{"id":389846,"date":"2026-07-09T11:30:50","date_gmt":"2026-07-09T06:00:50","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=389846"},"modified":"2026-07-09T11:39:36","modified_gmt":"2026-07-09T06:09:36","slug":"regional-arbitration-centres-central-asia-south-caucasus-adr-ecosystems-eaw-2026","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2026\/07\/09\/regional-arbitration-centres-central-asia-south-caucasus-adr-ecosystems-eaw-2026\/","title":{"rendered":"From arbitration users to arbitration destinations: Central Asia and South Caucasus build stronger ADR ecosystems at IAC Eurasia Arbitration Week 2026"},"content":{"rendered":"
\n

International arbitration across Central Asia and the South Caucasus is entering a new phase of development. While London, Paris, Singapore and other established arbitration seats continue to dominate complex international disputes, jurisdictions across the region are steadily strengthening their legislative frameworks, arbitral institutions and judicial systems to position themselves as credible alternatives for resolving regional commercial disputes. Increasing cross-border investment, expanding infrastructure projects and evolving geopolitical realities have further accelerated this shift, prompting businesses and practitioners to reassess where disputes should be resolved.<\/p>\n

Against this backdrop, a panel at the Eurasian Arbitration Week 2026<\/span>, titled “Regional Update: ADR Trends in Central Asia & South Caucasus”<\/span>, examined how regional jurisdictions are modernising their arbitration frameworks while addressing practical challenges relating to judicial support, enforcement of arbitral awards, institutional development and investor confidence.<\/p>\n

Moderated by Usen Tastanbekov<\/span>, Associate at Kinstellar, the discussion featured Cristen Bauer<\/span>, Director of External Affairs at the Chartered Institute of Arbitrators (Ciarb); Mikhail Shuganov<\/span>, Associate at White & Case LLP; Akzhan Sheraliyeva<\/span>, Associate at GRATA International; Davit Tabatadze<\/span>, Head of Litigation at BLC Law Office and Chairman of the Georgian Association of Arbitrators; and Erik Manukyan<\/span>, Junior Associate at Sigma Law Group.<\/p>\n

\"\"<\/p>\n

Opening the discussion, Usen Tastanbekov<\/span> observed that arbitration clauses involving parties from Central Asia and the South Caucasus had traditionally designated institutions in Singapore, London, Switzerland and other established arbitration centres. However, he noted that commercial preferences are gradually evolving as businesses increasingly recognise the advantages offered by regional arbitration institutions that combine international standards with greater proximity, lower costs and familiarity with local commercial realities.<\/p>\n

Cost, accessibility and regional expertise driving a shift in arbitral seats<\/span><\/p>\n

The discussion began by examining whether jurisdictions within the region are beginning to emerge as preferred seats of arbitration rather than merely being places where disputes originate.<\/p>\n

\"\"<\/p>\n

Reflecting on Georgia’s experience, Davit Tabatadze<\/span> explained that the increasing cost of international arbitration has fundamentally altered how commercial parties evaluate dispute resolution mechanisms. While globally established arbitration centres remain attractive for high-value disputes, he suggested that many regional commercial disputes can be resolved more efficiently through institutions located closer to where business is conducted.<\/p>\n

According to Davit, regional arbitral institutions possess several inherent advantages. Beyond lower costs, they benefit from greater familiarity with local languages, commercial customs, legal traditions and business culture. Such proximity, he argued, often enables tribunals to better understand the commercial context within which disputes arise.<\/p>\n

He further observed that improving economic relations across the South Caucasus, particularly involving Armenia and Azerbaijan, are likely to generate increasing numbers of cross-border commercial disputes. Rather than referring every dispute to distant jurisdictions, regional institutions now have an opportunity to establish themselves as trusted forums for dispute resolution.<\/p>\n

Nevertheless, Davit emphasised that institutional growth alone would not guarantee success. The decisive factor remains confidence. Only by consistently delivering efficient, impartial and professionally administered arbitration can regional centres earn the trust necessary to attract international users.<\/p>\n

Erik Manukyan<\/span> echoed many of these observations while presenting Armenia’s experience. He acknowledged that established arbitration centres such as London and Paris continue to enjoy unparalleled reputations built over decades of institutional stability. However, commercial parties increasingly ask whether comparable legal services can be obtained within the region more quickly and at significantly lower cost.<\/p>\n

\"\"<\/p>\n

According to Erik, Armenia has sought to answer that question through sustained legislative reform.<\/p>\n

He explained that Armenian arbitration law, based on the UNCITRAL Model Law, has undergone important amendments following earlier judicial decisions that had restricted the arbitrability of disputes concerning contractual validity. Legislative reforms subsequently clarified that such disputes are capable of being resolved through arbitration while expressly incorporating the internationally recognised doctrine of separability, thereby confirming that the validity of an arbitration agreement survives any challenge to the underlying contract.<\/p>\n

Erik further highlighted Armenia’s growing institutional commitment to arbitration, noting that the Government itself has increasingly participated in arbitral proceedings, including disputes arising under FIDIC contracts. Complementing these reforms, Armenia has invested in specialist legal education through a dedicated LL.M. programme covering international arbitration, public international law and private international law. In his view, legislative reform, institutional engagement and professional education together provide the foundations necessary for developing a mature arbitration jurisdiction.<\/p>\n

Turning to Kazakhstan and the wider Central Asian region, Akzhan Sheraliyeva<\/span> explained that commercial parties are increasingly evaluating arbitration from a practical rather than symbolic perspective.<\/p>\n

\"\"<\/p>\n

Businesses, she observed, rarely choose arbitral institutions simply because of their international reputation. Instead, they focus on practical questions: whether proceedings will be efficient, whether tribunals possess appropriate expertise, how long disputes are likely to take and, ultimately, whether awards can be enforced.<\/p>\n

Where assets, witnesses and governing law are concentrated within Central Asia, she argued, referring disputes to regional institutions frequently represents the most commercially sensible option. Institutions such as the International Arbitration Centre operating within the Astana International Financial Centre have therefore become increasingly attractive to investors seeking efficient dispute resolution mechanisms while maintaining internationally recognised standards.<\/p>\n

At the same time, Akzhan stressed that arbitration should be viewed within the broader investment climate rather than in isolation. Strong arbitral institutions contribute to investor confidence, but they form only one element of the wider legal infrastructure supporting cross-border commerce.<\/p>\n

Judicial independence continues to define successful arbitration jurisdictions<\/span><\/p>\n

Although speakers expressed optimism regarding the growth of regional arbitration centres, Mikhail Shuganov<\/span> cautioned that institutional development alone cannot establish an internationally respected arbitration seat.<\/p>\n

\"\"<\/p>\n

He argued that every arbitration centre is ultimately judged by the quality of its judiciary.<\/p>\n

No matter how modern an arbitral institution or legislative framework may be, businesses will continue referring politically sensitive or high-value disputes to traditional arbitration centres unless domestic courts consistently demonstrate independence, competence and respect for arbitration.<\/p>\n

According to Mikhail, this remains one of the principal challenges confronting jurisdictions throughout the post-Soviet region.<\/p>\n

Illustrating this point, he examined practical issues arising under Article 503 of Kazakhstan’s Civil Procedure Code governing enforcement against foreign debtors. Divergent judicial interpretations, he explained, have created uncertainty regarding whether arbitral awards may be enforced against assets located within Kazakhstan where debtors are registered abroad.<\/p>\n

While some courts have interpreted the provision purposively to prevent debtors from avoiding enforcement, others have adopted narrower readings that potentially undermine effective enforcement. Such inconsistency, Mikhail argued, diminishes commercial certainty and discourages investment.<\/p>\n

He also discussed the ongoing debate regarding the jurisdiction of the AIFC Court to recognise and enforce foreign arbitral awards. Competing legal interpretations currently exist, making future appellate guidance particularly significant for the continued development of Kazakhstan’s arbitration framework.<\/p>\n

According to Mikhail, investors are less concerned with which legal interpretation ultimately prevails than with ensuring that judicial decisions remain predictable and consistent.<\/p>\n

Consistency, he suggested, is one of the strongest indicators of a mature arbitration jurisdiction.<\/p>\n

Arbitration succeeds only when awards can be enforced<\/span><\/p>\n

While the discussion on institutional development reflected the region’s growing ambition to become a preferred destination for commercial arbitration, the panellists repeatedly returned to one central proposition: the effectiveness of arbitration ultimately depends on the enforceability of arbitral awards.<\/span> Regardless of the quality of legislation, arbitral institutions or procedural rules, arbitration cannot command business confidence unless successful parties are able to realise the benefits of the awards they obtain.<\/p>\n

Introducing this segment of the discussion, Usen remarked that recognition and enforcement represent the true measure of an arbitration-friendly jurisdiction. Sophisticated arbitration laws and experienced tribunals, he observed, have little practical value if parties encounter significant obstacles when seeking to enforce awards before domestic courts.<\/p>\n

The discussion that followed demonstrated that although Armenia, Georgia and Kazakhstan have adopted different approaches to enforcement, all three jurisdictions continue to strengthen judicial support for arbitration while addressing practical challenges arising in cross-border disputes.<\/p>\n

Armenia combines efficient enforcement with judicial support<\/span><\/p>\n

Sharing Armenia’s experience, Erik described the country’s judicial approach as consistently supportive of arbitration. He noted that Armenian courts have generally recognised and enforced both domestic and foreign arbitral awards, reinforcing confidence among commercial users that arbitration agreements will be respected and awards effectively implemented.<\/p>\n

One notable feature of Armenian legislation, according to Erik, is the simplified enforcement procedure applicable to certain domestic arbitral awards. Where an award does not exceed AMD 5 million, it may proceed directly to the enforcement authorities without first obtaining a writ of execution from the courts. This mechanism, he explained, was introduced to reduce procedural delays, lower costs and encourage greater use of domestic arbitration.<\/p>\n

At the same time, Erik acknowledged that expedited enforcement raises legitimate questions regarding procedural safeguards. Although the simplified mechanism promotes efficiency, situations may arise in which awards containing obvious procedural irregularities proceed directly to enforcement without prior judicial review. Whether similar procedures should apply to larger disputes, he suggested, remains a matter requiring careful consideration.<\/p>\n

He also highlighted Armenia’s legislative recognition of interim measures issued by arbitral tribunals. While the New York Convention principally governs the recognition and enforcement of final awards, Armenian law extends enforceability to provisional measures ordered during arbitral proceedings. This provides parties with meaningful protection while arbitration remains ongoing and reflects the country’s broader commitment to facilitating effective dispute resolution.<\/p>\n

According to Erik, these developments collectively illustrate Armenia’s intention to strengthen every stage of the arbitral process, from commencement of proceedings to the successful enforcement of awards.<\/p>\n

Georgia emphasises judicial efficiency and limited court intervention<\/span><\/p>\n

Providing the Georgian perspective, Davit focused on the practical relationship between arbitration and domestic courts.<\/p>\n

Drawing upon his own experience, he explained that parties requiring urgent relief frequently achieve better results by approaching Georgian courts directly rather than seeking interim measures from arbitral tribunals in the first instance.<\/p>\n

Applications for provisional measures, he observed, are commonly decided within twenty-four hours, allowing courts to preserve assets before they can be dissipated. By contrast, interim measures issued by arbitral tribunals generally require additional judicial procedures before becoming enforceable, potentially delaying effective relief.<\/p>\n

Accordingly, even parties involved in international proceedings administered by institutions such as the International Chamber of Commerce may immediately seek protective measures before Georgian courts once arbitration has commenced.<\/p>\n

Beyond interim relief, Davit reiterated that judicial support remains the single most important factor influencing confidence in arbitration.<\/p>\n

While acknowledging the importance of modern legislation, institutional development and professional education, he maintained that these efforts cannot substitute for an independent judiciary capable of understanding arbitration’s limited relationship with national courts.<\/p>\n

Georgia’s judicial framework, he explained, reflects this philosophy.<\/p>\n

Applications for recognition and enforcement of international arbitral awards are considered directly by the Supreme Court of Georgia, which has consistently demonstrated a pro-arbitration approach. Davit recalled a recent decision concerning a multi-tier dispute resolution clause requiring mediation before arbitration. Although the arbitral tribunal had initially proceeded without mediation, it subsequently suspended proceedings to permit compliance with the contractual dispute resolution process before continuing the arbitration.<\/p>\n

When enforcement later came before the Supreme Court, the Court concluded that the issue concerned procedural management rather than jurisdiction. Because the tribunal had ultimately respected the parties’ contractual agreement, enforcement was granted. According to Davit, the decision illustrated appropriate judicial restraint by recognising that procedural questions arising during arbitration should ordinarily remain within the tribunal’s discretion.<\/p>\n

He acknowledged that some lower courts continue to adopt a more interventionist approach, particularly in consumer disputes where judges may be inclined to examine the substance of arbitral awards. Nevertheless, he considered the overall direction of Georgian jurisprudence to be strongly supportive of arbitration.<\/p>\n

Georgia’s enforcement infrastructure, he added, further contributes to that confidence. Comprehensive public registration systems for real property and corporate interests, together with effective mechanisms for identifying other assets, enable successful parties to enforce awards relatively efficiently once judicial recognition has been obtained.<\/p>\n

Enforcement begins long before the award is rendered<\/span><\/p>\n

Although much of the discussion focused on judicial practice, Akzhan reminded the audience that successful enforcement depends as much upon careful preparation by practitioners as upon the courts themselves.<\/p>\n

In her view, enforcement should never be regarded as merely the final procedural stage following an arbitral award. Instead, it should influence decision-making from the earliest stages of drafting commercial contracts.<\/p>\n

Parties, she explained, should identify the location of assets before disputes arise, carefully select the appropriate arbitral seat and ensure that arbitration agreements are drafted with sufficient precision to minimise future jurisdictional challenges.<\/p>\n

Equally important is strict compliance with procedural requirements throughout the arbitration itself.<\/p>\n

According to Akzhan, practitioners should ensure that arbitration agreements remain valid, that parties receive proper notice of proceedings and that each party has a genuine opportunity to present its case. Comprehensive documentation supporting these matters becomes particularly important when recognition and enforcement applications are later brought before domestic courts.<\/p>\n

She further observed that while courts should confine themselves to the limited grounds permitted for refusing recognition and enforcement, judges occasionally examine broader issues, particularly where arguments concerning public policy are raised. Careful procedural compliance therefore remains one of the most effective safeguards against unnecessary challenges during enforcement proceedings.<\/p>\n

Her comments reflected a practical theme running throughout the discussion: successful arbitration depends not only upon favourable legislation but also upon meticulous legal practice.<\/p>\n

Building judicial confidence through education<\/span><\/p>\n

The discussion then broadened beyond enforcement to consider how governments can strengthen judicial understanding of arbitration.<\/p>\n

Responding to questions from Usen, Cristen Bauer<\/span> argued that judicial education represents one of the most important investments emerging arbitration jurisdictions can make.<\/p>\n

\"\"<\/p>\n

Although judges possess extensive legal experience, arbitration operates according to specialised principles that differ significantly from ordinary litigation. Without appropriate training, courts may unintentionally exceed their supervisory role by reviewing the merits of arbitral awards rather than confining themselves to the recognised grounds for judicial intervention.<\/p>\n

Cristen emphasised that specialised judicial education should address the role of interim measures, recognition and enforcement proceedings, setting aside applications and the principle that arbitration is intended to provide finality rather than create an additional layer of judicial appeal.<\/p>\n

She suggested that judicial academies and continuing education programmes provide effective mechanisms for delivering such specialised training.<\/p>\n

In addition, Cristen highlighted the advantages of specialised commercial courts.<\/p>\n

Rather than requiring every judge within a judicial system to develop expertise in arbitration, dedicated commercial benches enable judges to acquire experience through repeated exposure to arbitration-related disputes. Such specialisation, she explained, promotes greater consistency, predictability and confidence among domestic and international commercial users alike.<\/p>\n

Throughout the discussion, a common theme emerged: legislative reform, institutional development and judicial education are not independent initiatives but complementary elements of a broader arbitration ecosystem. Sustainable growth requires progress across each of these areas simultaneously.<\/p>\n

Building an arbitration ecosystem: legislation, institutions and trust must evolve together<\/span><\/p>\n

As the discussion progressed beyond country-specific developments, the panel turned to a broader question: what separates jurisdictions that merely adopt modern arbitration laws from those that become internationally recognised arbitration hubs?<\/p>\n

Drawing upon her experience in commercial law reform and international arbitration, Cristen argued that successful arbitration jurisdictions are not created through legislative reform alone. While many emerging jurisdictions have modernised their arbitration statutes, genuine success depends upon developing an entire dispute resolution ecosystem in which legislation, institutions and market confidence evolve together.<\/p>\n

She proposed a three-part framework for jurisdictions seeking to establish themselves as regional and international centres for ADR.<\/p>\n

The first pillar, she explained, is a modern legislative framework aligned with international best practices. This includes adopting internationally recognised principles reflected in the UNCITRAL Model Law, ensuring effective implementation of the New York Convention and, where appropriate, embracing newer international instruments such as the Singapore Convention on Mediation. However, she cautioned that legislation alone cannot transform an arbitration jurisdiction. Even perfectly drafted laws remain ineffective if they exist only “on the shelf” without practical implementation.<\/p>\n

The second pillar concerns institutions. Independent and impartial courts capable of recognising, enforcing and supporting arbitral proceedings are indispensable to any successful arbitration system. Equally important are competent arbitral institutions that can administer proceedings efficiently while maintaining procedural integrity and professional credibility. Throughout the discussion, several panellists had emphasised that commercial users ultimately judge arbitration not only by procedural rules but by the reliability of the institutions responsible for administering and supporting those rules.<\/p>\n

The third pillar focuses on culture. According to Cristen, arbitration cannot flourish unless businesses, governments, lawyers and judges actively embrace ADR as a legitimate and effective method of dispute resolution. This requires developing both the supply side and the demand side of arbitration. Jurisdictions must cultivate experienced arbitrators, counsel and academics while simultaneously encouraging transactional lawyers, in-house counsel and commercial parties to incorporate arbitration clauses into contracts with confidence.<\/p>\n

Viewed collectively, her framework reinforced many of the themes raised by the other speakers. Legislative reform, institutional credibility, judicial independence, legal education and commercial confidence were repeatedly presented not as isolated objectives but as interconnected elements supporting the same ecosystem.<\/p>\n

Geopolitical developments continue to reshape international arbitration<\/span><\/p>\n

The final segment of the panel addressed the growing influence of geopolitical developments on cross-border dispute resolution.<\/p>\n

Inviting Mikhail to examine these developments, Usen noted that sanctions, changing international relations and competing jurisdictional frameworks increasingly affect the drafting and enforcement of arbitration agreements involving Russian parties. Against that background, he asked Mikhail to explain the operation of the so-called Lugovoy Law<\/span> and its implications for arbitration across Central Asia.<\/p>\n

Mikhail began by clarifying the legislation itself.<\/p>\n

Commonly referred to as the “Lugovoy Law”, the amendments introduced Articles 248.1 and 248.2 of the Russian Arbitrazh Procedure Code. Article 248.1 permits Russian commercial courts to assume jurisdiction over disputes involving sanctioned Russian parties notwithstanding previously agreed arbitration clauses or exclusive jurisdiction agreements. Article 248.2 further empowers Russian courts to impose financial penalties where foreign parties continue arbitration proceedings despite proceedings having been initiated before Russian courts.<\/p>\n

According to Mikhail, these provisions have fundamentally altered the strategic considerations surrounding disputes involving sanctioned Russian entities.<\/p>\n

Although some observers initially anticipated that sanctions would redirect a significant volume of disputes towards Central Asian arbitration institutions, he observed that many parties have instead gravitated towards established Asian arbitral centres, particularly Hong Kong. Nevertheless, institutions within Central Asia, including the International Arbitration Centre (IAC)<\/span> at the Astana International Financial Centre, have also attracted increasing attention as businesses seek alternative dispute resolution venues outside traditional European seats.<\/p>\n

Enforcement challenges extend beyond arbitration agreements<\/span><\/p>\n

Mikhail further explained that the practical implications of the Lugovoy Law extend well beyond questions of jurisdiction.<\/p>\n

While arbitral awards rendered under the New York Convention generally continue to benefit from established international enforcement mechanisms, judgments delivered by the AIFC Court do not enjoy automatic recognition in Russia under the regional treaty framework applicable to certain post-Soviet jurisdictions. Consequently, parties must distinguish carefully between enforcement strategies relating to arbitral awards and those involving court judgments.<\/p>\n

He observed that courts throughout Central Asia may increasingly confront difficult policy questions.<\/p>\n

Where parties seek enforcement against Russian assets located within the region, domestic courts must balance competing considerations. Strict adherence to international arbitration obligations may generate political sensitivities, while reluctance to enforce awards risks undermining investor confidence and diminishing the credibility of regional arbitration jurisdictions.<\/p>\n

Similarly, requests to recognise judgments issued pursuant to the Lugovoy Law itself may eventually require domestic courts to reconcile competing obligations arising under national legislation, international arbitration agreements and multilateral enforcement conventions.<\/p>\n

Although these issues remain largely unresolved, Mikhail noted that no consistent regional approach has yet emerged regarding recognition or enforcement of judgments arising under the Lugovoy framework. Future judicial decisions are therefore likely to play a significant role in shaping arbitration involving Russian parties across Central Asia.<\/p>\n

Confidence, consistency and cooperation will determine the region’s future<\/span><\/p>\n

Although the panellists approached the discussion from different jurisdictions and professional perspectives, several common themes consistently emerged throughout the session.<\/p>\n

First, legislative reform alone is insufficient. Modern arbitration laws provide an essential foundation, but commercial parties ultimately evaluate jurisdictions by examining how those laws are interpreted and applied by domestic courts.<\/p>\n

Secondly, judicial independence and predictability remain central to the continued development of arbitration across the region. Speakers repeatedly emphasised that commercial users are willing to resolve disputes before emerging arbitral institutions only where they have confidence that courts will respect arbitration agreements, exercise appropriate judicial restraint and enforce arbitral awards consistently.<\/p>\n

Thirdly, institutional credibility depends upon sustained investment in education, professional development and practical experience. Armenia’s specialised academic programmes, Georgia’s increasingly supportive judicial practice, Kazakhstan’s institutional reforms and Cristen’s emphasis on judicial training all reflected the broader recognition that arbitration ecosystems require continuous investment rather than one-time legislative change.<\/p>\n

Finally, the discussion demonstrated that geopolitical developments are becoming an increasingly important component of international arbitration strategy. Questions concerning sanctions, enforcement, competing jurisdictional claims and cross-border recognition of awards are no longer peripheral considerations but have become central to advising commercial clients operating throughout the region.<\/p>\n

A region moving from arbitration users to arbitration destinations<\/span><\/p>\n

The discussion concluded on a cautiously optimistic note.<\/p>\n

While speakers acknowledged that London, Paris, Singapore and other established arbitration centres continue to dominate the global arbitration landscape, they also recognised that Central Asia and the South Caucasus have made substantial progress in developing the legal and institutional foundations necessary to compete more effectively for regional disputes.<\/p>\n

Legislative modernisation, stronger arbitral institutions, increasing judicial engagement, improved legal education and expanding commercial activity are gradually reshaping the region’s arbitration landscape. At the same time, unresolved questions concerning enforcement, judicial consistency and the interaction between arbitration and rapidly evolving geopolitical realities underscore that the region’s development remains a work in progress.<\/p>\n

The panel ultimately reflected a shared conviction that the future of arbitration in Central Asia and the South Caucasus will not be determined solely by the adoption of modern legislation or the establishment of new arbitral institutions. Rather, sustained success will depend upon building confidence among investors, businesses, practitioners and courts alike and that regional jurisdictions can deliver independent, efficient and internationally credible dispute resolution.<\/p>\n

As regional economies become increasingly interconnected and cross-border commerce continues to expand, the discussion suggested that Central Asia and the South Caucasus are steadily evolving from jurisdictions that primarily export disputes to established arbitration centres into jurisdictions capable of resolving an increasing share of those disputes themselves. That transition, the panellists agreed, represents one of the most significant developments shaping the future of international arbitration across the region.<\/p>\n

Read more IAC Eurasia Arbitration Week 2026 coverage:<\/p>\n