In a recent ruling of 15 January 2026 (case no. I ZB 53/25), the German Federal Court of Justice (Bundesgerichtshof, BGH) clarified that Russia’s ongoing war against Ukraine and the resulting sanctions regime do not affect the Hague Convention on Civil Procedure and the exoneration of Russian claimants from any security for costs. The BGH rejected a request for cost security against a Russian claimant seeking enforcement of an arbitral award in Germany.

Background of the Dispute

The claimant, a company established under Russian law, had entered into a contract with a German company based in Kirchheim unter Teck for the purchase of machinery used in coating metal housings. The contract included a clause submitting disputes to arbitration before the International Commercial Arbitration Court (MKAS) in Moscow, and Russian law was to apply.

By late 2021, two out of three agreed deliveries had been fulfilled. The third was never made. The German company cited the outbreak of the war in Ukraine and its decision to cut ties with Russian businesses, partly due to dual-use concerns regarding the equipment’s potential military application.

The Russian company had already paid more than the value of the delivered goods and sought repayment of the overpaid amount. The dispute was brought before MKAS, which issued an arbitral award in November 2023 ordering the German respondent to repay €186,435 plus interest.

To enforce this award in Germany, the claimant applied to the Higher Regional Court (OLG) Stuttgart for a declaration of enforceability. The German company contested the request and sought an order for the claimant to provide security for legal costs, citing the geopolitical situation and practical enforcement difficulties in Russia.

Legal Framework and Arguments

The request for cost security was based on § 110 of the German Code of Civil Procedure (ZPO), which requires foreign claimants to provide such security unless exempted by international treaty. The Hague Convention on Civil Procedure (1954), specifically Article 17, prohibits Germany from demanding such security from nationals of other signatory states, including Russia.

The respondent argued that this treaty obligation had lapsed due to the war and the cessation of diplomatic relations, invoking Articles 62 and 63 of the Vienna Convention on the Law of Treaties (WVK). They also referred to Article 11 of EU Regulation No. 833/2014 (“No-Claims Clause”), asserting that claims arising from sanctions-violating transactions should not be entertained.

The Court’s Ruling

The BGH dismissed the application for cost security as procedurally inadmissible, given that the issue had already been decided by the OLG Stuttgart in 2024. Substantively, the Court found that the request would fail in any event:

  • Treaty obligations remain binding: The BGH confirmed that Germany’s obligation under Article 17 HZPÜ remains in force, and geopolitical changes do not override this unless Germany formally withdraws from the treaty.
  • No-Claims Clause not applicable: The Court rejected the argument that the EU’s sanctions regulation barred the procedural right to pursue claims without posting security.
  • No formal termination: The BGH emphasized that no formal steps had been taken by Germany to terminate or suspend the treaty, making it fully effective.

Conclusion

This decision underscores the continued legal force of international treaty obligations, even in times of severe geopolitical upheaval. So, the theoretical possibility to enforce a cost order in Russia is sufficient to exonerate the Russian claimant from the obligation to provide security for costs, no matter whether that is practically possible.

A more detailed analysis of this decision will be provided in the next edition of DRRZ – Deutsch-Russische Rechtszeitschrift.