CHINESE COMPANY BOUGHT A STRATEGIC ENTITY WITHOUT AN APPROVAL FROM THE GOVERNMENT
Appeal Court supported FAS: it recognized the fact of illegally establishing control by a foreign investor over Russian strategic company pronounced the buying-and-selling contract void
FAS established that “Tszinin” Trade-and-Economic Company” Ltd., being a foreign investor had got control over “Amurcopper” Ltd. in breach of No. 57-FZ Federal Law – without obtaining a preapproval from the Government Commission for control over foreign investments in the Russian Federation.
“Amurcopper” Ltd. is involved in geological surveying on a federal subsoil site and is of strategic importance for the national defence and state security.
FAS filed a claim to Amur Regional Arbitration Court to invalidate the deal and apply the consequences. The Court accepted that the transaction was performed in breach of the law but did not invalidate it.
The 6th Arbitration Appeal Court allowed the FAS appeal, reversed the judgment of Amur Regional Arbitration Court and ruled to invalidate the contract for buying-and-selling 100 % share of the authorized capital of “Amurcopper” Ltd.
Deputy Head of FAS Andrey Tsyganov emphasized: “The Court ruling is essential for establishing FAS enforcement practice in control over foreign investments and for restoring public interests in ensuring national defence and state security that were infringed by the unfair foreign investor and restored judicially”.