Why arbitration?

Arbitration is a flexible and reliable method of dispute resolution, completely adjusted to the parties’ needs. Speed, expertise of the arbitrators, moderate costs and enforceability of arbitration awards in over 150 countries are some of the reasons why such a large number of business disputes are resolved by arbitration.

The parties may agree upon jurisdiction of the Permanent Arbitration regardless of their nationality or membership at the Chamber of Commerce and Industry of Serbia. As an independent and non-governmental institution, the Permanent Arbitration guarantees neutrality and administer arbitration disputes in the most efficient manner. The Secretariat of the Permanent Arbitration is at the disposal to all participants in the dispute before the initiation of the arbitration, throughout the entire proceeding, and even during the enforcement stage.

  • DURATION OF ARBITRAL PROCEEDINGS

Duration of arbitral proceeding before the Permanent Arbitration is limited to 6 months from the date of constitution of the arbitral tribunal, or the appointment of the sole arbitrator. At the same time, according to the Supreme Court of Cassation statistics for 2015, there are over 36000 unresolved cases before the Commercial Courts of Serbia, of which over 50% have entered their fourth year, and in 25% between 5 to 10 years have passed since the date on which the initial act has been submitted.

A novelty, whose purpose is to significantly shorten proceedings, are the rules for the expedited arbitration, which apply when the amount in dispute does not exceed EUR 50 000, and are decided by a sole arbitrator. However, since the monetary value of a dispute does not always equal its complexity, parties are free to agree on application of these rules to the disputes of a greater value, being also allowed to exclude their application in the disputes where the amount in dispute does not exceed EUR 50 000.

  • THE PARTIES ARE FREE TO CHOOSE ARBITRATORS

As opposed to court proceedings, in arbitration the parties are free to choose arbitrators. The parties are given the opportunity to choose the arbitrator according to experience, familiarity with certain issues of law and other qualifications the parties deem relevant for the proceeding.

Permanent arbitration does not have a roster of arbitrators. Any natural person having contractual capacity may act as an arbitrator, unless the parties have agreed upon additional conditions with respect to the qualifications of the arbitrator. The arbitrators may be domestic or foreign nationals. In order to assist parties in choice of arbitrators, the Permanent Arbitration provides and publishes a list of persons qualified to serve as arbitrators. This list is not to be considered a recommendation, nor shall it bind in any way the parties or the Permanent Arbitration.

  • ARBITRATION COSTS

Arbitration costs before the Permanent Arbitration are moderate, predictable and depend on the amount in dispute. In the case of domestic arbitration before the Permanent Arbitration, the costs are in a great number of cases lower than the costs of the proceedings before the national courts. Costs of international arbitration at the Permanent Arbitration are usually lower than the arbitration costs before other arbitration institutions in the region and the world.

At the time of submitting a request for arbitration, a statement of claim, a counterclaim, or a set-off claim, the party shall deposit with the Secretariat of the Permanent Arbitration a sum of EUR 200.00 as a registration fee. Also, the claimant deposits an advance for costs with the Secretariat of the Permanent Arbitration. The advance of cost includes both the administrative costs and the arbitrators’ fees. Upon completion of arbitration, the costs are distributed between the parties, proportionally to their success in the dispute. You can calculate arbitration costs HERE.

  • FLEXIBILITY AND NEUTRALITY

Unlike court proceedings, arbitration is flexible and parties can adapt it to the particularities of the case. This is especially important in international arbitration, where the parties are free to agree upon the governing law, the language and the place of arbitration.

  • CONFIDENTIALITY

Arbitral proceedings are not public. The identity of the parties may not be revealed without their approval, and only the parties and the persons authorized by the parties may attend the hearings. Arbitral award may be published in its entirety only with the approval of the parties involved. As a result, the parties’ confidential business information is kept from the public. This way, arbitral proceedings do not harm business reputation of the parties involved, and also contributes to the preservation of the business relationship between the parties, both during and after the proceedings.

  • SINGLE-INSTANCE PROCEDURE

Arbitration is a single-instance procedure. The award is final and not subject to appeal, minimizing the possibility of impediment of proceedings and delay of the enforcement. However, that does not mean that arbitral proceedings are not susceptible to scrutiny. For the purposes of securing legal security, the proceedings are regulated by laws and other legal instruments. In case of violation of the rules of the procedure, the arbitration decision can be annulled.

  • ENFORCEABILITY OF ARBITRATION AWARD

The arbitration award becomes final at the moment of its enactment. In Serbia, awards made before the Permanent Arbitration have the force of a final judgment of a court of law.

The enforcement of arbitration awards abroad is significantly facilitated due to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, to which Serbia is, along with 157 other countries, signatory. For that reason, an arbitration award made before the Permanent Arbitration is enforceable in over 150 countries around the world. At the same time, enforcement of court decisions abroad is often associated to various obstacles. Even close commercial, historical and geographic relations with a country do not guarantee that a domestic court decision will be enforced in that country. In certain cases the enforcement abroad is only possible on the grounds of an arbitral award, or it may prove burdensome due to disproportionate expenses and delay.

Organisation

The Permanent Arbitration is managed by the President and the Board, while the Secretariat carries out technical and administrative tasks.

The President represents the Permanent Arbitration, organizes its activities and chairs the meetings of the Board. The President also acts as appointing authority of arbitrators and presidents of the arbitral tribunals in cases provided by the Rules of the Permanent Arbitration.

The Extended Board consists of the President, two Vice Presidents and four members. It supervises the application of the Rules of the Permanent Arbitration, monitor and discuss the practice, adopts the annual report, determines the amendments of the Rules of the Permanent Arbitration and performs other tasks as provided by the Rules of the Permanent Arbitration.

The Board consists of the President and the two Vice Presidents. It decides on confirmation of the appointments and challenges of arbitrators, on termination of the arbitrator´s mandate and on the final appointment of an arbitrator where an objection to his / her appointment has been made following the arbitrator´s statement on impartiality or independence. One of the significant functions of the Board is to scrutinize the award before it is signed and, if needed, the Board may point an arbitrator to the formal deficiencies of an arbitration award and draw the attention to the arbitral practice on specific issues of law. The Board may also point the arbitral tribunal towards the specific grounds upon which an arbitration award may be set aside or its enforcement refused.

The President, Vice Presidents and members of the Extended Board are appointed and discharged by the Managing Board of the Chamber of Commerce and Industry of Serbia, for a period of 4 years, after which they can be reappointed.

The Secretariat of Permanent Arbitration carries out technical and administrative tasks. It stands at the disposal to all participants in the dispute, during the entirety of the proceeding, to individuals in need of assistance with the contracting the jurisdiction of the Permanent Arbitration, or initiation of arbitral proceeding, and even throughout the enforcement stage.

History

The Permanent Arbitration at the Chamber of Commerce and Industry of Serbia is a modern arbitration institution with a decades long history and thousands enforced arbitration awards in the country and around the world. It is established following the reorganization of two institutions which existed at the Chamber of Commerce and Industry of Serbia - The Foreign Trade Court of Arbitration (which had jurisdiction in international disputes) and the Permanent Court of Arbitration (with jurisdiction in domestic disputes). The reorganization proved efficient, allowing for the parties to address to a single institution for resolution of domestic and international commercial disputes.

Both arbitration institutions that existed at the Chamber of Commerce and Industry of Serbia had outstanding reputations. The Foreign Trade Court of Arbitration was founded as a permanent arbitration institution by the Regulation of the Chamber of Commerce FNRY in 1946, and its first Rules were published on the 28th of April, 1947. The first elected president was Prof. Mihailo Konstantinovic PhD, who served that function for as much as 27 years. As early as the middle of the 20th century, The Foreign Trade Court of Arbitration became an important arbitration institution, taking into account the number of administered disputes, and its international nature in terms of both the parties and foreign laws applied to arbitral proceedings. During the economic rise of the SFRY and the 1980's, The Foreign Trade Court of Arbitration administered over 300 disputes per year, which even by today’s standards for arbitration institutions, is an remarkable success.

The first Rules of the Permanent Court of Arbitration were enacted on the 23rd of December 1966, providing for resolution of domestic cases by arbitration. The Rules on the Permanent Court of Arbitration of the Trades Chamber in Belgrade from 1931 may be deemed as its predecessor. The Permanent Court of Arbitration was an arbitration institution open to all types of domestic commercial disputes. The longtime cooperation with the most prominent lawyers who sat on the Board of the Permanent Court of Arbitration, and those who served as arbitrators, as well as the professionalism of the Secretariat has greatly contributed to the popularization of arbitration in the region.

The Foreign Trade Court of Arbitration and The Permanent Court of Arbitration gained immpeccable reputation among domestic and foreign business entities; the reputation that the Permanent Arbitration continues to enjoy. In spite of the political upheaval, putting constraint on the economy and the number of commercial disputes in the region, the Permanent Arbitration remained an institution with the longest tradition in the region, being entirely independent in its work and decision making. Cooperation with the most renowned domestic and foreign lawyers, enforced awards around the world, as well as complete readiness of the Secretariat to efficiently administer disputes are just a few of the many reasons the parties have, for 70 years, chosen, to resolve disputes before this institution.

In 2017, the Permanent Arbitration will organize a number of events that will mark the 70th year anniversary of this institution. Besides the outstanding tradition of the Permanent Arbitration, these events aim to emphasize the longstanding role of this institution in promotion of arbitration in the region. More information on the events can be found HERE.

Cooperation with other institutions

The Permanent Arbitration is proud of its decades long successful corporation with other arbitration institutions. Through mutual activities, our institution is modernizing its practice, exchange valuable knowledge and specific arbitration skills. Also, through its cooperations, the Permanent Arbitration has significantly contributed to the popularization of arbitration in the country and region.

Through a number of different activities (agreements, conferences, publications, numerous projects), the Permanent Arbitration has established cooperation with the following institutions:

·         Vienna International Arbitral Centre at the Austrian Federal Economic Chamber (VIAC)

·         Arbitration Court attached to the Foreign Trade Chamber of Bosnia and Herzegovina

·         Albanian Center of Mediation and Commercial Arbitration

·         International Commercial Arbitration Court at the Ukrainian Chamber of Commerce and             Industry

·         German Institution of Arbitration (DIS)

·         Faculty of Law, University of Belgrade

·         Permanent Elected Court attached to the Chamber of Economy of Montenegro

·         Arbitration Centre at the Chamber of Commerce and Industry of Slovenia

·         Permanent Court of Arbitration attached to the Economic Chamber of Macedonia

·         Permanent Arbitration Court at the Croatian Chamber of Commerce

·         Bulgarian Chamber of Commerce and Industry

·         Greek Arbitration Association

·         Japan Commercial Arbitration Association