The mechanism for redomiciliating foreign companies to Russian jurisdiction, in effect since 2018, has recently encountered serious obstacles. Taking into account the background of sanctions-related restrictions introduced in 2022 through 2025, it has become extremely difficult to achieve the goal. The situation gave rise to the phenomenon of dual domicile and led to a rise in the number of new litigations, both in Russia and abroad.

Since the onset of sanctions-related pressure, Western regulators have begun blocking transactions involving Russian financial assets. It is effectively impossible to delist companies, registered in the Great Britain or EU jurisdictions, from local registries.

Yet another complication is the refusal to act on the part of auditors, since without an auditor's report, the registration process cannot be completed; however, most foreign audit firms avoid engaging in cooperation due to concerns that they could violate sanctions.

As a result, a "dual domicile" is forming: a company is at the same time listed in both the Russian and foreign registries. This leads to problems relating to taxation, accounting, and the legal status of assets, as the two legal systems interpret differently the status of such a company.

Accelerated redomiciliation as an exceptional mechanism

In order to minimize risks, a simplified, accelerated procedure has been introduced in Russia, implemented by a decree of Russian President Vladimir Putin. According to this procedure, a company can be considered removed from a foreign register under Russian law. This mechanism has already been used, in particular, against such companies as Polyus and PhosAgro.

Nevertheless, the effect of this mechanism is only limited: foreign jurisdictions do not recognize the exception, so the problem of dual domicile is resolved only within the framework of the Russian legislation.

The situation as to redomiciliation has also worsened as precedents of forced redomiciliation emerged in Russia.

In the context of sanctions and restrictions, redomiciliation is increasingly becoming the subject of separate judicial analysis. The key question is whether relocating a company to Russian jurisdiction could violate injunctions in force in foreign cases.

Thus, in 2018, an English court injunction barred Oleg Deripaska from taking any actions that could impede the sale of his stake in EN+ Group. In 2020, his opponents, Navigator Equities and Vladimir Chernukhin, claimed that initiating EN+'s redomiciliation from Jersey to Russia violated the injunction.

The court considered the dispute for three years and in 2023 arrived to the conclusion that redomiciliation did not result in the stripping of assets and did not violate the court order, since it did not change the essence of corporate control, but only transferred the company to another jurisdiction.

A similar situation arose in Cyprus in the framework of the dispute about Togliattiazot. In 2019, Cypriot companies connected to Dmitry Mazepin pledged not to reduce the value of their assets below $ 1.75 billion. In 2021, two of these entities—Uralchem Holding PLC and CI-Chemical Invest Limited—began redomiciliation to Russia while remaining registered in Cyprus.

The party of Sergey Makhlai viewed this as a breach of contract and filed a complaint, stating the contempt of court. Nevertheless, the Cypriot court adopted the same position as the English court: redomiciliation itself does not constitute a violation, as the assets remain under the court's control.

Contempt of court as a tool of pressure in corporate conflicts

Contempt of court is traditionally viewed as a serious charge, which carry even the risk of imprisonment and significant legal costs. In the cases of Deripaska v. Chernukhin and Mazepin v. Makhlai, such claims were dismissed, and the plaintiffs were forced to pay legal costs.

However, the practice demonstrates that even despite the high costs, a party to a dispute may resort to claims of contempt of court in hope to exert pressure on the opponent, influence the court as it considers the case on its merits, or initiate a negative media coverage of the opponent.