Russian Government Implements New Decree Potentially Impacting Foreign Companies

The Russian Government is moving ahead with long delayed implementation of Decree of the President of Russia No. 422 dated May 23, 2024. The Decree calls for legal actions against governments of countries that seized the assets of Russia or the Bank of Russia. Private companies and individuals from such countries may be named co-defendants in such lawsuits if the plaintiff decides that its claims against the governments of respective countries cannot be satisfied with assets owned by such states and located in Russia. The assets of private companies that may be at risk include their immovable property, equity interest held in Russian subsidiaries, intellectual property, other tangible and intangible movable property.  The Kremlin is about to introduce a bill aiming to amend applicable legislation on civil procedure and enforcement of judicial awards in Russia to lay out legal basis for such lawsuits. If submitted to the parliament, there is not much doubt that the legislators will promptly process such bill and vote it into law.  Foreign companies may face serious challenges protecting their assets for certain limitations on ability to deal with them have been introduced in the past three years.

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Dmitry Kunitsa has almost 30 years of experience advising clients on doing business in Russia and other countries of Eastern Europe. Mr. Kunitsa’s practice is focused on assisting foreign legal entities and individuals with their investments in this region and helping Russian companies and nationals to do business in other countries, including in Europe, the United States, the Middle East and in South East Asia. Mr. Kunitsa has a broad network across Russia to call on to provide local counsel, to the extent it is needed. Read more here