Sergei Bakeshin has commented for Mashnews on attempts by processed Karat cheese producer to recover €4.8 million from French counterparties Sas Steap Stailor and SA Societe Generale

Karat-Togliatti, the Samara-based subsidiary of processed Karat cheese producer, is suing Sas Steap Stailor. The French company failed to supply equipment for the plant in Togliatti, explaining its failure to fulfil its obligations by sanctions despite the fact that the restrictive measures imposed by the EU do not apply to the supply of industrial plants intended for food production to Russia.

At the same time, Karat-Togliatti is also seeking €4.8 mn compensation for the  spent on the plant from the French bank Societe Generale, which provided bank guarantees under Sas Steap Stailor supply contracts. The Commercial Court of Moscow granted this claim on 12 July, but SA Societe Generale has a month to appeal the decision.

Sergei Bakeshin, Counsel, Head of Dispute Resolution & Insolvency Practice at Maxima Legal, explained to Mashnews that if SA Societe Generale has any property in Russia, it can be arrested by Russian bailiffs, and if it is not possible to collect the receivables in Russia, there is a possibility to apply to foreign courts for recognition and enforcement of the Russian court judgement. ‘Without this procedure (it is called exequatur), a Russian court judgement will not be enforceable abroad. Exequatur in France or in other ‘unfriendly’ states may be difficult, in ‘friendly’ states the chances of success are higher,’ the expert said.

At the same time, even in the absence of guarantees of return of funds, litigation with SA Societe Generale and Sas Steap Stailor is important for Karat-Togliatti. As Sergei Bakeshin emphasised, ‘since Karat-Togliatti paid Sas Steap Stailor an advance payment but did not receive the equipment, the litigation is necessary at least to avoid liability for violation of the rules on repatriation of foreign currency’.

To read the full article (in Russian), please, see Mashnews website >>>