Georgian Practice of Arbitration
Supreme Court of Georgia
ALEKSANDRE TSULADZE
HEAD OF THE DEPARTMENT
OF THE COURT STATISTICS AND ANALYSIS
March 2014
Overview
I.
Legal Framework
II. Enforcement of Awards
III. Practical Considerations
Georgian Practice of Arbitration
Georgia ?
Georgian Practice of Arbitration
Legal Framework for Arbitration in Georgia
- New York Convention 1958
- Law of Georgia on Arbitration 2009
- Code of Civil Procedure
Features of general legal system
- Legal System – civil law
- Three court instances – District, Appeal and Supreme
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New York Convention
Convention applies only to Foreign Arbitral Awards.
- Both Georgia and Mongolia Acceded in 1994;
- Guarantees a considerable degree of uniformity in the recognition and
enforcement of awards among the signatory states;
- the NY Convention stands to ensure the recognition and enforcement of
foreign arbitral awards by national courts;
- Georgia has made neither Reciprocity nor commercial reservation.
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Some Features of Georgian Arbitration Law
 Model Law Based (party autonomy enshrined)
 District Courts in charge of: arbitrator appointment, challenge, competence,
assistance with production of evidence
 Court of Appeals in charge of: interim measures, set-aside, R&E of domestic
awards
 Supreme Court in charge of: Recognition and Enforcement of foreign awards
 Tight time-frames: 30 days for appointment and decision on set-aside; 14
days for the decision on challenge and competence, 180 days for tribunal to
render award (+180), 10 days for R&E.
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Arbitrability
Art. 1(2) Law of Georgia on Arbitration (2009):
The arbitral tribunal shall be entitled to hear property disputes of a private character which are
based on an equal treatment of the parties and that parties are able to settle between themselves.
.
Art. 177(1) Swiss Private International Law Statute (1990):
Any dispute involving property may be the subject-matter of an arbitration.
Art 3. Arbitration Law of the People's Republic of China (1995):
Disputes over the following matters are not subject to arbitration:
disputes over marriage, adoption, custody, support and inheritance
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Enforcement of Awards in Georgia
The purpose of arbitration is to arrive to a binding decision on the dispute.
Once the award is issued, the winning party expects the arbitral award to be
performed voluntarily.
If the award is not carried out by the losing party, the award is enforced by
proceedings in a national court.
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Interpretation and Application of Law by
the National Courts
Article 44(1) of the Law of Georgia on Arbitration:
For the purposes of this Article and Article 45 of this Law, the
competent courts for arbitral awards rendered in Georgia shall be
the courts of appeal, while for arbitral awards rendered outside of
Georgia shall be the Supreme Court of Georgia.
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The Formalities
Article 44 (2) of the Georgian Law on Arbitration:
The party applying for recognition and enforcement of the arbitral award shall
supply to the competent court:
• the original award or a certified copy thereof; and
• original of arbitration agreement or a certified copy thereof ;
• If the award or an arbitration agreement is not made in Georgian
language, the party shall also supply to the court certified translation
into Georgian language.
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Refuse of Enforcement
Article 45(1) of Law of Georgia on Arbitration:
Recognition and enforcement of an arbitral award … may be refused if:
a) A party to the arbitration agreement lacked capacity…
b) The subject-matter of the dispute is not capable of settlement by
arbitration under the Georgian legislation
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Refusal of recognition and Enforcement
- No review of the merits!
- The grounds list is exhaustive!
- The burden of proof is on the party resisting enforcement!
–Court may refuse recognition and enforcement!
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The way to enforce an arbitral award in Georgia
The Procedure for the Recognition and Enforcement
Under Georgian legal system, for both domestic and international awards, it is necessary to
apply to the competent Georgian Court for the recognition and enforcement order as a
preliminary step to enforcement.
The Competent Georgian courts:
for the awards made in Georgia - the Court of Appeal.
for the awards made outside of Georgia – Supreme Court of Georgia.
Once the Competent court issues the order on recognition and enforcement
of the arbitral award, based on such order than the enforcement is made in
accordance with the Georgian law on “enforcement procedures”.
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Application for Recognition and Enforcement
Oral Hearing not necessary - Article 356(21 ) of the Civil Procedure Code
of Georgia:
- Issues related to recognition and enforcement of arbitral awards is decided by
the court without oral hearing;
- The court may appoint the date for the oral hearing if it considers that it is
necessary and will enhance the resolution of the issues;
Time Limit – 10 days from the date of application
decision on the enforcement application shall be made within 10 days from the
date of receiving the application by the court.
The is final and is not subject of appeal.
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Key Statistics for 2011
2011
Enforced
19%
Partially Enforced
32%
49%
Refused to Enforce
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81%
Key Statistics for 2012
2012
14%
29%
Enforced
86%
Partially Enforced
57%
Refused to Enforce
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Key Statistics for 2013
2759 cases filed in 2013
13% cases had a Sole Arbitrator and
87% had a three-member Tribunal
36 Institutional Arbitrations in a Country
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Key Statistics for 2013
2013
26%
5%
Enforced
95%
Partially Enforced
69%
Refused to Enforce
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Key Statistics for 2013
11%
Banks and Micro Finance Organizations
Rest
89%
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Keys to Success of Georgian Model
• Implementation of the 1958 New York Convention
• Providing a reliable and effective means of dispute
resolution
• Efficiency and promptness of court proceedings
• Consumer demand and trust
• Arbitration Institutions and Robust Arbitration Rules
• Arbitrators
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What needs to be done
for Mongolia?
Steps
 Willpower of the government
Legal framework
Support as a matter of policy
 “Arbitration-friendly” court practice:
Specialized judges dealing with matters under the Law
Liaison between courts and Arbitration users
Liaison between different courts
Assistance of practitioners
 Good (qualified) Arbitrators and Ethical Arbitrators
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Steps
Emerge Credible Institutions
Right Infrastructure in place
Marketing, Because General Perception Matters!
Publicity (scholars, articles, news alerts)
International Conferences
Teams for Vis Moot
Educational center
Be Optimistic, but also Realistic
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Thank you for your Attention
DRAFT OF CONSTITUTIONAL AMENDMENT 2013