New Rules of Arbitration Proceedings

A new law governing the arbitration proceedings has become effective from September 1, 2016. The law changes the previous arbitration proceedings system drastically. Earlier, the Russian laws based on the international treaties divided the arbitral tribunals into the permanent arbitral tribunals (permanent arbitral bodies) and arbitral tribunals established to settle a particular dispute (ad hoc tribunals).
New law differentiates the arbitral tribunals "administered by a permanent arbitration institution" and those performing arbitration without the administration by such institution. The latter are named the arbitral tribunals established by parties to settle a particular dispute. Parties can choose any arbitrators in the "permanent" arbitral tribunal, and not only those who included in the list prepared by the permanent arbitration institution. Whereas parties to the ad hoc arbitration can delegate "certain functions of dispute administration" to the permanent arbitration institution. Thus, the distinction between the permanent arbitral tribunals and ad hoc arbitral tribunals appears to be unclear, and the arbitration institution steps forward performing the functions related to the arbitration organizational support (support of the procedures of selection, nomination, or challenge of arbitrators, record keeping, arrangement of collection and distribution of arbitration charges), except for the direct dispute settlement functions of the arbitral tribunal.
The requirements to arbitrators on the one hand have been mitigated, but on the other hand, they have become stricter. Thus, the requirement that a sole arbitrator or the chairman of the panel of arbitrators has legal education has been changed from imperative (mandatory) to dispositive (changeable upon agreement between the parties). However, the arbitrator minimum age requirement has been introduced, which is 25 years old.
Much stricter requirements have been set for the recommended list of arbitrators in general. It must consist of at least 30 arbitrators; at least one third of arbitrators must have an academic degree in the scientific specialty included in the list approved by the authorized federal executive body; at least half of arbitrators must have an experience in settling civil disputes as referees or arbitrators in the arbitral tribunals (arbitration), or as judges of the federal court, constitutional (statutory) court of the constituent unit of the Russian Federation, justices of the peace for at least ten years prior to the date of inclusion in the recommended list of arbitrators. For example, the Justice of the Supreme Court of the Russian Federation can be a person with ten years of work experience in the field of jurisprudence, judicial experience is not mandatory. One person cannot be included in the recommended lists of arbitrators of more than three permanent arbitration institutions. As noted above, the selection of arbitrators as parties to the arbitration cannot be determined by their inclusion in the list of recommended arbitrators, the list may remain a list of "figureheads".
In spite of the functions of the permanent arbitration institutions being undetermined, the procedure for the creation is extremely complicated. The right to create them is granted by the act of the Government of the Russian Federation enacted based on the recommendation of the Council for Improvement of Arbitration Proceedings, which members are approved by the authorized federal executive body. The requirements specified for non-profit organizations claiming the right to perform functions of the permanent arbitration institution are very indistinct. Key requirements are reputation, range and nature of activity with regard to the founding (participating) members. Evaluative nature of these requirements allows granting the right to perform the functions of the permanent arbitration institution or deny such right at one's own discretion. The exceptions in terms of the creation procedure were made for the International Commercial Arbitration Court and Maritime Arbitration Commission affiliated with the Chamber of Commerce and Industry of the Russian Federation, but provisions with that effect are determined by law anyway.
Many rules of a new law are focused on increasing the enforceability of arbitration agreements (submission to arbitration agreements). It is expressly provided for that when interpreting the arbitration agreement, any doubts shall be interpreted in favor of its validity and enforceability. It is determined that in case of change of a party in the liability in relation to which the arbitration agreement was made, the arbitration agreement shall be valid in relation to both initial and new party (the issue of such "arbitration succession" was not litigated earlier). In addition, it is provided for that termination of the permanent arbitration institution stipulated in the arbitration agreement shall not result in termination of the latter: in this case, it will be considered that the parties have agreed on settlement of dispute in ad hoc arbitration. The innovation of the law is the right of the state court considering reversal or enforcement of the arbitral award to suspend the proceedings in order for the arbitral tribunal to resume the arbitration and eliminate the reasons for reversal or refusal in enforcement of the arbitral award. In other words, even if arbitrators make fundamental mistakes, the legislator is willing to give them an opportunity to correct them, and thus, to keep the arbitration agreement effective.
The introduction of the institution of corporate dispute arbitration is an undoubtedly positive change. At the moment, corporate disputes are within the exclusive jurisdiction of the state commercial courts, and arbitral tribunals cannot settle them. Such possibility will appear after a new law becomes effective, but only for the arbitral tribunals administered by the permanent arbitration institutions.
Following the enactment of a new law, the amendments have been made to the Law of the Russian Federation "On International Commercial Arbitration", Civil and Arbitration Procedure Codes of the Russian Federation, and a whole range of other laws.

See the Federal Law of 29.12.2015 No. 382-FZ "On Arbitration (Arbitral Proceedings) in the Russian Federation", and the Federal Law of 29.12.2015 No. 409-FZ "On Amendments to Particular Statutory Instruments of the Russian Federation, and Invalidation of Article 6 Part 1 Clause 3 of the Federal Law "On Self-Regulatory Organizations" due to Enactment of the Federal Law "On Arbitration (Arbitral Proceedings) in the Russian Federation".