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Hotel Marriott Grand was on the 9^th of October the venue of the Round table discussion “Foreign investments into businesses of strategic sectors: 100 days from the reference point” organized by law firm Vegas-Lex.

The scope of the event was attend various aspects of application of the Law № 57-ФЗ on limitations of foreign investments into economic communities of strategic significance. Participants of the Round table discussed issues related to the application of this law and specific features concerning foreign investors. The procedure of transactions arrangement set by the Law № 57-Ф3 and proceeding consequences for Russian businesses and foreign investors were also examined within the scope of the discussion as well as problems related to the structural formatting of deals in acquisition of control over strategic enterprises in view of the requirements of the novel legislation.

The Round table discussion was opened by Mr. Andrei G. Tsyganov (Deputy Head of the Federal antimonopoly service of the Russian Federation). He explored in the opening speech the subject of the Law № 57-ФЗ, its content and interpretation: “Federal Law № 57 contains exemption of limiting for foreign investors features. The said exempted limitations are executed with the sole objective – to secure the defense capability of the country and security of the State. The Law is applied in the whole of the territory of the Russian Federation and is featured by an exterritorial nature i.e. it does refer to transactions concluded outside the limits of the Russian Federation in the event they may involve the consequences specified in Clause 2 of the Law №57.” Mr. Tsyganov made it clear that the Law establishes that it does not extend to investments into economic communities if the share of the Russian Federation in the authorized fund of such exceeds 50% of the total number of votes; whereby “as a foreign investor was the  owner of a share holding subject to control under the Law № 57 it will not have to face the procedure of the approval of the transaction once over again exclusive strategic communities involved in subsurface resources management at fields of federal significance.” 

Participant of the Round table discussion shared the opinion of Albert Yaganyan (the Managing partner of the Law firm Vegas-Lex) who noted that the Law in effect on limitations of foreign investments will before long become a major tool in the State investment policies. “It is exactly the Law capable of regulating foreign investments at levels outside the scope of legislation alone which in terms of adoption are long enough per se, but at the level of the development of rules and regulations as well, Including the procedures and practices. The same refers to the level of bringing a certain level of the political and economic will existing in the country to everyday life practices of investors within shorter time frames.” – pointed out Mr.  Yaganyan. 

Yuri Bortnikov (Head of the Group if international projects of the Law firm Vegas-Lex) presented to the attention of the audience proposals for structural formatting of transactions to allow foreign investors exercise control over Russian strategic enterprises by virtue of requirements of the Law № 57-ФЗ: «Any transaction concluded abroad and resulting in the acquisition of control by a foreign investor over a Russian strategic enterprise shall receive a preliminary approval by law on foreign investments into strategic sectors. Structural formatting and execution of such transactions will account for the provisions of law as a matter of fact and will contribute to the preparation of contractual document with due respect to the legal requirement of the approval of the transaction.” – commented Mr. Bortnikov.