The first issue of the journal “Maritime Law” in 2022 covers the calendar period from January to March 2022. We summarise the quarterly statistics on “maritime” disputes heard by commercial courts. As before, the most significant cases have been reviewed and commented on in the journal. Furthermore, we point to an unfavourable trend for foreign persons in Russian judicial practice.

Cases heard in courts of cassation instance (courts of districts)

Between January and March 2022, the court of cassation instance issued 16 rulings in which the Merchant Shipping Code of the Russian Federation (hereinafter – MSC RF) was mentioned. Three of these cases involved challenges to the arrest of the vessels in a bankruptcy case and two involved occasional references to the MSC RF in connection with a compulsory pre-action procedure.

Two of the 12 truly “maritime” cases dealt with issues of public maritime law, in particular, challenging the judgements on administrative and customs violations. The remaining 10 cases dealt with the issues of private maritime law, including the recovery of debts under time charter and carriage of goods agreements, as well as arrests of the vessels.

Particular attention should be paid to the Review of Judicial Practice in Disputes Arising from Contracts of Carriage of Goods and Freight Forwarding adopted by the Commercial Court of the West Siberian District dated 18 January 2022.

During the period under review, the Commercial Court of the Far Eastern District had the highest number of “maritime” cases (4).

Below is a table showing the distribution of “maritime” cases between the courts of cassation instance.

Cases heard in courts of appeal

There were 55 cases in the courts of appeal during the period under review in which the MSC RF was mentioned. Only 27 of these cases were truly “maritime” disputes. In the remaining cases, there were occasional references to the MSC RF in relation to time-bar limitations and a compulsory pre-action procedure set out in this Code. 10 of these 27 “maritime” cases were matters of public law and 17 were matters of private maritime law.

In the public law field, the courts of appeal mainly dealt with administrative liability for illegal border crossing and customs violations. Private law “maritime” cases dealt with damages caused to the cargo, recovery under time charter, carriage of goods, and maritime agency agreements.

The Fifth Commercial Court of Appeal handled the largest number of cases, eight of which were in private law matters.

Below is a visual table similar to the one for the courts of cassation instance.

Disputes in courts of the first instance

In the Archive of commercial courts judgements (ras.arbitr.ru), we could find 145 judgements relating to “maritime disputes” for the period under review. The search was carried out on the request of the keywords “MSC RF” (38 judgements, 26 of which dealt with private law matters), “time charter” (13 judgements, 9 of which were private law matters), “bareboat charter” (8 judgements, 4 of which were private law cases), “harbour master” (85 judgements, 36 of which were private law disputes), pilotage (one private law case).

Therefore, in the first instance courts, there were 76 disputes dealing with private law matters and 69 cases dealing with public law matters.

In the private law field, the vast majority of cases are disputes to recover under various types of agreements, in particular, carriage of goods, maritime agency, and transhipment agreements. Furthermore, there are disputes to recover demurrage and berthing fees, the latter as unjust enrichment. A separate category of environmental damage cases can be identified.

Public law cases mainly focus on unlawful administrative liability for illegal cross bordering and violations of the rules on customs declarations. Moreover, decisions to amend customs declarations and to refuse registration of vessels and port facilities in the relevant registers are disputed. Tax offence disputes related to an artificial reduction of taxes on vessels and the sum of excise duties for the biological recourses are also considered.

Discriminatory judgements against foreign persons

Due to the political environment in February-March 2022, several discriminatory judgements against foreign persons were issued in Russia.

One such judgement is the Judgement of the Commercial Court of Kirovskaya Oblast No. A28-11930/2021 dated 03 March 2022. The court refused to protect the foreign claimant’s exclusive rights to the “images of Peppa Pig, Papa Pig”. The courts justified this conclusion by stating that the claim against the Russian person constituted an abuse of rights due to restrictive measures imposed by foreign states in Russia and by Russia on foreign states.

This case demonstrates an unfavourable trend for foreign persons, whereby a foreign person may be denied the protection of its rights merely on the basis of the political environment and “unfriendliness” of the country with which this person is connected. This situation calls into question the constitutional principles of separation of powers and judicial independence.

On 11 March 2022, the Commercial Court of the Moscow District issued a Ruling in case No. A40-149699/2021 suspending the enforcement of the judgements of the courts of the first and appellate instances in favour of the Claimant, Siemens Energetika LLC. This Ruling is based on the fact that the Claimant, the Russian legal entity, was controlled by the Siemens Group. Siemens Group, in turn, stated that it had suspended its activities in Russia, which “indicates that it is impossible and/or difficult to recover to the Defendant the money previously awarded in favour of the Claimant”. In other words, the fact that a Russian legal entity is “controlled” by a foreign group of companies indicates that it is no need to enforce the judgement in favour of such a person.

A similar judgement was issued in case No. A40-3406/2021, which is commented on in this issue of the journal. In this case, the court suspended enforcement of the judgements of the courts of the first and appellate instances in favour of DHL Global Forwarding LLC due to the fact that the said Russian legal entity is controlled by the German group of companies Dutch DHL Holding. The court referred to the fact that the DHL group declared that it suspends its activities in Russia. It is not true. This judgement demonstrates once again that only the connection with an “unfriendly” country is sufficient to suspend enforcement in favour of the foreign person.

We note that in both suspension cases, the Defendants have not provided any counter security. This situation creates an opportunity for the Defendants to dispose of their assets. As a result, the foreign persons will not receive the full amount due to them.

Conclusion

Therefore, in the calendar period under review, commercial courts heard 184 maritime disputes. The majority of disputes were private maritime law matters (103 disputes). The parties, as before, more frequently disputed over the non-performance of monetary obligations under various contracts. In the public law field, decisions on administrative liability for illegal border crossing and customs violations caused the most disputes.

Moreover, several judgements were identified as demonstrating a trend in Russian judicial practice to discriminate against foreign persons. We can only hope that this trend will not become an established practice and that these judgements will remain in history as isolated cases of violations of the principles of separation of powers and judicial independence. ■