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© Egorov Puginsky Afanasiev & Partners Law Offices
Ilya Nikiforov
Managing Partner
Egorov Puginsky Afanasiev & Partners
Be...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 2
Best Russian Law Firm 2010
International...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 3
Best Russian Law Firm 2010
International...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 4
Best Russian Law Firm 2010
International...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 5
Best Russian Law Firm 2010
International...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 6
Best Russian Law Firm 2010
International...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 7
Best Russian Law Firm 2010
International...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 8
Best Russian Law Firm 2010
International...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 9
Best Russian Law Firm 2010
International...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 10
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 11
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 12
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 13
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 14
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 15
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 16
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 18
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 19
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 20
Best Russian Law Firm 2010
Internationa...
www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 21
Best Russian Law Firm 2010
Internationa...
© Egorov Puginsky Afanasiev & Partners Law Offices
Ilya Nikiforov
Managing Partner
Egorov Puginsky Afanasiev & Partners
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Enforcement in Russia: Bullying at the Bear’s Den

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Enforcement in Russia: Bullying at the Bear’s Den. Ilya Nikiforov. January 2011

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Enforcement in Russia: Bullying at the Bear’s Den

  1. 1. © Egorov Puginsky Afanasiev & Partners Law Offices Ilya Nikiforov Managing Partner Egorov Puginsky Afanasiev & Partners Best Russian Law Firm 2010 / International Legal Alliance Summit & Awards Enforcement in Russia Bullying at the Bear’s Den
  2. 2. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 2 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Enforcement in Russia Bullying at the Bear’s Den Step 1 – Access your position Step 2 – Consider what result you want Step 3 – Know your opponent Step 4 – Tricky enforcement Step 5 – Plan your campaign
  3. 3. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 3 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Hot topics 2010 1) Attachments in support of ongoing arbitration proceedings Decision of the Supreme Arbitrazh Court of the Russian Federation, 20 April 2010, № 17095/09 (Edimax Limited vs. Chigirinsky) 2) Attachments in support of ongoing foreign court proceedings Decision of the Federal Arbitrazh Court of the North-West district, 29 July 2010, № A56-95127/2009 (Finisterre Recovery Fund 1 Limited, Finisterre Special Situations Fund, Whitewater EMCF LLC, Whitewater EMCO LLC, Spinnaker Global Emerging Markets Fund Ltd, Spinnaker Global Opportunity Fund Ltd, Spinnaker Global Strategic Fund Ltd vs. Teorema Holding Plc) 3) Enforcement in Russia against non-resident entities Ruling of the Supreme Arbitrazh Court of the Russian Federation, 28 June 2010, № VAS-6430/10 (SRL «MISINARIX»vs. SRL «Fercen Grup», JSC «SEB Bank») 4) Enforcement of judgments from non-treaty countries (reciprocity has to be proven) Ruling of the Supreme Arbitrazh Court of the Russian Federation, 7 December 2009, № VAS-13688/09 (Rentpool B.V. vs. Podyomnye Technology LLC)
  4. 4. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 4 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Identifying applicable rules International rules of law prevail over national legislation (article 15(4) of the Constitution of the Russian Federation) 1. Bilateral treaties: Azerbaijan, Albania, Algeria, Argentina, Byelorussia, Bulgaria, Hungary, Vietnam, Greece, Egypt, Iraq, Spain, Iran, Italy, Yemen, Cyprus, China, the Democratic People’s Republic of Korea, Cuba, Kyrgyzstan, Latvia, Lithuania, Moldova, Mongolia, Poland, Romania, Tunis, Finland (family and inheritance matters), Czech Republic, Slovakia, Estonia, Serbia, Macedonia. 2. Most important multilateral treaties: - Convention on Judicial assistance in Civil, Family and Criminal Matters of 22 January 1993 (“Minsk Convention”) - CIS Agreement on the Procedure of Economic Disputes Resolution of 20 March 1992 (“Kiev Convention”), which is focused on business/commercial matters - Convention on the taking of evidence abroad in civil or commercial matters (Hague, 18 March 1970) - Convention of the service abroad of judicial and extrajudicial documents in civil or commercial matters (Hague, 15 November 1965)
  5. 5. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 5 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Casual Wisdom • Get an arrest/attachment order as early as possible • Attachment in support of foreign court/judicial proceedings • Bank – warrant directly served • From Russia with warrant – Minsk & Kiev convention Convention on Judicial assistance in Civil, Family and Criminal Matters of 22 January 1993 (“Minsk Convention”) and CIS Agreement on the Procedure of Economic Disputes Resolution of 20 March 1992 (“Kiev Convention”), which is focused on business/commercial matters. • Courts are cheap. No fee shifting. Low stamp duty. Recalcitrant debtors prefer to fight to the end.
  6. 6. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 6 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Chisenau SEB Bank guarantor Fercen Grup debtor MISINARIX Case (№А40-156339/09-50-1134) MoscowKiev Chisinau MISINARIX creditor
  7. 7. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 7 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Access to Justice Rank for Enforcing contracts 1. Luxembourg 2. Iceland 3. Hong Kong 4. Norway 5. Korea, Rep. 6. France 7. Germany 8. USA 9. Finland 10. New Zealand 11. Austria 12. Belarus 13. Singapore 14. Hungary 15. Latvia 16. Australia 17. Lithuania 18. China 19. Russia 20. Japan Brazil Russian Federation India China Rank for enforcing contracts 100 19 182 18 Procedures (number) 45 37 46 34 Time (days) 616 281 1.420 406 Cost (% of claim) 16.6 13.4 39.6 11.1 Source: World Bank http://www.doingbusiness.org/economyrankings/
  8. 8. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 8 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Step 1 – Access your position Step 2 – Consider what result you want Step 3 – Know your opponent Step 4 – Tricky enforcement Step 5 – Plan your campaign Enforcement in Russia: Bullying at the Bear’s Den
  9. 9. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 9 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards What Does a “Win” Mean? Consider what result you want: • Money • Revenge • A precedent to deter others • Continuation of a commercial relationship • Due care/compliance exercise • Money
  10. 10. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 10 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Step 1 – Access your position Step 2 – Consider what result you want Step 3 – Know your opponent Step 4 – Tricky enforcement Step 5 – Plan your campaign Enforcement in Russia: Bullying at the Bear’s Den
  11. 11. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 11 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Learning by Planning & Planning from Learning 1. Investigate, investigate, investigate 2. Know your opponent’s…offshore assets, offshore bank account, credit cards 3. Even DASH is important – Names are difficult but ignoring “-” you’ll get negative 4. Check address: street name, corporate register 5. Legal/factual address: seat/mailing address 6. Form over substance… • Cases in Russia won and lost on what is said in the documents • Documents have to be properly authenticated, translated and certified at every stage …yet Serve by all means in all situs
  12. 12. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 12 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Chisenau MISINARIX creditor SEB Bank guarantor Fercen Grup debtor SBERBANK MISINARIX Case (№А40-156339/09-50-1134) MoscowKiev
  13. 13. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 13 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Step 1 – Access your position Step 2 – Consider what result you want Step 3 – Know your opponent Step 4 – Tricky enforcement Step 5 – Plan your campaign Enforcement in Russia: Bullying at the Bear’s Den
  14. 14. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 14 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Tricky enforcement. Bailliffs. Directly to the debtors’ bank but usually Bailiffs – officers of the Federal Bailiffs Service with broad powers, inter alia, to summon persons, to make enquiries, to search for property and persons, to impose restrictions on property and persons, to exact the property. • During 2009 the bailiffs service of RF has handled over 38 million execution cases, which is 8 million more than in 2008 (31 million cases). Closed over 22 million cases. 78% of them have been successfully closed (source: http://www.fssprus.ru/press_sdgerh_231109_print.html) • During 2009 over 87 000 asset/debtor search cases were handled. Closed 68 800 of them including 56 000 cases of debtors’ property retrieval (source: http://www.fssprus.ru/press_sdgerh_231109_print.html). • Federal Bailiffs Service web site contains a page “Information of the arrested and offered for auction property” • Internet sites including social network sites “vkontakte.ru”, “odniklassniki.ru” (analog of “facebook.com”) are used by the bailiffs for getting information about debtors and their property.
  15. 15. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 15 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Tricky enforcement No veil piercing is allowed on the enforcement stage Where corporations have experienced problems with enforcement, the problems were more commonly due to the insolvency and/or i.e. lack of traceable assets of the debtor Enforcement authorities trying their best: •Debtor’s list •Closed border •Garnishment of cell phone accounts / balances •Other creative stunts
  16. 16. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 16 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Live-bait fishing
  17. 17. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 18 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Chisenau MISINARIX creditor SEB Bank guarantor Fercen Grup debtor SBERBANK MISINARIX Case (№А40-156339/09-50-1134) MoscowKiev Ukrsocbank
  18. 18. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 19 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Step 1 – Access your position Step 2 – Consider what result you want Step 3 – Know your opponent Step 4 – Tricky enforcement Step 5 – Plan your campaign Enforcement in Russia: Bullying at the Bear’s Den
  19. 19. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 20 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Preferred enforcement scenario 1. Identify the entity, its owners and affiliates assets through public records 2. File for arrest of known assets of the debtor as a conservatory measure, early on but at least in support of a motion to allow the enforcement of foreign arbitral awards/judgment 3. Leak the story to mass media 4. Write letters to the debtor and its business partners advising them on the situation 5. Ask the State Commercial Court to proceed with the enforcement case on an expedited basis 6. If the debtor and its affiliates are involved in public procurement put the government customers on notice regarding the situation 7. Assist the enforcement authority – court bailiff – in properly identifying and seizing business assets of the debtor
  20. 20. www.epam.ru Ilya Nikiforov “Enforcement in Russia: Bullying at the Bear’s Den ” 21 Best Russian Law Firm 2010 International Legal Alliance Summit & Awards Ilya Nikiforov Managing Partner St. Petersburg office Egorov Puginsky Afanasiev & Partners T 7 (812) 322 96 81 F 7 (812) 322 96 82 e: Ilya_Nikiforov@epam.ru Ilya Nikiforov is a Managing Partner at St. Petersburg office of Egorov Puginsky Afanasiev & Partners. Ilya Nikiforov is known for a strong expertise in both litigation and arbitration and is listed as an arbitrator by prominent Russian & European arbitration institutions. Ilya has special experience in international business transactions, commercial arbitration, construction and development projects, and intellectual property law . Mr. Nikiforov represents client interests at domestic forums at all levels, before Moscow arbitration institution and other prominent commercial arbitration institutions, such as the ICC, LCIA and SCC. He is often engaged as a Russian law counsel/expert in connection with commercial litigation and international arbitration proceedings worldwide. Expert opinions of Mr. Nikiforov were accepted by US, English, German, Dutch and French courts. Ilya Nikiforov has been recognized by Chambers and Partners as an expert in his practice area and was highly recommended by The European Legal 500 as a head of the Dispute Resolution practice that “fully deserves its enviable reputation”. He “wins plaudits from competitors for the “superb job” he does in litigation and arbitration” (Chambers Europe 2008). The International Who’s Who of Commercial Arbitration 2010 lists Ilya Nikiforov as one of the top Russian lawyers specializing in international commercial arbitration. Since 1997 Ilya Nikiforov serves as an adjunct faculty member at the Law School of St. Petersburg State University. He frequently speaks on issues of law and legal practice to Russian and international audience at professional legal conventions. Mr. Nikiforov has published a substantial number of works on Russian business laws. He has co-authored one of the leading Commentaries to the Civil Code of the Russian Federation (Parts 1, 2 and 4) that was published in 2004, 2005 and 2007. Ilya Nikiforov
  21. 21. © Egorov Puginsky Afanasiev & Partners Law Offices Ilya Nikiforov Managing Partner Egorov Puginsky Afanasiev & Partners E-mail: spb_office@epam.ru Тел.: +7 (812) 322 96 81 www.epam.ru Thank you!

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