Recognition and enforcement of state court decisions between Germany and Russia
Recognition and enforcement of foreign judgements in Russia has been at the center of my professional interest for a long time now. The traditional approach under Russian law was that foreign court decisions were only recognised if there was a bi- or multilateral treaty. Then, there was a time – back in “the old days” when the Highest Arbitrage Court still existed – when there seemed to be a movement in Russian court practice to recognizing the principle of reciprocity as a basis for the recognition and enforcement of foreign state court decisions. There were many examples of English, French, Belgian, Finnish, US and other western court decisions that were recognised in Russia without a bi- or multilateral treaty, in many cases, the application of the principle of “reciprocity” was based on the principle of “comity” in international law and sometimes on the European Convention for Human rights, namely art. 6 and the guarantee of access to justice. This practice even continued when the Highest Arbitrage Court was abolished, but there was a certain lack of consistency.
To the best of my knowledge, there has never been a single example of any German decision that was ever recognised in Russia (besides some insolvency cases, which follow other rules). With the decline of the political relations following the invasion of Ukraine, it seemed highly unlikely that this would ever change. There are even examples when Russian courts explicitly ruled that decisions from “unfriendly states” could not be recognised, even if there had been an established practice of reciprocity (see here an example: https://kdb.legal/en/russian-courts-post-sanctions-approach-to-reciprocity).
Quite unexpectly, there appeared a decison from the Arbitrage Court of St. Petersburg in which a court decision of the District Court of Stuttgart was recognised and declared enforceable based on the principle of reciprocity:
Arbitrage Court of St. Petersburg – judgement from 23 October 2024
On October 23, 2024, the Arbitrage Court of Saint Petersburg and the Leningrad Region, presided over by Judge N.A. Chekunov, issued a ruling in case number A56-49800/2024. The court ordered the enforcement of a judgment issued by the Stuttgart Regional Court in Germany on May 27, 2021, in favor of Viavi Solutions Deutschland GmbH (the Plaintiff) against “Vilcom SPB” LLC (the Defendant).
The case concerns Viavi Solutions Deutschland GmbH’s request to have a German court decision recognized and enforced in Russia. The German court had previously ruled that “Vilcom SPB” LLC was liable to pay the Plaintiff a sum of 85,515.17 euros, plus interest at 9% over the base rate from July 15, 2017, 68,411.70 USD with the same interest rate from December 1, 2017, additional accrued interest, and pre-judgment costs totaling 1,383.61 euros. Despite the Defendant’s notification, these payments had not been fulfilled.
In the hearing, neither party appeared, though both were notified. The Defendant argued against enforcement, claiming insufficient prior notification of the German case and alleging that enforcing the judgment would violate Russian public policy due to Germany’s political sanctions on Russia. The court, however, found these objections unsupported by evidence, citing proper notification and determining that enforcing the judgment did not contravene Russian public policy.
Applying Articles 241-243 of the Russian Arbitration Procedure Code, the court granted the Plaintiff’s request, upholding the principle of international comity and reciprocity in enforcing foreign judgments. The decision is very brief (just three pages in the printed version), so the arguments and legal basis was not developed any detail.
Commentary
10 years ago, such a decision would have been welcomed as a clear facilitation of German-Russian commercial relations. Nowadays and considering the state of Russian case law, especially the numerous decisions based on art. 248.1 and 248.2 APK (there are numerous examples, we provide some links below), reciprocity does pose a real risk: The German law position (§ 328 German Civil Procedure Code) is that foreign court decisions are recognised, “unless reciprocity is not guaranteed”. So, there is a presumption for reciprocity. Sofar, German law’s position (up to the Federal Court of Justice – Bundesgerichtshof) is that there is no evidence of reciprocity with regard to Russia (OLG Hamburg 13.7.2016 (6 U 152/11), BGH did not allow an appeal).
However, it was never possible to present any evidence that German court decisions are recognized in Russia. Now, with above judgement, there is such an example, so the next attempt to recognise and enforce a Russian court decision in Germany is not as clearly doomed as it was when there were no positive examples.
Of course, it remains to be seen whether the decision will be upheld on appeal. One (obvious) defence against the enforcement in Russia would be that there is clearly no reciprocity in Germany: Russian court decisions are not recognised in Germany, so if the Russian court really applies this criterion, recognition should have been refused. However, the decision is very short and it cannot be said whether this point was pleaded in any detail.
In any case, the “jurisdictional ping-pong” we have commented on here several times before is “enriched” by a further concern – now, it cannot be clearly said that Russian decisions cannot be enforced in Germany for lack of reciprocity. Of course, in case of decisions based on art. 248.1 and 248.2 APK, there are other defences such as lack of jurisdiciton of Russian Courts and possibly violation of public policy, but in any case, the “protection” offered by the lack of reciprocity might have just become a bit less effective.
We’ll follow this topic closely.
Another case of jurisdictional “ping-pong”
Ping-Pong decisions on jurisdicton
No protection for trademarks in Russia – Koch Boës – Rechtsanwälte (kdb.legal)
Enforcement of English Judgments in Russia: Reciprocity (kdb.legal)