International arbitration law and rules in Slovenia

  1. HISTORICAL BACKGROUND AND OVERVIEW
  2.  SCOPE OF APPLICATION AND GENERAL PROVISIONS OF THE SLOVENIAN ARBITRATION ACT
    1. Scope of application
    2.  Structure of the Slovenian Arbitration Act
    3.  General principles
  3. THE ARBITRATION AGREEMENT
    1.  Definition
    2.  Formal requirements
    3. Special tests and requirements of the jurisdiction
    4.  Separability
    5. Legal consequences of a binding arbitration agreement
  4.  COMPOSITION OF THE ARBITRAL TRIBUNAL
    1. The constitution of the arbitral tribunal
    2. The procedure for challenging and substituting arbitrators
    3. Responsibility of the arbitrators
    4. Arbitration fees
    5. Arbitrator immunity
  5.  JURISDICTION OF THE ARBITRAL TRIBUNAL
    1.  Competence to rule on jurisdiction
    2. Power to order interim measures
  6. CONDUCT OF PROCEEDINGS
    1. Commencement of the arbitration
    2.  General procedural principles
    3.  Seat and language of the arbitration
    4.  Multi-party issues
    5. Oral hearings and written proceedings
    6. Default by one of the parties
    7.  Evidence generally
    8.  Appointment of experts
    9.  Confidentiality
    10.  Court assistance in taking evidence
  7.  MAKING OF THE AWARD AND TERMINATION OF PROCEEDINGS
    1.  Choice of law
    2.  Timing, form, content and notification of the award
    3.  Settlement
    4.  Power to award interest and costs
    5.  Termination of the proceedings
    6. Effect of the award
    7. Correction, clarification and issue of a supplemental award
  8.  ROLE OF THE COURTS
    1.  Jurisdiction of the courts
    2.  Stay of court proceedings
    3.  Preliminary rulings on jurisdiction
    4.  Interim protective measures
  9.  CHALLENGING AND APPEALING AN AWARD THROUGH COURTS
    1. Jurisdiction of the courts
    2.  Appeals
    3.  Application to set aside an award
  10.  RECOGNITION AND ENFORCEMENT OF AWARDS
    1.  Domestic awards
    2.  Foreign awards
  11. SPECIAL PROVISIONS AND CONSIDERATIONS
    1.  Consumers
    2. Employment law

Arbitration is a well-established option for resolving disputes in Slovenia and we have noticed an increase in the number of disputes resolved by arbitration in recent years. However, court litigation remains the preferred option for most parties. Very few arbitral awards are disputed in front of Slovenian courts as reasons for the annulment of arbitral awards are interpreted very restrictively.

1. HISTORICAL BACKGROUND AND OVERVIEW

1.1.1 After gaining independence on 25 June 1991, following the dissolution of the Socialist Federal Republic of Yugoslavia (SFRY), Slovenia acknowledged the continuity of the rights and obligations under the international treaties concluded by the SFRY before 25 June 1991. 1 In a letter dated 1 July 1992 sent to the Secretary-General of the United Nations by the Government of the Republic of Slovenia.  Subsequently, Slovenia acceded to the New York Convention and the 1961 European Convention on 6 July 1992. On 7 March 1994, Slovenia ratified the Washington Convention.

1.1.2 On 9 May 2008 Slovenia enacted its arbitration act (Slovenian Arbitration Act). 2 Law on Arbitration of Slovenia adopted by the National Assembly of the Republic of Slovenia on 25 April 2008 and published in the Official Gazette on 9 May 2008.  The Slovenian Arbitration Act came into force on 10 August 2008 and incorporates the principal features of the Model Law (1985) and some aspects of the Model Law (2006).

1.1.3 Slovenia also promotes institutional arbitration through the Ljubljana Arbitration Centre at the Chamber of Commerce and Industry of Slovenia (LAC), which is an autonomous and independent arbitration centre providing services for the resolution of disputes between domestic and international parties. Arbitral proceedings at LAC are conducted pursuant to its rules, the Ljubljana Arbitration Rules (LAR). 

2. SCOPE OF APPLICATION AND GENERAL PROVISIONS OF THE SLOVENIAN ARBITRATION ACT

2.1 Scope of application

2.1.1 The provisions of the Slovenian Arbitration Act apply to all arbitrable disputes. Arbitrable disputes include all pecuniary claims capable of resolution by way of arbitral proceedings. 3 Slovenian Arbitration Act, ch 1, art 4(1).  Non-pecuniary claims, however, may also be subject to an arbitration agreement if the matter is capable of settlement. For consumer-related or employment-related matters, special provisions set out in Chapters IX and X of the Slovenian Arbitration Act apply. See section 11 below.

2.2 Structure of the Slovenian Arbitration Act

2.2.1 The structure of the Slovenian Arbitration Act follows the Model Law (1985). Chapter I of the Slovenian Arbitration Act contains general provisions on the scope of application of the law and the service of proceedings. Chapter II deals with the arbitration agreement itself. The composition of the arbitral tribunal and the challenge of arbitrators are set out in Chapter III. Jurisdiction of the arbitral tribunal is dealt with in Chapter IV. Chapters V and VI set out the provisions on the organisation and conduct of arbitral proceedings and the rendering of the award. Chapter VII deals with possible methods of recourse against an award. Chapter VIII deals with the recognition and enforcement of foreign awards. Chapters IX and X contain special provisions on consumer-related and employment-related issues.

2.3 General principles

2.3.1 The general principles underlying the Slovenian Arbitration Act are:

  • equality and objectivity (ie all parties must be treated fairly);
  • due process (ie all parties must have the opportunity to present their case);
  • good faith and conscientiousness; and
  • party autonomy.

3. THE ARBITRATION AGREEMENT

3.1 Definition

3.1.1 The definition of an arbitration agreement is set out in the Slovenian Arbitration Act and closely follows the Model Law (2006). 5 The definition corresponds with the Model Law (2006), ch 2, art 7 (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf).  The arbitration agreement is an agreement by the parties to submit to arbitration all or specific disputes which have arisen or which may arise between the parties, whether contractual or not. 6 Slovenian Arbitration Act, ch 2, art 10(1).

3.1.2 An arbitration agreement may either be concluded by way of a separate agreement or included as an arbitration clause in a contract. In either case, it needs to express clearly the intention of both parties to submit the dispute in question to arbitral proceedings. 7 Ibid.

3.2 Formal requirements

3.2.1 The Slovenian Arbitration Act provides the formal requirements of an arbitration agreement. 8 The requirements correspond with the Model Law (2006), ch 2, art 7 (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf)  An arbitration agreement must be in writing. 9 Slovenian Arbitration Act, ch 2, art 10(2).  If the arbitration agreement is contained in correspondence between the contracting parties and the information contained therein is accessible so as to be useable for subsequent reference (ie letters, facsimiles, emails or other means of communication), it is deemed that the arbitration agreement is in writing. 10 Ibid.

3.2.2 A reference in a contract to any other document containing an arbitration clause constitutes a valid arbitration agreement, provided that the reference is sufficient to make that clause part of the contract. 11 Ibid, ch 2, art 10(4).  

3.2.3 An arbitration agreement may also be deemed to exist if the claimant submits a request for arbitration and the respondent fails to object to the competence of the arbitral tribunal in its statement of defence (or earlier). 12 Ibid, ch 2, art 10(6).

3.3 Special tests and requirements of the jurisdiction

3.3.1 Generally, all pecuniary claims are arbitrable. However, disputes relating to non- pecuniary claims may also be arbitrable if the parties are able to conclude a settlement regarding the non-pecuniary dispute. As specified in article 1053 of the Code of Obligations, 13 Obligations Code, which was adopted by the National Assembly of the Republic of Slovenia at its session of 3 October 2001 (Code of Obligations).  disputes concerning the status of relations of natural and legal persons (eg questions regarding marriage, motherhood, fatherhood, adoption, paternal rights, etc) cannot be arbitrated.

3.4 Separability

3.4.1 The Slovenian Arbitration Act follows the provisions on the doctrine of separability set out in the Model Law (1985). 14 Model Law (1985), ch 4, art 16(1) (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/06-54671_Ebook.pdf).  An arbitration clause which forms part of a contract shall be treated as an agreement independent of the other terms of the contract. A nullification of a contract containing an arbitration clause will not affect the validity of the arbitration clause. 15 Slovenian Arbitration Act, ch 4, art 19(1).

3.5.1 A claim brought before the courts will be dismissed on the grounds of lack of jurisdiction if it is subject to an arbitration agreement and a respondent objects to the court’s jurisdiction no later than when submitting its statement of defence. The court will only dismiss a claim if the respondent chooses to object and will not undertake this action ex officio. The courts may hear the claim if it is found that the arbitration agreement does not exist, is null and void, is inoperative or is incapable of being performed. 16 Ibid, ch 2, art 11(1), following the Model Law (2006), ch 2, art 8 (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf).

4. COMPOSITION OF THE ARBITRAL TRIBUNAL

4.1 The constitution of the arbitral tribunal

4.1.1 There is no requirement that an arbitrator is qualified as a lawyer or is a registered member of the bar. Furthermore, nationality is not a reasonable ground for precluding someone from acting as an arbitrator, unless otherwise agreed by the parties. 17 Slovenian Arbitration Act, ch 3, art 14(1).

4.1.2 The parties are free to agree on the number of arbitrators. However, under the Slovenian Arbitration Act the default number of arbitrators is three. 18 Slovenian Arbitration Act, ch 3, art 13. The parties are also free to agree on the procedure for appointing the arbitrator(s). 19 Ibid, ch 3, art 14(2).  The mandatory provisions of the Slovenian Arbitration Act will apply, however, in the following instances:

  • if the parties fail to agree on a sole arbitrator, either party may request the court to make the appointment;
  • where there are three arbitrators, each party appoints one arbitrator and the two party-appointed arbitrators shall appoint the third arbitrator to act as chair; and
  • if the party-appointed arbitrators fail to agree on the identity of the chair within 30 days of receipt of a request to do so from the other party or within 30 days of their appointment, a party may request the court to make this appointment. 20 Ibid, ch 3, art 14(3).

4.1.3 The above mandatory provisions also apply if the parties have agreed the appointment procedure, but:

  • a party fails to act as required under such procedure;
  • the parties, or the party-appointed arbitrators, are unable to reach an agreement as envisaged under such procedure; or
  • a third party, including an arbitral institution, fails to perform a function entrusted to it under such procedure. 21 Ibid, ch 3, art 14(4).

4.1.4 Any party may request the court to take necessary measures to appoint an arbitrator, unless the appointment procedure provides other means for securing the appointment(s). 22 Ibid. The court’s decision as to the appointment of an arbitrator is not subject to appeal. 23 Ibid, ch 3, art 14(5).

4.2 The procedure for challenging and substituting arbitrators

Challenge of arbitrators

4.2.1 The Slovenian Arbitration Act provides limited grounds for challenging an arbitrator. 24 Ibid, ch 3, art 15.  Arbitrators may be challenged only where circumstances give rise to justifiable doubts as to their impartiality or independence, or if the arbitrator does not possess qualifications agreed to by the parties. Moreover, a party may challenge an arbitrator that it has appointed (or in whose appointment it has participated), only for reasons it becomes aware of subsequent to the appointment. 25 Ibid, ch 3, art 15(2).

Procedure for challenging an arbitrator

4.2.2 The procedure for challenging an arbitrator under the Slovenian Arbitration Act follows the Model Law (1985). 26 As set out in Model Law (2006), ch 3, art 13 (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf).  Under the Slovenian Arbitration Act, the parties are free to agree on the procedure for challenging an arbitrator. If a specific procedure is not agreed upon, a party who intends to challenge an arbitrator should submit a written statement to the arbitral tribunal setting out the reasons for its challenge. Such a statement must be sent within 15 days of the party becoming aware of either the constitution of the arbitral tribunal or the circumstances set out in article 15 of the Slovenian Arbitration Act. 27 See above at paragraph 4.2.1.  Unless the challenged arbitrator withdraws from his or her office or the other party agrees to the challenge, the challenge shall be decided by the full arbitral tribunal including the challenged arbitrator. If such a challenge is not successful, the challenging party may file a request to the court to decide on the challenge. A request of this nature must be made within 30 days of receiving notice of the arbitral tribunal’s decision rejecting the challenge. 28 Slovenian Arbitration Act, ch 3, art 16 (3).  The court’s decision cannot be appealed. While a request is pending, the full arbitral tribunal may continue the proceedings and render an award. 29 Ibid.

4.2.3 Under LAR, an arbitrator may be challenged if circumstances exist that give rise to justifiable doubts as to his or her impartiality or independence or where the arbitrator does not possess the qualifications agreed by the parties. A party may challenge an arbitrator within 15 days after the circumstances became known to that party. If the other parties do not agree to the challenge or the challenged arbitrator does not withdraw, the LAC Board (Board) decides on the challenge. The Board has no obligation to give reasons for its decision. 30 LAR, art 18.

4.2.4 Should an arbitrator become unable to perform the duties of an arbitrator then the arbitrator’s mandate shall terminate – if the parties so agree, or if the arbitrator withdraws from the office. If no agreement is reached, or the arbitrator does not voluntarily withdraw, any party may request the court to rule on the issue. The court’s decision cannot be appealed. 31 Slovenian Arbitration Act, ch 3, art 17(1).

Substitution of arbitrator(s)

4.2.5 Where the mandate of an arbitrator terminates, a substitute arbitrator must be appointed according to the rules applicable to the appointment of the arbitrator being replaced. 32  Ibid, ch 3, art 17(2).

4.3 Responsibility of the arbitrators

4.3.1 There are no specific statutory provisions relating to the responsibility of arbitrators. Pursuant to the LAC Arbitrator’s Guidelines, arbitrators may only accept the appointment if they are confident that they will be able to perform their duties impartially, independently and without undue delay. In addition they shall accept the appointment only if they are fully satisfied that they are competent to determine the issues in dispute, and possess an adequate knowledge of the language of the proceedings. 33 Slovenian Arbitration Act, ch 6, art 39(1).

4.4 Arbitration fees

4.4.1 Unless otherwise agreed by the parties, the arbitral tribunal decides, at the request of the parties to the arbitral proceedings, the extent to which either party shall be liable for the costs of the proceedings, including costs of representation and the arbitrators’ fees and expenses. The arbitral tribunal has discretion in making its decision and can take into account individual circumstances and the outcome of the proceedings. 

4.4.2 Under LAR, when a claim is filed, the claimant must pay a registration fee amounting to EUR 1,000. 34 LAR, Appendix II, art 1  

4.4.3 The arbitrator’s fee depends on the amount of the dispute, diligence and efficiency of the arbitrators, the amount of work performed, the complexity of the case, the efficiency of the proceedings and the timeliness of the making of the award. 35 LAR, Appendix II, art 2.

4.5 Arbitrator immunity

4.5.1 There are no special provisions in relation to the immunity of arbitrators.

5. JURISDICTION OF THE ARBITRAL TRIBUNAL

5.1 Competence to rule on jurisdiction

5.1.1 The arbitral tribunal has the power to rule on its own jurisdiction (the principle of competence-competence), which includes any objections with respect to the existence or validity of the arbitration agreement. 36 Slovenian Arbitration Act, ch 4, art 19(1), following the Model Law (2006), ch 4, art 16(1) (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf).

5.1.2 An arbitration clause forming part of a contract shall be treated as an agreement independent of the other terms of the contract. A decision by the arbitral tribunal that the contract is null and void does not automatically invalidate the arbitration clause. 37 Ibid.

5.2 Power to order interim measures

5.2.1 Upon hearing the submissions of both parties, the arbitral tribunal is entitled to order any interim measures it considers necessary to protect the subject matter of the proceedings. The arbitral tribunal may require the party requesting an interim measure to provide appropriate security. 38 Slovenian Arbitration Act, ch 4, art 20(1).  Exceptionally, the arbitral tribunal may, if it considers it necessary, independently order interim measures absent a request by either party. 39 Ibid, ch 4, art 20(2).

5.2.2 The arbitral tribunal may modify, suspend and/or terminate an interim measure upon the application of any party or, in exceptional circumstances, by its own motion without the application of either party. 40 Ibid, ch 4, art 20(3).  While an arbitral tribunal has the power to order an interim measure, only the court has the power to enforce interim measures in the event of a party’s non-compliance. 41 Ibid, ch 4, art 20(4).

6. CONDUCT OF PROCEEDINGS

6.1 Commencement of the arbitration

6.1.1 Unless otherwise agreed by the parties, the Slovenian Arbitration Act provides that the arbitral proceedings in respect of a particular dispute commence on the date the request for arbitration is received by the respondent. 42 Ibid, ch 5, art 25.  However, under LAR the arbitral proceedings commence on the day the statement of claim is received by the LAC. 43 LAR, art 4.

6.2 General procedural principles

6.2.1 The parties are free either to agree on the procedure to be followed in conducting the arbitral proceedings or to refer to the rules of an arbitral institution. If the parties do not agree upon a procedure to be followed or refer to institutional rules, then the arbitral tribunal shall conduct the arbitration in the manner it considers appropriate. 44 Slovenian Arbitration Act, ch 5, art 23

6.2.2 The parties should be treated equally and be given a full opportunity to present their case. 45 Ibid, ch 5, art 21.  The parties also have the right to be represented by a proxy, which may be any natural person with full capacity. A proxy is not required to be a Slovenian national. Furthermore, a foreign or national law firm may act as a proxy. 46 Ibid, ch 5, art 22.

6.3 Seat and language of the arbitration

6.3.1 The parties are free to agree on the seat of arbitration and may also choose the language of the arbitral proceedings. 47 Ibid, ch 5, art 24.  If the parties fail to reach an agreement on the seat of arbitration 48 Ibid.  or language of the arbitral proceedings, then the seat of jurisdiction or the language or languages to be used in the proceedings shall be determined by the arbitral tribunal. 49 Slovenian Arbitration Act, ch 5, art 26, based on the Model Law (2006), ch 5, art 22 (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf).  Prior to the determination of the language of the arbitral proceedings, the statement of claim and other submissions can be made either in the language of the arbitration agreement or in Slovenian. 50 Slovenian Arbitration Act, ch 5, art 26(3).

6.4 Multi-party issues

6.4.1 The Slovenian Arbitration Act does not contain any specific provisions addressing multi-party issues. Therefore, multi-party issues are subject to the provisions of the arbitration agreement.

6.4.2 Under LAR, where there are multiple parties to a dispute and they cannot agree among themselves on a joint arbitrator, the joint arbitrator shall be appointed by the Board. 51 LAR, art 14 and 15.

6.5 Oral hearings and written proceedings

6.5.1 The parties are free to agree on whether proceedings shall be conducted orally or in writing. 52 Slovenian Arbitration Act, ch 5, art 23(1). In the absence of an agreement between the parties, the arbitral tribunal shall decide whether to hold an oral hearing or whether the proceedings shall be conducted based on written submissions only. However, the default position under the Slovenian Arbitration Act is that an oral hearing is required if one of the parties requests it. 53 Ibid, ch 5, art 28(1). Under the LAR, art 32(1), an oral hearing shall be held if requested by a party, or if deemed appropriate by the arbitral tribunal.

6.5.2 The arbitral tribunal has the power to determine the admissibility, relevance, materiality and weight of any evidence. 54 Slovenian Arbitration Act, ch 5, art 23(2).  The parties are entitled to receive sufficient, advance notice of any hearing scheduled by the arbitral tribunal for the purposes of inspecting the evidence. Furthermore, the parties are entitled to receive submissions, documents or communications supplied to the arbitral tribunal by the other party, including expert reports or other documents on which the arbitral tribunal may rely in making its decision. 55 Ibid, ch 5, art 28.

6.6 Default by one of the parties

6.6.1 The arbitral tribunal may continue with the proceedings and render an award even if one of the parties does not participate. The arbitral proceedings may be continued in the absence of a party if:

  • the respondent fails to communicate its statement of defence within the agreed or ordered timeframe; or
  • any party fails to appear at a hearing or to produce documentary evidence. 56 Ibid, ch 5, art 29(2) and (3).

6.6.2 If the claimant fails to file a statement of claim in accordance with the agreement of the parties or the provisions of the Slovenian Arbitration Act, the arbitral tribunal should terminate the proceedings. 57 Ibid, ch 5, art 29(1).

6.7 Evidence generally

6.7.1 Within the period of time agreed by the parties or determined by the arbitral tribunal, the claimant shall present the facts supporting its claim and the respondent shall present its defence in respect of those particulars. The parties may agree as to the required elements of such statements. The parties may submit with their submissions all the documents that they consider to be relevant or may add a reference to the documents or other evidence they intend to submit. 58 Ibid, ch 5, art 27(1).  Any statement of case can be amended or supplemented by the parties unless it is agreed otherwise or the arbitral tribunal considers that such amendment or supplement would disproportionally delay the proceedings or that it would cause disproportionate prejudice to the other parties or for any other legitimate circumstances. 59 Ibid, ch 5, art 27(2), reflected in LAR, art 29.

6.8 Appointment of experts

6.8.1 Unless the parties have agreed otherwise, the arbitral tribunal has the authority to appoint experts to produce a report on specific issues that are to be determined through the arbitral proceedings. Furthermore, the arbitral tribunal may require a party to give a tribunal-appointed expert any relevant information or to produce or provide access to any relevant documents, goods or other property for inspection. 60 Slovenian Arbitration Act, ch 5, art 30(1).

6.8.2 Unless otherwise agreed by the parties, if a party so requests or if the arbitral tribunal considers it necessary, in addition to written or oral report(s), a tribunal- appointed expert shall participate in the hearing where the parties have the opportunity to put questions to the tribunal-appointed expert and to present expert witnesses in order to testify on the points at issue. 61 Ibid, ch 5, art 30(2).

6.9 Confidentiality

6.9.1 While there are no special provisions in the Slovenian Arbitration Act in relation to confidentiality, LAR does provide for the confidentiality of proceedings, unless otherwise expressly agreed by the parties. According to Article 50, the LAC, the arbitrators and the emergency arbitrator shall maintain the confidentiality of the proceedings, the arbitral tribunal’s deliberations and the award, as well as any other orders or decisions of the Arbitral Tribunal. This duty of confidentiality extends to all documents submitted in the proceedings by a party which are not already publicly available, except and to the extent that disclosure is required:

  • of a party under a legal duty;
  • to protect or pursue a party’s legal rights; or
  • to enforce or challenge an award before a judicial authority, unless otherwise expressly provided. 

Accordingly, the parties should bear this in mind when drafting their arbitration agreement.

6.10 Court assistance in taking evidence

6.10.1 The arbitral tribunal or a party (with the arbitral tribunal’s permission) may request court assistance in the taking of evidence or performance of any other acts for which the arbitral tribunal does not have authority. The court executes the request within its competence, jurisdiction and according to the relevant procedural rules. The arbitrators are entitled to participate in the taking of evidence before the court. 62 Ibid, ch 5, art 31(1).

7. MAKING OF THE AWARD AND TERMINATION OF PROCEEDINGS

7.1 Choice of law

7.1.1 The arbitral tribunal shall decide the dispute in accordance with the rules of law chosen by the parties. Any designation of the law or legal system of a given state shall be interpreted as directly referring to the substantive law of that state rather than its conflict of laws rules. 63 Ibid, ch 6, art 32(1).  Failing any designation by the parties, the arbitral tribunal shall apply the rules of law which it considers appropriate. 64 Ibid, ch 6, art 32(2).

7.1.2 The arbitral tribunal may also decide ex aequo et bono if the parties have expressly authorised it to do so. 65 Ibid, ch 6, art 32(3).  In all cases, the arbitral tribunal shall make its decision in accordance with the terms of the contract and the relevant trade customs. 66 Ibid, ch 6, art 32(4).

7.2 Timing, form, content and notification of the award

7.2.1 The award shall be made in writing and shall be signed by the arbitrator(s). If there is more than one arbitrator, the signatures of the majority of the arbitral tribunal will suffice, provided that the reason for any omitted signature is stated. The award must provide reasons upon which it is based, the date of issue and the seat of arbitration. Each party has a right to receive a copy of the signed award. 67 Ibid, ch 6, art 35.

7.3 Settlement

7.3.1 The parties may settle at any time during the arbitral proceedings. If the parties so request and the terms of a settlement are in accordance with Slovenian public policy, 68 Slovenian public policy is an indefinite legal concept, which is defined by academic literature, a number  the settlement may be recorded in the form of an award. 69 Slovenian Arbitration Act, ch 6, art 34.  Such an award will have the same status and effect as an award on the merits of the case. 70 Ibid, ch 6, art 34.

7.4 Power to award interest and costs

7.4.1 Unless otherwise agreed by the parties, the arbitral tribunal may decide, at its own discretion but upon the request of one of the parties, which party is obliged to reimburse:

  • the costs of the arbitral proceedings;
  • the costs of arbitrator fees;
  • the fees of any arbitral institution; and
  • each party’s lawyers’ fees.

7.4.2 The arbitral tribunal’s decision on the amount and the allocation of costs between the parties can be recorded in either the award or in a separate order. 71 Ibid, ch 6, art 39.

7.5 Termination of the proceedings

7.5.1 Arbitral proceedings usually terminate as a result of settlement or the rendering of a final award on the merits. 72 Ibid, ch 6, art 36(1).  The proceedings can also terminate as a result of the rendering of an order for the termination of the arbitral proceedings if:

  • the claimant withdraws its claim, unless the respondent objects and the arbitral tribunal recognises a legitimate interest on the respondent’s part in obtaining a final award;
  • the parties agree on the termination of the arbitral proceedings; or
  • it is impossible or unnecessary for the arbitral proceedings to continue. 73 Ibid, ch 6, art 36(2).

7.5.2 The mandate of the arbitral tribunal terminates with the termination of the arbitral proceedings. 74 Ibid, ch 6, art 36(3).

7.6 Effect of the award

7.6.1 The award has the same effect as a final judgment between the parties. 75 Ibid, ch 6, art 38.

7.7 Correction, clarification and issue of a supplemental award

7.7.1 The Slovenian Arbitration Act follows the Model Law (2006) in relation to correction, clarification and supplemental awards. 76 Ibid, ch 6, art 37, based on the Model Law (2006), ch 6, art 33 (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf).  Accordingly, the arbitral tribunal may correct any errors in computation, any clerical or typographical errors or any errors of a similar nature within 30 days of receipt of the award by the parties. The arbitral tribunal may do so either at the request of one of the parties or on its own initiative. 77 Ibid.  

7.7.2 Furthermore, the parties can request that the arbitral tribunal give an interpretation of a specific point or part of the award. The parties can request the issuance of an additional award on claims presented in the arbitral proceedings but omitted from the award. Any interpretation or corrections are considered to be part of the award. 78 Ibid.

8. ROLE OF THE COURTS

8.1 Jurisdiction of the courts

8.1.1 Under the Slovenian Arbitration Act, the District Court in Ljubljana is the competent court for judicial tasks in relation to arbitration matters.

8.1.2 The District Court in Ljubljana decides on the:

  • admissibility of arbitral proceedings;
  • appointment, challenge and termination of an arbitrator’s mandate;
  • competence of arbitral tribunals;
  • setting aside of an award; and
  • recognition of domestic/foreign awards. 79 Slovenian Arbitration Act, ch 1, art 9.

8.2 Stay of court proceedings

8.2.1 Generally speaking, applications in relation to the jurisdiction of the arbitral tribunal, the setting aside of an award and the admissibility of arbitral proceedings are governed by general provisions of Slovenian civil procedure. 80 See the Civil Procedure Act, which was published on 15 April 1999 in the Official Gazette no 26/1999 et al.  Other court proceedings in connection with arbitration (eg relating to the appointment, challenge and termination of the mandate of an arbitrator or the recognition of the award) are governed by the non-litigious rules of Slovenian civil procedure. 81 See the Non-Litigious Civil Procedure Act, which was published on 28 July 1986 in the Official Gazette no 30/1986.  The public can be excluded from court proceedings regarding arbitration matters upon the legitimate request of a party to the dispute. 82 Slovenian Arbitration Act, ch 1, art 9(2).

8.3 Preliminary rulings on jurisdiction

8.3.1 There are no statutory provisions in relation to preliminary rulings on jurisdiction.

8.4 Interim protective measures

8.4.1 The court may issue, if so requested by the parties, an interim measure in relation to the subject of the arbitral proceedings prior to or during the arbitral proceedings, irrespective of the existence of the arbitration agreement. 83 Slovenian Arbitration Act, ch 2, art 12.

9. CHALLENGING AND APPEALING AN AWARD THROUGH COURTS

9.1 Jurisdiction of the courts

9.1.1 As referenced above, the District Court in Ljubljana has jurisdiction over arbitration matters and decides on whether or not awards issued in Slovenia should be set aside. 84 Ibid, ch 1, art 9; see section 8.1 above.  A decision of the District Court may be appealed to the Supreme Court. 85 Slovenian Arbitration Act, ch 1, art 9(3).

9.2 Appeals

9.2.1 The only judicial remedy against an award is an application to set aside the award. 86 Ibid, ch 7, art 40(1).

9.3 Application to set aside an award

9.3.1 The award shall be set aside only if:

(i) the party making the application furnishes proof that:

  • a party to the arbitration agreement was under some incapacity;
  • the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any contrary indication, under Slovenian law;
  • the party was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present its case;
  • the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or contains a decision on matters beyond the scope of the submission to arbitration;
  • the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties; or 

(ii)  the court finds that:  

  • the subject matter is not capable of settlement by arbitration; or
  • the award itself violates public policy. 87 Ibid, ch 7, art 40(2).

9.3.2 The parties cannot waive their right to apply to set aside an award. 88 Ibid, ch 7, art 40(1).  It should be noted that setting aside an award does not automatically invalidate the underlying arbitration agreement. 89 Ibid, ch 7, art 40(6).

9.3.3 The court may, at its own discretion or if requested by a party to the dispute, suspend the proceedings to set aside the award for a period of time in order to provide the arbitral tribunal with an opportunity either to resume the arbitral proceedings or cure the grounds for setting the award aside. 90 Ibid, ch 7, art 40(5).  

10. RECOGNITION AND ENFORCEMENT OF AWARDS

10.1 Domestic awards

10.1.1 A domestic award is executable when the District Court in Ljubljana declares it enforceable. 91 Ibid, ch 8, art 41(1).

10.1.2 The court may reject an application for the enforcement of a domestic award if the court finds that the subject matter is not capable of settlement by arbitration or the award violates public policy. 92 Ibid, ch 8, art 41(2).

10.2 Foreign awards

10.2.1 Slovenia is a signatory state to the New York Convention. 93 See paragraph 1.1.1 above.

10.2.2 Foreign awards shall have binding effect when the District Court in Ljubljana recognises them. 94 Slovenian Arbitration Act, ch 8, art 42(1).  The party applying for enforcement of an award shall supply the original award or a copy of it. Additionally, a court may request that a party provides an original or a certified copy of the arbitration agreement. 95 Ibid, ch 8, art 42(4).

10.2.3 The grounds for refusing the enforcement of an award set out in the Model Law (1985) 96 Model Law (2006), ch 8, art 36 (see full text in http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf).  have not been specifically included in the provisions of the Slovenian Arbitration Act.

11. SPECIAL PROVISIONS AND CONSIDERATIONS

11.1 Consumers

11.1.1 Due to the nature of consumer relations, provisions governing consumer disputes are governed by a separate chapter of the Slovenian Arbitration Act. 97 Slovenian Arbitration Act, ch IX.  Provisions regarding the arbitration agreement, language of the arbitration and recourse against an award are adjusted in order to ensure the protection of the party with less bargaining power (ie the consumer).

11.1.2 Pursuant to the Consumer Protection Act, 98 Zakon o varstvu potrošnikov, Official Gazette of Republic of Slovenia Nos. 98/2004, 46/2006, 126/2007 and 86/2009, [http://www.uradni-list.si/1/objava.jsp?urlid=200498&stevilka=4288] (accessed 3 December 2011).  a consumer is a natural person who acquires or uses goods and services for purposes other than in the course of his or her business.

11.1.3 Unlike the Model Law (1985), the Slovenian Arbitration Act offers protection for consumers who are involved in arbitration. The arbitration agreement must be written in a separate document directly signed by the consumer (and not be contained in the commercial enterprise’s general terms and conditions). 99 Slovenian Arbitration Act, ch 9, art 45(2).  Therefore, an arbitration agreement between a commercial enterprise and a consumer can only be effectively concluded after the dispute has arisen. 100 Ibid, ch 9, art 45(1).

11.1.4 In addition to the general grounds for setting aside awards, the provisions relating to consumers include other grounds, such as violation of mandatory consumer protection provisions. 101 Ibid, ch 9, art 47.

11.2 Employment law

11.2.1 Provisions of the Slovenian Arbitration Act governing matters related to employment law are not based on the Model Law (1985).

11.2.2 If the subject of the arbitration is a labour dispute, 102 As defined by the Law on labour court proceedings. Zakon o delovnih in socialnih sodiščih, Official Gazette of Republic of Slovenia No. 2/2004, [http://www.uradni-list.si/1/content?id=46630&part=&highlight=.+Zak on+o+delovnih+in+soci alnih+sodi%C5%A1%C4%8Dih] (accessed 3 December 2011).  the Labour Court is the competent body to decide on: the questions relating to the jurisdiction of the arbitral tribunal; the setting aside of an award; the admissibility of arbitral proceedings; the appointment, challenge and termination of the mandate of an arbitrator; or recognition of the award. 103 Slovenian Arbitration Act, ch 10, art 48.

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Dunja Jandl
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