News

2 February 2012 NLMK Group

RF Supreme Commercial Court and Constitutional Court Support NLMK

The Constitutional Court and the Supreme Commercial Court of the Russian Federation have supported NLMK’s position regarding the unlawfulness of the award issued by the International Commercial Arbitration Court (ICAC) at the Chamber of Commerce & Industry (CCI) of the Russian Federation that was challenged by Nikolay Maximov.

The first decision relates to the Constitutional Court’s examination of Maximov’s claim questioning the constitutionality of the law that gives the ICAC no authority in the investigation and trial of corporate lawsuits, as was the case between Maximov and NLMK.

The Constitutional Court examined the award issued by the Cassation Court confirming the reversal of the ICAC ruling, with respect to possible violations of constitutional rights. Under the RF Constitution, a party to a lawsuit is not entitled to choose its preferred means and methods to exercise its rights to trial, when such are regulated by Federal laws. As such, the Arbitration Code places the settlement of all corporate disputes within the jurisdiction of commercial courts.

Acting on such grounds, the Constitutional Court of the Russian Federation issued a Resolution 1804-О-О/2011 dated December 21, 2011 (http://www.ksrf.ru/Decision/Pages/default.aspx) dismissing Nikolay Maximov’s claim as inadmissible.

The second resolution was pronounced by the supervisory court authority in the ICAC ruling case, i.e. the Supreme Commercial Court (SCC) panel. After the Cassation Court, in this case, the Federal Arbitration Court of the Moscow District, upheld the Moscow City Arbitration Court ruling to overturn the ICAC award, Nikolay Maximov lodged a complaint before the Supreme Commercial Court (SCC). On January 30, 2012, via its website, the Supreme Commercial Court (http://kad.arbitr.ru/?id=b808f500-dab4-43d7-ad6c-422080163f0e) reported that the SCC panel passed a resolution dismissing the petition to refer the case to the Presidium for review.

Therefore, the two judicial instances, both the RF Constitutional Court and the Supreme Commercial Court, have confirmed the lawfulness of the court decisions that had overturned the ICAC award. Moreover, they confirmed that the Russian Federal legislation had been violated by the ICAC judges engaged in the NLMK Vs. Maximov proceedings whereas they had no authority to do so.