CHOOSING YOUR DISPUTE RESOLUTION MECHANISM IN OIL

CHOOSING YOUR DISPUTE RESOLUTION MECHANISM IN OIL & GAS CONTRACTS Rupert D’Cruz / Руперт Д’Круз (Barrister / Барристер, Littleton Chambers) First Legal Forum; Almaty; 16 September 2011

GENERAL THEMES • British Kazakh Law Association • Litigation v Arbitration • Issues to be aware of when drafting your arbitration contract • Establishing jurisdiction in England • Examples of recent CIS and Central Asian cases in England • Issues relevant to dispute resolution in England

British-Kazakh Law Association • Established December 2010 • English Law Seminar Almaty (May 2011) • Kazakh Law Seminar (October 2011) • Networking forum designed to strengthen relations and contacts between the Kazakh and English legal professions • Contact details: rdc@littletonchambers. co. uk (Secretary)

(international) LITIGATION v ARBITRATION • Flexibility (procedure, language, tribunal, venue, seat) • Enforceability • Confidentiality • Speed • Costs • Split hearings (where third parties are involved) • Arbitrability

Issues To Be Aware Of When Choosing Arbitration • Ensure all main issues relevant to proper functioning of the arbitral process is contained in the contract Ø Language Ø Seat Ø Applicable rules Ø Qualifications of the arbitrator Ø Prior dispute settlement steps (meetings, mediation)

Establishing jurisdiction in England • 5 main bases: (1) English Jurisdiction Clause (2) Defendant domiciled in England (3) Claim against Co-Defendant over whom English courts have jurisdiction (4) Subject matter connection (5) D served with proceedings in England

• Tajikistan Aluminium Co (Tad. AZ) v Nazarov [2008] • Yugraneft v Abramovich, Millhouse Capital & Berezovsky [2008] • Kazakhgold Group Ltd v Assaubayev [2010] • Aes Ust-Kamenogorsk Hydropower Plant LLP v Ust-Kamenogorsk Hydropower Plant JSC [2010] • BTA Bank v Ablyazov & Others [2011] • Allianz Bank JSC v Aquanta Corporation & Others [2011] • Cherney v Deripaska [2011] • Berezovsky v Abramovich [2011]

The growth of Central Asian and CIS disputes in England Moscow Times Article (11 May 2011): Russian Rule of Law Being Imposed by British Courts Ø“The caseload from the CIS is increasing all the time. Last year was more substantial than the year before. ” Ø “It has become a trend … as [CIS] have become more integrated into international trade where the use of English law is commonplace” Ø “Every significant law firm now has a Russia expert” Ø“[CIS] clients are a big pie for English lawyers” Ø“Certainly the market we’re in is very buoyant” Over 25% of cases filed this year at the LCIA involve a CIS party

Why is England a popular choice for CIS/Central Asian dispute resolution? • “The English courts are practically flawless, ” exiled billionaire Boris Berezovsky, who has lived in London since 2000 and has been involved in more than 20 legal disputes in Russia and Britain, told The Moscow Times. In Russia, “Putin decides what happens, ” he said. • No need to obtain a criminal conviction before pursuing a civil claim for compensation • Flexible and robust interim measures with international scope

• Reputation for independent judiciary experienced in international commercial disputes • Wide use of English law in international contracts But: • Costs + delay?

Contact Details Rupert D’Cruz (Barrister) Littleton Chambers 3 King’s Bench Walk Temple London EC 4 Y 7 HR www. littletonchambers. com Tel: +44 (0)207 797 8600 E-mail: rdc@littletonchambers. co. uk