LITMIR.BIZ

      M.B.: So, Professor, you have more or less devoted your life to arbitration. In your opinion, what is the essence of arbitration? What is the essence of arbitration, what is arbitration really about?

      S.L.: Your question is very simple, and very difficult to answer. What is the essence of arbitration? Well, to tell legally, it is a procedure for settlement of disputes between the parties, and if it is a commercial arbitration it is a procedure for settlement of disputes between parties to commercial transactions, to contracts. And such disputes do arise, even if there are good relations between the parties. Nevertheless, many problems arise which cause differences, arise between the parties. If it is international relationship, then is a problem of cultural traditions in countries of each party. They all may be very important for the parties, which also must overcome themselves. And then the question is: how resolve these problems? How to resolve? And then to invite people who are called, nowadays, arbitrators, to settle this dispute, to help the parties to settle this dispute.

      M.B.: Given your long experience with international arbitration, what would you say that the key obstacle to peaceful resolution is? What is the major obstacle that the arbitrators have to overcome in order to find a solution?

      S.L.: There is a problem for the arbitrators in dealing with disputes in commercial fields: to take into account the situation in the country of each party to that transaction. Take, for example, a dispute between Russian and English companies: it is important to see what are the regulations of certain problems according to English law and according to Russian law? And there are differences in such regulations. How to overcome it? Of course, there is a possibility to determine which law is applicable, which should govern the relations between the parties. Yes, it is, let’s assume that the parties have agreed that English law would be applicable. But it does not mean that arbitrators should ignore what are the regulations in Russia? Even if English law is applicable. And the differences in regulations, in customs, trade customs and so on, are difficult. Of course, during globalization period which is existing right now, it is important to go to unification, and to try to adopt international conventions on certain problems of trade. And for me, I always recall with great sympathy the adoption of the Vienna Convention on the international contracts of sale. I had the chance to participate in preparation of that convention in UNCITRAL and I believe it is a great achievement, actually, for international trade, because contracts of sale are the most used form of relationship in foreign trade and international trade. And so it is a great achievement for international practice. But there are other aspects, other forms of intentional transactions, where there are no such unification, and then the problem of application of national laws remains. And it is very important to take into account these regulations existing in each country, even if the law of one country is formally applicable in this case.

      M.B.: Professor, may I ask a personal question? You were born in 1938, I believe? Russia was a very different country back then. What role do you think that international trade have played in the development of Russia during your lifetime?

      S.L.: Well, actually, that is a very general question for me to answer. What I can say, when I graduated from my school in 1952, it was necessary for me to find what to do later. And I was thinking, I was 18 years old at that time, and it was difficult for me to find what to do. But there was an interest for various reasons to study law. And I first decided to go to the law school of the Moscow State University. And I tried to find out what they were studying and so on. And I was not particularly happy. And then I was recommended to go to the Institute of Foreign Trade, to the law school in that Institute. And that happened to be most interesting for me, because the programs in that law school concerned not only Russian law, but also laws of other countries, related to commercial transactions, relationships and so on. It happened to be very interesting to me. And I studied in that law school, just to try, and it was really interesting, it happened to be very interesting to me, from year to year. I believe I thought initially that one year in that school would show to me whether it was interesting or not. And from one year to another year, it was more and more interesting to me. And I can tell you that this year I happened to be for arbitration in Germany, and I flew to Hamburg and then I went to Kiel. Why? In Kiel, there is my Professor, who was my Professor in 1954, in Moscow, in my law school, who was teaching private international law, Professor Boguslavskiy. And now he is very old, and he is living in Kiel, and I went to Kiel to see him. And I brought to him my notes of his lectures, which I made in 1954. I’m sorry, in 1951–1952, when I was graduating my law school. So I showed those notes to him. And it was very interesting for me, because it concerned international trade. Of course, I don’t have experience and knowledge about international trade, about economic aspects and so on, but certain aspects of legal regulations are very interesting to me. And for that reason I believe that foreign trade is a very important thing. Although I am not an expert in economic aspects of that field of relations between countries.

      M.B.: If I may continue on that matter, already back in 1940, there was a Soviet-Swedish agreement on arbitration for the future trade. Could you say anything about the role of Sweden in arbitration, already back in the ’50s and ’40s? Did it play any important role in arbitration for Soviet trade already back then?

      S.L.:

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