Hague court to rule on financial disputes
The Hague has launched a new international court in addition to its collection of judicial institutions. Prime Finance, an international tribunal for financial disputes, will deal with all kinds of knotty financial squabbles. More than 100 highly qualified judges will rule in the court’s cases. The court will boast the highest rate of decision making and its rulings will be impossible to contest. Experts are at odds over its future given that it is being created amid the second wave of a global financial crisis.
According to Prime Finance founders, the new court was set up in order to avoid any delays or unexpected turns in decision making at the local level. In times of crisis, these kinds of actions have to be precluded, or the price to pay for them could be too high. This becomes clear from the clashing rulings of the US and British courts on lawsuits against Lehman Brothers Holdings, which was declared bankrupt in 2008. Jeffrey Golden, Prime Finance head, comments.
“A tribunal for financial disputes marks a significant milestone in global finance. We’ll administer law and distribute rulings in London, or New York. In these countries the judges do their jobs perfectly well but the main problem until now was that their rulings were not always binding in the jurisdiction of one of the parties.”
The newly founded tribunal will consider cases which will be submitted to it with the consent of both parties. This will guarantee that its rulings will be mandatory. Thus Prime Panel will perform the functions of an arbitration court. Lawyer Vladimir Yurasov has this to say.
“According to international law, any country, or any legal entity, has the right to create an international court. In fact, it’s a sort of arbitration court. In their agreement the parties involved may make a reservation to the effect that in case there is a financial dispute, it will not be passed to courts on the territories of the defendant or the plaintiff, it will go to the financial tribunal in the Hague. The new court will not necessarily handle all financial disputes.”
Prime Finance will deliver rulings in a record short time, within one year, even on the most sophisticated and “costly” cases. It will also handle disputes between companies and states. Some media reports say that the creation of such a tribunal spells the oncoming default of a number of eurzone countries. They say investors are getting ready to face a sweeping financial turmoil. Economist Maxim Bratersky comments.
“The Westphalian system is as relevant as ever. The country’s ratings can be downgraded, it may be denied loans, but the international law knows no such mechanism which would make it possible to declare a country bankrupt and divide it between the creditors. No international court will help if a nation defaults. In that case, the entire system of international law will have to be changed. Prime Finance is a market-driven initiative launched by the Dutch in order to secure more international weight. It’s a private-public project with a vague future. However, I wouldn’t say that it’ll be totally useless.




