multi-jurisdictional disputes in your region? Are such cases traditionally problematic, or are there mechanisms in place to ease the process?
Ukrainian law does not define and recognise the notion of multi-jurisdictional disputes and treats them as a set of separate disputes, which relate to interrelated factual background and legal issues and are heard by Ukrainian and foreign courts and tribunals (depending on the subject-matter and territorial jurisdiction). Due to the above there are no specific mechanisms that ease the consideration of multi-jurisdictional disputes.
When undertaking complex international, multi-jurisdictional disputes, which involves Ukrainian dispute resolution institution, the interested company is free to initiate as many different separate disputes as necessary, some of which may by aimed exclusively at establishing one or more crucial fact. Also the initiating company should bear in mind that any necessary preliminary injunctions with respect to the property on the territory of Ukraine should be issued by Ukrainian dispute resolution bodies. If such injunctions are issued by foreign court or tribunal, they would not be enforceable in Ukraine.
In your experience, what legal and contractual considerations should companies make to address the possibility of encountering future disputes in their commercial activities?
Bearing in mind that any business transaction and activity may trigger commercial dispute, the companies should retain as many documents certifying each step (all payments, transfers, deliveries, etc) in the transaction as possible. Also any agreement and practice established by the parties should be set forth in the form of a written agreement, because in such form above agreements and practices would be recognised by Ukrainian dispute resolution institutions as due and sufficient evidence.