CEE Legal Matters

Category: Russia

  • Severing Russian Ties: Baker McKenzie and DLA Piper Announce Russian Exit

    Baker McKenzie and DLA Piper have joined the plethora of firms announcing their exit from the Russian market.

    Baker McKenzie announced that, after 33 years of operating in the country, its current Moscow and Saint Petersburg offices will become an independent law firm. “We have made this difficult decision following ongoing consultation with our multinational clients, whose urgent on-the-ground legal needs we are serving, as well as careful consideration of the wellbeing of our many people in the wider region,” a firm press statement read, thanking its “many partners, associates, business professionals, and others who have worked so hard to build this business. Many have been part of the Baker McKenzie team for decades.”

    “In light of Russia’s actions in Ukraine and the resulting humanitarian crisis, and our consequent decision not to act for clients connected to the Russian state, we have concluded that maintaining a presence in Russia is not aligned with our values and therefore no longer viable,” a DLA Piper spokesperson said, with the firm announcing it is closing its 17-year-old offices in Moscow and Saint Petersburg, informing that the intention is to transfer the Russian business to its team there. The press statement added: “We are acutely aware of the impact this will have on our colleagues and friends in Russia, many of whom have been with the firm for a significant portion of their careers. We will continue to prioritize their safety and support them through this very difficult time and would like to thank them for the many contributions they have made to our firm,” while concluding: “We stand with the people of Ukraine and all those affected by this tragedy.”

    With Baker and DLA, the total number of firms announcing or confirming their exit from the Russian market is now 24. The previously announced exits are:

  • Severing Russian Ties: Debevoise, Dechert, Dentons, and CMS Announce Russian Exit

    Debevoise & Plimpton, Dentons, Dechert, and CMS have announced they are closing their Russian offices and exiting the market.

    “Based on a careful review, we have decided to wind down our office in Moscow,” a Debevoise spokesperson said informing that “current circumstances” have led the firm to conclude it is no longer tenable to operate in Russia and the firm will wind down its office in Moscow that was first opened in 1997. “We continue to hope for peace and an end to the violence in Ukraine,” they concluded.

    Dentons too announced it is to begin exiting Russia and separating from its offices in Moscow and Saint Petersburg, which will operate as an independent law firm. “This is a difficult decision which we have taken in full consultation with our colleagues in Russia in order to continue meeting our legal and ethical obligations,” commented Dentons Global CEO Elliott Portnoy. “We have enjoyed more than 30 years of collaboration and friendship with our colleagues in Russia who bear no responsibility for this crisis nor for the circumstances that have led to this decision. Our hope is that at a future time we will be able to come back together when it is lawfully and practically possible to do so.”

    “We stand with the people of Ukraine and have done everything in our power to assist our Ukrainian colleagues, their families, and other civilians displaced by the war,” added Dentons Europe Region CEO Tomasz Dabrowski. “We share the news of our separation process from our offices in Moscow and Saint Petersburg with deep regret.  We will support our 250+ colleagues in Russia in achieving a smooth and orderly transition in accordance with our professional obligations to our clients.”

    “We remain deeply concerned about the appalling situation and humanitarian crisis in Ukraine,” a Dechert spokesperson said. “After careful consideration, we have decided to close the Moscow office. We thank our team for all their contributions and will support them through this transition, including relocation assistance where possible.”

    “We have been through a lot during our 30 years in Russia,” read a CMS press statement announcing that “a difficult decision has been taken by CMS to leave the Russian market,” with the 80-strong local team to stay in Moscow and operate under a new identity to be announced later.

    With the four, the total number of firms announcing or confirming their exit from the Russian market is now 22. The previously announced exits are:

  • Severing Russian Ties: Baker Botts, BCLP, White & Case, and Hogan Lovells Exit Russia

    Baker Botts, Bryan Cave Leighton Paisner, Hogan Lovells, and White & Case have announced they are closing their Moscow offices and exiting the market.

    “Following our prior announcement condemning the invasion of Ukraine, we have decided that the firm will conclude any relationships with state-affiliated entities in Russia,” a Baker Botts press statement read, adding the firm has also decided to close its Moscow office: “While this is the right choice for us as a firm, we recognize the impact this will have on our valued colleagues in Russia, with whom we have been privileged to practice for many years. However, in light of the situation in Ukraine, we see no alternative to winding down our operations.” While expressing gratitude to its Moscow team, the firm added that “it is important to recognize that this situation has been forced upon all of us.”

    “After very thorough, careful thought and consideration, BCLP is ceasing its operations in Moscow in response to Russia’s ongoing actions in Ukraine,” a BCLP spokesperson said. “Alongside other global businesses, the firm stands in support with the people of Ukraine.” The firm noted it is committed to providing support to its colleagues in Moscow and assisting with transitions. “The wellbeing of our people continues to be very concerning to us, and it is difficult to part ways under such circumstances. Having been a part of BCLP since 2009, we are grateful for their dedication, friendship, and contribution to our firm over the years.”

    “We stand with the people of Ukraine and those across the world in condemning Russia’s military aggression, and we support the call for an immediate and complete withdrawal of all Russian forces from Ukraine,” a Hogan Lovells press statement announced, adding the firm has “determined that [it] can no longer continue to operate in Russia and will be progressing with an orderly wind-down of [its] operations in Moscow. We deeply care about, and value, our colleagues in Russia and our focus is on their safety and wellbeing.”

    “We are horrified by the terrible events taking place in Ukraine and condemn Russia’s unjustified invasion,” read a White & Case press statement announcing the firm is ceasing all representations of Russian and Belarusian state and state-owned entities and will close its Moscow office. “We will continue to support our people there, and their safety and wellbeing remain our priority. We are in the process of winding down our operations in Russia and are committed to an orderly transition.”

    With the four, the total number of firms announcing or confirming their exit from the Russian market is 18:

  • Severing Russian Ties: A&O, Clifford Chance, Herbert Smith, Squire, and Winston Exit Russia

    Allen & Overy, Clifford Chance, Herbert Smith Freehills, Squire Patton Boggs, and Winston & Strawn have confirmed they are exiting Russia.

    “This was not an easy decision to make as we have 55 people there and we needed to make sure that we could take this action with their best welfare in mind,” read an A&O press release announcing the firm will wind down its office in Moscow, which had been established in 1993. “Our thoughts remain with all those in Ukraine and neighboring countries who are most directly affected by this crisis,” the firm concluded.

    Following its earlier statement that the firm is “shocked and appalled by the continuing and increasing Russian military aggression in Ukraine and the resulting human suffering in Ukraine and the surrounding countries,” Clifford Chance announced “steps for an orderly wind-down of [its] operations in Moscow.”

    “We strongly condemn the invasion of Ukraine by Russia and are appalled by the humanitarian consequences,” a Herbert Smith Freehills statement read, announcing that the firm has “taken the decision to close [its] office in the country.” The Moscow office was described as a “valued and successful part of [its] business,” with the firm stating it is “working closely with the team there to support [its] colleagues who have been directly impacted by this decision.”

    “As circumstances surrounding the conflict in Ukraine continue to change rapidly, it has become clear that it is no longer tenable for us to continue our operations in Russia and we have therefore decided to wind down our Moscow office,” a Squire Patton Boggs spokesperson commented. Talking about the team, they added: “Since the beginning of this crisis, our foremost focus has been on the safety of our colleagues, particularly in Moscow. We will continue to provide them with the support they need and extend our sincere gratitude for their valuable contributions to the firm,” while concluding that “the humanitarian and economic toll of this conflict continues to be severely distressing and we all continue to hope a peaceful resolution can be found.”

    “Winston continues to condemn Russia’s invasion of Ukraine and the resulting loss of life, destruction, and needless suffering,” said Winston Chairman Tom Fitzgerald. “We are closing our Moscow operations out of a sense of solidarity with the Ukrainian people. This decision is simply the right thing to do, and our clients understand and respect that.”

    These five bring the total confirmed international exits to 14, following Eversheds Sutherland and Morgan Lewis (reported here), Freshfields Bruckhaus Deringer, Latham & Watkins, Mannheimer Swartling, and Gowling WLG (reported here), Linklaters and Borenius (reported here), and Norton Rose (reported here).

  • Severing Russian Ties: Eversheds and Morgan Lewis To Leave Russia

    Eversheds Sutherland and Morgan Lewis have confirmed they will no longer have a presence in Russia.

    “This decision has not been made lightly and is not a reflection on our valued colleagues in those offices, but we will not continue to operate in Russia given its government’s invasion of Ukraine,” said an Eversheds spokesperson, explaining that the firm’s priority is to support its 50 colleagues in Moscow and Saint Petersburg and to “ensure an orderly transition of the business.”

    A Morgan Lewis statement informed that, after the firm focused over the last two weeks on “colleagues in Moscow, assisting them in addressing the disruption in their lives, potential threats to their safety, and in implementing their personal plans, including relocating to other jurisdictions where they have made that choice,” it is now winding-down all its operations in Moscow, noting that many of the lawyers who had previously practiced in the office will continue with the firm in other jurisdictions. “We join with others in condemning the Russian government’s aggression and violence that has caused unspeakable suffering to innocent people,” the statement concluded.

    This morning, CEE Legal Matters reported the exits of Freshfields Bruckhaus Deringer, Latham & Watkins, Mannheimer Swartling, and Gowling WLG, following Linklaters, Borenius (as reported on March 7), and Norton Rose (as reported on March 8) also announcing the winding-down of their Russian offices.

  • Severing Russian Ties: Freshfields, Latham, Mannheimer, and Gowling To Also Leave Russia

    Freshfields Bruckhaus Deringer, Latham & Watkins, Mannheimer Swartling, and Gowling WLG have joined the ranks of firms announcing they are shutting down their Russian offices.

    “This is not a decision we have taken lightly,” read a Freshfields press release, pointing to its 30-year presence in the market. “However, in light of the Russian government’s actions in Ukraine, and the clear stance we have taken on Russia-related work, we believe that this is the right course of action,” the statement added while noting: “The safety and well-being of our colleagues in Russia has remained one of our key priorities as we respond to this unprecedented crisis, and that continues to be the case.”

    “The unfolding humanitarian crisis is devastating to watch and we stand with so many in the world in condemning the violence in Ukraine and the needless human suffering taking place,” Latham Chair and Managing Partner Rich Trobman commented. “The firm will immediately begin an orderly transition, consistent with our ethical duties to our clients, to wind down operations in Moscow. During this process, our focus will be principally on the safety and well-being of our colleagues in Russia.”

    Swedish firm Mannheimer Swartling stated: “We at Mannheimer Swartling are horrified by the military aggression against Ukraine and the atrocities being committed against the Ukrainian people,” adding that the firm “has suspended its operations in Russia with immediate effect” and that it is analyzing whether it “can leave the Russian market in an orderly manner and with due care to our Scandinavian clients and Russian colleagues,” while noting that its former Moscow-based Swedish lawyers have been relocated.

    Canadian firm Gowling’s press release stated: “We are shocked and deeply concerned about the growing humanitarian crisis in Ukraine. Gowling WLG stands united with the Ukrainian people,” informing that the “departure will be orderly” as the firm seeks “to transition the business to our team in Moscow.”

    The firms join Linklaters, Borenius (as reported by CEE Legal Matters on March 7), and Norton Rose (as reported by CEE Legal Matters on March 8) in exiting the market.

  • Severing Russian Ties: Norton Rose Fulbright Announces Russian Exit

    Norton Rose Fulbright has announced it is “winding down [its] operations in Russia and will be closing [the] Moscow office as quickly as [possible], in compliance with professional obligations.”

    “The wellbeing of our staff in the region is a priority,” the firm noted. “We thank our 50 colleagues in Moscow for their loyal service and will support them through this transition.”

    The firm informed it is not accepting any further instructions from businesses, entities, or individuals connected with the current Russian regime, irrespective of whether they are sanctioned or not, adding that, while it is continuing to review exiting from existing work where professional obligations allow, “where we cannot exit from current matters, we will donate the profits from that work to appropriate humanitarian and charitable causes.”

    The announcement follows after Linklaters and Borenius also announced closing their Russian offices in Moscow and Saint Petersburg (as reported by CEE Legal Matters on March 7, 2022).

  • Russia: Electronic Management of Labor and Employment Documents

    The long-discussed and anticipated electronic management of labor and employment documents in Russia finally resulted in corresponding amendments to the Russian Labor Code, effective as of November 22, 2021.

    The law now explicitly provides that e-document management can apply to most of the labor and employment documents, even to those which the law requires to be executed in hard copy and against an employee’s signature. Only a few exceptions apply, like employee labor books, internal HR orders on dismissal, reports on accidents at work, and documents related to labor protection briefings, which must still be executed in hard copy.

    However, Russian law establishes a number of requirements for the IT systems to be used for e-document management. It can be either a governmental IT system or an employer’s IT system meeting the requirements on signing and storage of documents and providing for the possibility to record the receipt of documents by an employer and an employee. The drafting, signing, provision, and review of e-documents by an employee shall be managed via such IT systems.

    Transfer to e-Document Management

    In order to implement a transfer to e-document management, an employer shall take the respective decision considering the opinion of a primary trade union (if there is one in the company), providing: (1) information about the chosen IT system for e-document management; (2) procedure to access the IT system of the employer (if necessary); (3) a list of documents to be transferred to an electronic format; (4) categories of employees to which e-document management applies; and (5) the notice period to notify the employees about the transfer to an electronic format.

    The employer shall also adopt an internal policy on e-document management (considering the opinion of a primary trade union, if there is one) which can provide, in particular: (1) timelines for signing and review of e-documents by employees; (2) the procedure to conduct briefings on e-document management; and (3) exceptional cases when labor and employment documents can be executed in hard copy.

    Employees shall be individually informed of the transfer to e-document management, within the established term. The transfer requires the written consent of the employee, unless the employee has been hired after December 31, 2021, or had no work record as of December 31, 2021. If an employee does not grant consent, the employer shall provide them with labor and employment documents in hard copy at no expense.

    Upon hiring, any new employee shall be notified of e-document management in the company. Lack of consent cannot serve as grounds for a refusal to hire or dismissal.

    e-Signatures

    The law sets forth a number of requirements for electronic signatures to be used by employers and employees. The type of electronic signature to be used depends on the document it should apply to.

    In particular, it requires an employer to use an enhanced qualified electronic signature for signing and amending employment contracts, material liability contracts, notices on changes to employment terms and conditions, and internal orders on a disciplinary penalty. For signing other documents other types of electronic signatures can be used.

    To sign and amend employment contracts and material liability contracts, to sign consents for transfers to another job position, resignation letters, and revocations of resignation letters, and to acknowledge a notice on changes to employment terms and conditions an employee can use either an enhanced qualified electronic signature, an enhanced nonqualified electronic signature (if the parties had agreed on the procedure of its use), or an enhanced nonqualified electronic signature issued with the use of governmental infrastructure.

    An employee not having an electronic signature cannot serve as grounds for dismissal or refusal to hire. The employer bears the expenses for obtaining the required electronic signatures by employees.

    Further Aspects of e-Document Management

    The employer shall keep electronic documents within the same terms as provided for by Russian law with respect to documents executed in hard copy.

    The employer is entitled to decide that e-document management also applies to employees working remotely.

    Finally, since the described law provisions are just the first steps towards a transfer to e-document management in the area of labor and employment relations, we anticipate the issuance of governmental clarifications and, likely, the adoption of further amendments to the law or by-laws in the short-term.

    By Olga Mokhonko, Head of Corporate & Employment, Noerr

    This Article was originally published in Issue 8.12 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

  • Evgeny Oreshin Joins Eversheds Sutherland as Partner

    Former Bryan Cave Leighton Paisner Counsel Evgeny Oreshin has joined Eversheds Sutherland’s Russia office as a Partner in its Dispute Resolution practice.

    Specializing in dispute resolution, Oreshin previously worked at Bryan Cave Leighton Paisner for over ten years, having joined the firm in 2012 as a Senior Associate and being promoted to Head of Group in 2016. Earlier, he spent over five years at Pavlova & Partners as Attorney-at-Law, between 2006 and 2011.

    “We are pleased to welcome Evgeny to our team,” Eversheds Sutherland Partner and Head of Dispute Resolution Yury Pugach commented. “We are confident that the comprehensive expertise, extensive experience, and in-depth knowledge of such a recognized specialist in dispute resolution will be beneficial to our clients and will significantly strengthen one of the leading practices of our firm.”

    “I am happy to join Eversheds Sutherland’s team,” Oreshin added. “We are now facing interesting prospects – difficult and non-standard legal tasks, challenges of modern society, the need to form and change judicial practice. We will actively work on them together with the firm’s clients for the successful development of their business.”

  • The Buzz in Russia: Interview with Dmitriy Chepurenko of Liniya Prava

    With the economy returning to pre-pandemic levels, and digital transformation being a priority, Russia is on the right track for a good 2022, according to Liniya Prava Managing Partner Dmitriy Chepurenko.

    “The pandemic got us stuck, for quite a long time. Businesses stopped, litigation stopped, everything was put on hold,” Chepurenko begins. “However, now, I’m happy to say we’ve bounced back.” He reports strong levels of market activity and says that the entire legal market is “abuzz with how deals have picked up both in value and in volume.” 

    Chepurenko says that there “are a lot of interesting projects taking shape on the horizon” and that the legal market is prepped and ready to tackle them all head-on. “Business is picking up, arbitration and litigation proceedings are back to where they were before COVID-19 – mostly due to the fact that the level of overall digitalization has spiked, country-wide.” He reports that both businesses and state administrative bodies, as well as the courts, have successfully adapted to online work, which prevented further slowdowns.

    “The government has decided to further this, and there is a strong desire to enact new legislation and regulations on technological developments – cryptocurrencies and blockchain,” Chepurenko says. “These are very positive developments and the markets have clearly shown a strong desire and a need for regulation.” Chepurenko feels that, in addition to cryptocurrencies and blockchain, big data and legal tech will be the way forward. “Sberbank has recently developed its own platform for legal services and electronic template use – and swaths of law firms have done the same or similar,” he says. “People want to do business online and now they can.”

    Ultimately, Chepurenko reports that, despite the political situation the country finds itself in, the economy is advancing in a healthy direction and commerce is unimpeded. “The political situation in the world is very unstable but mostly it looks like these are all artificial constructs that are performed for the sake of those who stand to profit from the turmoil. It is not something that weighs heavily on general day-to-day business,” he says. There have been plenty that took a hit though, and “a lot of businesses that went under. We expect a strong wave of restructurings, insolvencies, and bankruptcies to hit the legal market very soon.” Still, this was not to be expected given the pandemic and what it did for the economies of Europe, but Chepurenko is hopeful that Russia will keep “spearheading progress and overall economic prosperity.”