Category: Uncategorized

There is no unified definition of corruption in the private sector in the national or the international legal context. However, it is undisputedly recognized as a major and growing problem worldwide.

Corruption distorts markets, creates unfair competition, destroys the basis of economic life – and therefore undoubtedly hurts the public interest. It is a crime that favors a minority but is detrimental to society at large. 

The lack of legal certainty in this matter originates from the numerous areas of highly diverse nature where it occurs. Media, sports, health care, pharmacy, education, and science can be pointed out as the main – though not the only – sectors where corruption among business enterprises prevails. Unfortunately, the predominant approach is that the private sector itself should deal with its internal problems (including corruption), and external interference is not appreciated. Keeping in mind that the victims of corruptive behavior are the public and consumers – those whose interests must be actively defended by the state – this perspective can be questioned.

Moreover, international and European Union law both directly oblige states to criminalize corruption in the private sector and encourage businesses to apply a zero-tolerance approach towards corruptive behavior in their professional practices. 

Articles 7 and 8 of the Council of Europe Criminal Law Convention on Corruption (1999) urges the states to criminalize active and passive bribery in the private sector. Article 12 of the United Nations Convention Against Corruption (2003) encourages states to take measures to prevent corruption involving the private sector, enhance accounting and auditing standards in the private sector, and, where appropriate, provide effective, proportionate, and dissuasive criminal penalties for failure to comply with such measures. The European Union, in the Council Framework Decision 2003/568/JHA of 22 July 2003 on combating corruption in the private sector, also stresses the importance of combating corruption in the private sector. In addition, the Framework Decision stipulates that not only natural persons in the capacity of employees, but also legal persons such as firms should be held liable for corruption in the private sector. Some novel sanctions are also to be considered by the member states, including exclusion from entitlement to public benefits or aid and temporary or permanent disqualification from the practice of commercial activities. Active initiatives of the Transparency International organization are also an indicator that corruption in the private sector is regarded as a major threat to society and business worldwide.

Corruption in the private sector distinguishes itself with fluctuating development in the criminal law in Lithuania. During the years under the Soviet regime it was impossible to speculate about this type of criminal behavior, as the concept of private property did not exist in the Soviet Union. After Lithuania regained its independence, the Criminal Code was amended to include articles 319-321, which criminalized bribery and the abuse of commercial, economic, and financial activity in the private sector. The concept of this phenomenon shifted again when the Criminal Code of 2002 came into force, as these articles were eliminated, and, hence, corruption in the private sector was no longer specifically identified as a particular type of crime in the Criminal Code. Nevertheless, through the erratic case law of national courts in the following years, corrupt acts such as bribery committed by the employees of private entities or self-employed persons was defined as a criminal act, even though committed in the private sector. Courts used to recognize that the perpetrator in the above-mentioned cases could be treated as equal to a civil servant. It was a common practice for at least 11 years.

However, in 2014 the Supreme Court of the Republic of Lithuania formed a position in opposition to the developed practice. This new position of the Supreme Court has the power of a precedent for the lower national courts. The Court de facto reinstated the decriminalization of corruption in the private sector. 

According to the ruling, one specific prerequisite determines whether an illegal act committed in the private sector is of a criminal nature. A particular act of a perpetrator (a person equal to a public servant) committed in the private sector must have a connection with the public interest. The performance of the specific duties or failure to perform them must mean a breach of the public interest. In other words, a formal corpus delicti of a corruptive act (an act of bribery, influence peddling, etc.) is not sufficient to constitute a crime if it is committed in the private sector. An illegal act, essentially, has to rise to the level of corruption in the public sector in order to be prosecuted. 

With respect to the international and EU legal provisions which Lithuania has to comply with, this position of the Court is rather surprising, as it clearly contradicts the international legal obligations of the country. On the other hand, almost each act of corruption in the private sector causes a certain amount of damage to the public, thus the public interest suffers. 

Taking everything into consideration, the vagueness of the criterion – the connection with public interest – in the ruling of the Court might be considered a generally positive loophole, as it allows for the provisions of the Criminal Code to be interpreted in accordance with international and EU obligations.

By Giedrius Danelius, Senior Associate and Head of the White Collar Crime Group, Tark Grunte Sutkiene

This Article was originally published in Issue 2.2. of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

The term “white collar” crimes was first coined by sociologist Edwin Sutherland. It denotes the full range of crimes committed by people who enjoy a high social standing over the course of their professional life. This term was later imported into the legal terminology.

There’s no single opinion with regard to the typology of crimes that meet the definition of “white collar.” Despite the diversity of offenses that could fall into the category, the following common features seem to stand out. First, the crimes are committed by people with a high social standing (e.g., civil servants, decision-makers, presidents and senior managers of companies, and other high-ranking officials). Second, the crimes are committed in the process of carrying out job-related responsibilities and to the detriment of the employing company. Third, the motives for committing the crimes by the “white collar” offender is the pursuit of material gains. 

In the Republic of Moldova, the “white collar” phenomenon is characterized by a high degree of invisibility. The reasons are twofold: first, “white collar” crimes are perpetrated through convoluted schemes, over a long period of time. Second, “white collar” criminals, due to their high social standing and network of contacts, are capable of inspiring trust and credibility through their behavior.

“White collar” criminality is closely linked with corruption-related offenses and work-related crimes. “White collar” criminality is often associated with and takes the shape of economic crimes. 

As such, there are two main groups of offenses: 1) justice-related crimes and corruption in the public and private sectors; and 2) economic crimes.

The first category covers the following offenses: interference with justice and criminal prosecution, issuing a court sentence, decision or judgment in violation of the law, forgery of evidence, passive corruption, active corruption, influence peddling, misuse of authority or abuse of power, etc.

The second category of “white collar” crimes includes: acquiring credit by fraud, violation of crediting rules, bad or fraudulent management of a bank, obstructing banking supervision, improper use of proceeds from domestic and foreign loans guaranteed by the state, illegal practice of entrepreneurial activity, money laundering, corporate tax fraud, individual tax fraud, limiting free competition, non-loyal competition, smuggling, intentional insolvency, fictitious insolvency, etc.

Taking into account the distinct nature of “white collar” criminality, criminal legislation stipulates clear penalties. In addition to fines and imprisonment, in such cases when offenses meet the criteria of “white collar” crimes, applicable sentences include depriving the offender of the right to hold certain offices or undertake certain activities. These punishments aim to remove the convicted person from his/her office, through which the execution of the crime was facilitated. The penalties applied in relation to those found guilty of “white collar” crimes are normally more severe compared to those found guilty of different offenses. The maximum size of applicable fines can reach MDL 200,000 (around EUR 10,000), compared to MDL 20,000 (around EUR 1,000) in the case of ordinary offenders, if the latter don’t have special status or didn’t act with the intent to accumulate material wealth. The same principles apply in cases when the offender is deprived of the right to hold certain offices and/or exercise certain activities. In such cases, the penalties for offenders meeting the “white collar” criteria are more severe than for ordinary criminals. The severity of punishment extends up to 15 years, compared to a general ban of 5 years for ordinary offenders. 

In addition to the above punishments, other measures can be applied, including confiscation of assets and extended confiscation of assets. 

In comparison to special confiscation, extended confiscation is intended primarily for people who fit the category of “white collar” criminals. It represents the confiscation of certain assets if their value substantially exceeds the value of legally acquired goods by the offender. Such decisions are taken by courts, based on evidence put forward by the prosecution. The Criminal code of Moldova clarifies the nature of such illegal activities. In the case of extended confiscation, the confiscation can also cover goods originating from illegal activities that do not directly relate to the crimes for which the offender is sentenced – in other words, where a direct link between the crime that leads to sentencing and the confiscated goods is not established.

The introduction of such a measure in the criminal legislation of Moldova is the result of recent reform efforts and the implementation of the National Justice Sector Reform Strategy. This development represents a necessary and long-awaited change in national legislation. It puts in place a modern concept for combating the illegal acquisition of property. We hope that this legal measure will be an efficient tool and will prove successful in combating general criminality, and in particular “white collar” offenses, whilst increasing social support for addressing these challenges. 

By Daniel Martin, Litigation Partner, and Stanislav Copetchi, Lawyer, ACI Partners

This Article was originally published in Issue 2.2. of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

In economic crises entrepreneurs often choose to protect their interests by initiating the bankruptcy of debtor companies as well as the bankruptcy of their own. However, the bankruptcy tool should be treated carefully, because, when implemented improperly, it may lead to criminal prosecution.

The Criminal Code of the Republic of Belarus has four types of crimes related to bankruptcy: (1) false bankruptcy; (2) concealing a bankruptcy; (3) deliberate bankruptcy; and (4) obstruction of debt recovery by creditor(s).

Although the number of persons prosecuted for these crimes in the last twenty years does not exceed 50, the number is gradually increasing.

The small number of persons prosecuted for these crimes, in our opinion, does not mean that there are few crimes in this area but rather reflects a lack of attention to the question by law enforcement authorities, caused by the difficulty of establishing guilt and a scarcity of officials in charge of investigating such crimes. However, as the number of bankruptcy cases increases, the number of investigations and prosecutions for bankruptcy-related crimes is growing.

So, what can be considered a bankruptcy-related crime?

• False Bankruptcy 

“False bankruptcy” refers to the filing of a debtor’s statement of economic insolvency (bankruptcy) by an individual entrepreneur or a representative of the legal entity in the economic court, as well as other documents, containing deliberately false information about the debtor’s financial status in order to support the recognition of the debtor as insolvent (i.e., bankrupt).

The key reason some may falsely claim insolvency is that while the company is in bankruptcy it enjoys the following benefits: (1) execution of its obligations to creditors (with a few exceptions) is suspended; (2) forced debt recovery through an indisputable write-off from company’s account in the favor of the creditors is prohibited; and (3) levying execution against debtor’s property cannot be implemented. 

In addition, the debtor may be granted an exemption from the penalty for failing to fulfill the terms of obligations, and the property can be sold by sufficiently rigorous procedures. In practice banks also suspend the accrual of interest on credit resources from the date proceedings were initiated. All these benefits may tempt some to wait the crisis out in bankruptcy proceedings.

• Concealing a Bankruptcy

“Concealing a bankruptcy” means concealing the fact of insolvency of an individual entrepreneur or a legal entity, committed by an individual entrepreneur or company officials by providing deliberately false information, falsifying documents, or misstating accounting records, causing large-scale damage to creditors.

Thus, concealing a bankruptcy stands in opposition to a false bankruptcy. Concealing a bankruptcy may be aimed at concluding a transaction with a counter-party, obtaining property from him for which the company is obviously not able to pay, hiding data to protect individuals from responsibility for failing to file a bankruptcy petition when such filing is mandatory, and discouraging transaction invalidations where required by legislation. However, for the purposes of assessing the criminality of acts the goals and motives of the potential bankruptcy are not significant.

• Deliberate Bankruptcy

“Deliberate bankruptcy” refers to the deliberate creation of or increase in the grounds for an insolvency of an individual entrepreneur or legal entity that is committed by the individual entrepreneur or an official of the company for personal benefit or benefit of a third party and causing large-scale damage.

Usually these situations occur when an entity has assets and has no intention to fulfill its obligations (especially financial ones) to its counter-parties. To solve this issue the authorized persons withdraw assets on unfavorable terms for the company, and later, once all property has been disposed of, simply bring the company to bankruptcy. This crime also includes situations where some of the financial benefits from the conclusion of a deal are accumulated not by the company but by the guilty person on the side, for example by receiving a kickback. 

• Obstruction of Debt Recovery by Creditor(s) 

“Obstruction of debt recovery by creditor(s)” involves concealing, alienating, damaging, or destroying the property of an individual entrepreneur or a legal entity in order to prevent or reduce damages to creditor(s), committed by the individual entrepreneur or officials of the company and causing large-scale damage to the creditor(s).

Finally, it is worth noting that the presence or absence of grounds for a bankruptcy is determined following a procedure stipulated by legislation. It should also be noted that the analysis of solvency and expertise is based on the enterprise’s accounting data, which complicates the objectivity of the study (because the offender can deliberately distort the data or deliberately keep it incomplete) and contributes to the latency of such crimes.

By Roman Shpakovsky, Partner, and Siarhei Miadzvedzeu, Of Counsel, Vilgerts Legal & Tax

This Article was originally published in Issue 2.2. of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

As we announced earlier in May this year, the Bulgarian Commission on Protection of Competition (“CPC”, “Commission”) launched a sector inquiry in the pharmaceutical sector.

Ultimately, the Commission published its decision on opening a sector inquiry. It is now evident that the Commission’s investigation will be focused on the retail market of pharmaceuticals paid in full or in part by the National Health Insurance Fund (“NHIF”). The inquiry was provoked by the request of the Bulgarian Pharmaceutical Union in April 2015.

Based on its findings published in a previous pharma sector inquiry (2006), and based on current information provided by the Bulgarian Pharmaceutical Union that the process of horizontal integration in the pharmaceutical retail market has developed significantly, the CPC took the decision to review the retail market of pharmaceuticals. In particular, one of the regulator’s concerns is that a group of undertakings has been formed to conduct business under one brand and share a common commercial behaviour – “Mareshki” pharmacy chain (“Anmeku Mapewku“). According to CPC, such activities might escalate to a coordinated anticompetitive behaviour. Therefore, CPC decided to carry out an in-depth investigation of the structure and organisation of the relevant market, trends in the market and potential anticompetitive practices undertaken by certain market players.

The main goals of the sector inquiry, as defined by the Commission are the following: 

• providing a clear definition of the market of pharmaceutical products paid in full or in part by the NHIF; 
• specifying the services concerned within the market of pharmaceutical products paid in full or in part by the NHIF, as well as their price formation, compared to the number of customers;
• tracking the amendments to the market structure; 
• identifying the main market participants and analysing the changes in their market behaviour; 
• following the changes to demand and supply of the medicines paid by public funds which come as a result of state regulation, legislation and the general economic environment in the country; 
• ascertaining the reasons behind potential competition issues. 

Based on CPC considerations, we may expect the Commission to send mandatory questionnaires to major market players (pharmacies), state authorities, as well as contract partners of the pharmacies, such as wholesale distributors. Answers to such questionnaires have to be given very carefully since, based on the provided information, CPC may open individual cases against one or more undertakings. Therefore, the information and evidence provided to CPC should be considered in the light of possible further proceedings for antitrust infringement, unfair competition and non-compliance with merger control requirements.

We would like to note that for supply of inaccurate or misleading information, and even for delays in the provision of complete and accurate information, CPC may impose significant financial penalties – 1% of the company’s total turnover in the preceding business year. 

One needs to keep in mind that in the course of the inquiry, the CPC legislative investigative powers are limited in comparison to its powers in individual antitrust investigations. CPC is not entitled to inspect (dawn raid) the premises of market participants in order to obtain relevant evidence for the investigation. However, collected evidence during the course of the inquiry may be used in other investigation cases at the Commission.

Based on the results of the inquiry, CPC can open individual investigation files against particular market player(s) for infringement of competition law (abuse of a dominant position, restrictive business practices, unfair competition and non-notified mergers). Therefore, in order to be prepared for the Commission’s requests, companies from the investigated sector should check whether their commercial relations (contracts, practices, communications, etc.) are compliant with competition regulations (i.e. internal competition compliance audit). 

By Anna Rizova, Managing Partner, and Dessislava Iordanova, Senior Associate, Wolf Theiss

Nina Sydorenko, Partner at Peterka & Partners and the firm’s Director for Ukraine, has been appointed to the Antimonopoly Committee of Ukraine and will be leaving the firm as of today.

The firm was informed in June that the Ukrainian state administration intended to nominate Sydorenko to the Antimonopoly Committee of Ukraine, “in order,” according to the firm, “to use her experience and knowledge during the implementation of crucial reforms in competition regulations and practice in Ukraine.” 

The firm issued a statement asserting that, “Despite the short notice, we have decided to support this movement, as we understand the urgency of the situation in Ukraine and fully support the efforts of the new state administration at strengthening democracy, the rule of law and good governance.”

The firm reported that the appointment of a new director of its office in Kyiv will be announced “in due course,” but that, in the interim, Partner Monika Simunkova Hoskova and Senior Associates Lyudmila Lapchyk and Anastasiia Poels “will be the main contact persons for client work as well as day-to-day operations of the office.”

 

Goltsblat BLP has won an open tender to provide advisory legal services to the Russian Federal Property Management Agency (“Rosimushchestvo”), and will advise Rosimushchestvo on signing a shareholders’ agreement with the Republic of Bashkortostan in relation to the Joint-Stock Oil Company Bashneft.

Bashkortostan is located between the Volga River and the Ural Mountains, and is the most populous republic in Russia.

The Goltsblat BLP team is led by Partner Anton Sitnikov, and includes Partners Matvey Kaploukhiy and Head of Group Anton Panchenkov.

Commenting on the project, Panchenkov said: “We see our involvement in this project as a unique and most exciting experience. Shareholders’ agreements between two public entities are as yet very rare for Russian joint ventures and we are proud to be able to contribute to shaping the relevant practices. All the more so since this agreement relates to governance of such a significant asset as Bashneft, being of great importance to the state.”

 

“A legal entity may appear in a trial with the status of a person to whom the measures of criminal law are applied should its authorized representatives commit any criminal offense” — Angelika Sitsko, partner at Gvozdiy & Oberkovych Law Firm warns.

What recent changes in criminal law of Ukraine would you single out as the most significant?

Things have been eventful in Ukraine of late. It started back in 2012, when the country expressed its desire to radically change its criminal procedural law by openly declaring that it wishes to abolish Soviet fundamentals when state interests were above human rights and the interests of persons involved in criminal proceedings.

The country adopted a new Criminal Procedure Code (CPC), which definitely had to change the approaches to investigation and to provide general European principles of criminal proceedings which, among other things, include inviolability of property rights, adversarial fair legal process, enforcement of the right to challenge procedural decisions, acts or omissions and the setting of reasonable time limits for investigation and trial.

The provisions of the new code are aimed not only at protecting the interests of an individual, but also at protecting the interests of a legal entity if it is involved in criminal proceedings.

And so, after two and a half years the provisions of the adopted Code are implemented in practice. However, the question of what exactly has changed in terms of the interests of a legal entity, remains topical. Business people are interested what should a legal entity know in criminal proceedings and what risks the CPC of Ukraine poses for their activities.

What are the most typical issues of criminal law that businesses in Ukraine are concerned about?

Until now only an individual was a subject of criminal responsibility in Ukraine. But a legal entity may also appear in a trial with the status of a person to whom the measures of criminal law are applied should its authorized representatives commit any criminal offense, the exhaustive list of which is set out by the Criminal Code of Ukraine (propaganda of war, conduct of aggressive war, sale or transportation of weapons of mass destruction, corruption offenses for the benefit of a legal entity, etc.).

In criminal proceedings a legal entity may act as a claimant, and if the criminal offense caused any material damage even as a victim. Furthermore, the legal entity may be a civil plaintiff or civil defendant.

In addition to involvement as a direct participant, the legal entity may be involved indirectly. Typically, this takes place when the legal entity carries certain information and has in its possession any evidence required for the investigation. It is not excluded that as part of criminal proceedings against certain contractors, law-enforcement officers may also check the legality of activities of other legal entities. There are a number of cases when law officers unlawfully interfere with the activities of legal entities under the cover of existing criminal proceedings which have no relation to such legal entity.

The current Code provided legal entities with a sufficient tool to protect their interests in criminal proceedings. Yet, such instruments should be wisely used with the participation of professional advisers, as the specifics of the criminal proceedings are significantly different from other processes, whether civil, economic or administrative, in which the legal entity is frequently involved. In addition, the criminal process associated with more stringent measures to enforce criminal proceedings that may adversely affect the entity’s economic activity.

How often does a legal entity act as a victim in Ukraine? 

Quite often business owners who vested the company’s top management with absolute trust barely control their activities. As a result, unscrupulous managers may abuse such trust and use the company’s assets for their own enrichment.

To do this, managers register companies in the name of the controlled entities, to which, by virtue of fictitious sale operations, the funds are withdrawn from the company and valuable movable and immovable property is transferred to the ownership virtually on a free-of-charge basis.

Managers may also attract controlled companies – intermediaries through which current assets shall be purchased at a price significantly higher than the current market price. 

There are cases of banal theft, resulting in the disappearance of significant amounts of property.

What measures would you recommend to prevent this?

Naturally, it is wise to prevent any possible theft by introducing continuous monitoring, first of all by involving “compliance” specialists.

But what should be done if the theft did actually take place and the owner found out about this? It is clear that most people would file a statement with law-enforcement officers and rely on their professionalism in holding the perpetrators liable and returning the lost assets.

At first glance this is the case and the company makes its way in the right direction. However, this is only in terms of filing the statement with law-enforcement officers. The company must realize that such categories of cases always have both, a perpetrator and a victim, with their different views of events. And each of these parties shall provide convincing arguments to confirm the positions that are voiced. If one party is active, and the other is inactive in pursuing its interests, as practice shows, the active participant will prevail. Thus, in most proceedings with the economic component, actus reus depends directly on the subjective attitude of the victim to events (fraud, appropriation of another’s property through abuse of office, etc.). In addition, in some cases, law-enforcement officers have no authority to return the property, as this can only be done only by a court of law. For example, in the case of illegal transfer of title to immovable property to a front company, the former owner has to prove in court the illegality of the transfer of title, accompanied by the committing of penal acts by a hired employee.

As noted above, a legal entity suffering material damage caused by a criminal offense may receive the status of a victim. The key here is the “possibility”, and not the obligation. Failure to carry out certain actions to obtain this status may lead the legal entity to not being involved in criminal proceedings and deprive it from the possibility to affect its further continuation.

 A legal entity that is a victim may be represented by its proxy, which may be its director, or any other person authorized by law or the company’s documents, an employee of the legal entity by virtue of a power of attorney, and a person who has the right to defend it in criminal proceedings, namely an attorney-at-law. No other persons may take part in the proceedings.

After obtaining the status of a victim the legal entity shall be able to have its own status in the case, request that law-enforcement officers perform procedural and investigative actions and to collect evidence independently, including the initiation of expert examinations and presentation of evidence collected personally to the prosecutor.

A legal entity that is a victim takes part in the proceedings with the right to appeal court rulings.

Does a legal entity have any right to join other persons’ criminal proceedings? 

Until this time in Ukraine there is an established illegal practice of law-enforcement officers to collect information on the legal entities in the course of existing criminal proceedings.

We refer to the cases where law-enforcement bodies are sending requests to a legal entity, and sometimes also injunctions requesting information and evidences in criminal proceedings, which has no relation to activities of this legal entity.

Legal entities providing the required information and pieces of evidence on such dubious requests in future may become a subject of different inspections of economic activities, the findings of which become the grounds for registering criminal proceedings concerning activities of the entity being inspected.

Unfortunately, in Ukraine the law-enforcement officers do not always have an independent position. As we can see from the public register of court judgments, a large amount of findings made by inspectors are not accepted by a court. The rendering of a court judgment, however, takes more than one month, and throughout this period of time the company is involved in criminal procedures: searches, examinations, repeated calls of employees for questioning, seizure, etc.

The importance of professional legal advice is of major importance for the legal entity, which is party to criminal proceedings, and essential for the proper defense of its best interests.

A legal entity’s assets may be temporarily seized as part of the criminal proceedings of “other persons”, and this may complicate its activity. This happens when, for example, a part of a warehouse is leased, and the owner is in legal trouble. Law-enforcement officers who came with a search warrant may temporarily seize the assets/warehouse, even without identifying the legal owners. The court may, in its turn, also arrest the property without even calling in the owner, which is absolutely permitted by the current CPC.

As a result, access to the property will become impossible, and the operations related to circulation of the seized property may be paralyzed. Adequate knowledge of criminal procedural law in such cases is vital.

When can a legal entity act as a subject of criminal law measures? 

As mentioned previously, a legal entity may receive the status of a participant in criminal proceedings if certain offenses are committed by the specifically defined subjects. Despite the fact that an individual remains the subject of criminal liability, such penalties as a fine, confiscation of assets and liquidation may be applied against a legal entity too.

A fine and mandatory winding up may be applied against legal entities only as principal measures of criminal law, and confiscation of property only as supplementary measures. In applying measures of criminal law the legal entity shall be obliged to compensate in full for the losses and damages caused and the received amount of undue benefits that is obtained, or could be obtained, by the legal entity.

At the same time, the court shall apply a fine that is double the sum of the illegally obtained undue benefits.

The lawmaker allows a legal entity to actively defend its rights through a representative, including a licensed attorney-at-law.  

To sum up the above, it should be mentioned that at the moment legal entities can hardly operate without adequate legal support. Only awareness of their rights and timely measures to protect their best interests can prevent unlawful acts against legal entities from both employees and law-enforcement officers.

By Angelika Sitsko, Partner, Gvozdiy & Oberkovych Law Firm

Sorainen has prepared the Technopolis group’s TP documentation to demonstrate that pricing for intra-group services and financing transactions is in line with the arm’s-length principle.

The Technopolis group is engaged in real estate development and operations, and it owns a chain of 20 smart business parks in Estonia, Lithuania, Finland, Norway, and Russia.

Technopolis was advised by Sorainen Partner Janis Taukacs, Senior Associates Aija Lasmane and Indre Sceponiene, and Associate Aina Oksenuka.

 

Egorov Puginsky Afanasiev & Partners’ Competition Team has obtained the Russian Federal Antimonopoly Service’s (FAS) approval on behalf of client ROSSIUM Concern LLC for its acquisition of a controlling stake in FC URALSIB.

The application for the acquisition of a 100% of stake in FC NIKoil LLC and 85.98% of the voting shares in FC URALSIB OJSC was filed with the FAS on June 4, 2015 by ROSSIUM Concern LLC — controlled by Roman Avdeev’s MKB — and was granted on July 3, 2015. 

As a result of the transaction, MKB will acquire the diversified financial services portfolio of URALSIB, which has an extensive branch network. MKB is acquiring the rights to URALSIB Bank, a management company, two brokerage companies, a non-governmental pension fund, and a leasing company. As a result, a single group will be established, which, according to an EPAM press release, “will enable MKB to enter the federal level and explore the financial services markets.”

The firm’s Competition Practice team was supervised by Counsel Anna Numerova, and included Senior Associate Elena Kazak and Associate Ksenia Firsova.

 

Borenius has agreed to provide legal assistance to the Latvian Ministry of Transport on the implementation of the Rail Baltica rail transport project – which Borenius describes as “the largest transport infrastructure project in the history of Latvia.”

The firm’s legal assistance will include analysis of the domestic legal framework and practice, taking into account the experience of other EU Member States, in implementing optimal and fair legal solutions for estimating the compensation for expropriation of properties directly or indirectly affected by the implementation of the project. 

The goal of the Rail Baltica Project is to integrate the Baltic states into a single European rail infrastructure. The project will reach across the area of 4 EU Member States – Poland, Lithuania, Latvia, and Estonia — and will indirectly also involve Finland, since the project embraces a prolongation of the Tallinn-Helsinki connection. 

On May 7, 2015 CEE Legal Matters reported on Sorainen entering into a similar agreement with Estonia.