1. The lack of registration of the contract in the system (TSOYEAT) does not violate the public order. Participation in the process of appointment of an arbitrator bars jurisdictional claims.

The facts of the case

A Joint Stock Company (the “applicant“) applied to the “Riga International Arbitration Court” (“arbitration court“) against the Limited Liability Company (the “debtor“). The arbitration court ruled in favour of the applicant awarding the debt owed, with other costs, and recognized the right to “statutory interest on arrears at 8% per annum on the unpaid amount of the principal debt“.

The court of first instance* recognized and enforced the arbitral award. A writ of execution was issued for the recovery of the sum of the principal debt, penalties, the costs of the arbitration, and legal costs. [This Resolution does not mention statutory interest as the awarded sum to be collected with the writ of execution.]

The debtor filed an appeal to the court of appeal instance.

The Supreme Court’s position (as the court of appeal instance)

Arguments that the goods have not been delivered, and there are no documents, including customs cargo declaration, bills of lading, invoices on the shipment of goods, cannot be considered by virtue of Art. 254 IV EPC.

The argument that the dispute was heard by incompetent foreign arbitration is also unfounded since the parties had agreed on the jurisdiction and the debtor had participated in the appointment of the [members] of the arbitral tribunal. The court cannot also consider the argument on invalidity of the contract because the parties also agreed that the dispute about its invalidity is also subject to arbitration.

Moreover, the lack of registration of the contract in [the system**] and the applicant’s requirement for payment by the debtor directly to the applicant do not contradict the principles of public order and the Uzbek legislation, are not the basis for establishing the violation of public order, and this requirement [of registration with the system] is provided for monitoring the mutual calculations of business entities.

The debtor’s argument that the contract was invalid due to the criminal acts of an organized group cannot be accepted either, since the fact of the criminal acts of the individuals, including of the debtor’s manager, is not confirmed by a court’s sentencing decision which has entered into legal force.

In addition, it is also impossible to suspend the proceedings because Art. 101 EPC is applied when considering disputes in an economic court, in this case it is not a dispute, but an application for the recognition and enforcement of an arbitration award, and in this case Art. 101 EPC cannot be applied.

The court of appeal instance upholds the ruling of the court of first instance.

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*) As per Art. 249 EPC.

**) The system or TSOYEAT means “Tashqi savdo operatsiyalarining yagona elektron axborot tizimi” [Unified Electronic Information System for Foreign Trade Operations] existing under Art. 11 V of Law of 22 November 2019 No. LRU-573 and Schedule No. 1 to RCabMin dd 14 May 2020 No. 283.