Debt collection and enforcement of judgments on the territory of Russia

Debt Recovery Procedures in Russia

Claims by foreign companies against Russian counterparties are considered under the procedure established by the Arbitration Procedural Code of the Russian Federation. If there is a contract specifying jurisdiction at the defendant’s location, the dispute is heard in the relevant arbitration court of the Russian region.

Depending on the nature of the claims and the amount of the debt, one of the following procedures may apply:

1. Injunction Proceedings
   Used when the debt is documented. The case is heard without the parties being summoned. The court order is issued within no more than 5 business days.

2. Simplified Procedure
   Applicable to claims up to 500,000 rubles against legal entities. The case is heard without the parties being summoned, based solely on written materials.

3. Claim Procedure
   Used in all other cases. The foreign plaintiff must submit the claim, evidence, and other documents with translations into Russian.

As part of the process, a request for provisional measures may be filed—for example, for the seizure of the debtor’s assets or the blocking of bank accounts. These measures help prevent the alienation of assets until a decision is made.

Obtaining an Enforcement Order and Submission Procedure

Once the court decision enters into force (usually one month after its issuance, unless an appeal is filed), the plaintiff may apply to the court for an enforcement order. The document is issued by the court that rendered the decision, based on a written request from the creditor.

For a foreign company to obtain the enforcement order, it or its representative must provide:

• A request for the issuance of the enforcement order;

• A copy of the court decision with confirmation of its entry into force;

• A power of attorney (if acting through a representative);

• Translations of documents into Russian.

Once the enforcement order is obtained, there are two possible ways to submit it:

1. To the Federal Bailiff Service (FSSP) at the location of the debtor or their assets. This is the main mechanism for enforcement in Russia.

2. To the servicing bank—if the debtor’s account details are known, the order can be sent directly to the bank to withdraw funds.

In all cases, submission must be accompanied by a completed application.

Enforcement Proceedings in Russia

After the enforcement order is submitted to the Federal Bailiff Service, enforcement proceedings are initiated. Within three business days of receiving the documents, the bailiff issues a ruling to start the case and notifies the parties (Article 30 of Law No. 229-FZ).

Main enforcement measures include:

• Withdrawal of funds from the debtor’s accounts;

• Seizure of property (movable and immovable);

• A ban on registration actions related to assets;

• Restrictions on the debtor’s departure (in the case of an individual);

• Requests to tax authorities, banks, the State Register, traffic police, and other bodies.

The FSSP is entitled to recover debt based on the court decision in both rubles and foreign currency. Execution is usually carried out in rubles based on the exchange rate of the Central Bank of Russia on the day of execution (Article 72 of Law No. 229-FZ).

Debt recovery can only take place if the creditor has a Russian bank account. Transfer of funds to a representative’s account is not permitted (Supreme Court of the Russian Federation). To speed up execution and monitor the actions of the FSSP, it is advisable to hire a Russian representative or attorney.

The term for enforcement proceedings is two years from the submission of the enforcement order. If the bailiff fails to act or violates deadlines, an appeal can be filed with the court.

Enforcement of Foreign Judgments in Russia

Foreign court and arbitration decisions can be recognized and enforced in the Russian Federation based on an international treaty or the principle of reciprocity. The provisions of Chapter 31 of the Arbitration Procedural Code of the Russian Federation and the 1958 New York Convention (for arbitration decisions) apply.

To file a request for recognition and enforcement of a decision, the following must be submitted to the arbitration court:

• A copy of the decision with confirmation of its entry into force;

• Proof of proper notification of the parties;

• Translation of all documents into Russian.

The court verifies the compliance with procedural rights, the jurisdiction of the foreign court or arbitration, and whether the decision complies with the public order of the Russian Federation. Grounds for refusal include lack of proper notification, violation of the exclusive competence of Russian courts, inconsistency with Russian law, or expiration of the filing period (three years from the date of entry into force).

A recognized foreign decision is enforced in the same manner as a Russian court decision.

Practical Challenges and Typical Risks

Enforcing a court decision in Russia is only possible if the debtor has assets that can be seized. In practice, enforcement is often hindered by the following circumstances:

• The debtor’s assets are missing or registered with affiliated entities;

• At the time of initiating enforcement proceedings, the assets have already been transferred;

• A bankruptcy case has been initiated;

• The bailiff fails to take timely measures to locate assets and enforce decisions.

Additional complexity arises when attempting to recover from companies registered in another jurisdiction or those that have ceased operations in Russia. In these cases, a comprehensive approach is required, including monitoring the actions of the bailiffs, filing complaints, submitting additional applications to identify assets, and tracking legal changes in the debtor's structure.