Legal news website Pravo.ru has published the results of tenders for a contract to represent the distribution grid company Severo-Zapada. The winning bid for this work was made by Maxima Legal.

As part of the bidding process, lawyers were required to represent the interests of the subsidiary Rosset (at an appeal stage before the regulator) in an administrative claim against the Arkhangelsk Agency for Tariffs and Pricing. The company is seeking a ruling that a civil servant’s decision dated 13 December 2013 which established a base level for controlled prices of its branch Arkhenergo for 2014 is ineffective. Severo-Zapada also asks that the agency approves the tariffs for electricity distribution services in 2017 taking into account the new regulations (in place of the regulations being ruled to be ineffective).

Additionally Maxima Legal won a further tender from Severo-Zapada to provide legal services to represent the interests the company in the Arbitration Court of the Novgorod region and higher instances in two disputes with TNS Energo Veliky Novgorod for the recovery of debts in the sum of 80 million roubles.

To read this news on the Pravo.ru website (in Russian), click here.

The Russian Parliament has introduced a draft law according to which courts will have the ability to lower damages payable for infringements of exclusive intellectual property rights below the minimum figures established in the Russian Civil Code.  The proposed law relates to situations when one infringement touches upon a number of intellectual property rights; for which the right holder is entitled to compensation or damages.

At the same time, the draft law establishes a minimum limit for compensation for one infringement: 10,000 roubles. The authors of the proposed law suggest that the size of compensation should be determined by taking into account the circumstances of the case, the consequences and character of the infringement.  It is proposed that such an approach when calculating compensation will exclude situations compensation payable is manifestly unfair and disproportionate to the infringement.

Senior Associate at Maxima Legal, Maxim Ali, who specialises in intellectual property matters, commented that providing courts with more freedom to reduce compensation is justifiable, however, the current draft legislation has a number of inadequacies. The conditions for reducing compensation are rather abstract, and overall the draft law is more favourable for the person infringing intellectual property rights, when compared to the recent guidance from the Russian Constitutional Court, which is the source of the proposed changes to the Civil Code.

It is possible that in the event of a dispute, the Court will be able to reduce the compensation to the minimum level of 10,000 roubles. Accordingly a company seeking to protect its exclusive intellectual property rights might more cautiously approach issuing court proceedings.  From another side, companies who are defendants in such claims from right-holders will get an additional tool that can reduce the adverse effects of such legal disputes.

To read the full article (in Russian), please click on the following link.

On 14 June, the St Petersburg City Court reached a decision in favour of Maxima Legal’s client, Trust bank, in respect of a dispute concerning credit notes.

On hearing the appeal of the bank, the court overturned an earlier decision of Oktyabrisky regional court, which had been in favour of the holder of credit notes, and declined in full the claimant’s attempt to recover all money spent on the purchase of credit notes.

The case concerned securities issued by a foreign company that had entered subordinated loans with the bank.  The credit notes could only be acquired by qualified investors, who understood the risks associated with investing in such a tool, which includes the possibility of complete loss of invested funds.  A feature of subordinated loans is that in the event of a threat of bankruptcy to a bank that has received such a loan, it is written off in order to ensure that the bank's obligations to depositors and other customers can be discharged.

Such an event happened in December 2014.  Guided by the provisions of the contracts, as well as Russian legislation, the bank wrote off subordinated loans, which led to the cancellation of the derivatives of the credit notes. The holders of credit notes subsequently applied to the courts, citing that they did not appreciate the difference between foreign securities and bank deposit and insisting that they had been misled, believing that they money had been held on deposit.

Initially, not having understood the full circumstances of the cases, courts, including in St. Petersburg, often took the side of the holders of credit notes. These court decisions were referred to by many credit note holders in different regions of Russia.  However, judicial practice in such disputes has now changed to favour of the bank's arguments.

In February of this year, Senior Associate at Maxima Legal, Natalia Demina, successfully changed the practice of the St Petersburg City Court and won a dispute involving the Trust bank against Mr Vibornov, who disputed being considered a qualified investor, but did not claim for the funds spent on the purchase of the credit notes.

Head of the Dispute Resolution Practice at Maxima Legal, Sergey Bakeshin, successfully represented the bank in a further dispute with the holders of credit notes, strengthening the position of the Trust bank and deprives the holders of credit notes if the opportunity to make further claims against the bank.

On 14 June business newspaper, Delovoy Peterburg, published an article ‘Baltinvestbank argues with the bailiff’, about the potential recovery from the bank of 11 million euros which was awarded to a Virgin island offshore company Marzia Trading Ltd in February after it won an appeal following a dispute with Baltinvestbank.

If the bailiff succeeds in recovering the funds before the decision is overturned, the offshore company will be due the money. However, there are no legal grounds for not complying with the decision before the case is considered further at appeal.

“The bailiff can seize and recover funds from the bank account of the company or follow another avenue – to transfer the money from the account of the credit institution with the Central Bank”, commented Managing Partner of Maxima Legal, Maxima Avrashkov. “However, if the bailiff has not done this, the bank has an opportunity to delay payment, finding fault with the formalities, for two or three weeks during which time the appeal court should consider the matter.  The same goes for the Central Bank, usually it does not delay with transferring funds, but in the current matter, in order to help the bridge bank, it may informally make an exception.”

To read further information (in Russian), visiting the following website.

On 15 June, the international legal rating publication Best Lawyers released the results of its research for 2017.

Partner at Maxima Legal, Vladimir Kilinkarov, was recognised in the category of Corporate Law (St Petersburg) as well as Head of the Tax Practice, Elena Kilinkarova, for Tax Law.

Best Lawyers is one of the oldest and respected ratings in the legal industry.  Inclusion in the ratings is a privilege for any lawyer and is regarded in the profession as an achievement. The main criteria on which Best Lawyers assesses lawyers is their work, analysis of their successes and reputation. The method of the rating is based on a peer-review conducted with leading lawyers in each sector.

For the results of the Best Lawyers ratings in Russia, please see click here.