Foreign investors will be gratified to learn that,
in the sphere of dispute resolution, a positive precedent has been
set. The law firm CMS Cameron McKenna recently represented a
foreign investor and successfully achieved the recognition and
enforcement, in Uzbekistan, of an arbitration award, that had been
made in a European Union country, against the Uzbek party.
Given the sometimes, apparently, insurmountable
hurdles needed to be overcome by foreign investors wishing to
conduct business here, this is welcome news, and a positive sign
that Uzbekistan’s legal system can function normally, and can
serve to protect the interests of foreign investors.
It is impossible to say that the case went
absolutely smoothly. The consequences of a lack of relevant
experience and expertise locally had to be surmounted, as did
bureaucratic procrastination. However, in the end, a precedent was
set - on the basis of Uzbekistan being a signatory to the New York
Convention on the Recognition and Enforcement of Foreign Arbitral
Awards - and all of the problems were successfully settled. The
foreign participant received fair compensation for the losses
incurred, in accordance with the terms and conditions of the
relevant agreement.
Of course, ‘One swallow’, as the saying
goes, ‘does not make a summer’. It would also seem
probable that the strategic industry, that was involved in this
particular dispute, helped to focus minds and expedite a resolution
favourable to the foreign investor. It remains to be seen if the
same will be the case in disputes arising, for example, among
partners involved in the undesirable practice [because it depletes
hard currency reserves] of importing chewing gum.
Ian Sepion
CMS Cameron McKenna