Russian media outlet Kommersant reports on decisions made by Russian courts in response to appeals from Belarusian taxpayers
In a significant development, Belarusian tax authorities have been increasingly relying on Russian courts to enforce debt collection decisions. This shift is primarily due to practical enforcement considerations and the legal frameworks enabling more direct debt recovery in Russia, according to experts.
The close economic and legal integration between Belarus and Russia allows Belarusian authorities to use Russian courts for enforcement purposes more efficiently. A case in point is the amount sought under subsidiary liability of €8.9 million of the debt of the bankrupt Osipovichi Railcar Plant.
Russian courts have been proactive in their approach, requesting information from the Federal Tax Service, Rosreestr, and the Ministry of Internal Affairs of Russia to determine the whereabouts of debtors and their assets in Russia. This collaborative effort has resulted in six out of seven times, Russian courts satisfying the claims of Belarusian inspectors, deeming them valid.
However, there have been instances where claims have been rejected. For example, a Russian arbitration court recently rejected a Belarusian inspector's claim due to the expiration of the three-year deadline for enforcing the decision.
The migration of debtors and their assets to Russia has also contributed to an increase in cross-border debt recovery efforts. Belarusian tax authorities are proactively tracking debtors' property abroad, including in Russia. This practice is not limited to Belarusian authorities; foreign tax authorities from countries such as Uzbekistan, Kazakhstan, and Kyrgyzstan have also approached Russian courts to recognize and enforce debt collection decisions.
The newspaper "Kommersant" reported this information, citing the database of arbitration cases. Russian courts have examined whether there are grounds for refusing to recognize and enforce Belarusian court decisions, citing bilateral agreements between the countries as the basis for their decisions.
The rejection of a claim by a Russian arbitration court indicates potential limitations in the cross-border debt recovery process. The overall trend, however, suggests that Belarusian authorities are eager to reach the assets of debtors whose whereabouts have been traced to Russia, indicating a growing trend in cross-border debt recovery.
In summary, the increasing reliance of Belarusian tax inspectors on Russian courts stems from practical enforcement considerations, the legal frameworks enabling more direct debt recovery in Russia, and the interconnected economic and jurisdictional realities between the two countries. This trend is further reflected in the growing number of foreign tax authorities approaching Russian courts for cross-border debt recovery.
- In the context of the interconnected economy and legal systems, Belarusian authorities utilize Russian courts to efficiently enforce debt collection decisions, especially considering the subsidiary liability of €8.9 million of the bankrupt Osipovichi Railcar Plant.
- The trend of foreign tax authorities, including Uzbekistan, Kazakhstan, and Kyrgyzstan, approaching Russian courts to recognize and enforce debt collection decisions, indicates the growing use of cross-border debt recovery practices.
