A foreign company operating in Russia is caught between two sets of rules that were designed against each other: the sanctions of its home country, and Russia's countersanctions. They are not mirror images, they can conflict, and staying compliant means satisfying both at once.
Your home regime (US, EU or UK) restricts what you can do with Russia. Russia's countersanctions restrict what you can do as an 'unfriendly'-linked party inside Russia — moving dividends, selling assets, repaying loans, transferring shares. Both apply simultaneously.
Screen counterparties by ownership, not just name; know where your payments, supply chains and subsidiaries are exposed; document your position; and get the right permits on the Russian side before acting, not after.
The single most important thing to understand about operating in Russia under sanctions is that you are subject to two regimes simultaneously, and they were built in opposition to one another. Your home country's sanctions — US, EU or UK — restrict what you, as a company from that country, may do in relation to Russia. Russia's own countersanctions restrict what you may do inside Russia because you are linked to an 'unfriendly' state.
These two systems are not mirror images. An action permitted under one can be restricted under the other, and in places they pull in opposite directions — your home regime may discourage a payment that Russian rules require you to route in a particular way, or Russian rules may block a transaction your home regime has no issue with. Compliance is not choosing which rulebook to follow; it is satisfying both at the same time, which is what makes the area genuinely difficult.
Your home sanctions and Russia's countersanctions apply at the same time and aren't mirror images — an action fine under one can be restricted under the other. Compliance isn't choosing a rulebook; it's satisfying both at once, which is what makes this hard.
Foreign companies tend to arrive well-briefed on their home sanctions and much less so on the Russian countersanctions that affect them day to day. In practice, the Russian measures that bite a foreign-owned business operating there include:
Dividend and profit distributions to shareholders from 'unfriendly' countries above a monthly threshold require a permit from the Government Commission, or the funds go to a restricted account — and in practice permits have become harder to obtain.
Loan repayments to 'unfriendly' lenders fall under the same permit regime.
Transactions with shares or participatory interests in Russian entities involving 'unfriendly' parties — sales, transfers, changes of control — need Government Commission approval, and a transaction entered without it can be null and void.
Exiting the market carries a mandatory discount, a budget contribution and Commission approval.
A Russian company controlled by an 'unfriendly' person is itself treated as 'unfriendly' — so the restrictions follow the control, not just the passport.
The through-line is that moving value — dividends, loan repayments, asset sales — out of a foreign-linked Russian business is the most restricted activity, and it is gated by permits and approvals that have to be obtained on the Russian side before the money moves.
Dividends to 'unfriendly' shareholders above a monthly threshold need a Government Commission permit or go to a restricted account; loan repayments and share transfers are gated the same way. Getting value out of a foreign-linked Russian business is where the permits bite.
Sanctions exposure hides in specifics, so the checking has to be concrete. Four things matter most:
Counterparties — and crucially their ownership, not just their name. A company clean on the lists can be caught because a listed person owns 50% or more of it, directly or through layers. This ownership analysis is the heart of screening and is covered in detail in our piece on screening counterparties.
Banks — whether the banks on both sides of a payment can actually process the flow, since a lawful transaction can still be refused by a bank's own policy.
Ultimate beneficiaries — the individuals behind the structure, which the Russian public register does not reliably show.
Goods — whether what you are importing or supplying falls into a restricted category, particularly for technology and dual-use items.
In practice, the failures cluster in a few predictable places, and knowing them is half the battle:
Payments — a transfer refused or returned, either because it is genuinely restricted or because a bank won't process a lawful one. What to do when a bank refuses is covered in our piece on refused payments.
Logistics and supply chains — goods held at the border over classification or a counterparty question.
IT and technology supplies — software, hardware and services that fall into restricted or dual-use categories.
Subsidiaries and intragroup dealings — where the group's own structure creates exposure, and where moving value between entities triggers the Russian permit regime.
There is no single Russian-law mandate to run a sanctions-compliance programme in the way anti-money-laundering rules are prescribed, but operating without documented diligence is a poor position — banks, counterparties and regulators increasingly expect to see it, and specific steps (currency-control paperwork, Government Commission applications) carry their own documentation requirements. What a sound position looks like in practice:
A record of counterparty screening — who was checked, to what depth, and what was found — so a clean position can be evidenced later, not just asserted.
Documented commercial purpose and ownership for payments, prepared before they are made.
A process for the permits and approvals the Russian side requires, built into how transactions are done rather than sought in a rush.
Regular re-checking, because both the lists and ownership structures change — a screen is only good for the day it was run.
We handle the Russian side of all of this — establishing who really owns and controls a Russian counterparty, navigating the Government Commission and permit processes, structuring and documenting payments so lawful ones clear, and keeping the position current. On how your home regime — US, EU or UK — applies, we coordinate with your OFAC or EU counsel rather than opining on their law ourselves.
That division is deliberate and it works in your favour: the Russian-side facts and permissions we establish are exactly what your sanctions counsel needs to reach their conclusions, and what your bank needs to process a payment. The two halves of the two-system problem are handled by the people best placed to handle each.
We handle the Russian side — ownership, permits, payment structuring — and coordinate with your OFAC or EU counsel on their regimes. The Russian-side facts and permissions we establish are what your sanctions adviser and your bank need to act.
No — that covers only one of the two systems you're under. Your home sanctions govern what you can do with Russia; Russia's countersanctions govern what you can do inside Russia as an 'unfriendly'-linked party, including moving dividends, repaying loans and transferring shares. The two aren't mirror images and can conflict, so satisfying one doesn't mean you've satisfied the other.
Mainly the restrictions on moving value out. Dividend distributions to shareholders from 'unfriendly' countries above a monthly threshold need a Government Commission permit or go to a restricted account; loan repayments fall under the same regime; and transactions with shares or interests in Russian entities need Commission approval, without which they can be void. A Russian company controlled by an 'unfriendly' person is itself treated as 'unfriendly', so the rules follow control, not just nationality.
There's no single blanket mandate the way anti-money-laundering rules are prescribed, but operating without documented diligence is a weak position. Banks, counterparties and regulators increasingly expect to see it, and specific steps — currency-control paperwork, Government Commission applications — carry their own documentation requirements. A documented screening and payment-purpose record is what lets you evidence a clean position rather than just assert it.
We handle the Russian side — who really owns a counterparty, the permits and approvals Russia requires, and structuring payments so lawful ones clear. On whether something is permissible under US or EU law, we coordinate with your OFAC or EU counsel rather than opining on their law ourselves. The Russian-side facts we establish are what your sanctions adviser needs to reach a conclusion.
Practical support for international business in Russia.