SLOVAK REPUBLIC

CONTACT

1. ARBITRATION

Pursuant to the Slovak Act on Arbitration Proceedings (Act No. 244/2002 Coll., as amended), parties may enter into an agreement that any or all disputes arising from their contractual relationship shall be decided by one or more arbitrators or by a standing court of arbitration. The standing courts of arbitration may be established either by the national sport federation or a chamber established pursuant to the legal regulations, or on the basis of a special legal regulation (e.g. Act No. 492/2009 Coll. as amended on Payment Services). The act reflects the UNCITRAL Model Law to a certain extent and applies to both domestic and international arbitration proceedings, if the seat of arbitration is in the Slovak Republic.

The main arbitral institution in the Slovak Republic is the Arbitration Court of the Slovak Chamber of Commerce and Industry established in 2002. The Arbitration Court deals with commercial disputes of both national and international nature. It has its own rules of arbitration.

An arbitration agreement can be included as a clause contained in the initial contract between the parties, or as a separate agreement (e.g. as a “compromise” for disputes that arose after the original contract was concluded). An arbitration agreement must be in writing. It may be replaced by a statement of the parties in the minutes of an arbitral tribunal in which they subject themselves to the jurisdiction of the arbitral tribunal. This statement shall be made at the latest at the commencement of arbitration proceedings. In order for the arbitration agreement to be valid, the dispute between the parties must concern a subject matter that is not otherwise excluded by law from resolution by a judicial settlement.

A dispute cannot be decided by arbitration where the dispute: (a) concerns the origin, change or expiration of rights related to real estate; (b) concerns personal status disputes; (c) is linked to the enforcement of a decision; or (d) arose in the course of bankruptcy or restructuring proceedings.

The parties are free to agree on the substantive law, the procedural rules, the seat and language of arbitration. However, disputes arising from domestic commercial or civil relationships are decided only on the basis of Slovak law. In addition, the parties are free to agree on the number of arbitrators and their method of appointment. However, there must always be an odd number of arbitrators.

According to Section 22 of the Arbitration Act, the arbitral tribunal has authority to issue any interim measures it deems necessary to protect the subject matter of the dispute and preserve the integrity of the proceedings. The arbitral tribunal may require that the party seeking interim measures provides security in exchange for any interim measures that are granted. Parties also have the right to seek interim measures from the courts either before the constitution of the arbitral tribunal or after the termination of the arbitration proceedings. The arbitral tribunal may also apply to the courts for assistance in enforcing an interim measure.

Generally, Slovak courts only uphold challenges to arbitral awards if there are compelling reasons for them to do so. Section 40 of the Arbitration Act provides the following grounds for challenging an award:

-the subject matter of the dispute was non-arbitrable;

-the award dealt with a dispute not contemplated by or not falling within the terms of the arbitration agreement and the party challenging the award objected to this fact before the arbitral tribunal;

-the award addressed issues that had already been determined by a previous court or arbitral tribunal;

-a party to the arbitration challenges the validity of the arbitration agreement;

-a party to the arbitration was unable to present its case (e.g., was not duly represented);

-the award was rendered by an arbitrator who had been removed for bias;

-the principle of the equality of the parties was violated;

-there are compelling reasons for re-opening the case (e.g. new evidence has emerged which casts serious doubt upon the correctness of the arbitral tribunal’s decision);

-the award was tainted by fraud or other criminal conduct; or

-the consumer protection laws were violated.

Please note that as of 1 January 2015 arbitration proceedings with respect to consumer protection are subject to further significant restrictions. Alternative dispute settlement in this regard is governed by Act No. 391/2015 Coll. on Alternative Settlement of Consumer Disputes, as amended.

2. ENFORCEMENT OF FOREIGN ARBITRAL AWARDS

Pursuant to the Slovak Act on Arbitration Proceedings, arbitral awards issued abroad shall be recognized and enforced by the courts in the Slovak Republic. Recognition of a foreign arbitral award shall not be declared in a special decision. The foreign arbitral award shall be recognized by the respective court in execution proceedings. In some instances, the courts may decline to recognize and enforce a foreign arbitral award based on the petition of the party obliged by the award.

The Slovak Republic is a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958, 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. With regard to awards made in the territory of non-contracting states, the Convention will only be applied to the extent to which those states grant reciprocal treatment.

The Slovak Republic is also a party to the 1961 European Convention on International Commercial Arbitration and to the 1965 Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States.

PROCEDURE AND ASSUMPTIONS

PRACTICE TIPS

TYPE OF PROCEEDINGS

Approximate Duration

Approximate Costs

PROCEDURAL COSTS

Simple case

Complex case

ATTORNEYS’ FEES (NET)

Simple case

Complex case

Arbitration Proceedings

Document Production

-In cases with a speedy decision within 1 month, the arbitration fee is increased by 75% and if within 4 months, by 50%.

-In simple proceedings (without any hearings, only based on evidence), the arbitration fee is decreased by 30%. Total decrease may be up to 50%. Similarly, the administrative fee may be decreased up to 30% in total.

-If the dispute is decided by a sole arbitrator, the arbitration fee is decreased by 30% and the administrative fee by 20%

Limited.

The usual duration of arbitration proceedings is between 1 month and 2 years.

-The arbitral tribunal only considers the evidence proposed by the parties.

-In general, a party could ask the arbitral tribunal for its support in document production.

-The arbitral tribunal may ask the general court for support in document production.

Costs depend on several factors: Whether a sole arbitrator or an arbitral tribunal of three members is appointed, the complexity of the case, the administrative charges and other expenses (translation, travel and accommodation of foreign arbitrators, etc.), if the dispute is national or international, whether a speedy decision is expected, etc.

The following estimates are based on the procedural costs of the Arbitration Court of the Slovak Chamber of Commerce and Industry.

Assumption: sole arbitrator appointed and an amount in dispute of EUR 1,000,000: Total costs: Arbitration fee of EUR 14,000, administrative fee of EUR 9,500.

Assumption: Sole arbitrator and an amount in dispute of EUR 10,000,000: Total costs: arbitration fee of EUR 62,400; administrative fee of EUR 16,700.

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. In total: EUR 25,000 to EUR 35,000.

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 statements; document production up to 500 pages; preparation and review of expert opinions; preparation of oral hearing and participation; preparation and review of one post hearing brief. In total: EUR 230,000 to EUR 400,000.

-For the enforcement of awards under the New York Convention, the creditor must provide the court with the authenticated original award or a duly certified copy thereof and the original of the arbitration agreement or a duly certified copy thereof.

The court fee for the decision on authorization executor is EUR 16.50.

Reward and expenses of the executor are governed by the Regulation on Rewards and Expenses of Court Executors.

Application for recognition/enforcement:

Simple case: EUR 1,300 to EUR 3,000

Complex case: EUR 2,000 to EUR 6,000

Approximate Duration

Enforcement of Foreign Arbitral Awards

1 to 2 months until a decision on authorization to the executor is rendered in first instance and 3 to 6 months if the decision is appealed.

The duration of execution proceedings depends mainly on whether the debtor has executable assets and whether execution measures are opposed by the debtor.

Approximate Costs

COURT FEES

ATTORNEYS’ FEES (NET)

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 the Slovak Republic, please contact