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Development of Arbitration Law in the Republic of Lithuania After the Restoration of Independence

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Legal Developments During 30 Years of Lithuanian Independence

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Abstract

This chapter overviews the inception of modern concepts of arbitration law in Lithuania and their development over the 30 years of state independence. It presents the general analysis of the evolution of the statutory legal framework of arbitration in Lithuania by introducing the Law on Commercial Arbitration and reviewing the main concepts enshrined therein.

Further, by analyzing the current statutory regulation and its interpretation in the case law of the Supreme Court of the Republic of Lithuania, the chapter explores three core doctrines in arbitration, namely the doctrine of arbitrability, the competence-competence doctrine, and the notion of public policy. The analysis of these concepts aims to review the status quo of these doctrines in arbitration theory and practice in Lithuania, as well as to suggest a direction for the rectification of the identified shortcomings of their interpretation in the case law of Lithuanian courts.

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Notes

  1. 1.

    Latvia and Estonia adopted their national laws on arbitration in 1998 and 2005 respectively. Chapter D of the Civil Procedure Law of the Republic of Latvia regulating arbitration was adopted in 1998 and came into force in 1999. See Udris and Kačevska (2004), pp. 211–220; Part 14 of the Code of Civil Procedure of the Republic of Estonia was adopted in 2005 and came into force in 2006. See Pohla (2008), pp. 17–29. It must be mentioned that in 1991 the Law on the Arbitration Court of the Estonian Chamber of Commerce and Industry was adopted in Estonia. It provided for the establishment of the Arbitration Court of the Estonian Chamber of Commerce and Industry (ECCI) and set basic principles and standards of the arbitration proceedings at the ECCI and for the assistance of national courts. For this reason, it is sometimes indicated that the said law was the first national arbitration law in Estonia. E.g. see Krūminš (2017), p. 305.

  2. 2.

    The VCCA was established in 2003 by merging two permanent arbitration institutions, namely the Arbitration Court at the Association International Chamber of Commerce Lithuania and the Vilnius International Commercial Arbitration. See the official site of Vilnius Court of Commercial Arbitration.

  3. 3.

    It must be mentioned that after efforts were made to decrease the number of permanent arbitral institutions in Latvia, including the adoption of the new Law on Arbitration in 2015, the number of institutions decreased twice.

  4. 4.

    For instance, see LCA 1996, Art. 25, which ruled that the language of national arbitration is Lithuanian, but allowed the parties to choose the language of international proceedings.

  5. 5.

    This deviation from the Model Law was remedied by the LCA 2012.

  6. 6.

    Note of the Secretariat of the Competition Committee of the Directorate for Financial and Enterprise Affairs of the Organisation for Economic Co-operation and Development (2011).

  7. 7.

    Restrictions related to State and municipal bodies are discussed under the heading of subjective arbitrability, however, it should be admitted that there is no consensus on whether such restrictions should be treated as the question of arbitrability, capacity or simply mandatory legal norms affecting the validity of the arbitration agreement. See Born (2014), p. 729; Gaillard and Savage (Eds.) (1999), pp. 312–313; Lew et al. (2003), pp. 186–187.

  8. 8.

    European Convention on International Commercial Arbitration 1964. United Nations, Treaty Series, 1965, vol. 484, p. 349. See Article II(1): In cases referred to in Article I, paragraph 1, of the convention, legal persons considered by the law which is applicable to them as ‘legal persons of public law’ have the right to conclude valid arbitration agreements; Swiss Private International Law Act 1987. FF, 1988, I 5. See Article 177(2): A state, or an enterprise held by, or an organization controlled by a state, which is party to an arbitration agreement, cannot invoke its own law in order to contest its capacity to arbitrate or the arbitrability of a dispute covered by the arbitration agreement. Resolution on arbitration between States, State Enterprises, or State Entities, and Foreign Enterprises of the Institute of International Law, adopted at Santiago de Compostela Session on 12 September 1989. See Article 5: A State, a state enterprise, or a state entity cannot invoke incapacity to arbitrate in order to resist arbitration to which it has agreed. See also Gaillard and Savage (Eds.) (1999), pp. 322–329; Mantilla-Serrano (2013), p. 431; Hanotiau (1999), pp. 149–153; Born (2014), pp. 727–733.

  9. 9.

    Art. 16(3) of the Model Law explicitly allows to challenge the tribunal’s decision in which ‘the arbitral tribunal rules as a preliminary question that it has jurisdiction’. Article 19(3) of the LCA 1996 (which is no longer in force) mirrored the wording of Article 16(3) of the Model Law.

  10. 10.

    As referred to in Article II(3) of the New York Convention and Article 8(1) of the Model Law 2006.

  11. 11.

    In the latter case, however, the Supreme Court at all wrongly engaged into the analysis of the parties’ will regarding the chosen arbitral institution and failed to consider that parties might have agreed on ad hoc arbitration.

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Authors and Affiliations

  1. Department of Private Law, Vilnius University Faculty of Law, Vilnius, Lithuania

    Eglė Zemlytė

  2. Law firm “Miliauskas ir Zemlytė”, Vilnius, Lithuania

    Guoda Almantė Driukaitė

Authors
  1. Eglė Zemlytė
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  2. Guoda Almantė Driukaitė
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Correspondence to Eglė Zemlytė .

Editor information

Editors and Affiliations

  1. Department of Criminal Justice, Vilnius University Faculty of Law, Vilnius, Lithuania

    Gintaras Švedas

  2. Department of Public Law, Vilnius University Faculty of Law, Vilnius, Lithuania

    Donatas Murauskas

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Zemlytė, E., Driukaitė, G.A. (2021). Development of Arbitration Law in the Republic of Lithuania After the Restoration of Independence. In: Švedas, G., Murauskas, D. (eds) Legal Developments During 30 Years of Lithuanian Independence. Springer, Cham. https://doi.org/10.1007/978-3-030-54783-7_7

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