Specific features of subsidiary liability of foreign parent companies: Nikolay Pokryshkin’s talk at the Forbes insolvency conference

On 24 April, Partner and Head of Insolvency at KK&P Nikolay Pokryshkin spoke at the Plenary Session of a Forbes conference entitled Insolvencies, Restructurings, Corporate Conflicts: Landmark Cases and Trials in Modern Russia.

In recent years, the practice of imposing tort liability on Russian subsidiaries for failure to fulfil contractual obligations of parent companies that comply with sanctions has become widespread.

On 23 April 2025, the Russian Supreme Court overturned the decisions of lower courts in the case of Sovcombank v Citibank N.A., which had previously supported this approach. However, since the reasoning has not yet been published, the position of the highest court remains unclear: will the Russian Supreme Court refute the legality of this approach or establish a specific test, i.e., conditions that allow its application in individual cases?

During his talk, Nikolay examined possible directions for further development of court practice, as well as the arguments and counterarguments available to parties in upcoming disputes on bringing foreign parent companies to subsidiary liability.

Nikolay also took part in debates on the possibility of business insolvency without personal insolvency and defended the need to limit the use of the instrument of subsidiary liability as payment for the collapse of a business and the acceptance of natural business risks.

The Insolvencies, Restructurings, Corporate Conflicts Conference is organised by Forbes. The participants examined significant cases in the field of corporate insolvency and corporate conflicts, as well as issues of lawmaking and law enforcement.