Paul Backer, an American attorney based in Moscow, recently has offered the following original contributions to the JRL on the subject of sanctions and the response by business and legal counsel. Backer, pbacker@skalalaw.com, is with Skalaw Law, online at skalalaw.com. Part I: Russia sanctions: implementing client sanctions policies – Sept. 26, 2014 Part II: Russian companies’ failures to adopt effective sanctions policies […]
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(Interfax – October 17, 2014) The current decline in oil prices is no tragedy, Russian Energy Minister Alexander Novak said, adding that the average annual price of oil needs to be considered. “The price reached $120 per barrel at the beginning of the year, and averaged $100 per barrel in the three preceding years. If we had $120 and now […]
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(Russia Beyond the Headlines – rbth.ru – Maria Karnaukh, special to RBTH – October 17, 2014) Falling oil prices – and the falling ruble – have different consequences for the budget and consumers Oil prices – and the Russian ruble – continue to sink. As of Oct. 16, the price of a barrel of Brent crude, the standard on which […]
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(Interfax – October 17, 2014) Most Russians claim they have felt no effect from Western sanctions and expect that the sanctions will be good for the national economy, sociologists have told Interfax. A relative majority (41 percent) of 1,630 respondents polled by Levada Center in 134 populated localities in 46 regions in September said the sanctions were aimed against the […]
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(Business New Europe – bne.eu – Timothy Ash of Standard Bank – October 15, 2014) Russia’s foreign minister, Sergey Lavrov, this week estimated that the crisis in Ukraine would likely cost the German economy €40bn this year, and a further €50bn in 2015 – presumably through lost exports, and a broader disruption to the German economy and weaker resulting real […]
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MOSCOW, October 15 (RIA Novosti) – Russian President Vladimir Putin has signed a law reducing the possible share of foreign stockholders in the Russian media to 20 percent, says the corresponding document published on the Russian government’s official legal information web portal Wednesday. “Unless otherwise stipulated by an international treaty … a Russian legal entity with a foreign participation share […]
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(Interfax – Moscow, October 14, 2014) There is no alternative to improving relations between Russia and the EU and Russia is ready to discuss the creation of a free trade zone with the EU, Russian Foreign Minister Sergey Lavrov has said. “I believe that no clear-headed person in Europe will argue with the fact that there is no reasonable alternative […]
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(Moscow Times – themoscowtimes.com – Delphine d’Amora – October 16, 2014) Consumer confidence in Russia’s financial system is falling, with half of Russians saying they don’t trust banks and are using such services less, in a troubling signal for a system under pressure from Western sanctions and more sensitive than ever to outflows of depositors, a recent study showed. In […]
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(Voice of America – Andre de Nesnera – October 15, 2014) After several rounds of international sanctions against Russia for its annexation of Ukraine’s Crimean peninsula in March and support of pro-Russian separatists in eastern Ukraine, experts are divided over whether they are working. “It depends on what your understanding of the purpose of sanctions is,” said Matthew Rojansky with […]
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(Moscow Times – themoscowtimes.com – Ivan Nechepurenko – October 16, 2014) Most of Russia’s indicators of economic health have plummeted this year. Inflation last month was at its highest level in three years, capital outflow this year is expected to exceed $100 billion, the ruble has lost almost 20 percent of its value since January, and economic growth is anaemic, […]
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VIENNA, October 16 (RIA Novosti) – Amid numerous US sanctions against Russia, Moscow has every right to begin introducing sanctions against the United States, but chooses not to follow this path, Russian Deputy Foreign Minister told RIA Novosti. “This is a reflexive, instincts-based reaction of Washington on what does not fit into the American idea of how, with whom, to […]
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(Moscow Times – themoscowtimes.com – Delphine d’Amora – October 16, 2014) Despite an economic slump and rising inflation, the majority of Russians believe that Western sanctions and Russia’s retaliatory ban on food imports will actually help the economy, a poll published Thursday showed. Only 25 percent of respondents expect sanctions to damage the Russian economy, and only 26 percent expect […]
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(Business New Europe – bne.eu – October 16, 2014) The ruble dropped to another historic low on October 15, passing the RUB41 per dollar mark in morning trading, but analysts said Russia’s central bank is not panicking because ruble weakness is bolstering manufacturing growth and budget revenues. “The CBR is not panicking either in terms of the scale of its […]
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(Interfax – October 15, 2014) Kremlin chief of staff Sergey Ivanov has said that the house arrest of billionaire businessman Vladimir Yevtushenkov is damaging Russia’s investment climate. In an interview with popular pro-Kremlin tabloid Komsomolskaya Pravda, which was quoted by Interfax news agency, Ivanov said that “I agree, this [the arrest of Yevtushenkov] is having a bad influence of the […]
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(Eurasia Daily Monitor: Volume 11, Issue 181 – Pavel K. Baev – Jamestown Foundation – jamestown.org – October 14, 2014) Considering Russia’s shocking transformation in the course of just half a year, it is easy to forget that last February the country was united in the joy of hosting the Sochi Winter Olympic games. The issues that dominated the political […]
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MOSCOW. Oct 14 (Interfax) – The Central Bank of Russia’s ruble exchange rate policy is “optimal,” Sberbank of Russia (MOEX: SBER) President and CEO German Gref said. “The policy that the Central Bank is pursuing is, in my view, optimal from the standpoint of managing the exchange rate. The economy is self-tuning, because the processes underway are very complex. Over […]
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(Business New Europe – bne.eu – October 14, 2014) On paper, Russian companies have huge foreign debts, and no way of refinancing them because sanctions effectively close Western capital markets to Russian borrowers. But with much of Russian corporate foreign debt in fact hidden equity investments from offshore zones, the figures seem much worse than they are. International headlines are […]
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(Interfax – October 14, 2014) Russia will use long-term measures to protect itself from Western sanctions, Russian Foreign Minister Sergei Lavrov has said. “We will certainly adopt all the measures needed to protect ourselves from unlawful restrictions. You are aware of the resources that are being allocated for these purposes. Beyond any doubt, it will be a long-term program,” he […]
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(Bloomberg – boomberg.com – Henry Meyer, Evgenia Pismennaya – October 13, 2014) Defying his former enemies in the U.S. and Europe may force Vladimir Putin to aid the ascent of his biggest rival in the east. Isolated over Ukraine, Russia is relying on China for the investment it needs to avert a recession, three people involved in policy planning said, […]
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(Interfax – October 12, 2014) Over half of Russians (61 percent) admit that fluctuations in the exchange rate of the ruble have a certain impact on their lives while 13 percent don’t notice any impact, a Public Opinion fund poll indicates. In the opinion of 62 percent of respondents a stronger ruble is better for the Russian economy and only […]
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(Bloomberg – bloomberg.com – Vladimir Kuznetsov – October 13, 2014) The ruble extended its longest losing streak in more than a year as $6 billion of Russian currency interventions failed to stem the depreciation amid tumbling oil prices. The ruble weakened 0.6 percent versus the dollar-euro basket to 45.3423 by 5:15 p.m. in Moscow, taking its seven-day decline to 2.3 […]
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(Blooomberg – bloomberg.com – Ye Xie and Elena Popina – October 9, 2014) As Russia starts burning through foreign reserves in a bid to defend the ruble, flashbacks to the country’s 1998 devaluation and default are inevitable. While the government is in a much stronger position today to fend off the crisis than it was then — foreign reserves are […]
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MOSCOW. Oct 9 (Interfax) – Capital outflows from Russia in 2014 could turn out to be less than the official forecast of $100 billion, Economic Development Minister Alexei Ulyukayev believes. “We haven’t changed the forecast for this year. It is still $100 billion. Our accumulated outflow, I believe, is currently $78 billion for eight months and it looks like it […]
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(Business New Europe – bne.eu – October 9, 2014) The ruble dropped on October 8 by a further 24 kopecks to the dollar and 29 kopecks to the euro. In order to support the exchange rate, the central bank was estimated by market participants to have sold more than $1.1bn, at least four times raising the upper threshold of the […]
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(Stratfor.com – October 9, 2014) Russian President Vladimir Putin celebrated his 62nd birthday Tuesday in a peculiar fashion: by himself in the Siberian forests. For the past few days, Putin’s spokesman, Dmitri Peskov, has brushed off journalists’ questions about why the president decided not to celebrate his birthday in Moscow or do other work as he has in previous years. This […]
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(Interfax – October 7, 2014) Food quality and assortments have not changed amid Russia’s retaliatory “food embargo” but prices have gone up, Muscovites told the Public Opinion Foundation. Two-thirds (66 percent) of 1,000 Muscovites polled over the phone on September 28 approved of the ban on food imports from a number of Western countries, 21 percent criticized that step and […]
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(Interfax – October 7, 2014) The risk of the Russian economy moving from stagnation to a full-scale recession “has become slightly higher” in the short run, privately-owned Russian news agency Interfax reported on 7 October, quoting the latest study carried out by a group of Russian researchers. The research headlined “Comments on the state and business” for the period from […]
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(Moscow Times editorial – themoscowtimes.com – October 8, 2014) Official documents published Monday show the Kremlin has scrapped the president’s annual budget address. President Vladimir Putin’s spokesman Dmitry Peskov told TASS that the set piece speech would, from now on, be folded into the state-of-the-union address, usually given in December. While Putin floated the idea of combining the two speeches […]
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MOSCOW, October 8 (RIA Novosti) – Speaking about the possible removal of sanctions against Russia, Russian Foreign Minister Sergei Lavrov said Wednesday that the matter was for Western states to decide. “Sanctions is the business of our western colleagues, the business of the countries that decided to use this illegal instrument for some reason, possibly just to take their frustration […]
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(Voice of America – Henry Ridgwell – October 7, 2014) As the annual meeting of the International Monetary Fund and the World Bank gets underway in Washington, Ukraine wants to adjust the terms of its $17 billion bailout. Kyiv says the country is now at war and needs to build new armed forces. But some analysts say the terms of […]
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(Window on Eurasia – Paul Goble – Staunton, October 8, 2014) The Russian Federation is seeking a revision in the international system but lacks the economic strength to be a new pillar, according to Fedor Lyukanov. And as a result, Moscow will seek to make up for that shortcoming by sudden and dramatic foreign policy moves as it has been […]
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(Moscow Times – themoscowtimes.com – Delphine d’Amora – October 8, 2014) Prominent economist and Kremlin critic Sergei Alexashenko says that political pressure has forced him to surrender his post as editor and contributor to a respected macroeconomic bulletin published by Moscow’s Higher School of Economics. “Someone doesn’t like what I write, what I do, where I live. And I have […]
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(Bloomberg – bloomberg.com – Vladimir Kuznetsov – October 7, 2014) Russia’s central bank spent as much as $1.75 billion to prop up the ruble over the last two trading days, its biggest market intervention since President Vladimir Putin’s incursion into Ukraine in March. Russia’s central bank spent the equivalent of $980 million to shore up the ruble on Oct. 3, […]
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MOSCOW, October 7 (RIA Novosti) – Russia needs to establish a system of domestic credit and improve the efficiency of public administration, so that the economy could successfully develop amid Western sanctions, Russian Presidential Aide Sergei Glazyev said Tuesday. “If we want to survive the war that is being waged against Russia, we need to create an internal system of […]
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Subject: Sanctions, Part 2. Date: Tue, 7 Oct 2014 From: Paul Backer <pauljbacker@gmail.com> Part 2. Russian companies’ failures to adopt effective sanctions policies worsen sanctions’ impact. Russian companies failed to address key aspects of sanctions: 1. Large law firm incentives are against giving operationally useful sanctions advice and 2. Nature and enforcement of sanctions differ from traditional law. Transacting with […]
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(Moscow Times – themoscowtimes.com – October 6, 2014) Year-on-year inflation hit 8 percent in September, driven up by the plummeting value of the ruble and Russia’s bans on many food imports from the United States and European Union, according to data from state statistics service, Rosstat. Rising food prices were the main driver, climbing 11.4 percent year-on-year in September, up […]
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(Bloomberg – bloomberg.com – Irina Reznik, Evgenia Pismennaya and Ilya Arkhipov – October 5, 2014) Russia’s wheels of power are grinding to a halt. That’s the assessment of five officials close to President Vladimir Putin, who say that a struggle at the heart of his inner circle is slowing decision making as sanctions squeeze the economy. With Putin focused on […]
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(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – October 3, 2014) Speaking at the Russia Calling Investment Forum, Russian President Vladimir Putin discussed the main direction in the development of Russia’s economy. Analysts believe that Russia’s main challenge will be keeping inflation under control – inflation that was partly brought about by the ban on food imports […]
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(Moscow Times – themoscowtimes.com – Delphine d’Amora – October 3, 2014) German Gref, head of Russia’s biggest lender Sberbank, on Friday castigated systemic inefficiencies in the Russian government that, he said, waste trillions of rubles and threaten to drag Russian society back into Soviet times. “We have inconceivable social costs in the area of public administration,” Gref said in a […]
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(Business New Europe – bne.eu – Ben Aris – Moscow, October 2, 2014) Leading Russian investment bank VTB Capital held a slimmed-down version of their annual investment conference on October 1-2. The event, “Russia Calling! 6th Annual VTB Capital Investment Forum” at the World Trade Center Moscow didn’t look cut down from the point of view of the number of […]
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NOVO OGARYOVO (outside Moscow), October 3 (RIA Novosti) – Russia has enough reserves to implement all the tasks under the state budget regardless of global political and economic trends, Russian President Vladimir Putin said Friday. “We certainly have reserves to resolve the issues that could arise as a result of developments of the situation in the world and in Russia,” […]
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MOSCOW. Oct 2 (Interfax) – Russia has no intention of ending its relations with its traditional partners, including Europe, and expansion of cooperation with China is a global trend, Russian President Vladimir Putin said. “Russia is also thinking about expansion of cooperation with China, and it didn’t begin thinking about it yesterday or due to some sanctions or political restrictions. […]
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(Bloomberg – bloomberg.com – Jake Rudnitsky – October 2, 2014) Russian oil output rose to near a post-Soviet record last month, a sign the biggest source of revenue for President Vladimir Putin’s government has yet to be eroded by U.S. and European sanctions. The nation increased output 0.7 percent to 10.61 million barrels a day, according to preliminary data from […]
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(Moscow Times – themoscowtimes.com – Alexey Eremenko – October 1, 2014) It seems unfeasible that Russia, which holds a fifth of the planet’s forests, could run out of wood. And yet it is happening, at least with commercially usable forests, environmental analysts say. The Russian logging industry will face lack of harvestable timber in 10 to 20 years, a short […]
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(Bloomberg – bloomberg.com – Ilya Arkhipov, Ryan Chilcote – September 30, 2014) President Vladimir Putin won’t be swayed by sanctions over Ukraine because he doesn’t allow such pressures to affect his decisions, said Igor Sechin, head of OAO Rosneft (ROSN), Russia’s biggest oil company. “He will never let himself be pressured into making a decision,” Sechin, who’s worked with the […]
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(Moscow Times editorial – themoscowtimes.com – September 30, 2014) This story begins a series of analytical articles and editorials in The Moscow Times about Russia’s long-term strategic prospects. It is strange to recall in 2014 that back at the beginning of his rule, President Vladimir Putin was hailed as a reformer. His main agenda during his first term in the […]
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Date: Fri, 26 Sep 2014 From: Paul Backer <contact@skalalaw.com> Subject: Russia sanctions, implementing client sanctions policies Part 1. Russia sanctions, implementing client sanctions policies. Skala Law client update. Sanctions’ impact will worsen through 2015. Failing to understand sanctions’ purpose and enforcement materially and avoidably damages listed and unlisted entities. Lack of a sanctions policy renders entities noncompetitive in tenders and […]
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BRUSSELS. Sept 30 (Interfax) – Russia is awaiting the European Commission’s proposal to lift its concerns about the enforcement of the EU-Ukraine Deep and Comprehensive Free Trade Agreement (DCFTA), Russian Permanent Representative to the European Union Vladimir Chizhov told reporters. “The decision of the European Council was anticipated and quite consistent with the agreement reached in the Russia-Ukraine-EU trilateral format […]
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(Moscow Times – themoscowtimes.com – Delphine d’Amora – September 28, 2014) An era in Russian media ended Friday as parliament passed a law limiting foreign ownership in domestic media assets at 20 percent, hitting some of the world’s largest media companies and turning back the clock on an industry that has thrived on foreign brands and capital. Since the draft […]
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(Moscow Times – themoscowtimes.com – September 29, 2014) The ruble sunk to a record low against the Central Bank’s currency basket Monday, continuing a steady slide that has seen it lose over 15 percent of its value this year. The Russian currency dropped during morning trading and was worth 44.37 against the euro-dollar basket shortly after midday, its lowest level […]
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