Russian court finds that UK and US sanctions suspend liability in Russian contract dispute

23 October 2026

The Arbitrazh Court of the Tambov Region in Russia has dismissed a RUB 69.5m claim against Russian servicing company ‘OOO Gorka-Aeroservis’ because UK sanctions and US export controls were  force majeure and suspended liability - OOO Yugo-Vostochnaya Agrogruppa v OOO Gorka-Aeroservis - A64-190/2024. All sanctions related judgments from Russian courts are on the Russia judgments section of this site.

Russian company ‘Yugo‑Vostochnaya Agrogruppa’ contracted with Aeroservis in 2018 and 2020 for the servicing of 3 helicopters. With Agrogruppa’s consent, Aeroservis sent 2 helicopter engines to a UK servicing company and 1 helicopter to a US servicing company in California.

In 2022 the UK servicing company suspended its maintenance work on the engines and did not export them back to Russia, in order to comply with UK sanctions (in particular March 2022 amendments to the Russia (Sanctions) (EU Exit) Regulations 2019 which prohibited the export of aviation goods to Russia). The US company also suspended its work on the helicopter and did not export it back to Russia to comply with a March 2022 BIS rule which amended the Export Administration Regulations and required exporters to obtain a licence to export aviation goods to Russia, with applications to be processed under a policy of denial.

Agrogruppa terminated the contracts in 2023 and brought a statutory claim to recover the value of the engines and helicopter (plus interest) under Art. 728 of the Russian Civil Code. This Article entitles a party who terminates a contract because of delays or defects in the servicing party’s performance to the return of its goods or, if this is impossible, to be paid the goods’ value.

The Court rejected Agrogruppa’s claim because:

• Under Art. 401(3) of the Russian Civil Code, a temporary force majeure event (an extraordinary and unavoidable event external to the party’s activity) suspends a party’s liability for failing to perform a statutory obligation for as long as failure to perform is caused by the force majeure event.

• The Russian Supreme Court in 2018 said that a force majeure event may include the imposition of foreign sanctions on business activity. If the sanctions have been imposed by an ‘unfriendly state’ the defendant must prove that the sanctions objectively make performance impossible. Aeroservis provided sufficient evidence that sanctions made its Art. 728 obligation to return the goods impossible, including certificates of confirmation by the Russian Chamber of Commerce and Industry.

• The US and UK sanctions are a temporary force majeure event and the obligation to return the goods under Art. 728 will resume when the sanctions are lifted. As a result, the return of the goods is delayed and not impossible for the purposes of Art. 728. Therefore, the alternative obligation to pay for the goods’ value did not apply to Aeroservis.