The dispute resolution landscape in Slovenia, whether domestic or international, is still dominated by litigation and court-connected mediation. The vast majority of domestic parties seem either to have more confidence in litigation or lack sufficient experience (or knowledge) regarding the arbitral resolution of disputes.

Despite litigation being the most popular form of resolving international commercial disputes, arbitration seems to be gaining in popularity. The gradual increase in the demand for the arbitral resolution of disputes seems to go hand-in-hand with the influx of foreign investments in Slovenia, and stronger integration of domestic entities into international trade flows.

On the one hand, arbitration is typically chosen by the parties as a preferred form of dispute resolution in cross-border M&A transactions, engineering, procurement and construction contracts, agency, distribution agreements and other types of commercial agreements, service agreements, etc. On the other hand, there are still important infrastructure projects and public-private partnership projects involving foreign parties where the state, state-owned entities and local municipalities commissioning such projects seem to be reluctant to opt for arbitration. Expected higher costs compared to litigation, unpredictability of a clear outcome, and very limited legal remedies seem to be the main factors inhibiting further growth in the popularity of international arbitration.

While 2020, which was deeply affected by measures to contain the COVID-19 pandemic, saw a temporary decrease in the number of new international arbitration cases, the gradual normalisation of life in general accompanied by restored economic activity in 2021 and 2022 has brought more life back to the arbitration landscape in Slovenia. This has been reflected in a noticeable increase in the number of new cases.

Reportedly, the structure of cases in 2021–22 has not changed significantly compared to previous years. The majority of cases are related to post-M&A, construction, international trade, agency and distribution, and public-private partnership disputes. Banking disputes seem to be gaining momentum.

In Slovenia, international arbitration cases are predominantly referred to the Ljubljana Arbitration Centre, which is an autonomous and independent institutional arbitration centre providing dispute resolution services since 1928 (see http://www.sloarbitration.eu/en). Modern arbitration rules, flexibility, the efficient resolution of disputes, and an ambition to be a regional leader make the Ljubljana Arbitration Centre an attractive place to turn to. The Ljubljana Arbitration Centre has recently updated its arbitration rules, the new version of which are in force as of 1 June 2023. The main changes that the new LAC Rules bring are disclosure obligations related to third-party funding, the possibility of remotely held oral hearings, and several provisions aimed at efficient management of arbitration proceedings as well as more detailed rules relating to the confidentiality of the proceedings.

It is not uncommon, however, that international disputes involving one or more parties from Slovenia are also referred to the Vienna International Arbitral Centre (VIAC) or the International Chamber of Commerce (ICC).

In 2021–22, no new arbitral institutions have been established in Slovenia.

Disputes related to arbitrations, whether domestic or international, are heard by the Ljubljana District Court, which has the exclusive competence to decide on matters related to:

• the admissibility of arbitration proceedings;
• appointment of an arbitrator;
• challenge of an arbitrator;
• termination of the mandate of an arbitrator;
• jurisdiction of the arbitral tribunal;
• setting aside of the arbitral award; and
• declaration of domestic awards as enforceable and the recognition of foreign awards.

If the seat of arbitration is in Slovenia, the arbitration proceedings will be governed by the Slovenian Arbitration Act.

The Slovenian Arbitration Act is largely based on the UNCITRAL Model Law on International Commercial Arbitration (the “Model Law”) and elements of its 2006 version have been incorporated as well. This includes the loosening of form requirements for an arbitration agreement and the introduction of interim measures.

In addition to transposing the Model Law into Slovenian legislation with only a few minor deviations, the Slovenian Arbitration Act prescribes specific rules on consumer and labour arbitration disputes.

The Slovenian Arbitration Act is generally considered a modern law and there have been no changes to it since its adoption in 2008. There is no pending legislation that would impact the arbitration landscape in Slovenia, as the consensus appears to be that any new developments in international arbitration practice should be reflected in the rules of the local arbitral institutions rather than the amendment of the law, reinforcing Slovenia as an arbitration-friendly jurisdiction.

Slovenian law allows arbitration agreements in the form of an arbitration clause in a contract or in the form of a separate agreement. In order for an arbitration agreement to be enforceable in Slovenia, it must meet the following criteria.

• It must be made in writing, which for the purposes of the Slovenian Arbitration Act means:
1. in a document signed by all parties; or
2. concluded by exchange of means of communication or recording of data which provide a record of the arbitration agreement that is accessible and suitable for subsequent reference – this definition is broad enough to include modern electronic means of communication (eg, email); or
3. in a document transmitted between the parties, where the contents are considered to be part of the contract in accordance with common usage; or
4. a reference to another document containing an arbitration clause (eg, general conditions); or
5. where the bill of lading contains an express reference to an arbitration clause in a charter party.
• It must stipulate the legal relationships between the parties.
• It must expressly provide that the parties submit their dispute to arbitration.

The parties’ will to agree to arbitration has to be clear and unequivocal. When requested, the Slovenian courts thoroughly investigate whether the parties have agreed on such a method of dispute settlement precisely in relation to their specific case. It is not sufficient that the contract containing the arbitration clause is concluded tacitly or by means of an implied agreement.

Arbitration Agreement in the case of Passiveness by the Defence

In accordance with the Slovenian Arbitration Act, an arbitration agreement is also validly entered into if the claimant brings an action before an arbitration and the respondent does not raise an objection on the jurisdiction of the arbitral tribunal at the latest in the statement of defence. When the defendant does not file a statement of defence at all, the validity should nevertheless be examined by the arbitral tribunal.

The definition of arbitrability is broad. As a general rule, it concerns claims with economic interest (pecuniary claims) or other claims on which the parties can validly conclude a settlement. Consequently, a limited number of disputes are not arbitrable, namely:

• family law matters (eg, challenge of paternity, child support);
• decisions with erga omnes effect (eg, validity of patents, trade marks and other registered intellectual property rights and insolvency).

The Slovenian Supreme Court has clarified that exclusive territorial or subject-matter jurisdiction of the courts does not limit the arbitrability of disputes.

It should be noted that in 2011, the Slovenian legislature caused significant confusion regarding arbitrability of disputes arising out of concession contracts. The legislature adopted an “authentic interpretation” of the law on concession contracts with an attempt to restrict arbitrability of concession disputes. However, arbitration practice and the Slovenian Supreme Court case law have been clear on rejecting the applicability of the authentic interpretation and uniformly recognising the arbitrability of concession disputes.

Slovenian courts respect that the parties to the arbitration agreement are free to choose the law applicable to the arbitration agreement. However, an arbitration agreement with its seat in Slovenia shall only be valid if the subject matter of the dispute is arbitrable under Slovenian law. Thus, the parties’ autonomy is limited regarding arbitrability as described in 3.2 Arbitrability.

While there is no Slovenian case law on this matter, the prevailing view of Slovenian legal doctrine appears to be that in the absence of an explicit agreement of the parties, the validity of the arbitration agreement is governed by the law of the country of the seat of arbitration.

As explained in section 3.1 Enforceability, Slovenian courts carefully consider whether the parties have agreed to arbitrate their disputes. Clauses that do not envisage the arbitral tribunal making a final and binding award are not considered enforceable arbitration agreements in accordance with Slovenian case law.

In the majority of cases, the Slovenian courts enforce the arbitration agreements and have previously upheld the position that a court cannot rule on the same case that has already been decided by an arbitral tribunal. This makes Slovenia a place of arbitration with a supportive legal framework.

The Slovenian Arbitration Act recognises the principle of separability, and the validity of the arbitration agreement is examined independently from the validity of the underlying contract.

The Slovenian courts have also confirmed the position long held by the arbitration legal doctrine and international case law on the autonomous nature of the arbitration clause and the independence of the underlying contract.

The parties are free to appoint arbitrators of their preference, with due regard to impartiality and independence of the arbitral tribunal. The parties are also free to determine the number of arbitrators (including a decision on an uneven number of arbitrators). There are no statutory restrictions on who may act as an arbitrator. Nevertheless, the parties may agree on certain required qualifications of the arbitrators.

The Slovenian Arbitration Act provides for a default procedure if the parties do not determine a method for selecting arbitrators. As a default, the number of arbitrators is three. The default procedure for appointing arbitrators is that each party appoints one arbitrator and the two arbitrators appoint the third arbitrator. The Slovenian court may intervene in the event that one party refuses to appoint an arbitrator (see 4.3 Court Intervention).

The Slovenian Arbitration Act does not contain any specific rules for the appointment of arbitrators in the framework of multiparty arbitrations. In contrast, the arbitration institutions, such as the Ljubljana Arbitration Centre, have adopted certain specific rules as to the appointment of the tribunal in cases of multiparty arbitrations.

Courts can support the arbitral process and intervene in the appointment of arbitrators upon the application of one of the parties. If the default procedure for appointment or the parties’ chosen method for selecting arbitrators fails (eg, because a party refuses to appoint an arbitrator or due to the lack of the required agreement expected in the appointing procedure) then a party may request the court to take the necessary measure and appoint an arbitrator.

In appointing an arbitrator, the court shall have due regard to any qualifications required of the arbitrator by the agreement of the parties and to such considerations as are likely to secure the appointment of an independent and impartial arbitrator.

The court may appoint an arbitrator of a citizenship other than the citizenships of the parties, if this is necessary to ensure the independence and impartiality of the arbitral tribunal. There are no further restrictions and the decision by the court on appointment of the arbitrator cannot be subject to appeal.

An arbitrator may be challenged only if circumstances exist that give rise to justifiable doubts as to his or her impartiality and independence, or if he or she does not possess qualifications agreed to by the parties.

The parties are free to agree on the rules for the challenge or removal procedure. Where institutional arbitration is used, the institutional rules will govern such procedure. If the parties have not agreed on a challenge procedure, Slovenian law provides for a default procedure.

The Slovenian Arbitration Act foresees that a party will first submit a written challenge, and then within 15 days:

• the challenged arbitrator may withdraw from his or her office; or
• the other party may agree on the challenge; or
• the challenge shall be decided by the full arbitral tribunal, including the challenged arbitrator.

If the challenge is not successful, the challenging party may request the court to decide on the challenge within 30 days after having received notice of the decision. The court’s decision cannot be appealed.

Applicable Law

Under Slovenian law, arbitrators may only accept the appointment if they are confident that they will be able to perform their duties impartially, independently and without undue delay.

To ensure this, the Slovenian Arbitration Act prescribes that a proposed arbitrator must disclose any circumstances likely to give rise to justifiable doubts as to his or her impartiality or independence. In addition, an arbitrator, from the time of his or her appointment and throughout the arbitral proceedings, is required to promptly disclose any such circumstances to the parties.

Ljubljana Arbitration Centre Arbitration Rules and Arbitrator Guidelines

The Arbitration Rules of the Ljubljana Arbitration Centre (Ljubljana Arbitration Rules 2023, the “LAC Rules”) require a prospective arbitrator to submit to the Secretariat a signed declaration of acceptance, availability, impartiality and independence, where the prospective arbitrator discloses any circumstances which may give rise to justifiable doubts as to his or her impartiality or independence.

The Secretariat then sends a copy of the declaration to the parties and the other arbitrators, and sets a period of time within which they may submit comments. Where any circumstances relating to justifiable doubts as to the arbitrator’s impartiality or independence arise during the course of the proceedings, the arbitrator has to immediately inform the parties, other arbitrators and the Ljubljana Arbitration Centre thereof in writing.

Furthermore, the Ljubljana Arbitration Centre has adopted Arbitrator Guidelines, which contain guidelines relating to the arbitrator’s duty to disclose circumstances that could raise doubts as to the arbitrator’s impartiality or independence. The Arbitrator Guidelines make explicit reference to the IBA Guidelines on Conflicts of Interest in International Arbitration’s examples of circumstances that arbitrators should disclose in connection with impartiality and independence.

Other Associations

The Slovenian Association of Judges adopted a resolution that it might be contrary to ethical standards for the judges to participate in out-of-court dispute resolution schemes. Because of this, it became common practice for the judges to request an opinion of the president of the court on whether they are free to accept a nomination to be an arbitrator.

In contrast, the Slovenian Bar Association does not prohibit participation of attorneys sitting as an arbitrator on one arbitration and a party representative on another. In this respect, double-hatting is permissible, with due regard to any conflict-of-interest situation that may arise.

See 3.2 Arbitrability.

The Slovenian Arbitration Law recognises the principle of competence-competence – ie, the power of the arbitral tribunal to rule on its own jurisdiction.

An objection to the tribunal’s jurisdiction has to be raised at the latest in the statement of defence (see also 3.1 Enforceability, under Arbitration Agreement in the case of Passiveness by the Defence). Additionally, an objection that the arbitral tribunal is exceeding its authority has to be raised as soon as the matter is raised during the arbitral proceedings. It should be noted that a party is not precluded from raising a challenge to the tribunal’s jurisdiction just because it has participated in the appointment of an arbitration.

If the respondent raises an objection to jurisdiction, the arbitral tribunal has to rule on the issue with a separate decision in the form of an order. If the arbitral tribunal decides that it has jurisdiction to decide on the dispute at hand, a party may request the court to review such decision and decide on the matter.

The Slovenian courts can also address the question of jurisdiction in other circumstances:

• where the court intervenes in the appointment of arbitrators (see 4.3 Court Intervention) if the defendant raises an objection to jurisdiction;
• in the event of litigation proceedings, if the defendant raises an objection to the court’s jurisdiction due to the existence of an arbitration agreement;
• prior to the constitution of the arbitral tribunal, if one of the parties requests that the court determines whether or not arbitration is admissible, in particular on the grounds that the arbitration agreement does not exist, is null and void, ceased to be valid or is incapable of being performed.

The rules on jurisdiction generally favour arbitration over court proceedings (see 5.2 Challenges to Jurisdiction). Reportedly, Slovenia is considered a safe seat of arbitration. When the Slovenian courts are asked to intervene by the parties, they provide a supportive framework. The Slovenian courts will generally find in favour of jurisdiction of an arbitral tribunal if the will of the parties to arbitrate and the form requirements in the arbitration agreement are provided. However, the arbitral tribunal is not bound by the position of the court that the arbitration agreement is valid.

The Slovenian Arbitration Act does not include any provision for the review of negative rulings on jurisdiction by the arbitral tribunal. The legal doctrine is of the view that an arbitral tribunal cannot be forced to accept jurisdiction. This means that a negative decision of the arbitral tribunal on jurisdiction makes an arbitration agreement inoperative.

Ultimately, the arbitral tribunal’s positive decision on jurisdiction can be reviewed in the context of set-aside proceedings (see 11.1 Grounds for Appeal).

The parties may challenge the jurisdiction before the court within 30 days of the separate decision on jurisdiction by the arbitral tribunal.

Additionally, a party may challenge the jurisdiction of the arbitral tribunal in annulment proceedings, which may be initiated after a (partial) arbitral award has been rendered.

In principle, the court makes a full and independent assessment as to the facts and the law, based on grounds invoked by the parties. The examination of an arbitral tribunal’s jurisdiction by the Slovenian court is in any case de novo, since in certain circumstances the arbitral tribunal may not be appointed at this stage, or the two different proceedings may run in parallel.

Nevertheless, the impact of a double negative decision on jurisdiction by both the courts and the arbitral tribunal and the adverse effect on the parties in such a case should be taken into account according to Slovenian case law. This means that the Slovenian courts will generally consider that at least one forum should have jurisdiction so as to avoid denial of justice.

The approach of Slovenian courts towards a party who commences court proceedings in breach of an arbitration agreement will be to declare that it has no jurisdiction, invalidate any actions taken in the proceedings and dismiss the action without prejudice, unless the court finds that the arbitration agreement does not exist, is null and void, ceased to be valid or is incapable of being performed. The courts are generally arbitration-friendly and will observe an arbitration agreement.

The court will not monitor the existence of an arbitration clause ex officio, but only if the defendant objects to the court’s jurisdiction. If the defendant does not object to the jurisdiction in its first written submission at the latest, it is considered that the defendant has implicitly consented to the jurisdiction of the Slovenian court.

The general rule under Slovenian law is that the arbitration agreement only binds the signatory parties. Slovenian courts are also relatively stringent on the will of the parties and form requirements of the arbitration agreement (see 3.1 Enforceability). In accordance with such a restrictive view, arbitration agreements cannot be extended to non-signatory third parties.

The Slovenian Arbitration Act does not contain explicit provisions for the arbitral tribunal to assume jurisdiction over non-signatory third parties. While there is no Slovenian case law extending arbitration agreements on third-party non-signatories, there are some opinions that under qualifying circumstances an arbitration agreement may also be deemed to extend to and be binding on third parties.

At the request of a party, the arbitral tribunal can grant an interim measure it considers appropriate, after giving the other party an opportunity to present its case or exceptionally ex parte, provided that the parties did not agree otherwise. Parties may still apply for these measures before Slovenian courts, even in the case of a potential exclusion.

The Slovenian Arbitration Act does not determine the form and content of such measures, thus they can include preservation of goods, preservation of the value of certain assets, prohibitory injunctions, etc. Such measures are binding only on the parties of the arbitration agreement (eg, measures that would require a bank to freeze assets of a defendant would not be admissible).

Save for interim relief measures issued ex parte, interim relief measures are enforceable through Slovenian courts. Furthermore, interim relief measures rendered by foreign arbitral tribunals are enforceable in Slovenia.

Under Slovenian law, parties may turn to the Slovenian courts to grant interim relief measures in both arbitrations seated in Slovenia and foreign arbitrations (see 6.1 Types of Relief).

The Slovenian courts also offer assistance with the enforcement of interim relief measures issued by arbitral tribunals. The court will deny the enforcement of an interim measure if it finds that circumstances for denial of enforcement of a domestic arbitral award or for recognition of a foreign arbitral award are present.

Additionally, there are no special provisions for emergency arbitrators under the Slovenian Arbitration Act. In principle, there should be no difficulty with the enforceability of orders issued by emergency arbitrators under institutional rules, such as the LAC Rules.

The powers of Slovenian courts and arbitral tribunals to issue interim relief are understood to encompass the power to order security for costs.

In contrast to the Slovenian Arbitration Act, which limits the interim relief to the appropriate consideration having regard to the subject matter of the dispute, the LAC Rules (similarly to the Model Law) have omitted such restriction, and it appears that even under the LAC Rules security for costs can be ordered.

The Slovenian Arbitration Law grants the parties extensive autonomy in determining the rules governing the arbitral procedure, with only a few mandatory provisions. There is also a default framework that allows the arbitral tribunal to conduct the arbitration in such manner as it considers appropriate, subject to the mandatory provisions. The power conferred upon the arbitral tribunal includes the power to determine the admissibility, relevance, materiality and weight of any evidence.

Mandatory Provisions

The parties may not derogate from the following:

• the right to be heard;
• the equal treatment of the parties;
• the independence and impartiality of arbitrators;
• the right to be represented by a legal counsel;
• the rule that the arbitral tribunal may not exceed its authority;
• the rule on capacity to be a party; or
• contractual capacity.

Furthermore, the parties are free to agree on the seat of arbitration. However, it is not considered possible for parties to determine that arbitration with its seat in Slovenia would be governed by foreign procedural law.

Submission of Disputes to an Institution Under Institutional Arbitration Rules

When parties submit their disputes to an arbitral institution, they are deemed to have agreed to the application of the arbitration rules of that institution.

There is no case law concerning the validity of arbitration clauses where the parties submit their disputes to one arbitral institution and determine the procedure to be conducted in accordance with the rules of another institution. However, in the arbitration practice of the Ljubljana Arbitration Centre, it is not acceptable to refer a dispute to the Ljubljana Arbitration Centre under the procedural rules of another arbitral institution (eg, the ICC, SCC, Swiss Arbitration, VIAC, etc). The only exceptions are the UNCITRAL Arbitration Rules, under which the Ljubljana Arbitration Centre regularly administers complex international construction, investment and trade disputes.

The parties are largely free to agree on the manner in which their arbitration proceedings are to be conducted (see 7.1 Governing Rules).

One of the procedural steps that will apply by default is that the arbitral tribunal has to examine its jurisdiction ex officio if the defendant does not file a statement of defence at all.

Additionally, the following procedural steps will apply, unless the parties agree otherwise:

• the arbitral proceedings will commence on the date on which a request for the dispute to be referred to arbitration is received by the respondent;
• the arbitral tribunal will determine the language to be used in the proceedings;
• the arbitral tribunal will determine the timetable;
• the claimant will have the opportunity to state a definite claim, the facts supporting the claim, and the points at issue;
• the respondent will have the opportunity to state its defence;
• the arbitrators will give the parties an opportunity to present their respective cases in writing or orally; at the request of a party, an oral hearing will be held prior to the determination of the dispute; and
• in the case of more than one arbitrator, any decision by the arbitral tribunal will be made by the majority of its members, save for questions of procedure, which may be decided by the presiding arbitrator if authorised by the parties or all members of the arbitral tribunal.

Under the Slovenian Arbitration Act, there are no rules on time limits concerning the duration of proceedings. However, the LAC Rules provide for an obligation of the arbitral tribunal to hold a case management conference with the parties and thereafter set a procedural timetable for a quick and efficient resolution of the dispute (generally within nine months), which is strictly monitored by the Ljubljana Arbitration Centre with a hands-on approach.

The Slovenian Arbitration Act provides arbitrators with the power to:

• rule on their own jurisdiction (see 5.2 Challenges to Jurisdiction);
• grant any interim relief (see 6.1 Types of Relief);
• conduct the arbitration in the manner deemed appropriate by the arbitrators, subject to the mandatory provisions of the Slovenian Arbitration Act (see 7.1 Governing Rules);
• terminate the arbitration if the claimant fails to submit a statement of claim;
• continue proceedings and render an award if the respondent fails to submit a statement of defence or any party fails to appear at the hearings or present documentary evidence;
• appoint experts and require document and information disclosure from parties for such purpose; and
• request assistance from a Slovenian court in collecting evidence (see 8.1 Collection and Submission of Evidence).

Additionally, according to the Slovenian Arbitration Act, arbitrators must:

• remain impartial and independent throughout the arbitration, which includes their duty to disclose (as set out in 4.5 Arbitrator Requirements);
• treat the parties equally and ensure they are given a full opportunity to present their cases;
• decide the dispute in accordance with the rules of law chosen by the parties as being applicable to the matter in dispute, or in the absence of such choice, the law they determine to be applicable;
• render an award in writing and set out the reasons upon which it is based (see 10.1 Legal Requirements); and
• correct any errors in an award, issue an interpretation of a specific part of an award, or issue an additional award upon request of either party.

Under the Slovenian Arbitration Act, there are no particular qualifications or other requirements for legal representatives in arbitration proceedings, provided that they have contractual capacity. This means that the parties in arbitration proceedings have the right to choose any domestic or foreign law firms as representatives and also the right to choose someone who is not admitted to the Slovenian Bar Association or any foreign Bar.

The arbitral tribunal or a party with the approval of the arbitral tribunal may request a competent court to assist in taking evidence or to perform another action that the arbitral tribunal is not empowered to carry out. If the court carries out the request, it does so according to its rules of procedure. The arbitrators are entitled to participate in any judicial taking of evidence and to ask questions. Actions of court assistance are carried out by the court in accordance with the Slovenian rules governing assistance between courts.

Under the Slovenian Arbitration Act, when conducting the proceedings, the arbitral tribunal has the power to decide on the admissibility, relevance and probative value of each piece of evidence as it deems appropriate. It is important to ensure the party’s right to be heard. According to Slovenian case law, this means that the party has a right to have all the submitted evidence taken, unless there are justifiable grounds for refusing it (eg, irrelevance, unsuitability, if the proposed evidence is not substantiated or under qualifying circumstances is evidence that was illegally obtained).

Furthermore, the arbitral tribunal may not make a pre-emptive evaluation of evidence. For example, the arbitral tribunal may not refuse to hear a witness, proposed by one of the parties, on the grounds that he or she is unreliable or biased or that whatever the witness would say could not overturn the tribunal’s conclusions, made on the basis of evidence submitted by the other party.

Slovenian law does not stipulate rules of evidence that apply specifically to arbitral proceedings and leaves them up to the parties to the arbitration. By default, the arbitral tribunal may decide on the admissibility, relevance and probative value of each piece of evidence as it deems appropriate (see also 8.1 Collection and Submission of Evidence). The arbitral tribunal may apply the Slovenian Civil Procedure Act or other rules of evidence, such as the IBA Rules on the Taking of Evidence in International Arbitration.

In particular, the arbitral tribunal may apply Slovenian rules on the standard of proof, which are considered to be a matter of procedure (in contrast to the rules on burden of proof). It should be noted that the standard of proof under Slovenian rules is very high. It is prescribed that the judge (or arbitrator) must be persuaded of the existence of a certain fact; if not, the judge (or arbitrator) should find against the party on whom the burden of proof for this fact rests (ie, the standard of “beyond doubt for a reasonable person”).

Additionally, the arbitral tribunal may order that any documentary evidence shall be accompanied by a translation into the language of the arbitral proceedings.

For more information regarding the request for assistance by the Slovenian court, see 8.1 Collection and Submission of Evidence.

Arbitral tribunals do not have the powers of compulsion. Thus, court assistance is usually requested for measures relating to third parties. In this regard, possible measures that can be ordered by the court include:

• ordering a (third) party to disclose documents directly to a party or an expert;
• ordering a (third) party to appear as a witness before the arbitral tribunal (whereas there is no obstacle to agreeing upon an adversarial system of cross-examination); and
• ordering a (third) party to allow access to a land plot, property, or item for inspection.

It should be noted that the parties are prohibited from producing documents containing settlement offers from another party in the course of negotiations, and documents produced or filed in the course of mediation.

The principle of confidentiality is not expressly included in the Slovenian Arbitration Act. Nevertheless, confidentiality is respected, and arbitration proceedings are generally confidential and the public excluded.

Arbitration institutions, such as the Ljubljana Arbitration Centre, have adopted certain specific rules as to confidentiality. The LAC Rules provide that unless otherwise expressly agreed by the parties, the Ljubljana Arbitration Centre, the arbitrators and the emergency arbitrator shall maintain the confidentiality of the proceedings, including the mere existence of the proceedings, identity of the parties, all awards, orders and other decisions of the arbitral tribunal, as well as any documents submitted, which are not otherwise publicly available.

Confidentiality During the Proceedings

In arbitration practice, the Ljubljana Arbitration Centre, when performing tasks and administering the arbitration, tends to provide their addressees only the minimum amount of information that is required for:

• the candidate arbitrator before their appointment in order to perform a conflict-of-interest check;
• the national court in the case of an intervention related to the selection of arbitrators (see 4.3 Court Intervention), issues of jurisdiction (see 5.3 Circumstances for Court Intervention), and interim relief (see 6.2 Role of Courts).

Publishing of the Orders, Decisions and Awards

With respect to publishing the awards, the Ljubljana Arbitration Centre may publish the award, orders and other decisions of the arbitral tribunal in an anonymous form that does not enable identification of the parties or other persons unless a party objects to such publication.

In this regard, information from arbitration proceedings cannot be disclosed in subsequent proceedings, save for anonymised orders, decisions, and awards that allow for consistency, uniformity and predictability of arbitral case law.

The Ljubljana Arbitration Centre regularly publishes anonymised orders, decisions and awards in various arbitration-related databases, with due regard to any party objections.

The award must meet the following requirements:

• it must be made in writing and signed by the arbitrators (in the case of two or more arbitrators, by all the arbitrators or the majority of the arbitrators provided that the reason for omitting any arbitrator’s signature is stated);
• it must state the reasons for the award, unless the parties have agreed that no reasons are to be given or the award is one on agreed terms;
• it must state the date of the award and the place of arbitration; and
• a copy of the award shall be delivered to each party to the proceedings.

The Slovenian Arbitration Act does not prescribe time limits for the delivery of the award. However, such time limits can be agreed upon by the parties. It should be noted that the LAC Rules require the arbitral tribunal to set a procedural timetable and render an award within nine months or within six months in case of expedited proceedings (see 7.2 Procedural Steps).

The Slovenian Arbitration Act does not contain any explicit provisions on the types of remedies that an arbitral tribunal may award. This is because the choice between different remedies (monetary damage or specific performance, prohibitory injunction, etc) is considered to be a matter of substantive law. However, declaratory relief is considered to be a matter of procedural law and is only possible provided that the claimant has a sufficient legal interest.

Additionally, any remedies that would be considered incompatible with the basic principles of the Slovenian legal system (ordre public), would be excluded. For instance, punitive damages are against Slovenian public policy and as such cannot be imposed.

By default, the arbitral tribunal shall, at the request of a party, decide on the costs, ie, which party shall bear them and to what extent. The costs may include costs for legal representation and the arbitrators’ and experts’ fees. The arbitral tribunal does so at its discretion, taking into consideration the circumstances of the case and the outcome of the proceedings. The arbitral tribunal’s decision may be included in the final award or the order for the termination of proceedings. The arbitral tribunal can also issue a separate award on costs, if the proceedings have already been terminated.

In practice, the “costs follow the event” principle is prevalently used. The “costs follow the event” approach was also adopted by the LAC Rules; however, this principle is now combined with the arbitral tribunal’s determination of each party’s contribution to the effectiveness and expeditiousness of the proceedings, taking into consideration the reasonable costs and other relevant factors (eg, not acting in good faith, abuse of procedural rights, etc).

The Slovenian Arbitration Act does not provide for the entitlement to recover interest. This right is considered a substantive right and depends on the law applicable to the merits.

The Slovenian Arbitration Act does not foresee appellate proceedings against an arbitral award. However, since the parties are relatively free to determine the procedural rules of arbitration proceedings, it would be permissible to agree that an arbitral award could be appealed, so that a two-instance deciding process would be established. As far as is known, no such case exists in Slovenian arbitral practice.

An arbitral award can be challenged before the court, with an action for annulment of the arbitral award. It is not permissible to waive the right on judicial annulment in advance.

The action for annulment of the arbitral award shall be filed no later than three months from the receipt of the arbitral award. The District Court of Ljubljana is exclusively competent to decide on such annulment.

There are two types of violations that can lead to the annulment of the arbitral award – the court is ex officio attentive towards the most serious violations and can, in these cases, annul the arbitral award even if the violations were not raised by the parties: 

• where the subject of the dispute cannot be the subject of an arbitration agreement (see 3.2 Arbitrability); and
• where the arbitral award is against public order.

The court would annul the arbitral award where the plaintiff proves:

• that either of the parties was incapable of concluding the arbitration agreement, or that the agreement is not valid under the chosen law or Slovenian law if the parties did not choose the applicable law;
• that its right to be heard has been deprived by the arbitral tribunal (eg, it has not been duly informed of the appointment of the arbitrator or of the arbitration proceedings);
• the award relates to a dispute not covered by the arbitration agreement or contains a decision on issues that go beyond the scope of the arbitration agreement – however, in such a case, if it is possible to delimit the decision on the issues covered by the arbitration agreement from the decision that goes beyond the agreement, only that exceeding part of the award shall be annulled; or
• that the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was inconsistent with mandatory provisions of the Slovenian Arbitration Act, or that it was not in accordance with the Slovenian Arbitration Act in the absence of an agreement of the parties.

Special provisions and additional grounds for annulment are applicable for arbitral awards issued in labour and consumer arbitration proceedings, where, for example, violation of Slovenian mandatory provisions (and not only public order) can be grounds for annulment.

Under Slovenian law, the parties cannot exclude or expand on the provisions regarding judicial annulment of an arbitral award.

Judicial review is, as explained in 11.1 Grounds for Appeal, mostly limited to procedural questions and violations. The merits of a case can only be reviewed in the scope of compliance with Slovenian public order and arbitrability (ex officio judicial review).

Slovenia succeeded the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”), which the former Socialist Federal Republic of Yugoslavia (Slovenia’s successor state) ratified in 1981.

In 2008, with the adoption of the new Arbitration Act, Slovenia annulled the reservations made earlier by Yugoslavia (that it will apply the Convention on a reciprocal basis only to arbitral awards rendered in the territory of another member of the New York Convention and to disputes arising out of contractual or non-contractual legal relations which are considered to be commercial).

Currently, there are no reservations regarding the use of the New York Convention.

Slovenia has also ratified/succeeded to:

• the 1927 Geneva Convention on the Execution of Foreign Arbitral Awards;
• the 1961 European Convention on International Commercial Arbitration;
• the 1965 Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the “ICSID Convention”).

Different rules apply for enforcement of a domestic arbitral award (ie, issued by an arbitration institution located in Slovenia) and foreign arbitral award.

Domestic arbitration awards can be enforced when declared enforceable by a Slovenian court (exclusive jurisdiction of the District Court of Ljubljana). The award is not declared enforceable if reasons for ex officio annulment (see 11.1 Grounds for Appeal) exist, except if the claim on annulment has already been finally dismissed.

Foreign arbitration awards can be enforced when recognised by a Slovenian court. Provisions of the New York Convention apply, and the Slovenian Arbitration Act does not contain detailed provisions. The application for recognition can be made together with the request for enforcement.

Appeal against the decision issued in the enforcement and recognition proceedings is possible to the Slovenian Supreme Court. However, the scope of such appeal is limited (see 11.3 Standard of Judicial Review).

A recognised and enforceable arbitral award becomes a legal title in accordance with the provisions of the Slovenian Enforcement and Security Act. This means that it has the same status as final and enforceable judgments issued by Slovenian courts.

It is disputable whether an arbitral award that has been set aside by the courts in the seat of arbitration can be recognised and enforced in Slovenia due to the wording of Article V of the New York Convention – recognition and enforcement may be refused. There are some opinions on allowing this possibility, especially because of a case under the 1961 European Convention on International Commercial Arbitration where an arbitral award issued in Slovenia was annulled by a final decision of the Slovenian court but later recognised in Austria.

If proceedings on annulment would be initiated in the domestic state of the arbitral award (ie, not in Slovenia), Slovenian courts are not required to suspend the recognition proceedings but may nevertheless do so (in practice, usually upon the request of the debtor under the award). If Slovenian courts are not bound to the decision of the set-aside proceedings, it is not considered a preliminary question in accordance with Slovenian law. In practice, it is more likely that the court would suspend the proceedings until a final solution of the foreign set-aside proceedings.

Ultimately, once an arbitral award is recognised and enforceable in Slovenia and becomes a judicial title, the state cannot raise the objection/defence of sovereign immunity. This is subject to earlier stages and proceedings, not enforcement.

According to the Slovenian Supreme Court, in assessing the merits of an application for recognition of the enforceability of an arbitral award, the court may only consider whether the arbitration has respected the limits of arbitrability (see 3.2 Arbitrability) and whether the procedure and effect of the award are in accordance with public order (ie, acceptable from the point of view of the most fundamental values and constitutional principles of the domestic legal order). The public order exception must be applied with restraint, and only as a last resort, when its non-application would lead to consequences that would be unsustainable for the domestic legal order.

The aforementioned must not be understood in a way that violation of domestic public order would mean any contradiction with mandatory provisions of Slovenian law. On the contrary, international public order is relevant in the meaning of the universal key principles and values of international conventions (eg, of the European Council, European Union, or United Nations). Nevertheless, the principle of public order is a legal foundation of Slovenian law (ie, domestic) and not international law.

Slovenia does not provide for a regime for class action or group arbitration. According to legal doctrine, such a regime would be permissible if there was an explicit agreement of all the parties.

See 4.5 Arbitrator Requirements.

Additionally, members of the Slovenian Bar Association acting as counsel in arbitration proceedings have to respect the Code of Professional Conduct of the Slovenian Bar Association, with respect to representation of a client.

There are no specific rules or restrictions on third-party funders. The concept of third-party funding is not entirely alien to Slovenian law and there has been legislation regulating it in regard to collective actions submitted in litigation proceedings. Thus, third-party funding is permissible under Slovenian law.

The recently updated version of LAC Rules addresses third-party funding and requires the parties to disclose the existence or identity of any third party funding its claim or defence and which has an economic interest in the outcome of the case. This enables the nominated arbitrators to duly comply with their duties of independence and impartiality.

The Slovenian Arbitration Act does not address the issue of consolidation of separate arbitral proceedings, and this issue would be governed by the arbitration rules agreed by the parties. Additionally, the Slovenian Arbitration Act does not preclude the arbitral tribunal from consolidating separate arbitral proceedings into a single proceeding. The key is that the will of the parties for all proceedings to be decided by arbitration must be clear. Consequently, it would be possible to consolidate proceedings where:

• all parties have agreed to consolidation; or
• all of the claims in the proceedings are covered by the same arbitration agreement; or
• the claims arise from the same legal relationship, between the same parties, and the arbitration agreements are compatible if not all of the claims are covered by the same arbitration agreement.

The LAC Rules set out conditions for a decision on consolidation by the board of the Ljubljana Arbitration Centre. In deciding whether to consolidate, the board takes into account all circumstances it considers relevant, including whether any arbitrators have been appointed in more than one of the proceedings and, if so, whether the same or different arbitrators have been appointed. Before adopting the decision on the consolidation, the board consults with the parties and the arbitrators already appointed.

In principle, arbitration agreements are only binding for the parties to the agreement (see 5.7 Third Parties). There is no general rule that would enable a national court to bind a foreign third party to arbitration. 

Under the LAC Rules, the arbitral tribunal may, at the request of any party, allow one or more third persons to be included in the proceedings as a party provided such person is bound by the arbitration agreement. The arbitral tribunal may, after giving all parties, including the person or persons to be joined, the opportunity to submit comments, decide not to permit the joining party, if doing so would cause disproportionate prejudice to any of the parties.