On April 28, 2026, the Higher Regional Court of Stuttgart once again confirmed that arbitral awards ordering performance in violation of sanctions are not enforceable in Germany—thus building on its landmark decision of 13 May 2025. A Gleiss Lutz team was also successful in this second proceeding on behalf of another German company based in Baden-Württemberg.
Prior to the start of Russia’s war of aggression against Ukraine, the parties had entered into supply and service contracts for production line machinery that included an arbitration clause designating Russia as the place of arbitration; after the war began, performance of these contracts violated EU sanctions. The International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation (MKAS) issued an award ordering the respondent to perform acts in violation of sanctions. The Higher Regional Court of Stuttgart rejected the application for a declaration of enforceability on the grounds that there was a violation of public policy and that one of the arbitrators had failed to disclose his appointment in a parallel arbitration proceeding in which Gleiss Lutz was acting on behalf of another German company in the recognition proceedings.
The Higher Regional Court of Stuttgart has reaffirmed its case law regarding the non-recognition of arbitration awards that violate sanctions. An appeal to the Federal Court of Justice may be filed against this decision.
The following Gleiss Lutz team advised on the case before the Higher Regional Court of Stuttgart: Prof. Stephan Wilske (partner), Dr. Claudia Krapfl (counsel), Dr. Friedrich Weyland (all Dispute Resolution/Arbitration, Stuttgart).
For further information, please see https://www.gleisslutz.com/en/news-events/know-how/disputes-russian-companies-protecting-european-companies-against-enforcement-russian-judgments-and-arbitral-awards
Forward
