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| Lawyers need to make sure they avoid running into the long-armed and sharp reach of Russian regulation |
Although a number of Western companies already have a well-established presence in Russia, many banks are cautious about entering this part of the world. Attracted by the tremendous opportunities in the Russian markets, but fully aware of the risks involved, these banks prefer not to set up a local office, but rather to operate off-shore. Despite the fact that one or even all counterparties to the deal may be located outside the Russian Federation, and therefore be outside Russian jurisdiction, while negotiating and structuring these deals, it is wise to take into account the possibility of extraterritorial application of Russian legislation to this type of transaction, and, most importantly, to their Western participants.
This article provides an analysis of several possible cases of cross-border or offshore participation of Western banks in Russian markets...