Russia & the CIS Insight

Welcome to the first edition of the newsletter from Steptoe & Johnson on a range of subjects which relate to businesses operating in Russia & the CIS. Increasingly, the global marketplace means that companies which  are trading internationally will either adopt the laws and procedures of another country in their business arrangements or they will run up against the "long arm" of foreign laws, for example on sanctions and anti-corruption and internationally agreed laws on inter-state trade arrangements.

This first newsletter provides insights into the make-up of the English legal system and how it operates, the court's powerful jurisdiction to freeze assets belonging to domestic and foreign organisations, the growing reach globally of the US legislation "The U.S. Foreign and Corrupt Practices Act", recent developments in corporate governance issues in the UK and, the new UK non-dom rules.

The articles are intended to be an insight but do not provide a comprehensive view. If any of these articles is of interest to you and you would like more information on how the issue in question could affect your business, please contact us; we would be delighted to discuss the matter with you further.

Steptoe & Johnson has been advising Russian and CIS clients for several years and we have native Russian speaking lawyers in our teams. For further details of our experience please click here or ask us to email you our Russia & the CIS Practice Group brochure which is available in both Russian and English language versions.

We hope you enjoy the newsletter and welcome your comments.

1.                  RUSSIA’S CUSTOMS BRIBERY CRACKDOWN

In late February of 2008 Russian Prime Minister Viktor Zubkov accused Russia’s Federal Customs Service of corruption, stating that bribes and blatant corruption are endemic among customs officials along Russia’s western borders. He announced that customs officials may hold containers for days seeking Russia’s law enforcement agencies to pursue some 300 criminal probes into such cases. The US Foreign Corrupt Practices Act (“FCPA”), among other things, criminalizes the bribery by covered persons of foreign government officials in order to obtain or retain business.

Please click here for the full article.

2.                  CORPORATE GOVERNANCE CHANGES

Corporate Governance remains an area of great interest to Russian and CIS corporates who are looking to access capital from Western investors. The Corporate Governance regime in the UK is regarded as one of the more advanced and is influenced by European legislation and developments in the US.

This article examines certain of the recent changes occurring in corporate governance in the UK.

Please click here for the full article.

3.                  UK NON-DOM RULES

The UK is to implement certain proposals for individuals who are UK tax resident but not domiciled here. Although numerous concessions have been made to dampen the impact of the proposals on the City of London and those who are internationally mobile, the Finance Bill 2008, which is likely to receive Royal Assent during the course of July, incorporates these proposals.

Please click here for the full article.

4.                  FREEZING INJUNCTIONS

Freezing injunctions in respect of Russian and CIS litigation proceedings are becoming more prevalent. You should note that a freezing injunction is an interim order that prohibits a party from disposing of or dealing with his assets and, pre-action, is typically sought by a claimant to preserve the defendant's assets until a judgment or award can be obtained and/or satisfied. Similar forms of order can also be obtained post-judgment. A freezing injunction does not give the claimant any proprietary rights over the assets of the defendant but, since it acts on the individual, it prevents the defendant from carrying out certain acts in relation to those assets. Any third party given notice of a freezing injunction must not aid or assist the defendant to breach the order and will run the risk of contempt if it does so. Effectively, by giving notice of the order to a bank, the account will be frozen, whatever attitude the defendant may take to complying with the order.

Please click here for the full article.

5.                  WHY LITIGATE IN LONDON?

It is common for disputes between Russia and CIS businesses to be dealt with in London. London has long been recognised as the pre-eminent centre for the resolution of commercial disputes whether by litigation, arbitration or mediation. English commercial law has for a long time been the global commercial law of choice. It is vital to the financial trading and business community of the City of London and internationally that disputes can be resolved efficiently and as quickly as possible.

Please click here for the full article.

Forthcoming event
17th – 18th June: Forum on Anti-Corruption - Steptoe & Johnson speaking at a conference organised by ACI in Canary Wharf, London

Recent event
27th May: Corporate Governance in the UK - presentation to senior executives from Russia's top companies

For further details about these events please contact Robert Harris or your usual Steptoe contact.