“Economic sanctions as force majeure” — Alsu Mukhametdinova for PROVED
The Russian courts regard the actions of the Russian authorities as the main force majeure, preventing the development of business. This follows from the decisions of courts that sided with businessmen who did not fulfill their contracts, explaining this by force majeure.
Alsu Mukhametdinova, lawyer of "Prime Advice":
According to the position of the Supreme Court of the Russian Federation, circumstances, the occurrence of which depended on the will or actions of the party obligations, for example, the lack of the debtor of the necessary funds, violation of obligations of its counterparties, illegal actions of its representatives can not be recognized as force majeure.
As for economic sanctions against goods, citizens and organizations, Russian courts do not automatically recognize them as force majeure. As a rule, the courts refuse to a party referring to the imposition of sanctions as force majeure because of the lack of evidence of a causal link between the action of sanctions and the failure of the party to fulfill its obligations.
It is noteworthy the case of N A40-70413/2017 at the suit of the "Roscosmos" State Corporation for Space Activities to JSC "S.A. Lavochkin Scientific-Production Association (Lavochkin Association)" on the recovery of a penalty in the amount of more than 52 million rubles, accrued as a result of violation of the contract for the supply of products.
The arbitration court of the city of Moscow, having refused to satisfy the claim, concluded that the deterioration of the international situation in 2014, the introduction of sectoral economic sanctions and the emergence of problems with the supply of products in the rocket and space industry are force majeure. The court referred to the provisions of the Model rules of European private law, stating that the late delivery of the order by the defendant was caused by the occurrence of force majeure circumstances coming from outside and outside the reasonable control of the defendant. It should be noted that in the earlier considered similar disputes between the same persons, the courts took the opposite position.
As you know, the draft law introduced in 2015 in the State duma, which proposed to add to the list of force majeure sanctions of foreign states against Russia, Russian citizens and Russian companies, was rejected in may 2018.
Thus, it can be said that at present the courts, when deciding on the issue of exemption from liability of a party that has not fulfilled its obligations due to the introduction of economic sanctions, still evaluate each specific case individually.