Sale of a Russian business: Consent of the Government Commission is required in case of limited liability companies

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published on 12 September 2022 | approx. 1 Minute


Yesterday Presidential Decree no. 618 of 8 September 2022: On a Special Procedure for Certain types of Transactions (Operations) Between Certain Parties introduced some new rules:



1. A new procedure was introduced for the transactions with shareholdings in Russian limited liability companies that involve persons from 'unfriendly' countries. Now such transactions are subject to approval by the Government Commission. The procedure used to apply only to shareholdings in stock companies, but now its application has also been extended to limited liability companies. The new rules do not apply to lending institutions and some financial agencies.

 

It can be concluded from the text of the above decree that the restrictions apply to the transactions involving sale and purchase of shareholdings in limited liability companies as well as to option agreements and corporate agreements. The restrictions apply both to the conclusion of new transactions and to the close of the relevant transactions concluded earlier.

 

The procedure for the grant of approvals by the Government Commission is yet lacking and is to be approved by the Russian government not later than 18 September 2022.

  

2. In addition, the decree allows the banks subject to sanctions to discharge in Russian Roubles, at the official exchange rate set by the Central Bank of the Russian Federation, their foreign currency-denominated obligations on bank deposits and customer accounts to their customers that are Russian resident entities.

  

3. The Decree rules furthermore that all limited liability companies in which a strategic enterprise that is a subsoil user in Russia participates – whether directly or indirectly – shall be entitled not to provide information on their activities to parties from "unfriendly" countries.

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