Expertise/Contract Law

Service

Sanctions Compliance

Before a transaction with a foreign party, it is checked whether foreign sanctions, Russian special economic measures or export control requirements prevent it from being concluded and performed.

We are most often instructed by:

  • Companies preparing a transaction with a foreign party
  • Parties to a contract whose performance has been affected by restrictions
  • Parties to operations that require a prior permit
  • Companies introducing ongoing screening of counterparties for restrictions

The information on this website is provided for information purposes only and does not constitute a public offer.

What the Service Includes

Timing and Fees
–timing on request
from ₽fee on request

Timing and fees are indicative and are confirmed when the engagement is agreed.

01 / Overview
Sanctions check

A sanctions check is not limited to searching for a company's name in the list of persons subject to restrictions. Depending on the applicable regime, the ownership and control structure, related persons, the ultimate recipient, the subject of the transaction and the involvement of other organizations in its performance are relevant.

Russian special economic measures and export control requirements are assessed separately. Certain operations are subject to a special payment procedure, prior permit requirements or export controls on dual-use goods. The specifics of Russia–China projects are described on the China Desk “Compliance” service page.

Sanctions restrictions affect not only the ability to conclude a contract. A transaction may encounter a bank's refusal to process a payment, the inability to use the chosen carrier, a restriction on the supply of certain goods or a change in a party's status once performance is already under way.

The results of the check are linked to the terms of the contract and the actual mechanics of the transaction: what happens if restrictions arise is determined in advance.

02 / Outcome
Service Outcome
  • Permissibility assessmentA written conclusion on whether the transaction can be carried out and on what conditions.
  • Check recordsRecorded results and sources for each person and element of the transaction checked.
  • Sanctions provisionsClauses, representations and procedures for the parties, ready for inclusion in the contract.
  • Permit applicationsPrepared applications and a set of materials for the competent authorities.
  • Ongoing screening procedureRules, sources and check forms for regular dealings with foreign parties.

The outcome of the service is the work performed within the scope agreed with the client.

03 / Projects
Selected Projects
01 / 05

Joint activity

Distribution partnership between English, Kazakh and Chinese companies

Challenge

English, Kazakh and Chinese companies were forming a partnership for joint activity in distribution. The relationship between the participants was worked out under the law of England and Wales.

What was done

The arrangements for conducting the joint activity, the distribution of economic results, decision-making and changes in the membership of the partnership were worked out. The work included participation in drafting and negotiating the documents, taking into account the interests of participants from three jurisdictions.

Financing structure

Co-investor obligations and security in a grain elevator construction project

Challenge

Funds from several co-investors were being raised to build a grain elevator. Their obligations had to be combined into a single financing structure.

What was done

A comprehensive structure was developed combining the investors' obligations with security and option mechanisms. The procedure for providing funds, the interrelationship between the individual elements of the transaction and the terms defining the parties' rights under different project implementation scenarios were agreed.

Cross-border transaction

Contractual relationship between Russian and Kazakh companies under the law of England and Wales

Challenge

A Russian and a Kazakh company were entering into a transaction whose documents were governed by the law of England and Wales.

What was done

The work included advice on the structure of the contractual relationship and participation in drafting and negotiating the terms of the transaction. Specific issues were worked out in the light of the chosen governing law and the involvement of parties from different jurisdictions.

Foreign trade contract

Negotiating a Chinese-law contract for the supply of production equipment

Challenge

Participation in advising the Russian party on a transaction for the supply of production equipment governed by Chinese law. Advisers from China were engaged on matters of Chinese law.

What was done

The terms of the contract were negotiated, and specific issues relating to the Russian and Chinese parts of the transaction were coordinated. The comments of the Chinese advisers were taken into account in working out the contractual terms and the final version of the documents.

Contract review

Pre-signing review of contracts for the international sale of goods

Challenge

A Chinese company required a legal review of contracts for the international sale of goods between China and Russia. Such contracts carry risks of inconsistency in the governing law, delivery terms and dispute resolution mechanisms.

What was done

The review covered the governing law, delivery terms (Incoterms), the dispute resolution procedure and the currency and tax aspects of the contracts. The risks identified were eliminated before signing.

04 / Questions
Frequently Asked Questions

The scope of the check depends on the specific operation. The matters usually assessed are the parties to the transaction, the ownership and control structure, the ultimate recipient, the goods or service, banks, carriers, insurers, the delivery route, the payment method and other elements of the operation on which performance depends.

At the same time, it is determined which foreign restrictions and Russian special economic measures may apply to the transaction.

Not always. Depending on the applicable sanctions regime, what matters is not only whether the company itself is listed but also its ownership and control structure.

In such cases, not only the counterparty's name is checked but also the persons who directly or indirectly own or control it.

The status of the parties, banking channels and the applicable restrictions may change while the contract is being performed.

Sanctions provisions determine the consequences of such changes in advance: the ability to suspend performance, change the method of payment or delivery, request additional documents, withdraw from the contract and make final settlements.

First, the reason for the refusal is established: documentation requirements, the bank's internal risk assessment or a restriction that directly prevents the operation.

The terms of the contract and possible further steps are then assessed: providing additional documents, changing the payment arrangements or other permissible options for performance.

Not for every operation. Whether a permit is needed depends on the parties involved, the subject and type of the operation, and the requirements in force at the time of the operation.

The question is checked before the operation is carried out, which determines the applicable procedure and the documents required.

If the applicable requirements permit an alternative structure, a different lawful way of carrying out the transaction is determined: its structure, the parties involved in performance, the payment arrangements or other parameters are changed.

It is determined which transactions and counterparties are subject to checks, who carries them out, which sources are used, how the results are recorded and when in-depth legal analysis is required.

Check forms, internal rules and a procedure for reassessing counterparties and ongoing transactions are developed.

An hourly rate, a fixed fee or a combined model is used; in some cases part of the fee depends on the outcome achieved. The fee is determined by the time actually spent, the complexity of the matter and the overall timeframe of the project, and is agreed before work begins.

Key Contacts
Deni Murdalov Deni Murdalov Partner, PhD (Law), LL.M. Ilya Smirnov Ilya Smirnov Partner

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Concluding, Amending and Terminating Contracts Foreign Trade Contracts Commercial Models and Contract Structuring Contract Management on Retainer Systematic Contract Management Licensing Trade Secrets and Confidentiality Documents and Consultations

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