SERBIA

1. ARBITRATION

Arbitration proceedings are governed by the Serbian Arbitration Act, which entered into force on 10 June 2006. The Arbitration Act applies to both domestic and international arbitration proceedings where the seat of arbitration is in Serbia. International arbitration is generally defined as arbitrations whose subject matter concerns disputes arising out of international commercial business relations. In general, Serbian companies are willing to sign arbitration clauses, especially concerning international commercial and business transactions.

The last few years have seen a number of developments with respect to Serbian arbitration institutions. The Belgrade Arbitration Centre was established in 2013 as a permanent arbitral institution that administers domestic and foreign disputes in accordance with its BAC Rules. The BAC also assists in technical and administrative aspects of ad hoc arbitral proceedings under rules other than its own and furthermore organizes and conducts mediation sessions.

Also, as of June 2016, the Permanent Arbitration at the Serbian Chamber of Commerce was established as an arbitration institution. This is only formally a new institution as it was formed by merging two long- standing independent arbitration institutions that existed at the Chamber of Commerce, namely, the Foreign Trade Court of Arbitration and the Permanent Court of Arbitration. Other chambers and organizations may also establish institutional arbitration courts, if their professional rules allow. For example, according to the Serbian Securities Act and the legal provisions governing the Belgrade Stock Exchange, disputes related to stock exchange transactions between members and participants of the Stock Exchange, or between these entities and the Stock Exchange, may be resolved by the Stock Exchange Arbitration Court.

Under Serbian law, the arbitration agreement must be in writing, and is deemed to be in writing if contained in documents signed by the parties or in other forms of communication exchanged between the parties that provide written proof of the existence of the parties' mutual agreement to settle the dispute through arbitration.

Arbitration may only be agreed upon for the resolution of proprietary disputes arising out of rights of the parties over which they may freely dispose. Claims where the subject matter is in the exclusive jurisdiction of the state courts (such as disputes concerning real estate in Serbia, marital and family disputes, personal status rights etc.) are not arbitrable.

The Arbitration Act does not stipulate a maximum duration of the arbitration proceedings. However, the Act does require the arbitrators to diligently and efficiently carry out their duties as arbitrators. The parties are free to agree on the substantive law, the procedural rules, the seat and language of arbitration.

Depending on the agreement between the contracting parties, arbitration proceedings may be presided over by an arbitral tribunal or by a sole arbitrator. There may only be an odd number of arbitrators. In addition, the parties may agree on the procedure for appointing the arbitrators. However, if no agreement has been stipulated in the arbitration agreement or reached between the parties in this respect, a local court shall decide how the arbitrators should be appointed.

The decisions of arbitral tribunals are based on material laws, legal rules, agreements and customs; however, the tribunal may also decide on the basis of what is just and fair (ex aequo et bono) if the parties have so agreed. If the parties have not agreed on the applicable substantive law and legal rules governing the arbitral proceedings, the arbitral tribunal or arbitration court may decide on the basis of conflict of laws rules.

The Arbitration Act provides that arbitral tribunals have the authority, unless the parties to the arbitration agree otherwise, to order upon request of a party such interim measures as the tribunal deems necessary.

The Arbitration Act stipulates that the parties may request interim measures from a court either before or during arbitral proceedings (Article 15 Arbitration Act). The Arbitration Act also stipulates that this possibility exists even when the arbitration agreement relates to arbitration that has its seat outside of Serbia.

Under the Arbitration Act domestic arbitral awards (i.e. awards rendered in Serbia) may be challenged by way of a claim for annulment. The Arbitration Act contains an exhaustive list of grounds for such challenge (Article 58 Arbitration Act). Those grounds include:

-invalidity of the arbitration agreement;

-lack of due process;

-ultra petita;

-incorrect composition of the arbitral tribunal;

-lack of arbitrability;

-violation of Serbian ordre public; and

-false testimony or a criminal act of an arbitrator or a party to the proceedings

(if established by a final court judgment).

2. ENFORCEMENT OF FOREIGN ARBITRAL AWARDS

Foreign arbitral awards may be enforced only if the foreign award has been previously “admitted” to the Serbian legal system in recognition proceedings. When recognized by a Serbian Court, a foreign award receives the same status as a domestic award.

Serbian courts will refuse to recognize foreign arbitral awards, upon a proposal of a party against which the enforcement is sought, based on grounds which are essentially the same as the described grounds for challenge of domestic arbitral awards. However, whereas the false testimony or criminal act of an arbitrator or a party to the proceeding is not among the grounds for refusal of the recognition of a foreign award by Serbian courts, the recognition of the award may be refused based on one additional ground. Namely, if the foreign award has not yet become binding for the parties, or if it has been annulled or its enforcement has been stopped by a court of the state where or based on whose law the award was rendered, the Serbian court will be entitled to refuse its recognition (and enforcement).

Serbia is a party to the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards, with the reservations that the Convention will only be applied to the recognition and enforcement of awards made in the territory of another contracting state, will only be applied to differences arising out of legal relationships, whether contractual or not, that are considered commercial under the national law and will only be applied to those arbitral awards which were adopted after the entry into effect of the Convention. Serbia is also a party to the 1961 European Convention on International Commercial Arbitration.

PROCEDURE AND ASSUMPTIONS

PRACTICE TIPS

TYPE OF PROCEEDINGS

According to the Permanent Arbitration, at the time of submission of a request for arbitration, a claim, a counterclaim, or a set-off claim, the party shall deposit the amount of EUR 200 as a registration fee.

Assumption: The amount in dispute is EUR 1,000,000: Total costs: registration fee of EUR 200 and administrative fee of EUR 27,000.

Assumption: The amount in dispute is EUR 10,000,000: Total costs: registration fee of EUR 200 and administrative fee of EUR 63,600.

Assumptions based on an amount in dispute of EUR 1,000,000: Review of 100 pages of documents; no challenge to the jurisdiction of the arbitral tribunal; two exchanges of submissions; review of correspondence with arbitral tribunal; assistance with the preparation of 4 witnesses; review of 4 written witness statements; no experts; preparation of oral hearing and participation in an oral hearing; preparation and review of one post- hearing brief. Total approximate cost: EUR 100,000.

Assumptions based on an amount in dispute of EUR 10,000,000: Review of 1,000 pages of documents; no challenge to the jurisdiction of the arbitral tribunal; two exchanges of submissions; review of correspondence with arbitral tribunal; assistance with the preparation of 8 witnesses; review of 8 written witness statements; document production up to 500 pages; preparation and review of expert opinions; preparation of oral hearing and participation in an oral hearing; preparation and review of one post hearing brief. Total approximate cost: EUR 250,000.

Arbitration Proceedings

In exceptional cases, the arbitral tribunal or the sole arbitrator may – with the consent of the President of the Permanent Arbitration – decide to extend  the arbitral proceedings, if this is necessary for the purpose of obtaining evidence, or if the parties make such a request, or for other justified reasons.

Approximate Costs

PROCEDURAL COSTS

Simple case

Complex case

ATTORNEYS’ FEES (NET)

Simple case

Complex case

Approximate Duration

The Law on Arbitration as well as the Rules of the Permanent Arbitration do not provide for special rules regarding the presentation of documents.

Document Production

According to the Permanent Arbitration, arbitration proceedings shall be completed within six months from the date of constitution of the arbitral tribunal or the appointment of the sole arbitrator. Rules on expedited procedure apply if the amount in dispute is less than EUR 50,000.

According to the Law on Court Fees, for the purpose of issuing a decision on recognition, the following amounts have to be paid:

Civil proceedings: EUR 18.

Commercial proceedings: EUR 185.

Other court fees for enforcement proceedings, as well as the fees of the public enforcement officer, depend on the amounts awarded by the respective foreign judgement or arbitral award.

Application for recognition/enforcement:

Simple case: EUR 250 to EUR 450.

Complex case: EUR 1,000 to EUR 4,000.

Approximate Duration

Approximate Costs

COURT FEES

ATTORNEYS’ FEES (NET)

-Pursuant to the Arbitration Act and the New York Convention, the party seeking recognition/enforcement of an arbitral award must provide the court with the following documentation: the original arbitral award or a duly certified copy thereof, an agreement on arbitration or a document on acceptance of arbitration in the original or a duly certified copy thereof, and certified translations of the abovementioned documents.

Varies.

Enforcement of Foreign Arbitral Awards

The information in this chapter was correct as of 1 January 2018. If you have any questions about the content of this chapter,

or would like further information about arbitration in Serbia, please contact

CONTACT

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www.wolftheiss.com/offices/serbia

Miroslav StojanoviĆ

Partner

Wolf Theiss Serbia

+381 11 330 2900

miroslav.stojanovic@wolftheiss.com

Vidak KovaČeviĆ

Advokat / Attorney at Law

+381 11 330 2900

vidak.kovacevic@wolftheiss.com

AnÐelka ToDoroviĆ

Advokat / Attorney at Law

+381 11 330 2900

andjelka.todorovic@wolftheiss.com