On May 28, 2020, the Federation Council of Russia received the Draft Bill proposing additional Russian countersanctions (“Draft“) that was approved by Russian State Duma in the second and the third readings on May 27, 2020. This Draft passed the first reading in Russian State Duma on July 24, 2019 (see our post on this here).
The Draft has been amended since then and now proposes the following principal provisions:
- Unless otherwise set forth under the treaties of the Russian Federation or the agreement between the parties, the disputes involving the sanctioned persons and any disputes between Russian persons, Russian and foreign persons or between the foreign persons that are based on sanctions against Russian persons, shall be submitted for settlement to Russian courts;
- Sanctioned persons are entitled to file lawsuits to competent courts in Russia provided that there are no pending court or arbitration proceedings outside Russia related to the same dispute between the same persons about the same subject or on the same groundings; and
- Sanctioned persons are entitled to approach competent courts in Russia with a request to prohibit initiation or continuation of the court proceedings outside of Russia. Non-compliance with this prohibition may result in a fine imposed by Russian court on the counterparty of such sanctioned person in the amount not exceeding the amount of the claim and legal costs incurred by the appealing party.
- If a sanctioned person considers the arbitration agreement impossible due to the sanctions preventing from the access to public justice, such sanctioned person is entitled to approach to a competent court in Russia ignoring the arbitration agreement.
Given that the Draft passed the second and the third readings and was delivered to the Federation Council that approved the Draft on June 1, 2020, it is highly likely that it will soon be adopted into law.