New Conditions for Transactions Involving Disposal of Assets by Foreign Persons from Unfriendly Countries

On October 15, 2024, the Subcommission of the Government Commission for Monitoring Foreign Investment made a decision to establish new conditions for transactions involving the disposal of assets (shares, stakes) by foreign persons from unfriendly countries. The sale of such assets must be carried out with a discount of no less than 60% of the market value, and at least 35% of the value must be transferred to the federal budget within two years. For transactions involving assets worth over 50 billion rubles, the consent of the President of the Russian Federation is required.

The Russian Government Approved Rules for Issuing Licenses for Foreign Trade Activities

In accordance with the rules approved by the Government of the Russian Federation, a procedure has been established for issuing licenses for the export and import of goods. These licenses may be general, one-time, or exclusive.

Licenses are issued in electronic form and may be valid for no more than one year.

Licenses are issued by the Ministry of Industry and Trade for each item classified under the Common Commodity Nomenclature of Foreign Economic Activity of the Eurasian Economic Union (HS Code of the EAEU).

The Bank of Russia Clarified the Procedure for Profit Distribution to “Unfriendly” Investors under Presidential Decree No. 254 of May 4, 2022

The Central Bank of Russia clarified that Russian companies may pay dividends to participants from “unfriendly” countries in amounts exceeding 10 million rubles per month only with permission: for financial organizations — from the Central Bank, for others — from the Government Commission for Monitoring Foreign Investment. Payments exceeding the limit must go through special “C-type” accounts, and offsetting claims requires similar approvals. Non-compliance with these requirements may result in legal consequences, including administrative fines.

Important Changes to the Real Estate Registration Procedure Effective March 1, 2025

Starting March 1, 2025, Federal Law No. 487 will come into force, introducing mandatory electronic interaction for legal entities with Rosreestr (the Federal Service for State Registration, Cadastre, and Cartography) when submitting applications for cadastral registration and rights registration. Exceptions include transactions involving individuals (except shared construction agreements, DDU), and some legal entities allowed to use paper applications until 2026. The law also requires mandatory registration of land plot boundaries in the Unified State Register of Real Estate (EGRN) for transactions involving those plots and buildings located on them.

Remote Participation in General Meetings of LLC Members

Starting March 1, 2025, new requirements for holding general meetings of limited liability company (LLC) members come into effect: in-person participation must be ensured unless otherwise specified in the charter; meeting notifications must include procedures for remote participation and identification; broadcasting and recording of meetings is mandatory; voting will be deemed invalid in case of technical failures (Federal Law No. 287-FZ).

Appointment and Termination of Sole Executive Body in LLCs Under Presidential Decree No. 618

The Ministry of Finance of the Russian Federation clarified that the procedure for transactions in LLCs set out by Presidential Decree No. 618 of September 8, 2022, does not apply to the appointment or termination of powers of the sole executive body (general director, president) of an LLC under the Labor Code. However, to conclude a contract by a commercial organization or individual entrepreneur to transfer the powers of the sole executive body of an LLC, approval from the Government Commission is still required.

Russian Court Denied Enforcement of Arbitration Award Due to Claimant's Unfriendly Status

The Arbitration Court of the Novosibirsk Region refused to recognize and enforce the decision of the Singapore arbitration tribunal in a case between Estonian company AMSTRADshipping OU and Russian JSC "Novosibirskhleboprodukt". The court justified its refusal by stating that the claimant is registered in an unfriendly jurisdiction — Estonia — which, according to the court, violates the public order of the Russian Federation. This approach contradicts a recent position of the Supreme Court of the Russian Federation, which previously indicated that legality and substantiation of claims are more important than the claimant’s country of origin.

Intellectual Property Court Upheld Termination of Legal Protection for Ericsson Trademarks

On February 12, 2025, the Intellectual Property Court dismissed the cassation appeal of Telefonaktiebolaget LM Ericsson and upheld the decision on early termination of legal protection for the company’s trademarks in Russia. The claim was filed by LLC "R-Klimat" on the basis of non-use of the trademarks in relation to heating, cooling, and ventilation devices (Class 11 of the Nice Classification). Ericsson failed to prove actual use of the trademarks during the prescribed three-year period. The court also rejected the company’s arguments regarding obstacles to use, including sanctions, and allegations of the claimant’s bad faith.

Direct Ban on Collecting Personal Data Using Foreign Databases Will Take Effect on July 1, 2025

On February 28, 2025, a law introducing amendments to the personal data regulation was published. These amendments will come into force on July 1, 2025 [1]

In addition to establishing a special data processing regime for certain categories of individuals (specifically: employees of the FSB, foreign intelligence, state security, the Ministry of Internal Affairs, judges, participants in criminal proceedings, and some other persons), the amendments also clarify the requirements for the collection of personal data.

Specifically, Article 18, Part 5 of Federal Law No. 152-FZ previously imposed a positive obligation on operators to process personal data collected in databases located in Russia. The updated wording now establishes a direct ban on collecting personal data using foreign databases.

Initial data collection, as well as any subsequent updates (clarification, renewal, or modification), must now be carried out using databases located exclusively within the territory of the Russian Federation. Whether the subsequently collected data can be transferred for use in foreign systems remains an open question, and we will closely monitor any further developments on this issue.

New Bill of Clarifying Requirements for the Return of Foreign Companies to Russia

A bill[2] has been submitted to the State Duma introducing measures that affect organizations from unfriendly states that ceased or reduced business operations in Russia after February 22, 2022, and are now seeking to resume their activities.

These measures include:

• Mandatory payments;
• Disclosure of technologies used in the creation of high-tech products;
• Other restrictions.

The decision to apply such measures to a particular organization, and their duration, will be made by the President. The Government will determine the procedures for enforcing mandatory payments, approve the form and conditions for technology disclosure, and define the list of business activities and other grounds for applying such measures.

Cassation Court Emphasizes the Need to Assess Public Policy in Sanctions-Related Disputes

By the judgment of court of first instance, a Swiss creditor was issued a writ of execution to enforce an award of the International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation (ICAC), to recover a debt from a debtor under Russian jurisdiction for goods supplied.

However, a cassation court overturned the order and remanded the case for reconsideration. It found that, at the time of the order, countersanctions were in effect on fulfilling obligations to foreign agents under the jurisdiction of foreign unfriendly countries. The court of first instance had failed to examine whether enforcing ICAC award would contradict Russian public policy. The creditor attempted to challenge the judgment of cassation court, but it was refused to send the case for the consideration of Supreme Court of of the Russian Federation [3]

Damages and Penalties Must Be Calculated in the Currency of the Obligation, Not the Payment Currency

The Supreme Court of the Russian Federation reviewed a dispute between an individual entrepreneur and a supplier under a leasing agreement. The contract stipulated that the obligation would be denominated in US dollars, while payments were to be made in Russian rubles. Due to the supplier’s failure to deliver the bus on time, the leasing deal was terminated and a new vehicle was purchased from another supplier at a higher price. The entrepreneur sought compensation for damages resulting from the substitute transaction.

Courts of all three instances upheld the claim and calculated the damages in rubles, rejecting the supplier’s argument that the calculation should be made in US dollars. However, the Supreme Court disagreed, stating the following:

·The parties had agreed on US dollars as the currency of the obligation and had accepted the currency exchange risk;

·Damages must be calculated in the agreed currency of the obligation, regardless of the payment currency;

·Calculating damages solely in rubles without reference to the agreed currency may distort the actual loss, especially in the context of exchange rate fluctuations.

The Court emphasized that when awarding damages in foreign currency, the amount must be indicated in that currency, with the ruble equivalent calculated at the official exchange rate on the date of payment, unless otherwise provided by law or contract (Ruling of the Supreme Court of the Russian Federation dated May 22, 2025 No. 305-ЭС25-619. The case was remanded for a new hearing).


[1] Federal Law No. 23-FZ "On Amendments to the Federal Law "On Personal Data" and Certain Legislative Acts of the Russian Federation"

[2] https://sozd.duma.gov.ru/bill/928052-8

[3] Ruling of the Supreme Court of the Russian Federation dated 16.05.2025 N 301-ES25-3149 in case N A43-27728/2024

Change of approach to the bonus payments to employees

As of September 1, 2025, amendments[1] to Article 135 of the Labor Code of the Russian Federation have entered into force, reaffirming the Constitutional Court’s position that prohibits the arbitrary deprivation of employees’ bonuses. Employers are now required to establish a transparent and documented bonus system that clearly defines the types, amounts, timing, and conditions of payments, and to ensure that employees are familiarized with these rules against their signature.

The amendments explicitly prohibit the complete deprivation of a bonus that forms part of an employee’s salary. A reduction may only be applied in the month in which a disciplinary sanction is imposed and may not exceed 20% of the employee’s total monthly earnings. Non-compliance with these requirements entails administrative liability — a warning or a fine of up to 50,000 rubles for organizations.

Employers are advised to review and update their internal bonus policies and employment documentation to ensure full compliance with the new rules.

[1] Federal Law No. 23-FZ "On Amendments to the Federal Law "On Personal Data" and Certain Legislative Acts of the Russian Federation"

Russian Court Grants Interim Relief in Support of International Arbitration in London

In August 2025, a Russian court of general jurisdiction granted interim relief in support of an arbitration proceeding administered by the London Court of International Arbitration (LCIA)[2]. The court imposed an asset freeze against the respondent pending the arbitral tribunal’s award and, in doing so, effectively recognized a non-signatory as a party to the arbitration agreement. This ruling is particularly significant in shaping case law at a time when cooperation with arbitral institutions in “unfriendly” jurisdictions has become increasingly restricted.

This precedent confirms that Russian courts remain willing to employ procedural instruments to safeguard claimants’ proprietary interests even in cross-border disputes. At the same time, the ruling raises important questions regarding jurisdiction, exequatur, and the relationship between claims filed before national courts and those submitted to international arbitration.

[2] Ruling of the Zamoskvoretsky District Court of Moscow, 23 March 2025, case No. 13-1256/2025

Presidential Decree No. 436: New Rules for Foreign Investors

On 1 July 2025, the President of the Russian Federation signed Decree No. 436 “On Additional Guarantees of the Rights of Foreign Investors” (“Decree 436”). According to the adopted document, starting from July 2025, foreign investors are entitled to make investments in the territory of the Russian Federation without being subject to certain provisions of the temporary economic measures that had been introduced.

The Decree expands opportunities for participation of foreign investors — including those from “unfriendly” jurisdictions — by allowing them to acquire Russian assets without prior approval from regulatory authorities.

Still, the additional guarantees of foreign investors’ rights that have been established apply to a limited list of transactions, in particular:

·acquisition of issued securities during their initial placement (IPO) or on the organized market based on a public offer;

·disposal of such securities in organized trading under a public offer;

·receipt of income (dividends, coupon payments) on such securities;

·placement of funds on deposits with Russian banks and fulfillment of deposit repayment obligations;

·entering into derivative transactions on organized markets based on a public offer and settlement of obligations under such transactions.

The Decree establishes a special procedure for carrying out such operations, namely, all relevant settlements and transactions by foreign investors must be conducted exclusively through special “In” accounts, while the use of any other accounts, such as standard current accounts, for these purposes is not permitted.

The significance of Decree No. 436 lies in the fact that, for the first time since the adoption of a series of counter-sanctions decrees by the President of the Russian Federation, it introduces a rather permissive regime for foreign persons, which may indicate the beginning of a gradual adjustment of the previously imposed restrictions.

Nevertheless, it should be noted that these relaxations apply only to a limited number of transactions/operations. In addition, the practical implementation of this mechanism is still in progress: banks are currently working on the technical rollout of functionality for opening and servicing “In” accounts.

“Clean as you go” principle and tighten the noose towards dormant companies in Russia

Russian law is not tolerant of sleeping or freezing companies and does not recognize the concept of a dormant company.

At the end of 2024, the Supreme Court of the Russian Federation, in one of the cases [1], formulated the “clean as you go” principle. The Court stated that shareholders and controlling persons who decide to cease business activities must ensure proper liquidation or insolvency proceedings, rather than abandoning the company. Otherwise, shareholders and controlling persons may be held additionally (subsidiarily) liable for the company’s debts, as well as for bad faith conduct during the deregistration or liquidation process.

At the end of 2025, the Supreme Court of the Russian Federation issued its Quarterly Review of judicial practice on subsidiary liability of shareholders of liquidated companies. The Review confirms that exclusion of a company from the state register does not, in itself, release shareholders and controlling persons from subsidiary liability where the company was left with outstanding obligations and without proper completion of liquidation or insolvency procedures.

Also, starting from 1 January 2026, factually dormant companies may become subject to mandatory social insurance contributions, even if their directors do not receive any remuneration or do not have an active employment contract. For 2026, it is assumed that the minimum salary of a director may not be lower than the statutory minimum wage (approximately EUR 300), resulting in monthly contributions of approximately EUR 100, or almost EUR 1,200 annually, for a company with no active employees.

The proposed changes would therefore increase the cost of maintaining factually dormant companies.

Opening a Bank Account in Russia Becomes Easier for Foreign Companies

Russian legislation has introduced a simplified approach to tax registration of foreign companies opening bank accounts in Russia. The changes were enacted by Federal Law No. 416-FZ dated 17 November 2025, which amended Articles 83 and 84 of Part One of the Russian Tax Code[2].

Under the amended rules, a foreign company opening a bank account with a Russian credit institution is no longer required to independently submit an application and supporting documents to the tax authorities for tax registration. Instead, the obligation to submit the relevant information is transferred to the Russian bank opening the account.

The tax authority is required to register the foreign company within five days from the date of receipt of the application from the bank and to issue an extract from the Unified State Register of Taxpayers confirming the tax registration. The extract is provided electronically via the bank.

The new rules are scheduled to enter into force on 1 September 2026.

Termination of Employment Contracts by Mutual Agreement Without Compensation at Risk

Russian courts continue to apply a substantive approach when assessing the validity of termination of employment contracts by mutual agreement. In particular, the absence of compensation or other countervailing benefits for an employee may indicate that such termination does not reflect a genuine and balanced expression of will of both parties.

In a recent case[3], the Supreme Court of the Russian Federation considered a dispute where an employment contract was terminated by mutual agreement on the same day the agreement was proposed, without any severance payment or additional guarantees. The employee subsequently challenged the dismissal, alleging that the agreement had been signed under pressure. The Supreme Court upheld the lower court’s findings that the termination was unlawful.

The Supreme Court emphasized that termination by mutual agreement presupposes a voluntary, informed and coordinated expression of will by both the employer and the employee, as well as the existence of a mutual interest in terminating the employment relationship. The Court noted that an employee’s interest may be evidenced by additional guarantees compensating the negative consequences of job loss. In the absence of such guarantees, and where the employee did not intend to resign, the agreement may be treated as forced.

This approach confirms that courts will assess the substance of termination agreements rather than their formal designation and reinforces the requirement to maintain a balance of interests when terminating employment by mutual agreement.

Foreign Court Orders Continue to Face Enforcement Barriers in Russia

Russian courts continue to apply a restrictive approach to the recognition and enforcement of foreign court orders where such orders interfere with the exercise of jurisdiction by Russian courts or affect the sovereign powers of the Russian Federation.

In November 2025, the Moscow Arbitrazh Court considered the issue of recognition and enforcement of interim orders issued by the Dubai International Financial Centre Court in connection with an investment dispute involving the Russian Federation. The foreign court orders required the Russian Federation to refrain from pursuing proceedings before Russian courts.

The Moscow Arbitrazh Court held[4] that such orders could not be recognized or enforced in Russia, as they constituted impermissible interference with the administration of justice of a sovereign state. In its reasoning, the court referred to fundamental principles of international law, including state sovereignty, non-interference in internal affairs and the principle of sovereign equality of states (par in parem non habet imperium - an equal has no power over an equal).

The court further noted that, under doctrines recognized in common law jurisdictions, including the act of state doctrine, courts should refrain from reviewing or restraining sovereign acts of a foreign state carried out within its own territory. On this basis, the Russian court concluded that the foreign court lacked jurisdiction to issue binding orders in respect of proceedings conducted before Russian courts.

This position confirms the limits of cross-border enforcement of foreign court orders in matters involving sovereign interests and parallel proceedings before Russian courts.

[1] Ruling of the Judicial Chamber for Economic Disputes of the Supreme Court of the Russian Federation dated 27 June 2024 No. 305-ЭС24-809 (case No. А41-76337/2021)

[2] Federal Law No. 416-FZ of 17 November 2025 “On Amendments to Articles 83 and 84 of Part One of the Tax Code of the Russian Federation”

[3] Ruling of the Judicial Chamber for Civil Cases of the Supreme Court of the Russian Federation dated 22 September 2025 No. 5-КГ25-113-К2

[4] Decision of the Moscow Commercial Court A40-92702/2025-56-674 - 21 Nov 2025

Mandatory Use of Russian Language in Company’s Signs, Labels, Packaging and Web-sites

Recent legislative amendments have introduced additional requirements regarding the use of the Russian language in business-to-consumer (B2C) relations.

Under the new rules, effective from 1 March 2026[1], information intended for public communication to consumers must be provided in Russian. This applies to a broad range of materials, including company signage, information signs and other publicly available information addressed to consumers. Advertising materials remain subject to separate regulation, under which the preferential use of the Russian language had already been introduced earlier.

The new requirements cover, inter alia, product descriptions, labels, instructions and other consumer-facing information. While such information may also be provided in foreign languages (e.g. English), the Russian version must be present, be given priority and be equivalent in content.

In practical terms, this means that commonly used foreign-language elements in consumer communication may need to be adapted. For example, signage or labels such as “café”, “flowers” or “sale” would need to be accompanied by their Russian equivalents («кафе», «цветы», «распродажа») when used in materials addressed to consumers.

Certain aspects of the new regulation remain unclear. In particular, questions arise as to whether the requirements fully extend to online content and product packaging. According to public statements of the Russian consumer protection authority (Rospotrebnadzor), the new rules are expected to apply to company websites. This suggests that businesses operating in Russia should review their online content from a compliance perspective.

As regards product packaging, there is also a risk that it may fall within the scope of the new requirements, given that such information is publicly available to consumers. In the absence of detailed official guidance, a cautious approach may be advisable.

Overall, the new rules will require businesses to reassess their consumer-facing materials and ensure that the use of foreign languages does not prevail over the mandatory Russian-language content.

Salary Overpayments May Be Recovered if Caused by a Counting Error: Supreme Court Clarifies

In its Review of Judicial Practice for the First Quarter of 2026[2], the Supreme Court of the Russian Federation clarified the conditions under which salary overpayments may be recovered from employees.

As a general rule, salary and similar payments to the employees cannot be claim as unjust enrichment from the employee. However, it is possible on exceptional scenario where the overpayment results from a counting error and the employee’s bad faith.

The Supreme Court considered a case where an employee received more than RUB 1.8 million instead of approximately RUB 10,000 due to an input error in payroll calculations (1,064 shifts were entered instead of 10.64). The employee refused to return the funds and subsequently resigned.

The Court confirmed that errors in data input leading to an incorrect calculation of the amount payable may qualify as counting errors. The key factor is not the classification of the error (e.g. technical or otherwise), but its effect on the arithmetic calculation.

The Supreme Court also took into account the employee’s conduct, in particular the refusal to return an obviously excessive payment.

As a result, the Court upheld the recovery of the overpaid amount as unjust enrichment.

Stricter Regulation of Foreign Investments in Strategic Assets

Federal Law No. 51-FZ dated 8 March 2026[3] introduces a number of amendments to the Russian regime governing foreign investments in strategically important sectors.

The amendments significantly expand the perimeter of state control.

The regulation now extends beyond acquisitions of shares in strategic companies and also covers transactions involving assets used for strategic activities, including property owned by the state or municipalities. In addition, the rules are expressly applied to certain non-commercial organisations where foreign investors may obtain control or acquire key assets.

The concept of a “strategic company” has also been broadened. A company may now fall within the regime not only based on the nature of its activities, but also due to holding a licence or other authorisation required for such activities.

At the same time, the list of strategic activities has been expanded. The new rules capture, among other things, certain categories of subsoil use (including deposits not previously classified as strategic), commercial extraction of groundwater and selected activities in the fisheries sector.

The amendments further introduce additional compliance obligations for foreign investors. In particular, notification requirements now apply to investors holding 5% or more of shares in certain cases, including where a company acquires strategic status as a result of licensing.

Finally, disclosure requirements have been strengthened. Information on beneficial owners and controlling persons must now be provided not only in relation to the acquirer, but also the disposing party in relevant transactions.

Overall, the changes indicate a continued shift towards a broader and more flexible interpretation of what constitutes a strategic asset, which may increase regulatory scrutiny and expand the scope of transactions requiring prior approval.

***

[1] Federal Law No. 168-FZ as of 24 June 2025 “On Amendments to Certain Legislative Acts of the Russian Federation”

[2] Review of Judicial Practice of the Supreme Court of the Russian Federation No. 1 (2026), approved by Resolution of the Presidium of the Supreme Court of the Russian Federation as of 25 March 2026 No. 5А/2026

[3] Federal Law No. 51-FZ as of 8 March 2026 “On Amendments to the Federal Law ‘On the Procedure for Foreign Investments in Business Entities of Strategic Importance for National Defense and State Security’, Certain Legislative Acts of the Russian Federation and Invalidation of Subparagraphs 8 and 9 of Paragraph 10 of Article 6 of the Federal Law ‘On Foreign Investments in the Russian Federation’”

Russian Courts respects ICC Arbitration Clause

The Russian court refused to consider itself competent to consider the dispute initiated by a Russian petrochemical company Nizhnekamskneftekhim (NKNH) against the German bank Bayerische Landesbank and a bailiff, holding that the dispute falls within a valid arbitration clause of the International Chamber of Commerce (ICC)[1].

The claimant asked the Russian court to declare invalid an instruction letter from the bank that served as the basis for seizure by the bailiff of the bank's receivables due from the company. The loan agreements contained ICC arbitration clauses with the seat in London. The first instance court dismissed the claim on the ground that the dispute was governed by the arbitration clauses and that the bailiff was not a party to the legal relationship.

During the appeal, the claimant argued that sanctions made the clause unenforceable and that Russian courts should have exclusive jurisdiction over the case under Article 248.1 of the Russian Arbitrazh Procedural Code. This article, sometimes referred to as an anti-arbitration injunction, was introduced in 2020 but was rarely used by Russian courts before 2022. In the discussed case the appeal court left judgment of the court of first instance unchanged, noting that no evidence was submitted that the claimant was actually subject to sanctions or faced real difficulties accessing the ICC forum – speculation about paying fees or obtaining visas was insufficient. The court also noted that the Russian Ministry of Justice included ICC in the list of recognized permanent arbitral institutions in 2021, confirming its impartiality, and that the status had not been revoked.

The decision confirms that Russian arbitrazh courts respect international arbitration clauses unless there is concrete evidence of both sanctions and/or evidence that the party faced with some sort of restrictive measures related to the agreed foreign arbitration. The case will be considered by the cassation court and GRS Legal will prepare a relevant update after new facts.

Contracts with Self-Employed or Employment: Courts Continue to Look at Substance Over Form

Russian courts continue to apply a substantive approach when assessing the validity of civil law contracts with self-employed individuals. In particular, the absence of clear scope, timing and payment terms, combined with the contractor's involvement into the business process and control by the customer, may indicate that such contracts in fact disguise employment relationships.

In a recent case[2], an entrepreneur engaged individuals under civil law contracts. Tax authorities qualified these agreements as employment contracts and assessed additional personal income tax and social contributions to be paid by the entrepreneur. The regulator pointed to several factors: the individuals were integrated into the production process, performed labour functions under the entrepreneur's control, worked according to a schedule, used the entrepreneur's equipment and materials, received monthly remuneration regardless of results, and derived all or nearly all their income from this source. The contracts themselves lacked specific scope, timing and payment terms, and were standardised regardless of the type of work.

The Arbitrazh Court of the Central District has upheld the tax authorities' position, holding that the outlined facts evidenced actual employment relationships. A similar position was recently taken by the Arbitrazh Court of the West-Siberian District.

The actual case law confirms that courts will look beyond the formal classification of contracts to the substance of the relationship, and that businesses using self-employed individuals must be accurate and ensure the arrangements genuinely reflect independent contracting to avoid the risk of qualification of such relations as employment.

Why Would a Debtor Go to Court to Pay Its Creditor? - RUSAL's Creative Strategy to Terminate LCIA arbitration award

The Arbitrazh Court of the Kaliningrad Region has refused to recognise and enforce two LCIA awards of September 2024 and August 2025, which ordered RUSAL (a major Russian aluminium producer) and its Jersey-based affiliate RTI Limited to pay the German company OWH SE i.L. over €247 million plus costs[3].

The dispute arose from financial transactions entered into in 2019 between RTI (a RUSAL affiliate) and OWH SE (then a VTB (major Russian bank) subsidiary). The contracts required RTI to post collateral if the dollar rose sharply against the rouble - a condition was not approved by RUSAL's board of directors. In February 2022, following sanctions against VTB, the German regulator BaFin took control of OWH SE, removed Russian shareholders, and appointed liquidators. OWH SE then demanded collateral, terminated the contracts, and obtained LCIA awards against RUSAL. RUSAL and RTI challenged the awards, but the tribunal ruled in favour of OWH SE, awarding over €247 million plus costs.

RUSAL faced a difficult position. Under Russian sanctions rules, payments to creditors from unfriendly countries require permission from the Government Commission on Foreign Investment, which can only be obtained if a Russian court confirms enforcement does not contradict Russian law. OWH SE refused to apply to Russian courts. RUSAL argued that if it paid through the special procedure, foreign courts might not recognise that payment as proper, exposing it to paying the same debt twice. To escape this trap, RUSAL itself applied to the Arbitrazh Court of the Kaliningrad Region.

OWH SE challenged the application, arguing lack of jurisdiction and that only the award creditor could seek recognition. The court rejected both arguments, holding that any party to the arbitration may apply.

On the merits, however, the court refused enforcement on public policy grounds. It found that OWH SE was under German control through BaFin, and that enforcement would leave funds under German control indefinitely, amounting to expropriation. The court also noted procedural defects in the notice process and OWH's bad faith.

While RUSAL formally cited the risk of double payment as its reason for applying, it seems that the rationale behind RUSAL's move is that the true strategic objective was to obtain a formal court refusal, which could then be used as a shield in foreign enforcement proceedings. The ruling has been appealed; the hearing is scheduled for 30 July 2026. GRS Legal will prepare a relevant update after new facts.

Liability for Late Filing of "Zero" and "Non-Zero" Returns Revised

A Federal Law signed on 26 June 2026 has amended Part 1 of the Tax Code, introducing significant changes to liability for late filing of tax returns/insurance contribution calculations as well as procedural aspects of liability imposition[4].

Effective from 26 June, 2026 taxpayers are no longer subject to the minimum RUB 1,000 fine under Article 119 of the Tax Code for late filing of "zero" returns or calculations where no tax or contributions are due. This applies to all organisations and individual entrepreneurs. The obligation to submit zero returns remains; failure to do so may still result in bank account blocking.

From 26 July, 2026 a new simplified procedure takes effect for late filing of "non-zero" returns. If a desk audit reveals no violations other than the late submission, tax authorities will no longer draw up an audit report. The materials will be reviewed without the taxpayer's participation, and a decision on liability (or waiver thereof) must be issued within five working days. If the taxpayer submits an amended return before the decision is issued, the decision will be based on the amended filing. Taxpayers may also submit documents confirming mitigating/excluding liability circumstances together with a late return. The right to appeal the tax authority's decision under a simplified procedure remains available.

The amendments also exempt individuals from fines for late filing of 3-NDFL returns on income from the sale or donation of real estate where the tax authority already has the relevant transaction data.

Overtime Work Limit Raised to 240 Hours per Year

From 1 September 2026, the annual overtime limit may be increased from 120 to 240 hours under new Labour Code amendments[5]. The increase is possible, if provided for in a collective or sectoral agreement, and does not apply to certain categories of employees (e.g., those in harmful working conditions). For pensioners, pre-pensioners and employees in harmful conditions, overtime work exceeding 120 hours requires written consent.

The law also sets uniform pay rules: overtime within 120 hours is paid at one and a half times for the first two hours and double thereafter; from the 121st hour onwards, each hour is paid at double rate. Employees may choose additional rest time instead of higher pay. Additionally, employees working beyond 120 hours of overtime per year will be entitled to one paid day off annually for medical check-ups.

***

[1] Ruling of the Ninth Arbitrazh Court of Appeal dated 27 May 2026 No. 09АП-1156/2026 in case No. А40-251326/2025

[2] Ruling of the Arbitrazh Court of the Central District dated 27 April 2026 in case No. А85-2081/2024

[3] Ruling of the Arbitrazh Court of the Kaliningrad Region dated 28 May 2026 in case No. А21-4252/2026

[4] Federal Law No. 201-FZ of 26 June 2026 “On Amendments to Part One of the Tax Code of the Russian Federation”

[5] Federal Law No. 144-FZ of 25 May 2026 “On Amendments to the Labour Code of the Russian Federation”