Nikita Deynega told Secret Firmy whether it makes sense for Russian investors to sue over the blocking of foreign assets

15.08.2022
|By maximapublisher
Nikita Deynega — Partner

At the end of February 2022, following the start of Russia’s special operation in Ukraine, the EU Council adopted the first restrictive measures against assets of Russian investors located abroad. Among other things, the European depositories blocked about €4.5-7bn held in the accounts of the National Settlement Depository (NSD). In August 2022, NSD sued the EU General Court in Luxembourg, demanding that the restrictions be lifted. Nikita Deynega, Senior Associate and Head of Tax and Administrative Law Practice at Maxima Legal explained to publication Secret Firmy that formally NSD had not been under EU sanctions before 3 June 2022 and there were no sufficient grounds for “freezing” the accounts.

Nikita drew attention to the fact that Russian investors may either join NSD’s lawsuit or demand the unblocking of assets and reimbursement of damages on their own. For example, the expert said that those affected can file lawsuits with the EU General Court and demand that the inclusion of NSD in the sanctions list is illegal, as it violates the rights of non-sanctioned persons. In addition, Nikita identified options such as

  • take legal action in the Belgian state courts to recover losses from the European securities depositories EuroClear/Clearstream, which illegally blocked the disposition of securities from February to June, when NSD was not under sanctions
  • sending administrative requests to the Ministry of Finance of Belgium to issue a special licence to a private investor to exclude the investor from the general blocking regime for NSD’s securities.

Nikita Deynega noted that there have not yet been any court cases to unblock securities at NSD, but Russians have previously successfully challenged European sanctions. For example, in 2016, the EU General Court found that the sanctions against Russian businessman Arkady Rotenberg imposed in connection with the joining of Crimea to Russia were unfounded and partially lifted.

To read the full article (in Russian) please visit Secret Firmy website >>>