Withdrawal of money abroad under loan agreements: court case

Legal Digest News
The Arbitration Court of the Moscow Region invalidated the transaction on the withdrawal of funds from the Russian Federation to a foreign company from an "unfriendly" country. The court demanded that the money be returned to the Russian state.

The essence of the case

In 2020, the Russian subsidiary of IKEA, a large furniture manufacturing and sales chain, acquired a loan from a subsidiary company in Ireland.

In November 2022, due to the closure of the Russian business, the remaining goods were sold to a Russian buyer in the amount of 12.9 billion rubles. Part of the money received was transferred to an Irish company to an overseas account in order to repay the loan.

The allegations

During the inspection by the Federal Tax Service, it turned out that the Russian company transferred money to the account of a foreign company in violation of the requirements of currency legislation — without using a special account of type "C" and without obtaining special permission from the Government Commission.

The tax authorities recognized this transaction as void, and the payment was invalid, and demanded to recover the amount in favor of the state.

Views of a judicial body

The Arbitration Court agreed with the arguments of the Federal Tax Service and noted that the Russian IKEA structure by its actions sought to damage Russia’s financial stability. This argument is a violation of the requirement of Article 169 of the Civil Code of the Russian Federation.

On the basis of which antisocial transactions that contradict the foundations of law and order and morality are recognized as void transactions, the income of which must be transferred to the address of the Russian Federation.

As a result

The Russian subsidiary is obliged to pay the previously transferred funds to the account of the Russian state, and the Irish organization is obliged to pay 100 thousand rubles each in the form of a state fee.

This court case is the first for non-compliance with transactions with "unfriendly" countries, so it is likely that regulatory and judicial authorities may refer to it in disputes that arise. In addition, this practice has shown that the risks of violating currency legislation are not theoretical.

To ensure that your company is not exposed to these risks, Acsour specialists are ready to advise you on the conduct of such transactions, as well as organize all necessary procedures, taking into account compliance with the requirements of Russian legislation.