On 7 November 2014, the Arbitration court of the Moscow city issued a widely debated decision stating that over 70% of OJSC JSOC “Bashneft” shares owned by the Russian Federation are to be repossessed from OJSC JSFC “Sistema” and CJSC “Sistema-Invest”. The decision came into force on 8 December 2014.
Since the respective shares were considered to be privatised in the early 2000s, the court’s reasoning in making their decision that 70% of the shares were still owned by the state after such a long period of time brought some debate as to Russian court practice.
Thus, despite the aim of the recent amendments to the Civil Code which were presumed, inter alia, to establish a general maximum length for the limitation of actions period (ten years starting rom the date of the violation of the right), the Arbitration court ruled that such tool may not be used as a means for the legalisation of seizure of assets which were illegally obtained.
Attention should be brought as well to the newly increased powers of the Public Prosecutor Office of the Russian Federation under the Arbitration Procedural Code that have made the claim possible. By means of the Federal Law dated 28 June 2014 No. 186-FZ “On the Amendments to the Arbitration Procedural Code of the Russian Federation”, the prosecutors were entitled to submit claims for the repossession of state and municipal property from the illegal third party currently in possession.