Pursuant to the Slovak Act on Arbitration Proceedings (Act No. 244/2002 Coll., as amended), parties mayenter into an agreement that any or all disputes arising from their contractual relationship shall be decidedby one or more arbitrators or by a standing court of arbitration. The standing courts of arbitration may beestablished either by the national sport federation or a chamber established pursuant to the legalregulations, or on the basis of a special legal regulation (e.g. Act No. 492/2009 Coll. as amended onPayment Services). The act reflects the UNCITRAL Model Law to a certain extent and applies to bothdomestic 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 ofCommerce and Industry established in 2002. The Arbitration Court deals with commercial disputes of bothnational 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 wasconcluded). An arbitration agreement must be in writing. It may be replaced by a statement of the partiesin the minutes of an arbitral tribunal in which they subject themselves to the jurisdiction of the arbitraltribunal. This statement shall be made at the latest at the commencement of arbitration proceedings. Inorder for the arbitration agreement to be valid, the dispute between the parties must concern a subjectmatter 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 expirationof rights related to real estate; (b) concerns personal status disputes; (c) is linked to the enforcement of adecision; 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 ofarbitration. However, disputes arising from domestic commercial or civil relationships are decided only onthe basis of Slovak law. In addition, the parties are free to agree on the number of arbitrators and theirmethod 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 itdeems necessary to protect the subject matter of the dispute and preserve the integrity of the proceedings. Thearbitral tribunal may require that the party seeking interim measures provides security in exchange for anyinterim measures that are granted. Parties also have the right to seek interim measures from the courts eitherbefore the constitution of the arbitral tribunal or after the termination of the arbitration proceedings. The arbitraltribunal 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 themto 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 thearbitration agreement and the party challenging the award objected to this fact before thearbitral tribunal;
-the award addressed issues that had already been determined by a previous court or arbitraltribunal;
-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 whichcasts 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 aresubject to further significant restrictions. Alternative dispute settlement in this regard is governed by ActNo. 391/2015 Coll. on Alternative Settlement of Consumer Disputes, as amended.
2. ENFORCEMENT OF FOREIGNARBITRAL AWARDS
Pursuant to the Slovak Act on Arbitration Proceedings, arbitral awards issued abroad shall be recognizedand enforced by the courts in the Slovak Republic. Recognition of a foreign arbitral award shall not bedeclared in a special decision. The foreign arbitral award shall be recognized by the respective court inexecution proceedings. In some instances, the courts may decline to recognize and enforce a foreignarbitral 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 ofForeign Arbitral Awards of 1958, with the reservations that the Convention will only be applied to therecognition and enforcement of awards made in the territory of another contracting state. With regard toawards made in the territory of non-contracting states, the Convention will only be applied to the extent towhich those states grant reciprocal treatment.
The Slovak Republic is also a party to the 1961 European Convention on International CommercialArbitration and to the 1965 Washington Convention on the Settlement of Investment Disputes betweenStates and Nationals of Other States.
PROCEDURE AND ASSUMPTIONS
TYPE OF PROCEEDINGS
ATTORNEYS’ FEES (NET)
-In cases with a speedy decision within1 month, the arbitration fee is increasedby 75% and if within 4 months, by 50%.
-In simple proceedings (without anyhearings, only based on evidence), thearbitration fee is decreased by 30%.Total decrease may be up to 50%.Similarly, the administrative fee may bedecreased up to 30% in total.
-If the dispute is decided by a solearbitrator, the arbitration fee isdecreased by 30% and theadministrative fee by 20%
The usual duration of arbitration proceedings is between 1 month and 2 years.
-The arbitral tribunal only considers theevidence proposed by the parties.
-In general, a party could ask the arbitraltribunal for its support in documentproduction.
-The arbitral tribunal may ask the generalcourt for support in document production.
Costs depend on several factors: Whether asole arbitrator or an arbitral tribunal of threemembers is appointed, the complexity of thecase, the administrative charges and otherexpenses (translation, travel andaccommodation of foreign arbitrators, etc.),if the dispute is national or international,whether a speedy decision is expected, etc.
The following estimates are based on theprocedural costs of the Arbitration Court ofthe Slovak Chamber of Commerce andIndustry.
Assumption: sole arbitrator appointedand an amount in dispute of EUR1,000,000: Total costs: Arbitration fee ofEUR 14,000, administrative fee of EUR9,500.
Assumption: Sole arbitrator and anamount 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 indispute of EUR 1,000,000: Review of 100pages of documents; no challenge to thejurisdiction of the arbitral tribunal; twoexchanges of submissions; review ofcorrespondence with arbitral tribunal;assistance with the preparation of 4witnesses; review of 4 written witnessstatements; no experts; preparation of oralhearing and participation in an oral hearing;preparation and review of one post hearingbrief. In total: EUR 25,000 to EUR 35,000.
Assumptions based on an amount indispute of EUR 10,000,000: Review of 1,000pages of documents; no challenge to thejurisdiction of the arbitral tribunal; twoexchanges of submissions; review ofcorrespondence with arbitral tribunal;assistance with the preparation of 8witnesses; 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 hearingbrief. In total: EUR 230,000 to EUR 400,000.
-For the enforcement of awards underthe New York Convention, the creditormust provide the court with theauthenticated original award or a dulycertified copy thereof and the original ofthe arbitration agreement or a dulycertified 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 andExpenses 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
Enforcement of Foreign Arbitral Awards
1 to 2 months until a decision on authorizationto the executor is rendered in first instanceand 3 to 6 months if the decision is appealed.
The duration of execution proceedingsdepends mainly on whether the debtor hasexecutable assets and whether executionmeasures are opposed by the debtor.
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