News

Russian residents have lost the opportunity to obtain corporate rights in Russian entities that they currently own through controlled foreign companies (CFCs) in "unfriendly" jurisdictions. This and a number of other corporate measures aimed at crisis management expired on 1 January 2026, Interfax reports.

Since 2022, a rule had been in effect allowing Russians who own companies in Russia through CFCs registered in unfriendly jurisdictions to obtain corporate rights in those Russian companies directly. This could be done by those who owned more than 50% of the CFC. A mandatory condition was that the CFC acted or was dormant as the controlling entity, violating the rights of the Russian company or its beneficiaries. The rule was extended several times and was effective until 31 December 2025, but no further extension has been made.

Similarly lapsed are legal provisions allowing suspension of the corporate rights of "unfriendly" foreign persons owning a stake (of 25% or more) in Russian companies licensed to extract subsoil mineral resources or operate cross-border gas transport infrastructure in Russia, if their shares were not traded on the stock exchange and there were no more than fifty shareholders.

Another legal provision that has timed out allowed the courts, until the end of 2025, to restrict the corporate rights of foreign co-owners of Russian companies if they interfered with those companies' normal functioning, such as by publicly announcing the cessation of operations in Russia, terminating significant contracts, or dismissing more than a third of employees. The restrictions included a ban on participating in meetings of shareholders and LLC members, receiving dividends, receiving distributed profits, and disposing of shares and participation interests.

In addition, a January 2023 presidential decree allowed a number of Russian companies in the fuel and energy sector, machinebuilding industry and trade to ignore the votes of co-owners from "unfriendly" countries, provided three conditions were met: sanctions had been imposed on the Russian co-owner; the "unfriendly" co-owners owned no more than 50% of the company; and the revenue of members of the group to which the Russian company belonged for the previous year exceeded RUB 100 billion. No extension of this decree has been announced.