The sanctions imposed by the European Union,
the United States and Western countries that have aligned themselves to support the EU and US positions towards Russia have led to enormous operational difficulties for European and Western companies, which are navigating by sight in the current geo-political and regulatory framework.
The problems that companies and entrepreneurs are facing not only have a reputational impact, but range from the sudden blockage of the payments, to the suspension of deliveries of goods to and from Russia, and even increasingly plausible fears of a possible “nationalization” of their assets by the Russian authorities.
In spite of the unpredictability of the moment and the continuous evolution of Western sanctions and Russian countermeasures, we can summarize as follows the fronts on which it is possible to act in order to protect as much as possible one’s own investments and activities, by relying on professionals active in the area:
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- MONITORING SANCTIONS AND PREVENTIVE ACTIVITY: constantly monitor EU and US sanctions and countermeasures adopted by the Russian Federation, in order to avoid incurring in violations of law and consequent sanctions;
- ALTERNATIVE IMPORT/EXPORT CHANNELS: evaluate alternative shipping and customs clearance channels and routes;
- FINANCIAL GUIDANCE: assess the feasibility of alternative methods of payment and collection, including the deposit of funds in escrow and channeling flows through credit institutions not yet affected by sanctions, in compliance with applicable regulations;
- ASSET PROTECTION: evaluate potential legal and corporate asset protection structures to ensure as much as possible their preservation and integrity until sanctions are removed (e.g. temporary trusts, etc.);
- CORPORATE GOVERNANCE REVIEW: evaluate and implement appropriate measures to ensure the continuity of governance of subsidiaries or affiliated companies in Russia in the event of measures that exclude non-residents from holding corporate offices in the Russian Federation;
- GOVERNMENT SUPPORT FUNDS: verify the possibility of benefiting from specific funds and exemptions made available to companies by the Russian authorities on the spot and by the EU and US authorities in the West, in order to alleviate the impact of the sanctions on specific sectors of the economy and/or for product categories and services that are considered strategic.
Viorica Efros
Junior Partner
Head of the East European Desk
E: viorica.efros@l2bpartners.com
