Judgment of the Supreme Court of Ukraine in case 824/62/25 dated 22 January 2026

RESOLUTION

IN THE NAME OF UKRAINE

22 January 2026, Kyiv

case No. 824/62/25, proceeding No. 61-10749av25

The Supreme Court, sitting as a panel of judges of the Second Judicial Chamber of the Civil Cassation Court: V. M. Korotun (Judge-Rapporteur), Ye. V. Korotenko,

M. Ye. Chervynska,

with the participation of:

the secretary of the court hearing M. O. Kalishenko,

the representative of Caribalt Alliance OU (Republic of Estonia), Maryna Oleksandrivna Vitlina, and the representative of Amikum Farma Limited Liability Company (Ukraine), Oleksandr Oleksandrovych Hudilin,

participants in the case:

applicant (debtor in the arbitration case): Caribalt Alliance OU (Republic of Estonia); interested party (creditor in the arbitration case): Amikum Farma Limited Liability Company (Ukraine),

having considered in an open court hearing the appeal of Caribalt Alliance OU (Republic of Estonia), filed by its representative Maryna Oleksandrivna Vitlina, against the ruling of the Kyiv Court of Appeal of 14 July 2025 rendered by Judge T. Ts. Kashperska in the case on the application of Caribalt Alliance OU (Republic of Estonia) to set aside the award of the International Commercial Arbitration Court at the Ukrainian Chamber of Commerce and Industry of 24 February 2025 in case

No. 246/2024 on the claim of Amikum Farma Limited Liability Company (Ukraine) against Caribalt Alliance OU (Republic of Estonia) for recovery of funds,

ESTABLISHED:

HISTORY OF THE CASE

In May 2025, Caribalt Alliance OU (Republic of Estonia) (hereinafter, Caribalt Alliance OU) applied to the court with an application to set aside the award of the International Commercial Arbitration Court at the Ukrainian Chamber of Commerce and Industry (hereinafter, the ICAC at the Ukrainian Chamber of Commerce and Industry) of 24 February 2025 in case No. 246/2024 on the claim of Amikum Farma Limited Liability Company (Ukraine) (hereinafter,

Amikum Farma LLC) against Caribalt Alliance OU for recovery of funds.

The application was reasoned by the fact that on 27 November 2023 Amikum Farma LLC

and Caribalt Alliance OU concluded contract No. 27/11, the subject matter of which is the supply of infant food for medical purposes.

By the award of the ICAC at the Ukrainian Chamber of Commerce and Industry of 24 February 2025 in case No. 246/2024, the following amounts were recovered from Caribalt Alliance OU in favour of Amikum Farma LLC: EUR 3,620.07 in accrued penalty, EUR 210.00 for safekeeping of the second batch of goods, EUR 16,411.92 in damages caused and EUR 1,820.31 in reimbursement of the arbitration fee paid, in total EUR 22,062.30; the remainder of the arbitration fee in the amount of EUR 79.81 was charged to the claimant.

The applicant stated that, in granting the claim, the ICAC at the Ukrainian Chamber of Commerce and Industry failed to take into account the respondent's evidence and violated fundamental principles of substantive and procedural law.

As to the lack of competence of the ICAC at the Ukrainian Chamber of Commerce and Industry to consider the dispute, the applicant explained that on 30 January 2025, as at the date of the award of the ICAC at the Ukrainian Chamber of Commerce and Industry, the contract between the parties had been terminated as a result of its unilateral termination by the claimant, and therefore the arbitration clause in section 10 of the contract had also ceased to have effect. In view of the foregoing, the ICAC at the Ukrainian Chamber of Commerce and Industry considered the case in the absence of competence and of a genuine expression of the parties' will to such consideration, which, under Article 459(2)(1)(a) of the Civil Procedure Code of Ukraine, is an independent ground for setting aside the award.

The applicant also cited the content of Articles 7 and 8 of the Law of Ukraine “On International Commercial Arbitration” and stated that section 10 “Arbitration” of the contract does not contain a clear list of disputes falling within the competence of the arbitral tribunal; consequently, the conclusion of the ICAC at the Ukrainian Chamber of Commerce and Industry that it had competence to resolve the dispute is premature, which, under Article 459(2)(2)(a) of the Civil Procedure Code of Ukraine, is an independent ground for setting aside the award.

The applicant relied on the conflict of the arbitral award with the public policy of Ukraine, which, under Article 459(2)(2)(b) of the Civil Procedure Code of Ukraine, is an independent ground for setting aside the award.

The applicant also relied on clause 9.1 of the contract, which provides for force majeure circumstances and that, if they continue for more than 2 months, each of the parties may refuse to perform its obligations, in which case neither party may claim compensation for damages from the other party.

The applicant explained that, in the business relations that developed between the parties, Caribalt Alliance OU was a commercial intermediary. The goods were purchased from Amikum Farma LLC in order to perform obligations to another entity, namely Medicuba S.A. (Republic of Cuba). The Republic of Cuba is included in the list of state sponsors of terrorism, which over time led to the complete suspension of all bank settlements, business relations and contracts between Caribalt Alliance OU and Medicuba S.A. The fact of the inclusion of the Republic of Cuba in the list of state sponsors of terrorism is commonly known. Furthermore, it is commonly known that the Republic of Cuba supports the russian federation in its full-scale armed aggression against Ukraine. Therefore, the supply of Ukrainian goods to the territory of a country that has been recognised as a sponsor of terrorism and that supports the russian federation in the war against Ukraine threatens the security and economy of the country.

In the circumstances set out above, since Caribalt Alliance OU took all available measures to duly perform its obligations under the contract, while the impossibility of performing them is caused by circumstances that are unavoidable under present conditions, and performance of the terms of the contract entails the supply of Ukrainian goods to the Republic of Cuba, which in such circumstances is contrary to general public and state interests, the imposition of liability on Caribalt Alliance OU evidences a manifestly incorrect application by the arbitral tribunal of fundamental rules of substantive law and a gross violation of the rules of procedural law, which must be qualified as a violation of public policy.

In view of the foregoing, Caribalt Alliance OU requested that the award of the ICAC at the Ukrainian Chamber of Commerce and Industry of 24 February 2025 in case No. 246/2024 be set aside.

Objections to the claims made

Amikum Farma LLC, objecting to the claims made, filed objections on 23 May 2025, in which it requested that the application be dismissed.

With regard to the arguments concerning the termination of the arbitration clause, it relied on Article 81 of the UN Convention on Contracts for the International Sale of Goods and Article 21(2) of the UNCITRAL Arbitration Rules. It stated that the Supreme Court, in its resolutions of 23 February 2021 in case No. 910/15842/19, of 17 December 2021 in case No. 910/9841/20, and of 12 November 2020 in case

No. 910/13366/18, and in its ruling of 11 May 2023 in case No. 910/5019/23, consistently upholds the principle of autonomy of the arbitration agreement; thus, the arbitral tribunal had proper competence.

With regard to the wording of the arbitration clause, it relied on Article 7(1) of the Law of Ukraine “On International Commercial Arbitration” and stated that the law does not require a mandatory list of specific disputes; rather, an indication of the referral of all or certain disputes arising from a specific legal relationship is sufficient.

Amikum Farma LLC cited Article 22 of the Commercial Procedure Code of Ukraine and the legal conclusions of the Supreme Court set out in its resolution of 16 August 2022 in case

No. 916/3245/21, to the effect that the court must interpret any inaccuracies in the text of an arbitration agreement in favour of its validity, effectiveness and enforceability, ensuring the principle of autonomy of the arbitration agreement. It stated that the legislation and case law of Ukraine recognise as valid arbitration agreements providing for the referral to arbitration of all disputes arising from a certain legal relationship, without the need to specify each possible dispute.

With regard to the impossibility of performing the obligations due to unavoidable circumstances, the company stated that the existence of force majeure circumstances is not an automatic ground for setting aside an arbitral award, and case law requires proper proof of such circumstances and of their impact on the performance of the obligation.

With regard to the alleged conflict of the supply of goods to the Republic of Cuba with general public and state interests, it explained that the public policy of Ukraine encompasses fundamental principles relating to independence, integrity, and the fundamental rights and freedoms of citizens. The Supreme Court notes that a violation of public policy may occur only in cases where enforcement of an arbitral award contravenes these principles. In this case, the applicant did not provide sufficient evidence that the supply of goods to the Republic of Cuba violates such principles. Moreover, public policy is an exceptional category, and the violation must be gross and manifest (resolution of the Supreme Court in case No. 796/411/20).

With regard to the alleged manifestly incorrect application by the arbitral tribunal of the rules of substantive and procedural law, it emphasised that the courts of Ukraine adhere to the principle of limited interference with arbitral awards, and a manifestly incorrect application of the rules of substantive or procedural law may be a ground for setting aside an award only in cases where it has led to a violation of public policy. In this case, the complainant did not prove such violations.

With regard to the applicant's reliance on the sanctions against the Republic of Cuba as force majeure, the company cited the content of Article 617 of the Civil Code of Ukraine, which requires documentary confirmation of force majeure, and relied on the legal conclusions set out in the resolution of the Supreme Court in case No. 925/1293/21 to the effect that a change in economic conditions does not constitute force majeure; the applicant did not prove that the obstacles were unforeseeable and beyond its control, whereas Amikum Farma LLC concluded the contract specifically with Caribalt Alliance OU, and not with a company of the Republic of Cuba, and therefore the applicant itself should have taken into account all existing risks in conducting its business activities.

With regard to the alleged violations of the arbitral procedure by the ICAC at the Ukrainian Chamber of Commerce and Industry and its failure to take into account the arguments of Caribalt Alliance OU, it stated that the candidate arbitrator who considered the dispute had been proposed by Caribalt Alliance OU itself, and Amikum Farma LLC agreed to that candidate arbitrator; the ICAC Rules provide for a procedure for submitting evidence and statements, which the applicant did not challenge; the ICAC Rules provide for a procedure for conducting the case, which the applicant did not challenge but rather acted within.

Summary of the contested ruling

By the ruling of the Kyiv Court of Appeal of 14 July 2025, the application of Caribalt Alliance OU to set aside the award of the ICAC at the Ukrainian Chamber of Commerce and Industry of

24 February 2025 in case No. 246/2024 on the claim of Amikum Farma LLC against Caribalt Alliance OU for recovery of funds was dismissed.

Having taken into account the principle of autonomy of the arbitration agreement from the main contract, as well as the circumstance that Caribalt Alliance OU did not object to the jurisdiction of the ICAC at the Ukrainian Chamber of Commerce and Industry during the arbitral proceedings, the Kyiv Court of Appeal concluded that the applicant's arguments regarding the lack of competence of the ICAC at the Ukrainian Chamber of Commerce and Industry to consider the dispute had not been substantiated.

With regard to setting aside the award due to the absence in the arbitration agreement of a clear list of disputes falling within the competence of the arbitral tribunal, the Kyiv Court of Appeal noted that any inaccuracies in the text of an agreement to refer a dispute for resolution to an arbitral tribunal or international commercial arbitration and/or doubts as to its validity, effectiveness and enforceability must be interpreted by the court in favour of its validity, effectiveness and enforceability.

With regard to the violation of public policy, the court stated that the disputed legal relations in the present case arose between business entities, and the circumstances established by the arbitral award concern the procedure for performing obligations that arose between the participants in this case on the basis of the contract concluded between them (private commercial legal relations). The award of the ICAC at the Ukrainian Chamber of Commerce and Industry was made solely in respect of its parties, and therefore enforcement of that award will not contravene the public policy of Ukraine.

The court also drew attention to the fact that contract No. 27/11 of 27 November 2023 concluded between Amikum Farma LLC and Caribalt Alliance OU, the subject matter of which is the supply of infant food for medical purposes, and the recovery of funds in connection with the improper performance of which was the subject of consideration by the ICAC at the Ukrainian Chamber of Commerce and Industry, governs legal relations only between these two legal entities and does not concern the rights and obligations that Caribalt Alliance OU has with other business entities. The applicant did not provide any evidence confirming that Caribalt Alliance OU supplied infant food specifically to a company in the Republic of Cuba.

Arguments of the applicant

Disagreeing with the ruling of the Kyiv Court of Appeal of 14 July

2025, the representative of Caribalt Alliance OU, M. O. Vitlina, on 18 August

2025 filed with the Supreme Court an appeal for consideration in appellate proceedings, in which she requests that the ruling of the Kyiv Court of Appeal of 14 July 2025 be set aside and a new judicial decision be adopted granting the application of Caribalt Alliance OU.

In substantiation of the appeal, the applicant states that on 30 January 2025, as at the date of the award of the ICAC at the Ukrainian Chamber of Commerce and Industry, the contract between the parties had been terminated as a result of its unilateral termination by the claimant. Therefore, the arbitration clause contained in section 10 of that contract had also ceased to have effect, as a result of which the ICAC at the Ukrainian Chamber of Commerce and Industry considered the case in the absence of competence and of a genuine expression of the parties' will to such consideration. It states that the arbitration agreement contains no clear list of disputes falling within the competence of the arbitral tribunal. The applicant also relies on clause 9.1 of the contract, which provides for force majeure circumstances and that, if they continue for more than 2 months, each of the parties may refuse to perform its obligations, in which case neither party may claim compensation for damages from the other party. It explains that, in the business relations that developed between the parties, Caribalt Alliance OU acted as a commercial intermediary. The goods were purchased from Amikum Farma LLC in order to perform obligations to another entity, namely Medicuba S.A. (Republic of Cuba). The Republic of Cuba is included in the list of state sponsors of terrorism, which over time led to the complete suspension of all bank settlements, business relations and contracts between Caribalt Alliance OU and Medicuba S.A. The said fact of the inclusion of the Republic of Cuba in the list of state sponsors of terrorism is commonly known. It draws attention to the fact that the court of appeal erroneously relied on the legal conclusions of the Supreme Court regarding the application of the Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters

(hereinafter, the New York Convention).

Arguments of other participants in the case

On 29 August 2025, the representative of Amikum Farma LLC, O. O. Hudilin, filed with the Supreme Court a response to the appeal, in which he requests that the appeal be dismissed and the ruling of the Kyiv Court of Appeal of 14 July 2025 be upheld.

The response is reasoned by the fact that the appeal contains the same arguments as the appeal, which have already been considered and rejected by the Kyiv Court of Appeal. In fact, the applicant is attempting to substitute the task of the appellate court, which reviews the decision of the court of first instance on the basis of the requirements of the law. It states that, in accordance with the principle of autonomy of the arbitration agreement (separability), an arbitration clause forming part of a contract is treated as an agreement separate from and independent of the other terms of the contract. Even if the main contract is held invalid or terminated, this does not automatically entail the invalidity of the arbitration agreement. This approach guarantees that any dispute related to the contract, including disputes about its validity or termination, will be considered by arbitration, as agreed by the parties. Under Article 21(2) of the UNCITRAL Arbitration Rules, a decision by the arbitral tribunal that the contract is null and void does not entail the invalidity of the arbitration clause. Article 81 of the UN Convention on Contracts for the International Sale of Goods expressly states that avoidance of the contract does not affect provisions for the settlement of disputes. The Kyiv Court of Appeal correctly relied on the consistent case law of the Supreme Court. The applicant's assertion that international rules were not applied is unfounded. The applicant's assertion that contract No. 27/11 of 27 November 2023 does not contain a clear list of disputes is likewise unfounded, since it is refuted by the very text of that contract. It draws attention to the fact that the applicant abuses the concept of public policy. The applicant's arguments regarding the impossibility of performing the obligations due to the sanctions against the Republic of Cuba are matters of substantive law that were subject to assessment by the arbitral tribunal. The Kyiv Court of Appeal correctly noted that interference in such matters is prohibited, since it would amount to a review of the case on the merits. In this case, there is no violation of public policy.

Receipt of the appeal by the Supreme Court as the court of appeal and progress of the case file

On 19 August 2025, the appeal was received by the Supreme Court and, according to the record of the automated allocation of the court case among judges, it was assigned to the Judge-Rapporteur.

By the ruling of the Supreme Court of 25 August 2025, appellate proceedings in the case were opened and the case file was requested from the Kyiv Court of Appeal.

On 18 September 2025, the case file was received by the Supreme Court as the court of appeal.

By the ruling of the Supreme Court of 5 December 2025, the preparatory actions in the case were completed and the case was set down for consideration in an open court hearing with notification of the participants in the case.

Position of the persons who took part in the consideration of the case

At the court hearing:

the representative of Caribalt Alliance OU, M. O. Vitlina, requested that the appeal be allowed, the ruling of the Kyiv Court of Appeal of 14 July 2025 be set aside and a new judicial decision be adopted granting the application of Caribalt Alliance OU.

the representative of Amikum Farma LLC, O. O. Hudilin, requested that the appeal be dismissed and the contested decision be upheld.

Position of the Supreme Court

Article 24(2) and Article 351(2) of the Civil Procedure Code of Ukraine provide that the Supreme Court reviews in appellate proceedings judicial decisions of the courts of appeal adopted by them as courts of first instance.

In accordance with Article 367(1) of the Civil Procedure Code of Ukraine, the court of appeal reviews the case on the basis of the materials therein and the additionally submitted evidence and verifies the lawfulness and validity of the decision of the court of first instance within the limits of the arguments and claims of the appeal.

Having heard the report of the Judge-Rapporteur and the arguments of the parties to the case, having verified the arguments of the appeal and the arguments set out in the response to the appeal, and having examined the case file, the panel of judges has reached the following conclusions.

Factual circumstances of the case

It has been established that on 27 November 2023 Amikum Farma LLC (seller)

and Caribalt Alliance OU (buyer) concluded a contract under the terms of which the seller transfers, and the buyer accepts and pays for, goods in accordance with the specification or invoices drawn up for each batch of goods shipped, which form an integral part of the contract. The contract is valid until 31 December 2024.

In clauses 10.1 and 10.2 of the contract, the parties agreed that all disputes and disagreements that may arise out of or in connection with this contract shall be resolved through negotiations. If it is impossible to reach agreement under the contract (whether in force or not in force), the parties must reach agreement at the ICAC at the Ukrainian Chamber of Commerce and Industry in accordance with its Rules. The arbitral tribunal shall consist of one arbitrator. The place of the arbitral hearing is the city of Kyiv. The language of the arbitral proceedings is English.

By the award of the ICAC at the Ukrainian Chamber of Commerce and Industry of 24 February 2025 in case No. 246/2024 on the claim of Amikum Farma LLC against Caribalt Alliance OU for recovery of funds, EUR 22,062.30 was recovered from Caribalt Alliance OU in favour of Amikum Farma LLC, of which: EUR 3,620.07 – penalty; EUR 210.00 – for safekeeping of the second batch of goods; EUR 16,411.92 – damages; EUR 1,820.31 – arbitration fee.

In that award, the ICAC at the Ukrainian Chamber of Commerce and Industry established that on 3 July 2024, after the statement of claim had been filed with the ICAC at the Ukrainian Chamber of Commerce and Industry, the claimant sent the respondent letter No. 050, by which it withdrew from (terminated) contract No. 27/11 of 27 November 2023 due to the respondent's breach of its contractual obligations to accept the second batch of goods.

Reasons on which the Supreme Court relies

The procedure for challenging awards of international commercial arbitration is set out in Section VIII of the Civil Procedure Code of Ukraine.

In accordance with Article 454(2) and (4) of the Civil Procedure Code of Ukraine, an award of international commercial arbitration may be challenged in the manner provided for by this Section if the place of arbitration is in the territory of Ukraine.

An application to set aside an award of international commercial arbitration shall be filed with the general court of appeal at the place of arbitration.

Under Article 459(1) and (2) of the Civil Procedure Code of Ukraine, an award of international commercial arbitration may be set aside by the court only in the cases provided for by this Article, unless otherwise provided by an international treaty the binding nature of which has been consented to by the Verkhovna Rada of Ukraine, or by the Law of Ukraine “On International Commercial Arbitration”.

An award of international commercial arbitration may be set aside if:

1) the party filing the application to set aside furnishes proof that: (a) one of the parties to the arbitration agreement was under some incapacity; or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of Ukraine; or (b) it was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable for valid reasons to present its explanations; or (c) the award deals with a dispute not contemplated by the arbitration agreement or not falling within its terms, or contains decisions on matters beyond the scope of the arbitration agreement, provided that, if the decisions on matters covered by the arbitration agreement can be separated from those not so covered, only that part of the arbitral award which contains decisions on matters not covered by the arbitration agreement may be set aside; or (d) the composition of the international commercial arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of law from which the parties cannot derogate, or, failing such agreement, was not in accordance with the law; or

2) the court finds that: (a) under the law, the subject matter of the dispute is not capable of settlement by international commercial arbitration; or (b) the arbitral award is in conflict with the public policy of Ukraine.

Similar grounds for setting aside an award of international commercial arbitration are also provided for in Article 34(2) of the Law of Ukraine “On International Commercial Arbitration”.

A decision of a national court to set aside an arbitral award may be rendered only where at least one of the grounds provided for by Article 34(2) of the Law of Ukraine “On International Commercial Arbitration” and Article 459(2) of the Civil Procedure Code of Ukraine exists (has been proven).

The legislation of Ukraine, while allowing an award of international commercial arbitration to be challenged by filing an application to set it aside, establishes an exhaustive list of grounds on which an arbitral award may be set aside.

Accordingly, under Article 459 of the Civil Procedure Code of Ukraine and Article 34 of the Law of Ukraine “On International Commercial Arbitration”, the burden of proving the existence of grounds for setting aside an award of international commercial arbitration rests with the party applying to set aside such award.

Under Article 5 of the Law of Ukraine “On International Commercial Arbitration”,

in matters governed by this Law, no court shall intervene except where so provided in this Law.

Thus, when considering cases on setting aside awards of international commercial arbitration, the powers of the national court are limited, since the national court has no power to review awards of international commercial arbitration on the merits of the resolution of the dispute or to undertake a full review or reassessment thereof.

Similar conclusions were reached in the resolution of the Supreme Court of 23 February

2023 in case No. 824/47/22 (proceeding No. 61-8730av22).

In the appeal, the applicant relies on a violation of subparagraphs (a) and (c)

of Article 459(2)(1) of the Civil Procedure Code of Ukraine and of Article 459(2)(2)(b) of the Civil Procedure Code of Ukraine.

These arguments cannot be taken into account for the following reasons.

Regarding the grounds provided for by Article 459(2)(1)(a) of the Civil Procedure Code of Ukraine

As the basis for the claims in this part, the applicant states that on 30 January

2025, as at the date of the award of the ICAC at the Ukrainian Chamber of Commerce and Industry, the contract between the parties had been terminated as a result of its unilateral termination by the claimant, and therefore the arbitration clause contained in section 10 of that contract had also ceased to have effect, as a result of which the ICAC at the Ukrainian Chamber of Commerce and Industry considered the case in the absence of competence and of a genuine expression of the parties' will to such consideration.

In assessing these arguments, the panel of judges takes into account the following.

Article 4 of the Law of Ukraine “On International Commercial Arbitration” provides that a party who knows that any provision of this Law from which the parties may derogate, or any requirement under the arbitration agreement, has not been complied with and yet proceeds with the arbitration without stating its objection to such non-compliance without undue delay or, if a time limit is provided therefor, within such period of time, shall be deemed to have waived its right to object.

The arbitral tribunal may rule on its own competence, including any objections with respect to the existence or validity of the arbitration agreement. For that purpose, an arbitration clause which forms part of a contract shall be treated as an agreement independent of the other terms of the contract. A decision by the arbitral tribunal that the contract is null and void shall not entail ipso jure the invalidity of the arbitration clause. A plea that the arbitral tribunal does not have competence shall be raised not later than the submission of the statement of defence. A party is not precluded from raising such a plea by the fact that it has appointed, or participated in the appointment of, an arbitrator. A plea that the arbitral tribunal is exceeding the scope of its competence shall be raised as soon as the matter alleged by the party to be beyond that scope is raised during the arbitral proceedings. The arbitral tribunal may, in either of these cases, admit a later plea if it considers the delay justified. The arbitral tribunal may rule on a plea referred to in paragraph 2 of this Article either as a preliminary question or in an award on the merits of the dispute. If the arbitral tribunal rules as a preliminary question that it has competence, any party may request, within 30 days after having received notice of that ruling, the body specified in Article 6 to decide the matter, which decision shall be subject to no appeal; while such a request is pending, the arbitral tribunal may continue the proceedings and make an arbitral award (Article 16 of the Law of Ukraine “On International Commercial Arbitration”).

In accordance with Article 7 of the Law of Ukraine “On International Commercial Arbitration”, an arbitration agreement is an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of any defined legal relationship, whether contractual or not. An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement. The arbitration agreement shall be in writing. An agreement is in writing if it is contained in a document signed by the parties, or is contained in a securities prospectus (decision on the issue of securities) providing for the appointment of a bond issue administrator, or is concluded by an exchange of letters or electronic messages, provided that the information contained therein is accessible so as to be usable for subsequent reference, telex or telegraph messages or by other means of telecommunication which provide a record of such agreement, or by an exchange of a statement of claim and a statement of defence in which the existence of an agreement is alleged by one party and not denied by the other. The reference in an agreement to a document containing an arbitration clause constitutes an arbitration agreement provided that the agreement is in writing and the reference is such as to make that clause part of the agreement.

In the resolution of the Supreme Court sitting as a panel of judges of the Commercial Cassation Court of 3 March 2020 in case No. 920/241/19, it was concluded that “an arbitration agreement has a positive and a negative effect: it obliges the parties to refer disputes to arbitration and confers on the arbitral tribunal competence over the disputes covered by the arbitration agreement (positive effect). If a dispute arises that falls within the scope of the arbitration agreement, either party may refer it to the arbitral tribunal for consideration. On the other hand, the arbitration agreement prevents the parties from attempting to resolve their disputes in court (negative effect). By concluding an arbitration agreement, the parties have determined another procedure, binding on them, for exercising their rights to judicial remedies, namely in a certain (or certain) international commercial arbitration. A party that has concluded an arbitration agreement may not ignore such terms of it and, instead of the chosen arbitration, apply to a state court which would have been competent to resolve the dispute had no such arbitration agreement been concluded between the parties. The New York Convention enshrines an approach to the enforcement of arbitral awards and arbitration agreements based on the presumption of the formal and substantive validity and autonomy of arbitration agreements (Article II(1) of the New York Convention). This presumption of validity may be rebutted only on a limited list of grounds. The principle of autonomy of the arbitration agreement (separability) means, first, that the validity of the main contract in principle does not affect the validity of the arbitration agreement included in it and, second, that the main contract and the arbitration agreement may be subject to different laws. Such autonomy of the arbitration agreement enables the parties to the disputed legal relations to have a guarantee that the dispute will in any event be considered by arbitration, since the existence of an arbitration clause precludes recourse to state judicial institutions. When concluding an arbitration clause, the parties usually provide for the referral to arbitration of any disputes, including disputes concerning the validity of the contract itself (unless such disputes are expressly excluded from the scope of the arbitration clause). Subsequently, if a party could renounce arbitration and challenge the competence of the arbitrators by relying on the invalidity of the contract, a bad-faith party would always use such an opportunity to frustrate the arbitration. It must be borne in mind that the principle of autonomy of the arbitration agreement from the main contract consists in the arbitration agreement and the main contract being considered as two separate agreements; therefore, the invalidity of the contract cannot be a ground for the automatic invalidity of the arbitration agreement. Under the New York Convention, each contracting state shall recognise an arbitration agreement under which the parties undertake to submit to arbitration all or any differences which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not, concerning a subject matter capable of settlement by arbitration. The said obligation to recognise the arbitration agreement also requires the court to interpret any inaccuracies in the text of the arbitration agreement and to resolve doubts as to its validity, effectiveness and enforceability in favour of its validity, effectiveness and enforceability (the principle of immunity and autonomy of the arbitration agreement)”.

When concluding an arbitration clause, the parties usually provide for the referral to arbitration of any disputes, including disputes concerning the validity of the contract itself (unless such disputes are expressly excluded from the scope of the arbitration clause). Subsequently, if a party could renounce arbitration and challenge the competence of the arbitrators by relying on the invalidity of the contract, a bad-faith party would always use such an opportunity to frustrate the arbitration. A legal position similar in content is set out in the resolutions of the Supreme Court of 3 March 2020 in case No. 920/241/19, of 24 September 2020 in case No. 824/198/19, and of 30 August 2024 in case No. 911/1766/22.

The presumption of lawfulness of a transaction means that a transaction that has been entered into is deemed lawful, that is, such as to give rise to the acquisition, change or termination of civil rights and obligations, until this presumption is rebutted. Thus, until the presumption of lawfulness of a transaction is rebutted, all rights acquired by the parties under it may be freely exercised, and the obligations created are subject to performance. The presumption of lawfulness of a transaction is rebutted: where the invalidity of the transaction is expressly established by law (that is, it is void); or if it has been declared invalid by a court, that is, there is a court decision that has entered into legal force (that is, the voidable transaction has been declared invalid by a court) (see the resolution of the Supreme Court of 28 July 2021 in case No. 759/24061/19).

Similar legal conclusions are set out in the resolutions of the Supreme Court of

14 May 2025 in case No. 824/167/24 (proceeding No. 61-2895av25), and of

22 September 2025 in case No. 824/11/25 (proceeding No. 61-8372av25).

Having taken into account the principle of autonomy of the arbitration agreement, as well as the circumstance that the respondent did not object to the jurisdiction of the ICAC during the arbitral proceedings, the Supreme Court concludes that the arguments of Caribalt Alliance OU for setting aside the award of the ICAC at the Ukrainian Chamber of Commerce and Industry on the grounds provided for by Article 459(2)(1)(a) of the Civil Procedure Code of Ukraine have not been confirmed during the appellate review of the case.

Regarding the grounds provided for by Article 459(2)(1)(c) of the Civil Procedure Code of Ukraine

As the basis for the claims in this part, the applicant relies on the fact that the arbitration agreement contains no clear list of disputes falling within the competence of the arbitral tribunal.

In assessing these arguments, the panel of judges takes into account the following.

Under Article 16 of the Law of Ukraine “On International Commercial Arbitration”, the question of the competence of the ICAC at the Ukrainian Chamber of Commerce and Industry in each particular case is decided by the arbitral tribunal considering the dispute.

An arbitration agreement is an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of any defined legal relationship, whether contractual or not. An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement.

In clauses 10.1 and 10.2 of the contract, the parties agreed that all disputes and disagreements that may arise out of or in connection with this contract shall be resolved through negotiations. If it is impossible to reach agreement under the contract (whether in force or not in force), the parties must reach agreement at the ICAC at the Ukrainian Chamber of Commerce and Industry in accordance with its Rules. The arbitral tribunal shall consist of one arbitrator. The place of the arbitral hearing is the city of Kyiv. The language of the arbitral proceedings is English.

In accordance with Article II of the New York Convention, which entered into force for Ukraine on 10 January 1961, each Contracting State shall recognise an agreement in writing under which the parties undertake to submit to arbitration all or any differences which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not, concerning a subject matter capable of settlement by arbitration.

The New York Convention enshrines an approach to the enforcement of arbitral awards and arbitration agreements based on the presumption of the validity and autonomy of arbitration agreements (Article II(1) of the Convention). This presumption of validity may be rebutted only on a limited list of grounds. The principle of autonomy of the arbitration agreement (separability) means, first, that the validity of the main contract in principle does not affect the validity of the arbitration agreement included in it and, second, that the main contract and the arbitration agreement may be subject to different laws. Such autonomy of the arbitration agreement gives the parties to the disputed legal relations the opportunity to have a guarantee that the dispute will in any event be considered by arbitration, since the existence of an arbitration clause precludes recourse to state judicial institutions.

Under the Convention, each contracting state shall recognise an arbitration agreement under which the parties undertake to submit to arbitration all or any differences which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not, concerning a subject matter capable of settlement by arbitration. The said obligation to recognise the arbitration agreement also requires the court to interpret any inaccuracies in the text of the arbitration agreement and to resolve doubts as to its validity, effectiveness and enforceability in favour of its validity, effectiveness and enforceability (the principle of immunity and autonomy of the arbitration agreement).

Similar conclusions are set out in the resolution of the Supreme Court of 3 March 2020 in case No. 920/241/19.

In accordance with Article 4 of the Law of Ukraine “On International Commercial Arbitration”, a party who knows that any provision of this Law from which the parties may derogate, or any requirement under the arbitration agreement, has not been complied with and yet proceeds with the arbitration without stating its objection to such non-compliance without undue delay or, if a time limit is provided therefor, within such period of time, shall be deemed to have waived its right to object.

From the content of the award of the ICAC at the Ukrainian Chamber of Commerce and Industry of 24 February 2025 in case

No. 246/2024 it is apparent that the tribunal resolved and examined the question of the competence of the ICAC at the Ukrainian Chamber of Commerce and Industry to consider case No. 246/2024, as a result of which it stated that the legal basis for the consideration of the case by the ICAC at the Ukrainian Chamber of Commerce and Industry is section 10 “Arbitration” of contract No. 27/11 of 27 November 2023. In the course of the arbitral proceedings, neither party raised any objections as to the jurisdiction of the ICAC, or as to the validity, effectiveness or operation of the arbitration agreement, or as to non-compliance with the requirements of the ICAC Rules or the lex arbitri. The tribunal stated that “in accordance with Article 4 of the Law of Ukraine “On International Commercial Arbitration” and Article 44 of the ICAC Rules, the parties are deemed to have waived the right to object on these matters. The dispute that arose between the parties falls within the subject-matter and object competence of the ICAC as defined by the Law of Ukraine “On International Commercial Arbitration” and the ICAC Rules. Thus, the ICAC has jurisdiction to resolve this dispute”.

In view of the foregoing, the panel of judges concludes that an arbitration agreement was concluded between the parties, by which the parties agreed that all disputes and disagreements that may arise during the performance of the contract or in connection with it shall be resolved through negotiations. If it is impossible to resolve the disputes in this way, they shall be referred for resolution to the ICAC at the Ukrainian Chamber of Commerce and Industry and its Rules.

In view of the foregoing, the Kyiv Court of Appeal reached a well-founded conclusion that the applicant's arguments that the award of the ICAC at the Ukrainian Chamber of Commerce and Industry of 24 February 2025 in case No. 246/2024 was made in respect of a dispute not contemplated by the arbitration agreement, in the absence of competence of the arbitral tribunal to consider case No. 246/2024, are unfounded.

Thus, the Supreme Court concludes that the arguments of Caribalt Alliance OU for setting aside the award of the ICAC at the Ukrainian Chamber of Commerce and Industry on the grounds provided for by Article 459(2)(1)(c) of the Civil Procedure Code of Ukraine have not been confirmed during the appellate review of the case.

Regarding the grounds provided for by Article 459(2)(2)(b) of the Civil Procedure Code of Ukraine

As the basis for the claims concerning the violation of public policy, the applicant relies on the fact that, in the business relations that developed between the parties, the respondent was a commercial intermediary, since the goods were purchased from the claimant in order to perform obligations to another entity, namely Medicuba S.A. (Republic of Cuba), which is included in the list of state sponsors of terrorism, which over time led to the complete suspension of all bank settlements, business relations and contracts between Caribalt Alliance OU and Medicuba S.A.

In assessing these arguments, the panel of judges takes into account the following.

Public policy is understood as the legal order of the state, the defined principles and foundations that form the basis of the order existing in it (relating to its independence, integrity, self-sufficiency and inviolability and to fundamental constitutional rights, freedoms, guarantees, etc.).

A violation of public policy may concern fundamental principles of both substantive and procedural law.

A violation of procedural public policy is to be understood as those procedural violations committed by the arbitral tribunal that constitute a ground for setting aside its award under Article 459(2)(1) of the Civil Procedure Code of Ukraine. Such grounds for setting aside an arbitral award may be applied where the party that filed the application to set aside the arbitral award substantiates such application with these arguments.

At the same time, the grounds for setting aside an arbitral award under Article 459(2)(2) of the Civil Procedure Code of Ukraine are subject to verification by the court ex officio.

The category of public policy is applied not only in order to protect the state from foreign arbitral awards that violate the fundamental principles of fairness and justice in force in the state of recognition and enforcement of such awards. A manifestly incorrect application by an arbitral tribunal of fundamental rules of national substantive law or a gross violation of the rules of procedural law may also lead to a violation of the public policy of Ukraine and is subject to assessment by the national court when an award of a commercial arbitral tribunal located in the same country is challenged before it.

Accordingly, awards of the ICAC at the Ukrainian Chamber of Commerce and Industry are also subject to assessment by the court as to whether they violate the public policy of Ukraine.

In reaching these conclusions, the Supreme Court is guided by the fact that the public policy of Ukraine may be violated by an award of an international commercial arbitral tribunal in the making of which the right to judicial protection was substantially and manifestly violated. Such violations include the inconsistency of the arbitral award with the exclusive competence of a state court to resolve such a dispute, or the existence of a decision of a national court in a dispute between the same parties, concerning the same subject matter and on the same grounds as the dispute considered by the arbitral tribunal.

A violation of public policy will also occur in cases where the arbitral award violates:

1. The basic, fundamental principles (foundations) of Ukrainian law, primarily constitutional ones, the foundations of the legal order in Ukraine, as well as the basic principles of civil law.

The legal order in Ukraine is based on the principles according to which no one may be compelled to do what is not provided for by legislation. Bodies of state power and bodies of local self-government and their officials are obliged to act only on the grounds, within the limits of their powers and in the manner provided for by the Constitution and the laws of Ukraine (Article 19 of the Constitution of Ukraine).

In accordance with Article 3 of the Civil Code of Ukraine, the general principles of civil legislation are: the inadmissibility of arbitrary interference in the sphere of a person's private life; the inadmissibility of deprivation of the right of ownership, except in cases established by the Constitution of Ukraine and the law; freedom of contract; freedom of entrepreneurial activity not prohibited by law; judicial protection of a civil right and interest; fairness, good faith and reasonableness.

Under Article 129 of the Constitution of Ukraine, a judge, in administering justice, is independent and is guided by the rule of law. The main principles of judicial proceedings are: 1) equality of all participants in the judicial process before the law and the court; 2) ensuring that guilt is proven; 3) adversarial proceedings and freedom of the parties in submitting their evidence to the court and in proving its persuasiveness before the court;

4) support of public prosecution in court by a prosecutor; 5) ensuring the accused's right to defence; 6) publicity of the judicial process and its full recording by technical means; 7) reasonable time limits for the consideration of a case by the court;

8) ensuring the right to appellate review of a case and, in cases provided for by law, to cassation appeal against a judicial decision; 9) the binding nature of a judicial decision.

2. Generally accepted principles of morality and the legitimate interests of persons, society and the state.

3. Fundamental principles and norms of international law, including international legal standards of human rights.

These conclusions were reached by the Supreme Court in its resolution of 30 March 2023 in case No. 824/50/22 (proceeding No. 61-8593av22).

The Supreme Court has established that the applicant did not provide the court with evidence confirming that the contested arbitral award affects the public, economic and social foundations of the activity of the State of Ukraine or that such award will cause harm to the sovereignty or security of the State of Ukraine.

Contract No. 27/11 of 27 November 2023 concluded between Amikum Farma LLC

and Caribalt Alliance OU, the subject matter of which is the supply of infant food for medical purposes, and the recovery of funds in connection with the improper performance of which was the subject of consideration by the ICAC at the Ukrainian Chamber of Commerce and Industry, governs legal relations only between these two legal entities and does not concern the rights and obligations that Caribalt Alliance OU has in relation to other business entities. The applicant did not provide any evidence confirming that Caribalt Alliance OU supplied infant food specifically to a company in the Republic of Cuba.

The circumstances established by the contested award of the ICAC at the Ukrainian Chamber of Commerce and Industry do not concern the public, economic and social foundations of the State of Ukraine; the award was made in a dispute contemplated by the arbitration agreement and solely in respect of the debtor as a separate legal entity and an independent participant in commercial transactions; therefore, enforcement of this award does not contravene the public policy of Ukraine and does not cause harm to its independence, integrity, self-sufficiency and inviolability, or to constitutional rights, freedoms and guarantees, which refutes the arguments of the appeal in this part.

In such circumstances, there are no grounds for setting aside the award of the ICAC at the Ukrainian Chamber of Commerce and Industry of 27 September 2024 in case No. 55/2024 in connection with a violation of the public policy of Ukraine.

The applicant's arguments regarding the violation of the public policy of Ukraine by the arbitral award in fact amount to disagreement with the correctness of the application of the rules of substantive law, to the need for a reassessment of the evidence and to an attempt to prompt a review of the dispute on the merits, which is procedurally impermissible.

The other arguments of the appeal do not refute the conclusions of the court of appeal as the court of first instance.

Conclusions following the consideration of the appeal

Under Article 375 of the Civil Procedure Code of Ukraine, the court of appeal dismisses the appeal and upholds the judicial decision if it finds that the court of first instance adopted the judicial decision in compliance with the rules of substantive and procedural law.

In view of the foregoing, the panel of judges considers it necessary to dismiss the appeal and to uphold the contested judicial decision, since the arguments of the appeal do not refute the conclusions of the court and do not affect the lawfulness and validity of the judicial decision.

Regarding court costs

Under Article 141(13) of the Civil Procedure Code of Ukraine, if the court of appeal or cassation, without remitting the case for a new consideration, amends the decision or adopts a new one, that court shall amend the allocation of court costs accordingly.

Given that the Supreme Court as the court of appeal dismisses the appeal and upholds the contested ruling, the court costs incurred in connection with the consideration of the case are not subject to allocation.

Guided by Articles 24, 351, 367-369, 374, 375, 381-384 and 459 of the Civil Procedure Code of Ukraine, the Supreme Court, sitting as a panel of judges of the Second Judicial Chamber of the Civil Cassation Court,

RULED:

The appeal of Caribalt Alliance OU (Republic of Estonia), filed by its representative Maryna Oleksandrivna Vitlina, is dismissed.

The ruling of the Kyiv Court of Appeal of 14 July 2025 is upheld.

The resolution enters into legal force upon its adoption, is final and is not subject to appeal.

The full text of the resolution was drawn up on 26 January 2026.

Judges: V. M. Korotun

Ye. V. Korotenko

M. Ye. Chervynska