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Январь 2019




Chief editor’s column


Interview of the issue


The Event. Comments of the Experts


Topic of the issue

I.S. Shitkina, O.V. Butkova Director Liability Risk and Business Initiative: Searching for Balance
The article deals with issues related to the director’s liability for losses through the prism of entrepreneurial and managerial risks, which are inseparably connected with the director’s activities. The authors identify the problems faced by courts and businesses in the application of legal remedies aimed at eliminating or limiting director’s property liability. They propose a number of legal measures that can be implemented in order to promote business initiative and to protect company directors from being held liable where their actions are not aimed at causing damage to the company.
Keywords: entrepreneurial risk, asset liability, good faith, duty of care, duty of loyalty
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A.V. Gabov Aspects of Responsibility of Members of the Board of Directors (Supervisory Board) of a Business Entity Acting as a Professional Attorney
The issues of responsibility of members of management bodies of legal entities (especially business entities) are currently in the focus of attention of both researchers and legislators. Traditionally, researchers have analysed the civil and criminal aspects of this responsibility. However, in 2018, the State Duma of the Russian Federation introduced a bill establishing administrative responsibility of members of the governing bodies. The article analyses the proposed novelties, including from the point of view of regulating the status of those members of the boards of directors of business entities representing the state who act as professional attorneys and are supposed to come under the extended scope of the corresponding responsibility.
Keywords: corporation, joint stock company, board of directors, professional attorney, independent director, administrative liability
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I.V. Stasyuk Vicarious Liability vs Compensation For Harm Caused by Wrongful Act. Choice of Cause of Action
This paper weighs up the creditor’s claim against a company director for damage caused by a wrongful act and the claim for vicarious liability. The author concludes that the recovery of company debts from directors can only be under the rules of vicarious liability. At the same time, recovering damages caused by a wrongful act helps neither the claimant nor the respondent or other creditors to adequately protect their interest in the indebted company.
Keywords: vicarious liability in bankruptcy, tort liability, liability of debtor’s director, liability of controlling persons
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S.L. Budylin Fiduciary Duties in Fundamental Transactions: The American Experience
This paper provides an overview of Delaware case law concerning fiduciary duties of directors and majority shareholders in corporate control transactions and squeeze-outs involving the compulsory sale of the shares of minority shareholders in a subsidiary corporation. Unlike Europe, the US experience shows that the Board’s role is crucial and therefore their fiduciary duties are relevant, and most of such transactions undergo judicial review. In squeeze-outs, the majority shareholder (corporation taking control) also owes fiduciary duty to minority shareholders. Delaware courts have developed comprehensive, most nuanced rules to determine whether fiduciaries have fulfilled their duties in such transactions. There are three standards of judicial review, including the business judgment rule (most lenient), enhanced scrutiny (intermediate) and entire fairness (most stringent one).
Keywords: fiduciary duties, fundamental transactions, liabilities of directors, squeeze-out, guarantees for minority shareholders’ rights, Delaware corporate law
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N.L. Lyutov An Interdisciplinary Review of Legal Standards for Executive Staff
This article discusses the problematic aspects of conflict of norms in labour law and civil law as applied to employee relations. It examines approaches to conflict-of-law provisions and prevalence of civil law and labour law rules in relation to the executive staff. The conclusion is reached that there are mixed managerial contracts combining features from civil law and labour law.
Keywords: executive staff, conflict of laws, mixed contracts, non-competition clauses
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Discussion Board

A.A. Ivanov How to Restructure Consumer Protection
This paper aims to identify current developments and future prospects for consumer protection laws in Russia. While recognising that central lawmaking tilts the balance towards manufacturers (producers), the author points to individual changes that would favour the interests of consumers, primarily in terms of replacement or service life. The second section analyses two main trends — personalised manufacturing and increased burden of recycling — which can impact the behaviour of consumers and producers in the marketplace and therefore require legislative instruments to encourage rational economic decisions. Otherwise, producers will impose their contractual terms leading to higher levels of consumer detriment.
Keywords: consumer protection, paternalism in civil law, product’s service life, warranty period, burden of recycling, product quality
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A.V. Ilyin The Principle of Justice of Administrative Proceedings
The principle of justice of administrative proceedings as a procedural principle should have its own specific content. Without this content, the courts cannot apply this principle in administrative cases. Comparison of the possible content of the principle of justice with the principles of legality and equality and analysis of the possibility of disclosure of the principle of justice through the characteristics of consideration (through the active role of the court and the distribution of the burden of proof) and resolution (identification with the means of checking the administrative discretion) of administrative cases show that the principle of justice does not have its procedural content and does not bear any meaning that allows to apply it in administrative proceedings.
Keywords: administrative discretion, principle of justice, active role of court, administrative proceedings
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Press Release



Theory and practice

A.A. Pavlov Grounds for Interruption of Limitation Periods
The limitation period is a classic institution, which is regulated by fairly conventional precepts of positive law. However, the interpretation and application of interruption rules can cause serious difficulties for both modern domestic doctrine and commercial litigation. This article reflects on the category of “acts that indicate acknowledgement of debt” and serve as grounds for interruption of limitation periods. It also reviews recent case law as related to the respective provisions of Article 203 of the Russian Civil Code.
Keywords: limitation period, interruption of limitation period, acknowledgment of debt, doctrine of apparent authority
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K.L. Branovitskiy, V.P. Skobelev Writ Proceedings in Post-Soviet Countries: Lost Opportunity
The article provides an overview of the actual procedural regulation of the EAEU member states in the field of writ proceedings. The authors analyze the real causa that motivated the national legislators of some states to exclude the crossborder nature of the writ, as well as the possible consequences for the approximation of legal norms in the EAEU space. The cross-border action of the writ (within an integration association) can significantly reduce the transaction costs for citizens and legal entities, increase the availability of justice for the claimants, and also help reduce caseload in the courts.
Keywords: approximation of civil procedure law, writ proceedings, judicial efficiency, fast track
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D.I. Smolnikov Shifting Burden of Proof in Civil Litigation: Playing Ping Pong or Archery?
This article looks at how the burden of proof can be shifted in civil litigation. Doctrinal approach in Russia upholds a static model of the burden of proof which stipulates the facts to be proved by each of the parties. The author finds it to be a misperception that common law countries have the dynamic model of shifting the burden of proof (it actually passes from one party to the other). Moreover, there are serious doubts about the need to have a conceptual model of the burden of proof.
Keywords: evidence, burden of proof, burden of approval, prima facie evidence
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A.S. Vorozhevich Damages and Other Compensation as a Remedy for Patent Infringements
Based on the analysis of Russian and foreign case law, the author considers the problems associated with protection of patent rights. The article deals with the problem of correlation of remedies existing in the Russian law: recovery of damages, compensation, and disgorgement of infringer’s profits. The author substantiates the need for establishing in Part IV of the Civil Code of the Russian Federation three methods of calculation of the patent owner’s damages: 1) lost profits damages; 2) reasonable royalty; and 3) disgorgement of profits. For each of these methods, a list of circumstances to be taken into account is defined.
Keywords: patent infringement, object protected by patent, recovery of damages, compensation, patent law, rightholder
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A.V. Roslyakov Collective Dominance, Group of Persons, Concerted Practices and Freedom of Contract
The institution of collective dominance — in the form in which it exists in current domestic legislation and law enforcement practice — restricts competition. Spread of restrictions on the use of competition tools for entities that formally occupy a collective dominant position to entities that do not possess real market power is contrary to the goals of competition protection legislation. Also, the institution of collective dominance serves as a tool to facilitate implementation by the Federal Antimonopoly Service of its functions to the detriment of the interests of economic entities.
Keywords: collective dominant position, abuse of dominance, group of persons, concerted practice, freedom of contract, oligopoly
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A.S. Podmarkova Pre-Emptive Rights in Privatisation: Pro et Contra
The article examines the issue of sale of the state-owned (municipal) share in common real estate ownership and its acquisition by the other participants of common ownership without bidding but through the pre-emptive right in compliance with the legislation on privatisation. Therefore, the author analyses the statutory regulation of privatisation of a share in common ownership, and examines the ratio of the norms in civil and privatisation laws. The pre-emptive right is evaluated and its category is recognised by privatisation legislation. The author determines the essence of trading and analyses the requirement to follow the rules of antitrust and privatisation laws. The conflicting decisions and arguments from two courts are reviewed focusing on the necessity of ensuring both public and private interests of those involved. A summary is provided for the points of view of public officials and other courts including the Supreme Court. Finally, the author concludes that it is necessity to use the pre-emptive right of other participants in common real estate ownership in the case of acquisition of a state-owned (municipal) share in it.
Keywords: privatisation, common ownership, share in real estate ownership, pre-emptive right, methods of privatisation, sale of state-owned property at auction
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