The number of contracts between business entities with an arbitration clause has been increasing since 2007, after the law of the Republic of Uzbekistan on Arbitration Courts came into force. This clause states that, if the conflicting sides fail to resolve a dispute through negotiations, the matter goes to arbitration. Businessmen began to use this alternative – to the state courts - way of solving the conflicts more often. Because the decisions made by arbitral courts have the same legal effect as the decisions done by civil or economic courts.

The fact that entrepreneurs provide in their contracts that the means of solving possible disputes is the arbitration, shows their desire to build long-term, fruitful and mutually beneficial relations. Quickness of adjudicating, the possibility for parties to choose arbitrators from among the experts to whom both of them trust,  less financing costs – all this features do not make the complete list of the advantages which arbitration has. It passes in the form of business negotiations, during which the arbitrator helps to find the legitimate way out of conflicting situation that can satisfy the both sides.

The law provides two form of arbitration. The firs one is permanently functioning arbitration court which works under juridical persons. The second type is temporal court, which is created for a particular case. Extensive use is made of permanent courts. The entrepreneurs greatly rate the option to choose the judge from among highly qualified specialists, who are ready to give detailed and professional review of a dispute.

Two large network of permanent arbitration courts have evolved in the country. The Association of the arbitration courts embodies some 140 courts, while 14 other tribunals operate under Uzbekistan’s Chamber of Commerce and Industry.

The work of arbitration courts is backed by purviews of the law, which provides an opportunity to dispute the decision of the arbitral court in state courts or to assure its enforcement. To cite an illustrative example, economic courts of the republic only, since the beginning of the year, have reviewed nearly 150 applications on enforceable judgment or disaffirmation of the courts decision.

Yet, business has to fully bring into play the existing potential of the arbitration courts. The promotion of this form of legal proceedings continues. Along with the Center of Legal Problems Studying, the Chamber of Commerce and Industry, and the Association of the arbitration courts an active part in this process in taken by the Ministry of Justice, which publishes, on its official website www.minjust.gov.uz, the information about permanently operating arbitration courts.

The legal basis for the development of arbitral procedure in Uzbekistan has been laid before the adoption of the Law on Arbitration Courts. It was specified in the article of the legislation, allowing the dispute to arbitration. Uzbekistan has recognized the possibility of arbitration, after joining to a number of international conventions and agreements, including New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States, the Agreement on the Settlement of Disputes relating to the Implementation of Economic Activity. But the state needed an entire law which could provide procedural rules for the establishing of arbitration courts in the country and examining cases by them.

The first arbitration court was created in Uzbekistan at the Center of Legal Problems Studying, back in 2002, and until 2007 it remained the only such organization in the country. New courts were not opened simply because the decisions of the arbitral courts were not mandatory. Until the adoption of the Law on Arbitration Courts, arbitration tribunal had not mechanism for enforceable judgment. When this regulatory document entered into force the decisions of arbitration courts were equated to those made by economic and civil courts. Today, the arbitral tribunals are not only being reckoned with, but also they are often chosen as the most appropriate way of dealing with commercial disputes between businesses.

The law of the Republic of Uzbekistan on Arbitration Courts has stimulated this form of legal proceedings in the country, which corresponds by its principles to the interests of the entrepreneurs and to international practice of business development. This law has set in Uzbekistan for the first time the rules of organization and operation of arbitration courts, the rules of their interrelation with public authorities. Now, the arbitration courts of Uzbekistan hear all disputes arising from civil relations. Except for claims between parties, which arise from administrative, family and work relationships, as well as disputes whose jurisdiction is determined by the legislation.

After the adoption of the law of the Republic of Uzbekistan on Arbitration Courts, changes to promote the courts activities were made in some normative acts, including the Civil Code, and in some laws "On the legal basis of business entities," "On the service of judicial acts and acts of other legal institutions", "On guarantees and measures to protect the rights of foreign investors."

Thus, the republic has created sufficient legal basis for the arbitration courts’ activity. Arbitration courts in Uzbekistan are not subject to any governmental authorities and are guided in their activities only by law. At the same time they are recognized and supported by the state as the law enforcement authority in executing justice.

Concentration of permanent arbitration courts in the Chamber of Commerce and Industry and in the Association of the arbitration courts of Uzbekistan favors the development of their infrastructure, and ensures high quality in dispute resolution.

Personnel recruitment is important factor in providing good quality of arbitration, like in any other organization. The courts, created at the Association of arbitration courts, introduced rules, according to which the judge must be a citizen of Uzbekistan and has to possess the certificate issued by the Higher Attestation Commission of the Association. The same conditions have been implemented in arbitration courts of the Chamber of Commerce and Industry, when Arbitration Development Center deals with the certification of the judges. In both cases, contenders for the certificate pass a qualifying exam to the commission, composed of experienced arbitrators, representatives from the Ministry of Justice of the Republic of Uzbekistan, state courts and legal scholars.

The Arbitration Development Center under the Chamber of Commerce and Industry of Uzbekistan actively implements the programs on training. In this regard, the Center organizes schools and internships. Not only leading local experts, but also foreign ones are invited to conduct lectures. In addition, the Center offers an opportunity for arbitrators from Chamber of Commerce and Industry of Uzbekistan to pass in-depth training in similar institutions of Great Britain, Russia and Slovenia. While the Association of arbitration courts, to meet his challenges, has created the Academy of Arbitrators. The academy deals with the retraining of lawyers, willing to work as arbitrators, and gives further training to those who are already working.

"Consulting and Mediation" is a network of affiliates working under the Association of arbitration courts. They prepare the contending parties to the arbitration dispute. This allowed to almost entirely eliminate misfit sues to the court with disputes which are not within the jurisdiction of arbitral courts, and in some cases even to resolve disputes without bringing it to trial.

At the initiative of the Chamber and the Association, international conferences on the development of arbitration were held several times. The conferences became the floor to exchange experience for specialists from Belgium, France Japan, Uzbekistan, India, Kazakhstan, Russia, Singapore and from other countries. Foreign experts are unanimous that in a short period of intensive development of arbitration courts, Uzbekistan has managed to achieve great results in this sphere and to gain experience, which deserves examination.

 Association of arbitration courts also contributes to the ensuring of judges with necessary periodicals and professional literature. In particular, a specialized newspaper Arbitraj va Huquq (Arbitration and the Law) is being published in the country. Special website www.arbitration.uz works on the Internet. The Association and the Chamber contribute to provision with professional literature, which are prepared and published with active engagement of the Center of Legal Problems Studying. This organization has prepared and issued a commentary on the law of the Republic of Uzbekistan on Arbitration Courts, the book "Arbitration Courts in Uzbekistan. Analysis and Trends of the Development" and a number of methodological publications.

During the years of independence, the country's entrepreneurs have become full members of international relations and strategic partners for foreign companies. This implies arbitration’s further course of development in the country - the establishment of international commercial arbitrations.

International commercial arbitrations are already established and are functioning at Tashkent’s branch of the Association of the arbitration courts and the Chamber of Commerce and Industry. They are guided by the law of Uzbekistan on Arbitration Courts, but in order to correspond with global practice of international commercial arbitration, a special law that would provide inclusion in the panel of judges foreign citizens is needed. According to experts from the Association of the arbitration courts of Uzbekistan, such law will be developed and introduced to Oliy Majlis as early as next year.

The development of international commercial arbitration in Uzbekistan will promote further progress in the economy. As, those disputes which are currently referred to the foreign arbitration courts, will be viewed in Uzbekistan, with lower financial costs.

In addition, experts believe that Uzbekistan is ready to develop international arbitration in the country. The republic has successful experience in arbitration and it has specialists-lawyers currently working as arbitrators in foreign international commercial arbitrations.

The first arbitral court in Uzbekistan was found in 2002 under our Center. A lot has changed since than. The adoption of the law of the Republic of Uzbekistan on Arbitration Courts defined not only the principles of organization and operation of the court, but also their standards of interrelation with public authorities, and the execution of decisions of the arbitration courts. All this has strengthened the reputation of this legal institute.

The creation of the Association of the arbitration courts of Uzbekistan was an important event. In spite of the fact that it functions only three years, it greatly contributed to the development and strengthening the system of legal proceedings in Uzbekistan. With its active participation the arbitration courts have been created in all regions of the republic, and already almost in all rural areas of the country. Moreover, the association pays great attention to the quality of the courts. The Academy of the arbitration courts was established in Uzbekistan. Special system of professional certification is introduced in the republic. The newspaper «Arbitraj i pravo» (Arbitration and Law) is published.

 My personal view is that, the adoption, in future, of the law «On international commercial arbitration» would be the next stage of development of arbitration legal proceedings in the country.

The association has been created in May 2009. The structure of Association’s central office consists of six departments; it also has higher qualifying commission on selecting candidates to arbitration judges and their conferment with qualifying classes. In sum, the commission has led 25 sessions and promotion examinations, where more than 700 candidates participated. Those who were the most worthy were recommended as arbitration judges.

 To prepare and improve professional skills of the judges, this year, we have created Academy of arbitration judges. To spread information about arbitration mechanism we publish a newspaper ‘Arbitration and the Law’ in three languages.

Since our beginning, we pay great attention to creation of arbitral courts in the regions of the country. We think that each city and each village should have its own arbitral court.

In the last eleven months of 2011 in the arbitration courts of the Association has received 7,010 claims in excess of 80.8 billion soums have already reviewed 6,847 statements, the rest are pending. For comparison, note that for the full year 2010 we have all been considered only the case in 1,103.

We pay much attention to study foreign experience. For this purpose, we have signed contracts with major arbitration associations from 18 countries, and recently Tashkent held a major international conference on the development of arbitration courts.

Uzbekistan’s arbitration courts started to intensively develop in 2006, with the adoption of the law of the Republic of Uzbekistan on Arbitration Courts. The Ministry of Justice of the Republic of Karakalpakstan, justice departments of the regions and Tashkent carry out registration of permanently and temporarily operating arbitration courts. Today, Uzbekistan has 154 constantly operating arbitration courts, where more than 700 judges work. Generalized data on this matter on a regular basis is being published by the Ministry of Justice on book “Collection of the legislation of the Republic of Uzbekistan” and on the official website of the ministry. The majority of the arbitration courts function under the Chamber of Commerce and Industry and the Association of arbitration courts of Uzbekistan and in their territorial divisions.

We represent a new product on Uzbekistan’s legal services market – a pre-trial form of dispute resolution. By the way, the world's legal practice is heading toward this usage, to resolve most disputes at this stage.

Our consulting services help the parties to analyze the situation in detail and to see legal options to go out from it. Often, this becomes sufficient that the parties came to a mutual agreement in resolving the dispute. The conciliation stage of the dispute with the participation of our specialists, according to world accepted terminology is called mediation.

In general, our work contributes to normal operation of courts. First, we introduce the conflicting parties with detailed information about the rules of dispute resolution, both in economic and arbitration courts. Secondly, we name them the documents which will be needed in the course of the dispute. After this, the parties go to the court with already prepared package of documents.

International Commercial Arbitration is a new division in the Chamber of Commerce and Industry. We differ from arbitration courts by the fact that we specialize in disputes between businesses when foreign companies involved. This week we will consider our first case.

Our international commercial arbitration operates in accordance with the law of the Republic of Uzbekistan on Arbitration Courts. But in order that its activity conforms to worldwide accepted idea about international commercial arbitration, we need a law that will allow us to include foreign citizens in a panel of judges.

I think that in the coming years, international commercial arbitration will also receive an intensive development in Uzbekistan. Necessary legal documents are already being prepared for consideration. International commercial arbitration is times’ requirement, which is dictated by the desire of local entrepreneurs to develop relations with foreign partners.

The number of disputes considered in arbitration courts increases, this trend will undoubtedly continue, as many entrepreneurs only now began to acquaint with abilities of arbitration.

 Arbitration tribunals have many good features such as: quickness of a dispute consideration; possibility for parties to choose judges from among professionals they both trust; less financial cost; the process looks more like a business negotiation, than a trial; short term of case examination - all this is just what entrepreneurs appreciate the most.

Further popularization of the arbitration will discharge to some extent the work of civil and commercial courts. And ultimately, this will contribute to improve the quality of dispute resolution in all courts.

Academy of arbitration boosts professional development of lawyers and retrains economists, acting as arbitrators. The creation of the Academy is a timely decision; it was required by necessity to train specialists for arbitration in region.

It is noteworthy to say that today the judges themselves are interested in taking advanced training in our academy. This is primarily due to the fact that the arbitration adjudication is still a new phenomenon to our country, and the specialists coming to work in these courts do not have enough practical experience in arbitration. In addition, each judge understands that his experience and skills heavily affect his employment, and his further perspectives to be demanded as a judge.

In the Academy, classes pass in "master class" mode. Here we discuss in detail the practical application of provisions of the law of the Republic of Uzbekistan on Arbitration Courts. We invited to give lectures leading experts from Lawyers Training Center, Tashkent Institute of Law, judges who have good experience in this area, and specialists from ministries and departments.