Debt Recovery for Businesses

In some cases, yes. The absence of a single signed contract does not necessarily mean that no enforceable obligation exists.

A Russian court may assess the evidence as a whole, including acceptance documents, invoices, payment records, business and electronic correspondence, and documents showing that the parties actually performed their obligations.

Written form is important for transactions between legal entities. As a general rule, failure to comply with simple written form restricts reliance on witness testimony but does not exclude written and other evidence. Certain types of transactions may be subject to special statutory consequences, so the legal basis of the debt and the available evidence must be assessed in the circumstances of the particular case.

Legal basis: Articles 161–162 of the Civil Code of the Russian Federation and Article 75 of the Russian Arbitrazh Procedure Code.

The first question is not only whether a court judgment can be obtained, but whether that judgment can actually be enforced.

Before and during court proceedings, it is important to assess the debtor’s known assets, existing court and enforcement proceedings, signs of financial distress and other circumstances that may affect recovery.

Where there is evidence that failure to take urgent measures may make enforcement of a future judgment difficult or impossible, interim measures may be requested. The Russian commercial court decides whether such measures are justified and proportionate in the circumstances of the case.

After an enforcement document is obtained, recovery may continue through enforcement proceedings. Russian law provides, among other things, for attachment of funds and property and, where statutory conditions are met, searches for the debtor’s property.

Legal basis: Articles 90–91 of the Russian Arbitrazh Procedure Code and Articles 64–65 of Federal Law No. 229-FZ on Enforcement Proceedings.

As a general rule, the limitation period is three years, but it is important to determine correctly when that period began to run.

Where an obligation has a specific performance deadline, the limitation period generally begins after that deadline expires. In other situations, the starting point depends on the nature of the obligation and the circumstances in which the right was breached.

Actions by the debtor that amount to acknowledgment of the debt may interrupt the limitation period, after which the period begins to run again.

For this reason, the three-year period should not automatically be calculated from the date of the contract, invoice or first correspondence. It must be calculated for the particular obligation.

Legal basis: Articles 196, 200 and 203 of the Civil Code of the Russian Federation.

In this situation, it is important not to focus only on preparing the claim. Evidence indicating a risk of loss or disposal of assets should be identified and preserved as early as possible.

If failure to adopt interim measures may make enforcement of a future judgment difficult or impossible, an application for interim relief may be made in Russian commercial court proceedings. Such measures may include attachment of funds or other property and restrictions on certain actions.

The court does not grant these measures automatically. The applicant must justify why they are necessary, and the measures must be connected with the dispute and proportionate to the claim.

If property has already been transferred to other persons, the possibility of challenging the relevant transactions depends on the legal grounds, timing and circumstances, including whether the debtor is subject to bankruptcy proceedings.

Legal basis: Articles 90–91 of the Russian Arbitrazh Procedure Code.

Yes, where there is an enforceable obligation and it can be established by admissible evidence.

Depending on the circumstances, evidence may include an agreement or written acknowledgment of debt, bank transfers, payment records, correspondence and other materials that establish the legal basis and amount of the debt.

The applicable court procedure and jurisdiction depend on the nature of the dispute and the status of the parties. Before filing a claim, the legal basis of the demand, the available evidence and the court with jurisdiction over the dispute should therefore be determined.

A court judgment by itself does not mean that the creditor has actually received the money.

After the judgment becomes enforceable and an enforcement document is obtained, the enforcement stage begins. In enforcement proceedings, a bailiff may take the enforcement actions provided by law, including obtaining information about the debtor’s property, attaching funds and property and, where the statutory conditions are met, searching for the debtor’s property.

For this reason, an effective debt recovery strategy should take enforcement into account before the claim is filed. The question is not only how to obtain a judgment, but also which assets may realistically be used to satisfy it.

Legal basis: Articles 64–65 of Federal Law No. 229-FZ on Enforcement Proceedings.

Depending on the legal basis of the obligation, a creditor may be entitled to claim not only the principal debt but also liability for delay provided by contract or law.

For a delayed monetary obligation, Article 395 of the Civil Code of the Russian Federation provides for interest on the outstanding amount unless a different interest rate is established by law or contract.

Where a contract provides for a penalty for breach of a monetary obligation, whether that penalty may be claimed together with Article 395 interest depends on the applicable law and the terms of the contract. In circumstances provided by law, a court may also reduce a contractual penalty if it is manifestly disproportionate to the consequences of the breach.

The principal debt, contractual penalty and statutory interest should therefore be calculated separately and the legal basis for each part of the claim should be checked.

Legal basis: Articles 333 and 395 of the Civil Code of the Russian Federation.