The analytical portal Pravo.ru has published the latest issue of its real estate and construction digest.
The main topics of this issue are de-privatization risks and long-awaited legislative initiatives designed to protect businesses from retroactive claims.
This refers to a bill establishing statutes of limitations for challenging privatization deals. In April, the document was adopted by the State Duma in its first reading, and in May it received official support from the Government. The proposed amendments to Article 217 of the Civil Code of the Russian Federation introduce a two-tier protective filter: a general three-year period from the date the violation is discovered and an absolute ten-year limit from the date the property was transferred out of state or municipal ownership.
The new rules are intended to apply both to future claims and to disputes already under consideration for which no court decision has yet entered into force. The only exceptions will be cases related to anti-corruption, anti-extremist, and anti-terrorism legislation, as well as disputes regarding violations of foreign investment rules in strategic companies.
The legal community views this draft as a direct response to the wave of de-privatization disputes in recent years. Previously, transactions dating back thirty years were challenged by circumventing standard statute-of-limitations rules, citing “public interest” or the nullity of agreements. This put bona fide purchasers at risk, as the assets had already changed hands multiple times over the decades.
Violetta Drondina, a senior attorney at KKMP, identifies the absolute ten-year statute of limitations on claims for the recovery of privatized property as a key provision of the draft law. According to her, the legislature is attempting to eliminate disputes over when the state became aware of the violation: the statute of limitations is proposed to be calculated from the date the right was violated. If more than ten years have passed, the court must dismiss the claim.
“In addition, the law will prevent attempts to circumvent the statute of limitations through alternative claims, such as claims regarding the invalidity of transactions or the recognition of a right as non-existent,” adds Violetta
For more details on the digest, please follow the link.
