Legal Support for Foreign Investors: Criminal, Investment, and Property Issues

With the ongoing transformation of the legal and economic environment in the Russian Federation, foreign investors and individuals are facing a range of new regulatory and law enforcement challenges.

A comprehensive approach combining protection of interests in cross-border disputes, support for investment activities, and structuring asset ownership in accordance with current restrictions is particularly important.

Experience shows that timely development of a legal position and proper interaction with government agencies can significantly reduce risks and preserve the economic value of assets.

In these circumstances, the following areas of legal support are in demand:

Support of procedural inspections and criminal cases against persons outside the Russian Federation, preparation of legal positions and opinions for participation in extradition procedures.
Supporting the activities of foreign investors on the territory of the Russian Federation.
Issues of returning assets of foreign entities into circulation in the Russian Federation.
Assistance in finding financing for lawsuits.
Assisting foreign clients in Real Estate matters

Support of procedural inspections and criminal cases against persons outside the Russian Federation, preparation of legal positions and opinions for participation in extradition procedures.

Businesses are constantly faced with inspections, including those to determine whether the actions of the owners and top managers of a company are indicative of a criminal offense.

In recent years it has become difficult or impossible for many people to appear before Russian law enforcement agencies to give explanations and present their position.

Our company is ready to build communication with law enforcement authorities, to ensure that the position of the principal and the relevant evidence are presented in the materials of the audit.

Timely action often makes it possible to prevent the initiation of criminal proceedings and, consequently, the problems associated with criminal prosecution.

In every criminal case against a person outside Russia, law enforcement authorities initiate extradition.

In each case where the authorities of the requested country decide on extradition, the application of the law of the requesting country is examined.

Our company has experience in preparing legal opinions on Russian law, as well as in preparing a legal position for attorneys involved in extradition proceedings.

In addition, at this stage it is also possible to submit a position and evidence to the criminal case file in order to terminate criminal prosecution.

Supporting the activities of foreign investors on the territory of the Russian Federation.

Our main services are divided into two areas: work with friendly foreign investors and work with foreign investors from unfriendly countries.

The list of unfriendly foreign countries is established by the Order of the Government of the Russian Federation.

1. For investors from friendly countries we usually provide services on registration and support of subsidiaries in the territory of the Russian Federation, as well as accreditation of Representative Offices and Branches of foreign companies in the territory of the Russian Federation. In addition, we provide accounting, financial, tax, currency and customs consulting services.

2. Investors from unfriendly states mainly seek services to support their exit from Russian assets. The main peculiarity of transactions with representatives of unfriendly states is that they require authorization from the Government Commission under the Ministry of Finance of the Russian Federation. These permits are required for the sale of shares and stakes in Russian business companies, alienation of real estate owned by unfriendly foreigners or their Russian subsidiaries, withdrawal from a Russian LLC or liquidation of a Russian company. Obtaining a Permit from the Government Commission is a rather long and complicated procedure, but we have gained solid experience in obtaining these documents and have successfully solved such tasks.

Issues of returning assets of foreign entities into circulation in the Russian Federation

Recently, due to the deterioration of relations between the Russian Federation and a number of states classified by the Government of the Russian Federation as “unfriendly,” certain difficulties have arisen in connection with the operation of businesses, both those incorporated in the territory of the Russian Federation in any organizational and legal form, and those conducting activities through branches and representative offices of foreign entities. Certain transactions and operations require prior written approval from a governmental commission, the obtaining of which is both challenging and time-consuming.

In this regard, a frequent request from foreign businesses has been for advisory services aimed at resolving issues related to:

withdrawal from entities incorporated in the territory of the Russian Federation and the liquidation of companies and branches established in Russia, while ensuring, to the maximum extent possible, that beneficial owners retain control over the assets previously held by the liquidated companies, in compliance with sanctions legislation;

settlement of accounts payable and accounts receivable arising at enterprises controlled by foreign persons within the territory of the Russian Federation. The recovery of such debts is often complicated by the fact that Russian courts, taking into account arguments presented by Russian parties to a dispute regarding difficulties in accessing justice in unfriendly jurisdictions, assume jurisdiction over such disputes, notwithstanding the existence of arbitration clauses in contracts providing for dispute resolution in foreign courts;

reinstatement into civil circulation of assets (movable and immovable property, as well as participatory interests and/or shares in companies) owned by persons who are residents of unfriendly states. As a general rule, such transactions may currently be carried out only upon obtaining permission from the governmental commission and subject to the provision of a substantial discount of up to 60%. Furthermore, restrictions are also imposed on settlement procedures in such transactions. Funds due to the seller must be credited to a special “Type C” account, and disposal of funds held in such an account is permitted only with the authorization of the governmental commission.

Our company, drawing on its established experience, is well positioned to provide legally compliant solutions to the aforementioned issues. 

Assistance in finding financing for lawsuits.

Our company has successful experience in litigation in Russian courts. At the same time, a Client, especially a foreign Client, who has a problem that needs to be resolved in court, is not always ready to bear the costs of resolving it, because he already has losses from the project and is not sure of the success of the dispute.

We are ready to consider the possibility of attracting financing to pay for legal services of our company for dispute resolution. 

Our partners are ready to finance cases with well-founded evidence and predictable enforcement of the judgment.

With our help, investors perform a comprehensive due diligence of a legal dispute - assessing the case for its prospects, the defendant's ability to pay, the ratio of legal costs and possible recovery. As a fee for the provided financing - the investor receives a share of the amount that the lawyers managed to recover from the debtor of our client.

Thus, the Client does not spend money on the lawyer's study of the case and conduct, but simply receives the result in the form of money or property, and if the case could not be won, the client has no obligation to pay for services.

Assisting foreign clients in Real Estate matters

In the real estate sector, we support foreign clients both at the real estate selection stage and at the real estate acquisition stage.

At the selection stage, we perform legal analysis of real estate objects, provide a legal assessment of the owner's title, describe the risks and targets identified in the counterparty or the real estate object.

We have the ability to engage cadastral engineers and planners for additional evaluation of land plots that are being considered for acquisition for the construction of industrial plants or large residential projects.

At the stage of real estate acquisition, we prepare and prepare documents, taking into account the participation of a foreign element in the transaction.

Our combined approach allows us to successfully implement investment projects in St. Petersburg and other cities.