The practice of illegal withdrawal by the management and beneficiaries of the business of companies’ assets in foreign jurisdictions has become widespread.
Inventive debtors actively use companies in offshore jurisdictions, trusts, fictitious payables, transfers of assets to formally not affiliated persons, etc.
In this regard, creditors inevitably face the problem of obtaining access to the foreign assets of such debtors.
First, as the first stage, start collecting information and evidence, as well as tracking the debtor’s assets. At this stage, it is important to identify key jurisdictions to search for assets, “narrowing down” the scope of follow-up work (as a rule, Russian businessmen prefer Great Britain, Monaco, France, Switzerland, and the United States).
The circle of such jurisdictions can be established by working with business partners, colleagues, debtor’s opponents, studying the debtor’s foreign trips, his social networks, his family’s residence, hobbies, and hobbies, etc.
Within the established jurisdictions, they are already starting to search for assets directly: bank accounts, shares in companies, securities, intellectual rights, art objects, houses and land, sea, river and aircraft, other real estate, cars, etc.
Such objects are searched in the registers of legal entities, registers of movable and immovable property, court decisions, financial statements, in the framework of interaction with government bodies, in cadastral maps, press reports, etc.
For the implementation of all these tasks, a team of professional lawyers and specialized expert detectives is involved, who, firstly, have the appropriate competence to disentangle complicated asset withdrawal schemes, secondly, have a complete list, access and skills to work with information sources in various jurisdictions thirdly, they know the peculiarities and can work in the multi-jurisdictional field; fourthly, they can assess the legal perspectives of the foreclosure of the found assets.
Secondly, if it becomes clear that there are prospects for foreclosure, then you can proceed to the next stage — the arrest of assets, legal proceedings in a foreign court on foreclosure, execution of judicial acts and return of assets, etc.
In this whole process, a variety of effective and “advanced” procedural tools of foreign legal orders will be of great help. Thus, using the example of the UK at the asset protection stage, a court may request interim measures (injunctions) in the form of arresting assets, imposing obligations on the debtor and third parties to disclose information, prohibiting execution of judicial acts and initiating legal proceedings regarding the subject of the dispute, if the parties agreed on exclusivity of English jurisdiction.
On the example of the tools offered by the USA in bankruptcy of a debtor – a company or an individual – the arbitration manager has the right to apply to the federal bankruptcy court with a statement recognizing the Russian bankruptcy case as a “main foreign proceeding” in the order of Chapter 15 of the US Code Chapter 15).
Such recognition would prohibit creditors from applying for recovery of debtor’s assets in the United States, bypassing the Russian bankruptcy estate, giving the arbitration manager the right to participate in legal proceedings regarding the debtor’s assets in the United States, as well as access to information about the debtor’s assets and interviewing witnesses.
Finding the debtor’s assets abroad and charging them is a time-consuming, time-consuming and costly task. Of course, its implementation makes sense only in respect of large debtors.
At the same time, the practice of recent years demonstrates its effectiveness in terms of the amount and value of “disclosed” assets, in connection with which creditors should pay attention to it.