Assignment of a Claim: Does the Arbitration Clause Travel With It?

Dispute Resolution | JVS Law

You have bought a debt. The contract it comes from carries an arbitration clause — the ICAC in Kyiv, or London under the GAFTA Rules. Now you need to collect, and the first question is not about the money: did the right to arbitrate come across with the claim, or do you have to agree it with the debtor all over again?

Getting this wrong is expensive in a specific way. Arbitrate without the right to, and you win an award the debtor kills at the recognition stage. Litigate when the clause binds you, and the claim is left without consideration while time runs.

The short answer under Ukrainian law: the clause normally travels with the claim. The long answer is about why “normally” is not a hedge, where the line actually falls, and what to put in the assignment agreement so the question never arises.

Replacing a party to an obligation is not one event but several. Article 512 of the Civil Code lists four grounds on which a creditor changes: transfer of rights by transaction (assignment of the claim), succession, performance of the debtor’s obligation by a surety or pledgor, and performance by a third party. Plus other cases established by law — which is where subrogation in favour of an insurer sits.

The provision that carries the argument is Article 514: the new creditor acquires the original creditor’s rights in the scope and on the conditions that existed at the moment of transfer, unless the contract or the law provides otherwise. That is the hook for saying the remedy travels with the right.

Three neighbouring provisions matter more in practice than they look:

• Article 513(1). The assignment must be made in the same form as the transaction that created the obligation. Written contract, written assignment. This matters twice over, because an arbitration agreement exists only in writing (Article 7 of the Law on International Commercial Arbitration and Article II(2) of the New York Convention). Two form requirements overlap here, and neither is satisfied by an oral understanding.
• Article 516(1). A creditor is replaced without the debtor’s consent. The debtor cannot block the assignment — but it does not follow that the debtor silently agreed to arbitrate against anyone, anywhere.
• Article 520. A debtor, by contrast, may be replaced only with the creditor’s consent. The asymmetry is deliberate: a new creditor is tolerable, a new debtor is not.

And there the Code falls silent. It speaks of rights in an obligation: to be paid, to be delivered to, to be compensated. An arbitration agreement is not a claim. It is an agreement about who decides and by what procedure, and the Ukrainian Supreme Court consistently stresses that it is autonomous from the main contract. Autonomy cuts both ways: it saves the clause when the contract is held void, and it hands your opponent the argument that assigning a claim under the contract does nothing to the separate agreement to arbitrate.

Closing that seam was left to the case law.

The question was settled by the ruling of the Grand Chamber of the Supreme Court of 1 November 2023 in case No. 910/3208/22.

The facts are simple. A Ukrainian plant sold wheat to a foreign company; clause 12.1 of the contract sent all disputes to arbitration under GAFTA Arbitration Rules No. 125, seat in London, in English. The parties then signed an addendum under which a third company, as guarantor, “assumes all obligations of the Buyer arising from the Contract, taking into account all amendments and supplements to the Contract, both existing and future”. When the buyer did not pay, the seller sued the guarantor — not in GAFTA, but in the Commercial Court of Kyiv.

The first-instance court left the claim without consideration because of the arbitration clause. The appellate court reversed: the addendum, it held, was a separate suretyship contract, it contained no clause, and the clause did not extend to the guarantor automatically. The Grand Chamber set the appellate ruling aside and restored the first-instance decision.

The passage worth reading the ruling for (paragraph 9.32):

“…the parties’ inclusion of an arbitration clause in a contract as a term has the effect of extending that arbitration clause to the legal relations under that contract involving another person who entered into those relations as a party and assumed the corresponding rights and obligations of a party to that contract, provided that the parties did not terminate the arbitration agreement, did not exclude a particular dispute from its scope, did not deprive it of binding force for such a party, and the arbitration agreement did not lose validity through other circumstances.”

Note the structure: the rule is framed through the absence of objections. The clause extends unless the parties terminated it, carved a dispute out of it, or released the new party from it. The burden therefore sits with whoever says otherwise.

Your opponent will almost certainly cite the ruling of the Supreme Court of Ukraine of 18 October 2017 in case No. 910/8318/16 — and will be technically right, because it has not been overruled.

There, a new creditor who had acquired a claim against Ukrnafta under a replacement-of-creditor agreement sued in the commercial court. Ukrnafta asked the court to terminate the proceedings because of the arbitration clause. The Supreme Court of Ukraine upheld the refusal: no agreement to arbitrate had been concluded between this claimant and this respondent, and the clause in the contract was between Ukrnafta and the original creditor. The conclusion was the opposite one.

The chamber of the Commercial Court of Cassation, referring case No. 910/3208/22 to the Grand Chamber, asked for that very conclusion to be departed from. The Grand Chamber declined to depart — for a purely technical reason (paragraph 9.43): the relations are not comparable. The 2017 ruling concerned termination of proceedings under clause 5 of part 1 of Article 80 of the Commercial Procedure Code as in force before 15 December 2017; the new case concerned leaving the claim without consideration under clause 7 of part 1 of Article 226 as in force from 15 December 2017. Different consequences under different regimes.

What follows is practical. The 2017 conclusion is alive but tied to a procedural regime that no longer exists. The Grand Chamber also noted separately (paragraph 9.41) that from 15 December 2017 the pro-arbitration approach is written into the codes: under Article 22(3) of the Commercial Procedure Code, any imprecision in the text of an arbitration agreement and any doubt as to its validity, effectiveness and enforceability is construed by the court in its favour. Article 21(2) of the Civil Procedure Code says the same. In 2017 that text was not yet there.

So the answer to the 2017 citation is not “it has been overruled” but “it is about a different procedural tool under an earlier version of the law”.

There is a second half to this, raised less often but argued constantly: if the creditor has assigned the claim, does it still hold the right to arbitrate — and does the clause between the original parties simply lapse?

The answer came in the ruling of the Civil Court of Cassation within the Supreme Court of 10 February 2022 in case No. 824/116/21. A Chinese supplier had received an insurance payout and, under a subrogation act, assigned its claim against the Ukrainian buyer to the insurer. The supplier — no longer the “owner” of the claim — then won an ICAC arbitration. The buyer applied to set the award aside: the party, it argued, had ceased to be a party to the contract and to the arbitration clause, so the award contained decisions on matters beyond the scope of the arbitration agreement (the ground in Article 34(2)(1), third paragraph, of the Law).

The Supreme Court refused, in terms worth keeping to hand:

“The arbitration agreement is valid precisely for these parties, and even the transfer of the claim under the main contract will not affect the validity and effectiveness of the arbitration agreement itself for these parties.”

Two practical consequences. First, an assignment does not extinguish the clause for those who signed it. Second, and more useful in defence: using an assignment as a ground to set an award aside is a weak move, and the Supreme Court has already rejected it.

The institution decides this first, long before it reaches a state court.

In case No. 71 (award of 17 May 2012) the tribunal held that under settled international arbitration practice, where a claim under a contract containing an arbitration clause is assigned, the rights provided for in that clause pass to the assignee as well. The Ukrainian-law basis given was Article 514 of the Civil Code. But the reasoning turns on a detail: the assignment agreement expressly provided that one of the conditions of the transfer was preservation of the dispute-resolution procedure set out in the contract. The tribunal went on to say that this procedure is not inseparably linked to the person of the previous creditor, corresponds to the debtor’s own expressed will, and secures the method of protection the debtor had chosen.

In case No. 89 (award of 26 February 2013) the reasoning is shorter: since all claims under the sale contract had passed to the claimant in full, the contractual right to apply to the ICAC passed as well.

The procedural side is governed by Article 23 of the current ICAC Rules (as amended with effect from 18 February 2025). It repays careful reading, because it is less automatic than people assume:

“In the event of termination of a legal entity, replacement of the creditor or the debtor in an obligation, death or declaration of a natural person as deceased or missing, and in other cases of replacement of a person in the legal relations from which the dispute arose, the President of the ICAC (before the tribunal is constituted) or the tribunal upon a written request of a party and/or the successor, taking into account the content of the arbitration agreement and all circumstances of the case, may join the successor of the relevant party to the case. All acts performed in the arbitration before the successor joined it are binding on the successor.”

Three things follow. A successor is joined on request, not spotted by the institution. The decision is discretionary — “may join”, weighing the content of the agreement and all the circumstances. And everything that happened before the successor joined is binding on it: a missed deadline for a counterclaim, a constituted tribunal, an agreed procedure — all inherited as they stand.

For contrast, Article 22 of the Rules, on third parties, requires that all parties and the third person be bound by the arbitration agreement, or consent within 15 days. Succession is a different, softer regime, and the two should not be conflated.

One more provision works for you where the text is imperfect: Article 4(1) of the Rules, under which any imprecision in the agreement and any doubt as to its validity, effectiveness and enforceability is construed in favour of validity, effectiveness and enforceability. The same formula as Article 22(3) of the Commercial Procedure Code.

Picture the commonest configuration: a foreign supplier assigns its claim against a Ukrainian buyer to a Ukrainian company. Both parties to the dispute are now Ukrainian. Has the dispute lost its international character — and with it the jurisdiction of international commercial arbitration?

It has not, and this follows from the text. Article 1(2) of the Law on International Commercial Arbitration ties the test to whether the place of business of at least one of the parties is abroad at the time the arbitration agreement was concluded. Not at the time of the dispute, not at the time of filing. A later change of party does not rewrite that.

Since 21 May 2026 the field is wider still. Law No. 4856-IX of 28 April 2026 restated that provision on the UNCITRAL formula: a dispute is also international where the parties have expressly agreed that the subject matter of the arbitration agreement relates to more than one state, or where the place of arbitration, the place of performance of a substantial part of the obligations, or the place most closely connected with the subject matter lies outside the state where the parties have their places of business.

And separately — clause 2 of the Final and Transitional Provisions of that Law: the amendments expanding the competence of international arbitration apply also to arbitration agreements concluded before it entered into force. Clauses signed years earlier became broader on their own, without the parties doing anything.

1. Name arbitration among what transfers. One sentence stating that the right to resolve disputes in the manner set by the arbitration clause of the main contract passes to the new creditor. That is precisely the wording that decided ICAC case No. 71 — and it disposes of the whole “rights and obligations” argument built on the Grand Chamber’s formula.
2. Where the stakes are high, bring the debtor in. A tripartite agreement, or a separate written confirmation from the debtor that the clause applies between it and the new creditor, closes the question for good. Writing is not a formality here: it is the condition of existence of an arbitration agreement under Article 7 of the Law and Article II(2) of the New York Convention.
3. Respect the form of the assignment itself. Article 513: the same form as the underlying transaction. Notarised or subject to state registration — the assignment likewise.
4. Do not file a “just in case” claim in a state court. The window for objecting to state jurisdiction closes not on a calendar deadline but on your first statement on the substance — the mechanism is set out separately: challenging an arbitration agreement in a Ukrainian court.
5. If the arbitration is already running, file a written request under Article 23 of the Rules and do not delay: everything done before the successor joins is binding on it.
6. Notify the debtor in writing and hand over the evidence of transfer. Without written notice, performance to the original creditor is good performance (Article 516(2)), and until evidence is provided the debtor is entitled to perform nothing at all (Article 517).
7. Remember the other direction. Replacing the debtor requires the creditor’s consent (Article 520). There is no construction in which a debt, clause and all, moves to someone else behind your back.

The cheapest moment is when the main contract is signed. A sentence providing that the arbitration clause remains binding on the successors and assignees of each party costs one line and removes everything described above. Also worth settling at that stage: ICC Rules or ICAC Rules and arbitration or court in a cross-border contract.

Sources

• ICAC jurisdiction where the parties to the dispute change — Kateryna Tsirat’s paper at the 6th Pobirchenko International Arbitration Readings (in Ukrainian). It collects the arguments for and against automatic transfer of the clause, and the ICAC practice this article relies on.
• Ruling of the Grand Chamber of the Supreme Court of 01.11.2023 in case No. 910/3208/22 — full text in the Unified State Register of Court Decisions.
• Rules of the ICAC at the Ukrainian Chamber of Commerce and Industry — as amended with effect from 18 February 2025 (Article 23, procedural succession).

Prepared in August 2026 from the current texts of the Civil Code of Ukraine, the Commercial Procedure Code of Ukraine and the Law of Ukraine “On International Commercial Arbitration” on the official Legislation of Ukraine portal, from the ICAC Rules as amended with effect from 18 February 2025, and from Supreme Court rulings in the Unified State Register of Court Decisions. This page states the general rule: the outcome in a given case depends on the wording of the clause, the wording of the assignment, and what exactly passed to the new creditor.

The author presented on this subject at the 6th Pobirchenko International Arbitration Readings; her doctoral research concerns the international instruments governing choice of forum, and she takes up the same thread in her guide to checking a Ukrainian counterparty. Related: recognition and enforcement of arbitral awards in Ukraine.