Russia

Russia has imposed sanctions (sometimes called counter sanctions) in response to sanctions imposed by “unfriendly countries”, including: restrictions on transactions with people related to those countries or involving foreign currency, import and export bans, targeted sanctions (asset freezes and travel bans), and the exclusive jurisdiction of Russian courts over sanctions-related disputes.

Federal Law No. 281-FZ dated 30 December 2006 “On Special Economic Measures and Coercive Measures”, coupled with Federal Law No. 127-FZ dated 4 June 2018 “On Measures of Impact (Countermeasures) on the Unfriendly Actions of the United States of America and Other Foreign States” (the “Counter-Sanctions Law”) provide for restrictions on:

• performance of transactions involving persons connected to “unfriendly countries”;

• international cooperation with designated persons;

• import/export of materials to/from designated persons; and

• provision of services by the designated entity for Russian state authorities or state-owned entities.

The types of measures which may be taken can be extended by presidential decree. The counter-sanctions are targeted at “unfriendly countries” (the USA and other countries that have imposed sanctions on Russia), and individuals and entities connected with those countries.

Restrictions on transactions with securities, participatory interests and funds

Presidential decrees on the restriction of certain transactions apply to transactions involving individuals or entities connected with “unfriendly countries.”

These consist of:

• Restrictions on transactions related to the issuance of loans, sale and purchase of securities and real estate (Decrees of the President of Russia No. 79 dated
  28 February 2022 and No. 81 dated 1 March 2022);

• Restrictions on transactions related to performance of obligations by Russian residents to creditors connected with “unfriendly countries” in respect of credits, loans, financial instruments and payment of dividends (Decree of the President of Russia No. 95 dated 5 March 2022);

• Restrictions on transactions aimed at the participatory interests or management rights of Russian Limited Liability Companies (Decree of the President of Russia No. 618 dated 8 September 2022);

• Restrictions on transactions aimed at the securities or management rights of Russian Joint-Stock Companies (Decree of the President of Russia No. 737 dated 15 October 2022);

• Restrictions on transactions aimed at, inter alia, the securities, participatory interests and management rights of certain Russian companies operating in sectors critical to national defense and security (Decree of the President of Russia No. 520 dated 5 August 2022).

Restrictions on transactions with designated persons

Based on Decree of the Russian President No. 252, 3 May 2022, restrictions on designated persons include:

• engaging in transactions;

• fulfilment of obligations;

• execution of financial transactions with designated persons (including if such persons are the beneficiaries of such transactions);

• supplying goods or raw materials produced in Russia to designated persons.

Exclusive jurisdiction of Russian courts over sanctions-related disputes

Article 248.1 of the Russian Commercial Procedure Code allows a Russian party designated under a foreign sanctions program to request a Russian court to assert exclusive jurisdiction over disputes, regardless of any jurisdiction or arbitration clauses previously agreed to by the Russian party.

Article 248.2 of the Russian Commercial Procedure Code enables a designated Russian party to obtain a court order that prohibits the initiation or continuation of foreign litigation or arbitration, provided that the sanctions imposed hinder the Russian party’s ability to access due process in those proceedings.