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Choice of forum. International arbitration is often preferable to a state court for disputes with a foreign element: the award is easier to recognise and enforce abroad thanks to the 1958 New York Convention.
Gather evidence early. The sooner you start documenting the counterparty’s breaches (correspondence, payment documents, proof of delivery), the stronger your position when proceedings begin.
Enforcement is a separate stage. Obtaining an arbitral award is only half the job. Recognition and enforcement in the debtor’s jurisdiction require separate proceedings, which are often slow.
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Ways to recover from a foreign counterparty
The contract determines the forum but does not guarantee it. If the contract contains an arbitration clause, the dispute goes to the chosen institution. If it does not, and the counterparty will not agree to arbitration voluntarily, the remaining option is a court at the counterparty’s location, or at the place of performance if the contract expressly provides for it.
A Russian court is not always a dead end. If the foreign counterparty has a representative office, an account with a Russian bank or other assets in Russia, recovery through a Russian commercial court may be faster and cheaper than foreign proceedings. The only question is whether those assets cover the amount of the debt.
The options we assess at the outset, depending on the contract and the debtor’s assets:
Tracing assets abroad
Registers and open sources. In many jurisdictions, information on a company’s directors, beneficial owners and property is available in open or semi-open registers. In the UK, Cyprus, the UAE and a number of other countries this is the starting point of the analysis, not a finished result.
Bank accounts are identified indirectly. Banking secrecy is not lifted without a court order, but the fact that a counterparty banks with a particular bank can often be confirmed from payment details of earlier transactions and from the chain of correspondent banks in transfers already made.
Interim measures work only if taken in time. An attachment of accounts or a ban on disposing of property, the equivalent of an English freezing order, should be sought before the counterparty learns of the claim. Otherwise, by the time of the judgment on the merits, the assets will have moved to another jurisdiction.
Without a local lawyer, the judgment stays on paper. In the country where the assets actually are, you need not a document translator but a lawyer who can promptly apply to attach property under local procedural rules. We build this network of partners in advance, not after the judgment is received.
Sanctions and currency control: getting the money after judgment
A judgment won is not the same as money in your account. Even after the judgment has been recognised and enforced, transferring funds from the debtor’s account to the Russian creditor’s account goes through a foreign bank’s compliance checks. Refusals happen most often at this stage rather than during the proceedings themselves.
Plan the payment route before filing. Receiving funds in an account in a third jurisdiction with no direct restrictions on transactions with Russian beneficiaries is often faster than waiting for a direct transfer to a Russian bank. Settle this question in advance, not after the judgment has been issued.
The sanctions status of the parties is checked separately. If the defendant or persons connected with it appear on sanctions lists, this affects both the choice of arbitral institution and the willingness of banks to process the payment. We run this check at the start of the work, not after a transfer has been refused.
When recovery makes economic sense
Experience in cross-border recovery specifically, not in practice as a whole.
Common mistakes before approaching lawyers
Waiting for the counterparty to pay “a little later”. Each month of waiting is not only lost time but also a risk that the debtor will move its assets and that the claim will fall outside the limitation period, which under foreign law may be shorter than the familiar three years under the Russian Civil Code.
Negotiating without recording what is agreed. Agreements on a deferral, a discount or a payment schedule reached orally, or in messenger chats without legally valid formalisation, are hard to use as evidence later, and are sometimes read against the party that relied on them.
Filing a claim without checking where the defendant’s assets actually are. A formally correct judgment issued without regard to where the debtor’s property is located may prove practically unenforceable. The choice of forum and jurisdiction for recovery should be considered before filing, not after the judgment is received.
What to do in the first weeks after a missed payment
A sequence of steps that reduces the risk of losing both evidence and the debtor’s assets while preparation for the proceedings is under way.
Formally documenting the breach
We send a claim letter by a method recognised by the law governing the contract. An ordinary messenger exchange is generally not treated as such evidence.
Checking the governing law and forum
We review the contract’s governing law and dispute resolution terms, since these determine both the limitation period and where a claim can be brought at all.
Assessing the debtor’s assets
We establish in which jurisdiction the counterparty actually holds property or accounts, which determines where it makes sense to seek a judgment and enforcement.
Deciding on interim measures
Where there is a risk of assets being moved, we prepare an application to attach property or freeze accounts before the claim on the merits is filed, not after.
Frequently asked questions
Which convention governs the recognition of international arbitral awards?+
The 1958 New York Convention. Most countries of the world are parties to it, which makes it easier to enforce awards abroad.
What if the debtor has no assets in the country where the judgment was issued?+
An award can be recognised and enforced in any contracting state where the debtor has assets, not necessarily in the state where the proceedings took place.
Do you have a debtor with assets abroad?+
Send a request and a litigation partner will contact you within one working day.