№357 FAS Russia Order of 17.09.2008 "On Confirming the Model Form of an Agreement on Securing Fulfillment of Obligations by Foreign Investor or by Group of Persons in the Procedures for Foreign Investments in the Business Entities of Strategic Importanc

Non-official translation

To implement Part 3 of the Article 12 of Federal Law No.57-FZ of 29.04.2008 «Procedures for Foreign Investments in the Business Entities of Strategic Importance for National Defense and State Security» (Corpus of the Russian legislation, 2008, №18, art. 1940)

I hereby order:

1. To confirm the model form of an agreement on securing fulfillment of obligations by foreign investor or by group of persons in the procedures for foreign investments in the business entities of strategic importance (see the Appendix).

2. I shall personally supervise the execution of the Order.

I. Artemiev

Head of the FAS Russia 

Appendix to the No.357 FAS Russia' Order of 17.09.2008

THE MODEL FORM OF AN AGREEMENT ON SECURING FULFILLMENT OF OBLIGATIONS BY FOREIGN INVESTOR OR BY GROUP OF PERSONS IN THE PROCEDURES FOR FOREIGN INVESTMENTS IN THE BUSINESS ENTITIES OF STRATEGIC IMPORTANCE

Moscow, »___»_________200_

The Federal executive body authorized to control procedures for foreign investments in the Russian Federation in the person of_____________________________________________________________________________________________

(position, full name of an authorized person)

acting under _____________________________________________________________________________________

_______________________________________________________________________________________________

(title and entry of the document setting the powers of an authorized person to sign the present Agreement)

on the one hand, hereinafter referred to as the Authorized body, and the foreign investor or the legal or private person, member of the group of persons, which has intentions to make a transaction or to set control over business entity of strategic importance in the person of__________________________________________________________________________________ acting under

(position, full name (the last - if possible)of an authorized person)
_________________________________________________________________________________________,

(title and entry of the document setting the powers of an authorized person to sign the present Agreement)

hereinafter referred to as Applicant, named together as Parties, concluded the present Agreement as follows:

1. TERMS AND DEFINITIONS

For the purposes of the present Agreement the terms and definitions are used in the meaning specified in the Federal Law No.57-FZ of 29.04.2008 «Procedures for Foreign Investments in the Business Entities of Strategic Importance for National Defense and State Security» (hereinafter referred to as the Law on Foreign Investments in the Strategic Sectors).

2. SUBJECT OF AN AGREEMENT

2.1. The subject of the Agreement is to secure the fulfillment (fulfillment) by the foreign investor of obligations which arise basing on requirements established by the federal laws or other legal and statuary acts of the Russian Federation when investing through acquisition of stocks (shares) which constitute nominal capital of the business entities of strategic importance for national defense and state security, as well as when concluding other transactions resulting in obtaining control by foreign investor or group of persons over such business entities.

3. RIGHTS AND OBLIGATIONS OF AN APPLICANT

3.1. The applicant is obliged to:

3.1.1. Secure the fulfillment (to fulfill) of obligations imposed on him and defined in the relevant notification of the Governmental Commission on Control over Procedures for Foreign Investments in the Russian Federation (hereinafter referred to as the Commission):
____________________________________________________________________________________________

(obligations defined in Commission's notification)* 

_____________________________________________________________________________________________

_____________________________________________________________________________________________

3.1.2. Observe the folllowing terms of fulfillment of obligations set forth in the item 3.1.1. of the present Agreement:

_____________________________________________________________________________________________

(term of fulfillment of obligations)** 

_____________________________________________________________________________________________

_____________________________________________________________________________________________

3.1.3. Submit documents and information under the request of the Authorized body necessary for conducting inspection over fulfillment of obligations taken upon himself in accordance with the present Agreement.

3.2. The applicant has a right:

3.2.1. In case of significant changes of circumstances under which the Parties concluded the present Agreement, to send to Authorized body justified proposals on changing the terms of the present Agreement for their further consideration by the Commission.

4. INSPECTION OVER FULFILLMENT OF OBLIGATIONS SET BY THE PRESENT AGREEMENT

4.1. Inspection over fulfillment of obligations by the Applicant and terms of its fulfillment set by the present Agreement is implemented by the Authorized body.

4.2. Inspection over fulfillment of obligations set by the present Agreement is conducted by the Authorized body as required but at least once a year during the whole period of validity of the present Agreement.

5. LIABILITY OF THE PARTIES

5.1. For non-fulfillment or improper fulfillment of obligations under the present Agreement the Parties incur liability envisaged by the legislation of the Russian Federation and the present Agreement.

5.2. The gross and repeated non-fulfillment of obligations established by the present Agreement causes judicially under the complaint of the Authorized body deprivation of the Applicant's voting right on the general meeting of stockholders (members) of business entities of strategic importance, and in this case votes belonging to the Applicant or group of persons are not considered when defining the quorum and counting votes on the general meeting of stockholders (members) of such business entity.

5.3. In case of Applicant's non-fulfillment or improper fulfillment of his obligations set by the present Agreement the Applicant is to pay to the federal budget penalties in the form of __________________________________________________________ 

____________________________________________________________________________________________

(fine, penalty, other forms - specify required)

in the amount based on terms of fulfillment of obligations.

5.4. The Applicant is liable to the business entity and/or third parties in case of infliction of loss as the result of non-fulfillment or improper fulfillment of obligations set by the legislation of the Russian Federation.

5.5. The Parties when implementing the Agreement are responsible for non-compliance of requirements of the legislation of the Russian Federation on protection of state, commercial or other secret protected by law.

6. DISPUTE SETTLEMENT

6.1. All disputes and controversies which may arise between the Parties as under the present Agreement shall be settled in order established by the legislation of the Russian Federation.

7. PERIOD OF VALIDITY AND ALTERATION OF THE AGREEMENT

7.1. The present Agreement is valid during the whole period of the business entity being under control of the Applicant and comes into force from the date of Commission's decision taking on preliminary agreement of transaction or agreement of setting the control.

7.2. The reasons for alteration of the terms of the present Agreement are the significant changes of circumstances basing on which the Parties concluded the Agreement. Alteration of the terms of the present Agreement is permitted on the grounds of the relevant decision of Commission and is committed in the same form and order as the present Agreement.

8. FINAL PROVISIONS

8.1. The present Agreement is made in Russian in three identical copies; one copy is to be obtained by each Party and one is to be submitted to the Commission.

9. ADDRESSES AND REQUISITES OF THE PARTIES

The Authorized body

__________________________________

The Applicant

__________________________________


* All the obligations defined in the relevant Commission's notification are given. 

** All terms of fulfillment of obligations defined in the relevant Commission's decision are given.