Assurances and Guarantees in Russian Law: Distribution of Contractual and Tax Risks

The civil law rules that took effect in 2015 on assurances and indemnity agreements enabled contractual parties subject to Russian law to include conditions similar to representations and warranties, as well as indemnity clauses in contracts under English law. Of course, Russian law was previously able to achieve the same effect for the proper recording and redistribution of risks or the assumption of additional liability. But since there were huge problems with this in practice, rules on assurances and indemnity agreements needed to be incorporated into Russian law. The new rules, as expected, raised new questions, ranging from the correlation of these institutions with the general concept of the obligation to their use in relation to public law, for example, tax risks. This roundtable will feature a discussion of the practical challenges that have emerged in recent years regarding assurances and indemnity agreements. The legal qualification of assurances and indemnity agreements as the concept of an obligation: what are we basing our conclusions on about what we face? Formalization of warranties and representations: do they really need to be prepared in writing with clear, explicit, and unambiguous statements? Is it possible to provide an assurance about something in the future? Is it possible to conclude an indemnity agreement based on a circumstance related to the debtor’s behaviour? Can representations and warranties be effectively used to protect one party to a contract against tax risks?