Putin Has Authorized The Revocation Of The Right To Redeem Shares For Investors Who Have Left Russia

The measure applies to transactions entered into after February 22, 2022.

Russian Federation dictator Vladimir Putin has signed a law allowing the revocation of foreign investors’ rights to repurchase shares and equity interests in Russian companies. The measure applies to transactions with investors from unfriendly states concluded after February 22, 2022. The document has been published on the legal acts portal.

Refusal to honor options can be sought through the Moscow Region Arbitration Court. Proceedings may be initiated by the purchaser of the asset or by the relevant ministry with the consent of the regulatory commission. A claim may be filed regardless of whether the foreign investor has requested a buyback.

To terminate the right, one condition from either of two groups is sufficient: the investor’s conduct (discrediting the military, public statements about suspending operations) or financial parameters (a price deviation from the market price of 25% or more, or additional investments by the buyer). A foreign national may receive compensation within one year provided they have not been held liable for financing terrorism or extremism. The amount of the payment will be determined by the court.

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