Recent rulings by Russia’s Supreme Arbitrazh (Commercial) Court (SAC) have clarified dispute resolution procedural issues in Russian courts. In particular, the following resolutions were adopted:

Resolution No. 61 of the Plenum of the Russian Supreme Arbitrazh (Commercial) Court of 8 October 2012, "Ensuring publicity of arbitration proceedings"

This Resolution provides much needed clarity on the issue of enforcing the publicity principle in respect of judicial proceedings. Until recently, the publicity principle was ill-enforced, with some courts denying visitors access to public hearings, holding that only parties to the case were permitted entry – which runs counter to the statutory provisions that entitle citizens to attend public hearings.

According to the Resolution, a public hearing may be attended by any citizen, including mass media representatives. The court may not deny a citizen its right to be present at a hearing, even if there are not enough seats in the courtroom. Moreover, the court must provide citizens with the opportunity to become familiar with the course of the trial; for example, by broadcasting the court proceedings.

Those present at judicial proceedings have the right to take notes and publish those notes in social networks and via electronic mass media, as well as to record the proceedings by means of audio devices without the consent of the judge hearing the case. However, citizens and mass media representatives must seek the judge's approval to conduct video recording, photo shooting, live-broadcast sessions on the radio, television, or on the Internet. Any audio or video recordings, made with the permission of the judge, may be used in any manner without the judge's consent.

For certain types of cases, Russian law permits the proceedings to be held in a closed session (which means citizens and mass media representatives are not allowed to be present and audio and video recording, broadcasting on the radio, television or the Internet are also prohibited). This is particularly the case where a dispute concerns information constituting a state secret.

When there is a need to preserve trade secrets and other secrets protected by law (e.g., medical), the proceedings can also be carried out in a closed session at the request of a person involved in the case and who has demonstrated a valid concern in keeping the relevant information secret.

In considering a motion for a case to be heard in a closed session, the court will check the files of the case for documents that contain information constituting a trade secret. The person who initially made the motion must prove that measures have been taken to render the information subject to trade secrecy, and that the information is not of a kind that may not, under Russian law, constitute a trade secret (constituent documents, financial statements, etc.).

The desire to uphold one’s reputation or maintain the privacy of one’s business activities or financial condition is not a valid reason for conducting court proceedings in a closed session.

If any information to be heard constitutes a trade secret, the use of videoconferencing systems is permitted with the consent of the parties involved in the trial, provided that measures are taken to safeguard that information.

The court may not act on its own initiative to hear a case in a closed session or remove it from a closed session. If there are documents related to the case that contain information warranting a closed session, the judge may draw attention to this fact to those involved in the case and explain their right to file a motion for a closed session to them.

Resolution No. 61 of the Plenum of the Russian Supreme Arbitrazh (Commercial) Court of 8 October 2012, "On certain issues arising from the establishment of a court for intellectual property rights within the system of arbitration courts "

As we noted in our Septemember 2012 issue of the CIS Legal Update, a new court for intellectual property rights (hereinafter, the Court) – the first specialized court in the Russian Federation – has been created and introduced as part of the Russian judicial system. Although the Court should have been established by 1 February 2013, it has yet to commence operation.

Despite the fact that the Court has just been created, questions have already been raised about its jurisdiction vis-à-vis other courts within the Russian judicial system. This Resolution clarifies the Court’s jurisdiction over disputes relating to intellectual property rights.

Initially, it was determined that the Court would consider the following cases as a court of first instance:

• cases challenging regulations that affect the rights and lawful interests of an applicant with respect to the legal protection of intellectual property;
• disputes concerning the provision or termination of legal protection of intellectual property and similar means of individualization of persons, goods, works, services and businesses.

The Resolution established that, in addition to the above, the Court will also consider disputes on applications that contain several related claims if at least one of them falls under the jurisdiction of the Court.

As a court of cassation, the Court will consider the following cases appealed from arbitrazh (commercial) courts of the administrative subdivisions of the Russian Federation acting as trial courts:

• disputes concerning the protection of intellectual property rights; disputes regarding the infringement of intellectual property rights and rights to means of identification; the right of prior and subsequent use; disputes arising from license agreements and agreements for the alienation of exclusive rights;
• disputes on the protection of intellectual property rights involving organizations engaged in the collective management of copyright and associated rights;
• cases concerning prosecution for applicable administrative offenses (illegal use of a trademark, unfair competition);
• cases challenging resolutions of administrative agencies concerning administrative liability for unfair competition.

These disputes are handled by trial arbitrazh (commercial) courts and by arbitrazh (commercial) appellate courts as the courts of the first and appellate instances respectively.

The Court may direct inquiries to scientists and professionals with expert knowledge in science and technology in order to seek clarification and confirmation (or refutation) of the correctness of the court’s application of the rules of law during proceedings. The Court may send this request at any time before the rendering of the judgment in a case as either a trial court or as an appellate court.

Resolution No. 62 of the Plenum of the Russian Supreme Arbitrazh (Commercial) Court of 8 October 2012, "On certain issues related to the consideration by arbitrazh (commercial) courts of cases using summary proceedings"

Recent amendments to Russian legislation have made it easier to obtain expedited rulings in Russian courts by way of summary proceedings, which allow for cases that fit a certain criteria to be efficiently filed online and decided on by a single judge on the basis of the documents provided by the parties. To qualify for summary proceedings in arbitrazh (commercial) courts, the claim must be either uncontested, acknowledged by the respondent, or the claim amount must not be financially significant.

The following disputes are subject to summary proceedings:

• claims to recover funds not exceeding 300,000 Rubles (approximately USD$10,000) for legal entities and 100,000 Rubles (approximately USD$3,000) for individual entrepreneurs;
• certain administrative and public relations disputes, particularly administrative liability cases where the sole sanction is an administrative fine not exceeding 100,000 Rubles (approximately USD$3,000) and cases for the recovery of mandatory payments and sanctions not exceeding 100,000 Rubles (approximately USD$3,000);
• claims based on documents submitted by one party establishing the other party's financial obligations, regardless of the amounts claimed, which the other party acknowledged but did not fulfill, and/or on documents confirming contractual debt;
• claims made by a notary protesting a bill for non-payment, non-acceptance, or undated acceptance.

With the mutual consent of the parties, other disputes may also be considered in summary proceedings if there are no circumstances that prevent it, such as a third party joining the process; the risk of disclosing a state secret or a breach of the lawful rights of third parties; the necessity to obtain an expert opinion or to hear witness statements; summary proceedings not constituting a sufficiently thorough procedure for the dispute; and the necessity to clarify additional circumstances and research additional evidence.

The Plenum clarified a number of issues regarding the procedures for hearing cases by way of summary proceedings.

In particular, the Plenum addressed the issue of determining whether a case subject to review in summary proceedings should be settled at the commencement of proceedings. If, during a trial, circumstances are revealed whereby a court finds that it cannot review the matter summarily (statement of a counterclaim which cannot be addressed through summary proceedings, the risk of disclosure of state secrets, the need to examine the evidence at its location, the need for an expert opinion, other circumstances), the court must then revert to the general rules of contentious proceedings.

The Resolution provides the legal framework for disputes to be summarily heard without having to summon the parties and give notice of the time and place of the hearing. Moreover, no court records are made when a case is heard, no rules are applied governing postponement of trial, and the court judgment is not published as required by the rules in the RF Arbitrazh Procedure Code. The date of judgment is the date when the judgment is prepared and delivered.

However, the court must notify the parties involved in the case that the dispute is to be reviewed by way of summary proceedings. If, by the day of the judgment the court has not yet been informed that the parties involved in the case have received notification of the acceptance of the claim for summary proceedings, or if the court has received information that expressly indicates that a party was unable to familiarize itself with the materials on the case and file defense, the court will then rule that the dispute will be reviewed under the general rules for contentious or administrative proceedings.

Although not yet widely offered as an option in standard contracts, we expect that summary proceedings will quickly become favored as an efficient judicial procedure for reviewing agreements in the banking and finance sectors due to the speed and economy at which they allow lenders to recover debt from borrowers.

All of the explanations provided by the SAC set the groundwork for further development of the Russian court system, allowing it to become a more competitive and effective mechanism for dispute resolution.