Notice: Russian regulatory deadline relating to nominee arrangement risks and unwinding under Russian law

Alert: Russian regulatory deadline — nominee arrangement risks and unwinding Effective: immediately under current enforcement practice

Foreign creditors holding claims against Russian counterparties that rely on nominee structures to conceal or shield assets are facing a narrowing enforcement window. Recent regulatory developments under Russian law have sharpened scrutiny of nominee arrangements — structures in which assets are formally registered in the name of one party whilst the beneficial interest is held by another. Where such arrangements are identified, Russian courts and enforcement authorities have moved to unwind them, with consequences that directly affect creditor recovery prospects.

Foreign creditors with live claims or anticipated enforcement proceedings against Russian entities should treat nominee arrangement risks as an immediate priority. Where a debtor's assets are held through a nominee, the practical enforcement value of those assets depends on whether the arrangement can be challenged before dissipation occurs. Under current enforcement practice, courts assess nominee arrangements on the basis of economic substance: registration in a nominee's name does not, of itself, insulate an asset from attachment or enforcement proceedings brought by a creditor with a legitimate claim. The Federal Tax Service and the bailiff service have both demonstrated an increasing willingness to look through nominee structures in the context of debt enforcement and asset recovery proceedings.

Creditors who delay risk allowing a nominee arrangement to become further entrenched, or allowing assets to be transferred in a manner that complicates subsequent recovery. The enforcement window is not indefinite. Preservation orders and interim relief applications are time-sensitive, and the relevant procedural steps must be initiated before asset movement makes recovery materially more difficult.

Recommended action:

1. Identify whether the Russian counterparty's assets are held through nominee or intermediary arrangements — this requires early-stage tracing and corporate registry analysis.
2. Assess whether grounds exist under Russian law to challenge the nominee structure in the context of enforcement or insolvency proceedings.
3. Obtain specialist Russian legal advice before initiating any formal step — including preservation applications — to ensure the approach is procedurally effective.

Speak to our team — info@vetrovpartners.com | WhatsApp/Telegram: +7 (983) 510-38-76

For more on the firm's approach to asset tracing and recovery in Russia: Asset Tracing & Recovery

— Elizaveta Razina Senior Lawyer, Practice Lead — IP Enforcement, Vetrov & Partners vetrovpartners.com/razina/

This alert is for informational purposes only and does not constitute legal advice. Vetrov & Partners is a Russian-qualified law firm. Contact info@vetrovpartners.com for advice on your specific situation.