Supreme Court Protects Banks from Remote Borrowers

The Russian Supreme Court issued an opinion, technically non-binding but at least very persuasive, concerning the venue of the resolution of disputes originating from loan agreements. According to the Supreme Court, if the agreement itself says (most such agreements do) that disputes should be resolved by a court at the bank's location, they indeed should be resolved by that court. Earlier many courts had held that disputes should be resolved at the borrower's place of residence, notwithstanding the contractual venue. This had made easier borrowers' life but had created substantial problems for banks; the new ruling reverses the situation. Some human rights activists believe that the ruling will decrease the borrower's chances for objective consideration of the dispute, let alone the practical possibility for them to appear in court (perhaps located in another city).

http://www.kommersant.ru/doc.aspx?DocsID=1208200 (Russ.)