International law firm Integrites in cooperation with English partners – Hogan Lovells and Littleton Chambers – held a workshop in Kiev on arbitration of corporate disputes and their practice in Ukrainian reality.
Participants of the workshop “Corporate arbitration: English style corporate warfare”, which took place on 29 March 2012 at the Premier Palace Hotel, discussed grounds of disputes and key aspects of their resolution as presented by lawyers that led some of the most pronounced cases of last years, including disputes Yugraneft v. Abramovich, Millhouse Capital and Berezovsky, BTA Bank v. Ablyazov, Kazakhgold & Polyus v Assaubaev, Alfa Access Renova v. British Petroleum, Eco Telecom v. Telenor.
Referring to recommendations of the Higher Arbitration Court of Ukraine dated 28 December 2007, Maksym Kodunov, Counsel at ILF Integrites, noted that corporate disputes were non-arbitrable in Ukraine, and, therefore, were predominantly settled in foreign jurisdictions. “Restriction on arbitrability under Ukrainian law is not an obstacle for settlement of corporate disputes abroad”, - Mr. Kodunov added. While naming England as a mature jurisdiction on matters of corporate disputes, he warned about high costs related to English arbitral proceedings.
Rupert D’cruz, Barrister at Littleton Chambers, drew attention to protection of Ukrainian shareholders under British shareholder agreements, obtaining interim measures in English arbitration and from English courts. Mr. D’cruz also explained approaches that can be applied to protect interests of minority shareholders against unfair prejudice under the English law.
Proceedings after M&As belong to the most common corporate disputes that are resolved in arbitration. According to Alexander Scard, Counsel at Hogan Lovells, primary bases of claim under a share purchase agreement in English law are a breach of warranties and representations, as well as and a failure to pay the purchase price. Among key issues associated with corporate arbitral proceedings in London, Mr. Skard pointed to a risk of satellite litigation.
Among participants of workshop were representatives of leading financial groups and big Ukrainian business, including Dragon Capital, ING Bank Ukraine, UkrSibbank BNP Paribas, JSC First Ukrainian International Bank (PUMB), JSC Oschadbank, JSC Commercial Bank Khreschatyk, JSCB Industrialbank, Insurance company “BROKBUSINESS”, Kernel Holding S.A., Louis Dreyfus Commodities Ukraine Ltd, Ukrproduct Group, Mriya Agro Holding PLC, Suntrade SE, JSC Furshet, KINTO, JSC UKRPLASTIC, MD Group, JSC Donetsksteel - Metallurgical plant, Astelit LLC, Auto House “Ukraine Mercedes-Benz”, Aerosvit Airlines and others.
Conclusions and materials of the workshop:
Part 1. Arbitration of corporate disputes. Ukrainian perspective (Maksym KODUNOV, ILF Integrites)
Part 2. Shareholders’ disputes (Rupert D’CRUZ, Littleton Chambers)
Part 3. Post-M&A arbitration (Alexander SCARD, Hogan Lovells)