Published 2 October 2019
One of the key priorities of the Russian Government is the attraction of Foreign Direct Investment (FDI). As a result, foreign investors can enjoy national treatment in Russia, provided they do not threaten state security in any way. The Russian legislation does however set some limitations on investments, in particular surrounding companies engaging in business activities of strategic importance. The main aim of these limitations is to supervise transactions of foreign investors, which can lead to their subsequent control over strategic companies. Strategic companies are very attractive to the foreign capital. This paper analyses the restrictions which apply to foreign investors in Russia. It finds specific features of public supervision of FDI in strategic companies and state-owned entities and shows problems arising from the procedure of the state’s preliminary approval of transactions listed in the Russian legislation. The paper concludes that the Russian Government shall increase the transparency of decision making, whereby the Governmental Commission approves FDI in strategic company and establishes a clear list of transactions, regulated by the Strategic Investments Law.
This paper will be part of the TDM Special Issue on "The Changing Paradigm of State-controlled Entities Regulation: Laws, Contracts and Disputes". More information here www.transnational-dispute-management.com/news.asp?key=1719