An arbitration clause is an autonomous agreement and does not terminate in connection with the termination of the main contract – SC CommCC

An arbitration clause incorporated into a contract is a separate (autonomous) procedural agreement, the validity and enforceability of which do not depend on the validity or termination of the main contract.

This conclusion was reached by a panel of judges of the Commercial Cassation Court within the Supreme Court.

A state-owned enterprise filed a claim against a limited liability company for the recovery of the principal debt under a services agreement, as well as a fine, inflationary losses, 3 per cent per annum, and a penalty, due to improper performance of monetary obligations.

By a ruling of the commercial court, which was upheld by the resolution of the appellate commercial court, the claim was left without consideration on the basis of paragraph 7 of Part 1 of Article 226 of the Commercial Procedure Code of Ukraine. The courts established that clause 8.1 of the contract contained an arbitration clause referring all disputes to arbitration in Stockholm (Sweden) in accordance with the Rules of the Arbitration Institute of the Stockholm Chamber of Commerce, and that the defendant had submitted objections to the consideration of the dispute by the commercial court within the prescribed time limit.

Disagreeing with those decisions, the state-owned enterprise lodged a cassation appeal, arguing, inter alia, that the contract had been terminated due to the claimant’s unilateral refusal, and therefore the arbitration agreement was invalid. The appellant also claimed that there were no grounds for the dispute to be heard by an international commercial arbitral tribunal.

When reviewing the case, the Commercial Cassation Court of the Supreme Court, among other things, noted that the principle of autonomy (separability) means that an arbitration clause is a separate agreement and does not terminate automatically in connection with the termination or challenge of the main contract.

The Commercial Cassation Court of the Supreme Court emphasised that the termination of the contract does not affect the validity of the arbitration clause.

At the same time, the Commercial Cassation Court of the Supreme Court pointed out that the appellate court had erroneously assessed the circumstances of the contract’s termination when deciding on the application of paragraph 7 of Part 1 of Article 226 of the Commercial Procedure Code of Ukraine, as this went beyond the scope of verifying the validity and enforceability of the arbitration agreement.

In addition, the Supreme Court noted that the defendant is an enterprise with foreign investment, and therefore referring the dispute to international commercial arbitration complies with the requirements of the Law of Ukraine “On International Commercial Arbitration”.

Following the cassation review, the Commercial Cassation Court of the Supreme Court concluded that the cassation appeal should be partially satisfied. It decided to amend the reasoning part of the appellate court’s resolution, setting it out in the wording used in the resolution of the Supreme Court, while leaving the court decisions unchanged in all other respects.

Resolution of the Commercial Cassation Court of the Supreme Court dated 12 February 2026 in case No. 911/2618/25 — https://reyestr.court.gov.ua/Review/134265576.

This and other legal positions of the Supreme Court can be found in the Database of Legal Positions of the Supreme Court - https://lpd.court.gov.ua.