Russia Blocks Foreign Investors' Right to Buy Back Assets

The Ministry of Economic Development has developed a mechanism for depriving foreign investors of the right to repurchase assets left in Russia.

Consensus

Ministry of Economic Development has developed a procedure to deprive foreign investors of the right to repurchase assets left in Russia.
The procedure is based on a law signed by Vladimir Putin in early August.
The Arbitrazh Court of Moscow Region will handle cases regarding the denial of repurchase rights.
Approval from a government commission is required for any legal action to block repurchase.
The law allows for denial of repurchase if the investor supported 'hostile actions' against Russia, financed terrorism or extremism, or discredited the Russian military.
The repurchase price must be close to market value; deviations exceeding 25% may be grounds for denial.
The mechanism applies to foreign investors who sold assets in Russia during or after the start of the war.

The law allows denial of repurchase based on 'non-market nature of the transaction,' even if no other grounds apply. — thebell
The law allows denial based on 'protection of brand and discredit of Russian authorities' in fulfilling their duties. — thebell
In 2022–2024, 21% of major exit deals included a repurchase option, with only one-third specifying market price. — thebell
Direct write-offs from auto manufacturers' exit deals with options exceeded $4 billion. — thebell
The procedure allows Russian owners of foreign assets and federal industry agencies to initiate lawsuits in court. — tg_echoonline_news