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Ceturtdiena 20.09.2018 | Name days: Marianna, Ginters, Guntra
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Arbitration courts to be revised significantly

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Janis Bordans

Justice Ministry has decided to revise Arbitration Courts. Using this private institution, entrepreneurs resolved their conflicts and were mostly satisfied, because this reduced the burden of state courts. However, in search of easy profit there are now more than 200 Arbitration Courts and the fraudulent behaviour of most of them has ruined the originally good idea.

There is now a new law being written, which will limit the activities of these courts, as reported by Nekā personīga (Nothing personal) programme of TV3.

Arbitration Courts were created in the beginning of the ‘90s based on the principles of the Commercial Courts. They review cases very fast – within one month. This significantly relieves state courts from having to review civil disputes. Founding an Arbitration Court is just as simple as founding an enterprise. A judge of Arbitration Court need not be a lawyer.

The freedom to found Arbitration Courts and the lack of supervision leads to a logical result – they are eventually used for fraudulent goals. Attorney at law Olavs Cers mentions exceptional so-called “pocket Arbitration Court” cases, when it is clear that a plea was reviewed in favour of only one party. “Arbitration Court belongs to the husband; a plea is submitted by an entrepreneur represented by the wife. The defendant sees all this, writes complaints, but everything seems acceptable by everyone,” – he explains.

The Enterprise Register currently has 212 Arbitration Courts. As a comparison: Sweden has only one, France – two, Estonia – three. Many of them are no longer functioning; others were created for one specific plea. Income to Arbitration Courts is brought by fees, usually 2% of the recoverable amount. “Decisions of Arbitration Courts have tans of million circulating, but these enormous amounts are regulated by individuals who are not regulated by anyone,” – said the lawyer.

The Justice ministry has decided to employ strict control the activities of Arbitration Courts. From now on, Arbitration Courts will be allowed to found a society that will include at least ten members – all legal persons. On top of that, their total annual revenue will need to be no less than 50 million LVL.

Judges will be monitored closely as well. Judges will be required to settle an exam, which will be assessed by experts of the Justice Ministry, courts and universities. But control will not be a mere one-time inspection. “However many strong organizations that can pass the criteria will state how many Arbitration Court we will have in the end. It is likely they will be uniting or be created anew,” – comments Justice Minister Janis Bordans.

It is planned to announce this project on the meeting of state secretaries this week. The minister believes this new law could become in force before the end of 2013.

Ref: 102.109.109.5837


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