Backed by colossal resource and financing, the Russian government has been pursuing a war in Ukraine that has wreaked havoc on the nation and its people, provoking international condemnation.
Now, the businesses that have ties to the Russian state, including a swathe of Western-led law firms, are coming under the gaze of the international community. The U.S. and the EU, and to a lesser extent the U.K., are instituting strict economic sanctions in a bid to stifle the Russian economy, such as restricting the movement of international reserves and cutting Russian lenders out of the Swift banking system. This will inevitably have a knock-on effect on law firm fee generation.
Here, Law.com International provides a breakdown of the biggest legal advisers to the largest Russian state-owned enterprises, which include: energy titans Gazprom, Rosneft, Gazpromneft, Novatek and Inter RAO; banks Sberbank, the Central Bank of Russia and VTB Group; transport company Russian Railways and defense company Rostec; and government bodies including the Ministry of Finance and the Russian Federation itself.
The Magic Circle firm is among the most prominent advisers to Russian state enterprises. It counts among its client base three of Russia’s biggest state-backed companies: Gazprom and Rosneft, and Russia’s largest state bank, Sberbank.
Linklaters has said it is reviewing all its Russia-related work.
With a revenue of nearly $90 billion, Gazprom is easily one of Europe’s biggest suppliers of gas, and is considered a structurally important company on the continent. It is one of several companies against which the U.S. and the EU have issued strong sanctions—with the U.K. being a notable exception.
The firm has advised Gazprom on the development and financing of the $11 billion Nord Stream 2 gas project, as well several debt issuances.
It advised Rosneft on its $12.9 billion acquisition of Indian oil company Essar Oil in 2016. Rosneft has attracted special condemnation for being a key supplier of fuel to Russia’s military.
It also advises Sberbank—Russia’s largest state-owned bank—and VTB Group, its second-largest. In 2007 the firm acted on $18 billion of Russian IPOs within the space of a single week.
Not for the first time is the firm’s links to Russia coming under scrutiny. In 2018, Linklaters was criticized by a U.K. parliamentary committee for refusing to discuss its role on the London listing of Russian energy company En+ Group.
Herbert Smith Freehills
HSF also counts several Russian companies in its client base. But unlike Linklaters, the firm has, so far, stayed silent on its Russia ties.
In 2019, HSF advised a Pertamina-Rosneft joint venture company on the award of engineering contracts for a new US$16 billion refinery in Indonesia.
Meanwhile, Moscow partner Dmitry Gubarev has advised several companies including VEB.RF and VTB Bank on a RUB32 billion project financing of the construction of a specialized coal seaport, and Sberbank on a €900 million secured financing acquisition of shopping malls in Moscow and St. Petersburg.
HSF did not provide a comment in time for publication.
Freshfields Bruckhaus Deringer
Freshfields’ clients include Gazpromneft, a subsidiary of Gazprom, Rosneft, Sberbank, VTB Group and Russian Railways, among others.
The firm has declined to comment on its Russia links.
In December, the firm advised Sberbank on the sale of subsidiaries to AIK Banka and other banks in a €7.33 billion deal, and it too advised Rosneft on its proposed strategic partnership with Pertamina.
Back in 2010, the firm advised VTB, among other sponsors, on a €1.1 billion Russian public-private partnership that saw the construction of a terminal at St Petersburg’s Pulkovo Airport.
In July 2021, the firm advised Gazprom Export on the acquisition of 100% of the shares in Centrex Europe & Energy Gas AG from Gazprombank, and in 2020 advised Sberbank’s investments arm on the RUB2 billion secured mezzanine financing for Avtoban, one of the largest road construction companies in Russia.
And in 2018, it advised Rosneft in a $1.4 billion ICC arbitration against Exxon over oil migration in an offshore oil and gas project in Russia.
The firm did not respond to multiple requests for comment on its Russia links.
Allen & Overy
The firm has long held links to Russian companies, but has declined to comment for this piece.
Recently, the firm advised VTB Group’s leasing arm on the restructuring and payment deferral under aircraft lease agreements with Russia’s flagship airline Aeroflot group during the pandemic.
In 2015 the firm advised Sberbank on the $2.5 billion financing of Renova Group’s tender offer to all shareholders of Swiss company Sulzer AG.
The firm has also advised oil majors Gazprom and Rosneft.
Back in 2011, it assisted Rosneft on the creation of a multi-currency facility worth $1.4 billion.
CMS is deeply entrenched in the Russian state, and is among the U.K.’s best known and most prolific advisers to Russian state enterprises, counting among its client base energy majors Gazprom, Gazpromneft, Rosneft and Inter RAO, and banks Sberbank and VTB Group, among others.
The firm declined to comment on its Russia ties.
Examples of its Russia work include advising Gazprom on a multibillion-dollar asset swap deal in Russia, Germany and North Africa; Rosneft on Russia’s massive Sakhalin III oil project in 2016—a joint venture with Sinopec; and Sberbank on the acquisition of a 79.6% stake in DocDoc.ru in 2017.
The firm has acted for, among others, Sberbank and Rosneft.
As far back as 2012, the firm advised Sberbank on a $2 billion term loan facility to Eurasian Natural Resources Corporation, and in 2016 advised the bank on launching a strategic joint-venture project.
A spokesperson said the firm is reviewing its Russia ties, which could culminate in “ceasing work where appropriate.”
The statement reads: “We continue to closely monitor the situation and the fast-evolving laws and sanctions globally and to align our client work, and our operations, accordingly. That may mean ceasing work where appropriate.
“We continually evaluate our operations and portfolio of work and any new client mandates to ensure we are complying with sanctions requirements and local government guidance, including the advice from U.K., U.S. and other governments. Our thoughts are with all those people affected by the situation in Ukraine, including many of our own colleagues who have relatives in the region.”
Norton Rose Fulbright
Norton Rose has its fingers in a number of Russian pies, including energy companies Gazprom and Gazpromneft, Rosneft, Inter RAO and Novatek, and banks Sberbank and VTB.
Among other mandates, the firm acted on Shell’s proposed acquisition from Gazpromneft of a 25% stake in a Russian company to create a new upstream oil and gas joint venture with Gazpromneft and Respol.
Whether the firm is reviewing or will continue its Russia work is not yet clear. A spokesperson for the firm simply said: “We are not able to comment further on individual client relationships. We have appropriate risk management policies in place across our global business and keep all relationships the firm has under review to ensure we comply with all applicable laws.”
Baker McKenzie’s clients include the Russian Federation, Gazprom and VTB, among other banks.
In 2020, the firm advised VTB on a $273 million capital raising by network provider VEON. And, according to its website, several of its lawyers have advised Gazprom at one time or another.
On Monday, it became among the first firms to say that it was reviewing its Russia operations and dropping Russian clients, though it did not specify which clients it was axing.
The firm has also advised defense conglomerate Rostec, and the Russian Ministry of Finance, which it advised on a €1.5 billion Eurobond offering last year, according to its website.
Clifford Chance is a big adviser to Russia’s state banks Sberbank and VTB Group. In 2010, with a combined London/Moscow team, the firm acted alongside Freshfields on the €1.1 billion Russian public-private partnership for the new terminal at St Petersburg’s Pulkovo Airport.
In 2013, it advised VTB on the acquisition financing of a $3.6 billion stake in Polyus Gold, and in 2017 advised it on the refinancing of two Boeing 747-8F aircraft. Meanwhile, that year its Russia office also advised Sberbank in what it called a “landmark derivatives case.”
The firm did not provide a comment in time for publication.
Cleary Gottlieb Steen & Hamilton
Cleary Gottlieb is a top-ranked firm in Russia, and is long-established in Moscow, having opened an office in 1991.
Among its big-ticket work, the firm in 2015 represented Rosneft and a group of its subsidiaries in the successful negotiation of a settlement agreement with former subsidiaries of Yukos Oil Company, as well as with individuals controlling those entities.
Back in 2009, Cleary advised Gazprom on its purchase of a 20% stake in its oil unit Gazprom Neft from Italian utility Eni.
In 2007, Cleary acted as U.S., English and Russian counsel to Sberbank in a $8.9 billion equity offering.
Cleary did not provide a comment in time for publication.
Latham & Watkins
Latham is another longtime Russia player, having debuted in Moscow in 1992. It has since advised a number of Russian state firms.
It advised Sberbank and VEB.RF on a project finance transaction for the development of a mine and renovation of Rubtsovsk enrichment plant for Ural Mining and Metallurgical Company group. It also advised Sberbank on a $2 billion facility.
It has advised VTB on the project financing for the reconstruction of the Zainsk power plant located in Tatarstan, Russia, and advised Gazprombank on a number of pre-payment facilities arranged for EU traders.
The firm has yet to respond to a request for comment.
Top-ranked in Russia, Baker Botts is also an established player among Russian state firms.
It has acted for, among others, Rosneft, including on its sale of a 10% stake in Vostok Oil to Trafigura.
In 2009, the firm advised on a $15 billion loan agreement between Russian oil and gas company Rosneft and the Chinese government regarding a major oil supply contract between the two countries. And in 2015, the firm helped Gazprom defend a claim for $1.37 billion by Moncrief Oil International.
The firm has yet to respond to a request for comment.
Skadden Arps Slate Meagher & Flom
Like several U.S. firms, Skadden opened in Moscow in the early 90s and has since established itself as a major player.
Among other mandates, the firm advised Gazprom in its listing on the Singapore Stock Exchange; and in 2018 acted for VTB’s infrastructure and investments arm on a $2.5 billion acquisition of a 29% stake in Russian food retailer Magnit.
The firm did not respond to a request for comment at the time of publication.
White & Case
Another of the early 90s U.S. gang, White & Case has built up a strong portfolio of clients.
Among its big-ticket work, in 2016, the firm acted for Rosneft on its planned sale of a less than 20% stake in the energy giant worth $7.5 billion. That same year, it acted for Sberbank as agent to the Russian Federation and VTB Capital on an $812 million privatization of the Russian Federation’s 10.9% stake in a diamond mining giant.
It has previously ranked number one on Mergermarket’s M&A deal table for Russia after it advised on 15 announced deals in Russia, worth $18.9 billion in total, in a single year.
It joined a raft of firms saying it was pulling out of certain Russian relationships, without specifying which.
A spokesperson for the firm said: “We are reviewing our Russian and Belarusian client representations and taking steps to exit some representations in accordance with applicable rules of professional responsibility. Our Moscow office is open and continues to operate. We are complying fully with all applicable sanctions, and we continue to closely monitor this rapidly evolving situation.”
Debevoise & Plimpton
Debevoise has deep roots in Russia’s dispute resolution scene, and as recently as July 2021, successfully represented Sberbank in London’s High Court “challenging the jurisdiction of the English courts to hear a $300 million conspiracy claim brought by a subsidiary of Russia’s second-largest bank, VTB.”
The firm has yet to respond to a request for comment.
Bryan Cave Leighton Paisner
BCLP has advised on a range of big-ticket state deals, including helping Gazpromneft on its joint venture with Russian tech company Zyfra for “developing a digital industrial platform.”
It has also represented Sberbank on a case concerning an alleged violation of the laws on procurement of goods and is the legal adviser to the Russian Agricultural Bank on the international sanction programs and restrictions.
The firm said in a statement: “As with most multinational organizations operating in the region, we have been closely coordinating to navigate the complexities of the situation. We are adapting to comply with applicable sanctions and responding as required in the circumstances. Due to confidentiality, we are not able to share more.”
Dentons counts Gazprom and Rosneft as major clients.
According to the firm’s website, it has represented the company in an arbitration brought by the Ministry of Energy of the Republic of Lithuania before the Arbitration Institute of the Stockholm Chamber of Commerce in a $1.9 billion claim.
A spokesperson for the firm said in a statement: “In light of the quickly evolving international sanctions against Russia, Dentons is reviewing matters related to sanctioned persons and entities to ensure compliance with our legal obligations and firm policies, including, where appropriate terminating our relationship with certain clients.”
Ashurst and Fieldfisher
It’s not just the Big Law firms that have a stake in Russia. Many U.K. firms have been advising state-owned companies or Russian high-net-worth individuals.
Among them are Ashurst, which has acted for Russian Railways and the Central Bank of Russia, according to its website, and Fieldfisher, which “helped Gazprom establish its U.K. operations,” the firm said on its website.
Ashurst said that it was no longer accepting instructions from “new and existing” Russian clients, while Fieldfisher declined to comment.