On 18 April 2025, the President of the Russian Federation approved a list* of instructions aimed at developing special regulations for transactions involving the “return” of foreign “unfriendly” companies to the Russian market.
According to these instructions, the Russian government is to develop a special procedure for approving transactions that could lead to the acquisition of immovable property or shares/interests in Russian companies by foreign entities from “unfriendly” jurisdictions.
Such a special procedure will have to consider the following aspects:
It appears that the requirements for foreign companies which have continued operations in Russia may be more lenient than for those that have ceased or suspended activities since 2022.
We anticipate that the economic sector in which the transaction occurs will be a key factor, as well as the extent to which the foreign company’s contribution is deemed important for the development of the relevant industry.
At present, it is unclear what form such guarantees might take — for example, whether this will involve an independent shareholder guarantee or other instruments securing the parties’ obligations. This will likely depend on the nature and scope of the transaction.
It should be noted that transactions involving the acquisition of Russian assets by “unfriendly” foreign entities are already subject to prior approval by the Government Commission, in accordance with existing presidential decrees* on “counter-sanctions”. It is therefore likely that, as with “exit” transactions, the Russian authorities (including the Government Commission) will develop specific requirements and approval criteria for “return” transactions under the existing procedure for obtaining Government Commission approval.
Buy-back (option) mechanism
The President’s instructions also include the development of special conditions allowing foreign shareholders to buy back Russian assets previously sold under non-market conditions following their “exit” after 22 February 2022. These refer to transactions approved by the Government Commission, where a mandatory discount — currently set at 60% — was applied.
Under rules established by the Government Commission in 2023, buy-back (option) transactions may be approved provided the following conditions are met:
• The buy-back must take place at market value as of the date on which the option is exercised. • The initial term of the option must not exceed two years.However, it is worth noting that in recent practice, the Russian authorities’ approach to such options has shifted. Thus, even where these conditions were satisfied, the Government Commission has not consistently supported such transactions.
Therefore, we do not rule out the possibility that the new buy-back procedure to be developed by the Government may amend the existing requirements, potentially calling into question the enforceability of previously approved options.
Special register
The President’s instructions also mandate the creation of a special register (or list) of “unfriendly” foreign entities that ceased or reduced operations in the Russian market after 22 February 2022.
This register will include information on the nature and timing of the suspension or termination of activities, as well as data on the shareholders and beneficial owners of the relevant companies.
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We closely monitor the development of new regulations on these issues and will provide further analysis of the “return” transaction approval procedure once full details become available.
* In Russian
Publication is also available in Russian and Japanese.
Authors:
Maxim Boulba, Partner, Head of Antitrust & Regulatory
Elena Andrianova, Senior Associate, Antitrust & Regulatory
Ksenia Voloshchenko, Associate, Antitrust & Regulatory
Maxim Boulba
Partner
