International Sanctions and Their Impact on International Commercial Arbitration: Legal Aspects

The purpose of this graduate paper is the overall analysis of legal aspects of the sanctions' impact on international commercial arbitration. To achieve this goal, we did the following: (1) generalized and systematized information on the imposed on Russia sanctions and imposed by the Russian Federation retaliatory measures, in particular, certain provisions that could potentially affect the resolution of the dispute in international commercial arbitration and / or recognition and enforcement of an arbitral award; (2) analyzed the extraterritorial effect of sanctions and its qualification under Russian legislation; (3) conducted an analysis of the legal impact of the sanctions regime on the international commercial arbitration with the participation of a Russian party and found a legal way to overcome the sanctions' barriers for the party who have signed / intend to sign an arbitration agreement and is under sanctions. On the basis of the study we make the following conclusions: (1) sanctions should be considered as force majeure; (2) due to sanctions arbitral institutions and parties may experience additional administrative burdens, for example, the need to conduct additional party checks; (3) Asian arbitration institutions are a real alternative to traditional for Russian businesses arbitration forums; and (4) to minimize the potential risks and avoid negative consequences caused by sanctions, we see sanctions and force-majeure clauses as a solution.