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CIS and Georgia

Corporations, financial institutions and private investors are increasingly exploring business opportunities in the Commonwealth of Independent States (CIS) and Georgia. In recent years, new investment sources have arisen in Asia and the Middle East, renewing the region’s historical links to China and the Islamic world.

Local and international investors alike require the counsel of a law firm with strong commercial judgment and cross-border capabilities when establishing or expanding a regional or global footprint. A sensibility to local business practices, too, helps ensure that companies maximize and protect their assets.

More than two decades of service

Our skilled lawyers have served clients in the CIS and Georgia since the early 1990s. With key offices in Russia, Georgia and Kazakhstan, we regularly advise clients on both inbound and outbound matters across the region. Our collaborative approach delivers results-oriented solutions that bridge business cultures to achieve our clients’ goals. Dechert’s CIS and Georgia team includes some of the market’s leading advisors on both domestic and cross-border corporate, energy, real estate and financing transactions, and domestic and international dispute resolution in the region.

A Multifaceted Global Practice

Our lawyers are qualified in multiple jurisdictions, including Russia, Georgia, Kazakhstan, the United States, the United Kingdom, the United Arab Emirates, France and Canada, and they are experienced with the region’s varied legal systems. We are also fluent in several languages, including English, Russian, Georgian, Kazakh, French and Italian, and offer a range of services in Chinese and Turkish.

Experience

Energy and Natural Resources

  • The consortium of “G6” oil companies (ExxonMobil, Shell, Total, Eni, ConocoPhillips and Inpex) on the development of the Kazakhstan Caspian Transportation System (KCTS) for the export of oil from Kazakhstan.
  • The Ultimate Beneficial Owners of Stroygazconsulting Group of Companies, the major contractor of Gazprom Group, on the sale of 100% equity to the companies affiliated with UCP and Gazprombank.
  • A major European oil company on several projects to explore and develop major hydrocarbon reserves in Kazakhstan, including production sharing agreement (PSA) drafting and negotiation, and advice on farming into existing petroleum projects.
  • A major German electric power company on a broad range of Kazakhstan electric power laws and regulations in preparation for its anticipated investment and development of a greenfield coal fire power plant in Kazakhstan, developing a comprehensive understanding of all major aspects of Kazakhstan’s electric power system and regulatory framework, and preparing a report for the client.
  • A major U.S. energy company on Kazakhstan’s renewable energy legal regime in the context of the proposed development of a wind power project in Kazakhstan.
  • Tengizchevroil, Karachaganak and North Caspian Operating Company on developing detailed proposals to the Ministry of Environmental Protection (MEP) for reforming the Environmental Code and other laws and regulations, including working group meetings with the MEP and other governmental bodies.
  • A consortium on the drafting, negotiating and executing of a term sheet for a joint venture to develop a cascade of hydropower plants in Georgia.
  • A consortium on the establishment of a joint venture to develop the Namakhvani Cascade of hydropower plants, including the drafting, negotiating and executing of the shareholders agreement and drafting and negotiating the implementation agreement with the government of Georgia.

Corporate/M&A and Joint Ventures

  • Betsson AB in connection with the acquisition of a Georgian gaming company, including providing a comprehensive overview of gaming regulations in Georgia; carrying out due diligence, providing advice regarding corporate structuring, advising and representing in negotiations with the target companies, and providing day-to-day corporate advice.
  • Boeing on various matters, including on its US$60 million joint venture with Open Joint Stock Company “Corporation VSMPO-Avisma”, the world’s largest titanium producer, to machine titanium forgings manufactured by VSMPO for Boeing or Boeing’s subcontractors located in Verkhnyaya Salda, Sverdlovsk Oblast, Russia for use in the Boeing 787 Dreamliner; and on its acquisition of the C-MAP group of companies and reorganization of Russian entities in connection with the acquisition. C-MAP, a provider of digital maritime cartography, data services, and other navigational information.
  • A consortium, including the state-backed Russian Direct Investment Fund (RDIF), on the US$625 million private equity acquisition from Inter RAO UES of 26.4% of Enel OGK-5, at closing the largest private equity investment into Russia with Middle Eastern participation.
  • Daimler on its US$250 million acquisition of a 10% stake in Russian truck maker KAMAZ, involving a rapid, comprehensive due diligence of approximately 150 companies in the CIS.
  • Deutsche Bahn (German Railways) on the establishment of a joint venture in Russia, Eurasia Rail Logistics, with Polish Railways, Belarussian Railways and Russian Railways.
  • Georgian Co-Investment Fund on the purchase of a 50 MW brownfield hydropower plant project, including full legal due diligence including review of the implementation agreement, electricity transmission agreement and power purchase agreement, as well as assisting with drafting and negotiating an Owner’s Engineer Agreement in relation to the Mtkvari Hydroelectric Power Plant Project.
  • Golden Telecom on its US$4.2 billion acquisition by VimpelCom, the largest acquisition by a U.S. publicly listed Russian company of a U.S. public company.
  • Kinross Gold Corporation on more than US$4 billion in acquisitions in Russia, including the first approved purchase of a 100% interest in a strategic subsoil company in Russia by a foreign company under the Strategic Sectors Law.
  • PepsiCo on its US$3.8 billion acquisition of 66% of Wimm-Bill-Dann Foods, including complex merger clearance advice and assistance in securing approval for the transaction from the Russian Federal Government Commission for Control over Foreign Investment in Russia; also on its US$1.4 billion joint acquisition of 75.5% of Russia’s leading branded juice company, Lebedyansky.

Antitrust/Competition

  • The Government of the Russian Federation on modifications needed to Russian law to establish independent power plants and enable the sale of privately produced electricity in Russia, as part of the restructuring of RAO UES, Russia’s former state electricity monopoly (co-advising with PricewaterhouseCoopers).
  • The Russian Ministry of Fuel and Energy on numerous legal issues relating to the conclusion and implementation of PSAs with major foreign oil companies.
  • Bayer on competition law issues regarding distribution of its products in Russia.
  • Boeing on its acquisition of the C-MAP group of companies and reorganization of its Russian entities in connection with the acquisition, including related FAS filings.
  • General Motors on its joint venture with AvtoVAZ and EBRD, as well on antimonopoly issues in connection with an investigation by FAS into the joint venture agreement.
  • The Kellogg Company on competition aspects of its US$2.7 billion acquisition of the Pringles Snacks business from Proctor & Gamble.

Banking and Finance

  • BNP Paribas on a borrowing base facility for MND Exploration and Production Limited, which owns production through its share of the Sawan gas field in Pakistan and several exploration licenses in Romania, Yemen, Pakistan and Morocco.
  • BXR Group’s subsidiary New World Resources N.V. on various matters, including its £1.3 billion initial public offering and listing of its ordinary shares on the London, Prague and Warsaw Stock Exchanges, the first triple listing on these three exchanges; €300 million offering of 7.375% senior unsecured notes due 2015; €500 million of 7.875% senior secured notes due 2018; and €141 million, nine-year export credit-backed loan to purchase digging equipment.
  • International Finance Corporation (IFC) on its US$150 million loan to finance a portion of OAO Lukoil’s costs associated with Phase II development of the Karachaganak oil and gas field in Kazakhstan, one of the world’s largest oil and gas fields.
  • Chevron on the project financing of a multibillion-dollar expansion program at Tengiz, the largest producing oil field in Kazakhstan.
  • European Bank for Reconstruction and Development (EBRD) on a €255 million loan to the Kazakhstan Electric Grid Operating Company (KEGOC) to finance the second phase of the modernization of KEGOC’s substations and high-voltage equipment.

Capital Markets

  • Barclays, HSBC and a multinational banking and financial services company on the issuance of US$300 million 6.95% Notes due 2042 by Kazakhstan Temir Zholy Finance B.V. (guaranteed by JSC National Company Kazakhstan Temir Zholy, JSC Kaztermirtrans and JSC Lokomotiv).
  • JSC Development Bank of Kazakhstan on an intermediated exchange offer for an aggregate principal amount of US$500 million of its US$777 million 5.50% Notes due 2015; in the update of its US$2 billion Medium Term Note Program; and the issuance of US$1 billion 4.125% Notes due 2022. This is believed to be the world’s first ever successfully completed 144A intermediated exchange offer.
  • JSC KazAgro National Management Holding on the establishment of its US$2 billion Debt Issuance Program and the issuance and listing on the Irish Stock Exchange of US$1 billion 4.625% Notes due 2023 thereunder, with a multinational banking and financial services company and HSBC acting as joint lead managers.
  • Georgia (acting through the Ministry of Finance) on the issuance of US$500 million 6.875% Notes due 2021 and the simultaneous completion of a cash tender offer by Georgia in respect of all or any of its outstanding US$500 million 7.50% Notes due 2013.
  • Georgian Railway LLC on its issuance of US$250 million 9.875% Notes due 2015; the transaction marked the first ever international debt offering by Georgian Railway LLC.

General Corporate and Commercial

  • An affiliate of the Russian state-owned gas company Gazprom on structuring and negotiating (with Total and Statoil) the planned multi-phased, multibillion dollar Shtokman Project, including upstream development and production of the Shtokman licensed natural gas fields, Shtokman liquefaction facilities, LNG transportation and downstream operations relating to marketing and sale of LNG, obtaining regasification capacity at LNG receiving terminals in North America and marketing and sale of natural gas.
  • Boeing on sales of Boeing aircraft to Aeroflot, as well as on various, separate general matters relating to its operations in Russia, including aviation equipment licensing issues, aspects of the Russian customs regime affecting spare parts for aircraft, issues relating to its design and engineering center in Moscow, and certain anticorruption (FCPA), labor, and other Russian law matters relating to Boeing’s operations in Moscow and St. Petersburg.
  • Federal Express on numerous regulatory and administrative matters in relation to the Federal Aviation Service of Russia, including on Russian and international regulations relating to FedEx aircraft passing through or near Russian airspace, and on the application of international treaties to which both Russia and the U.S. were party (these issues required extensive liaison with government officials).
  • A global tobacco company on a major distribution agreement with the largest distributor in Russia.
  • Porsche on the structuring of a contractual relationship with distributors, suppliers and service providers.
  • United Airports of Georgia on the renegotiation of the Build-Operate-Transfer agreement for Tbilisi International Airport with the Airport’s operator, TAV Georgia.

Litigation and Arbitration

  • A major construction contractor in several multimillion-dollar disputes with developers, a large commercial bank, a landowner, and the Kazakhstan registration authority, securing invalidation of several pledge agreements; negotiated a favorable settlement agreement securing unhindered removal of construction equipment; negotiated several favorable settlement agreements as a part of enforcement proceedings; appeared before several courts, including the Kazakhstan Supreme Court; and advised on enforcement issues.
  • A major U.S. oil company in litigation with the Republic of Kazakhstan over an environmental pollution lawsuit (in the first instance for US$70 million; in the second instance for over US$400 million) brought in Kazakhstan courts, advising the client on its position under a subsoil contract and joint venture agreement with the Republic of Kazakhstan, and under Kazakhstan law and international law, in preparation for bringing the case to international arbitration, and in devising settlement arrangements.
  • A NYSE-listed oilfield services company in a tax dispute with the Kazakhstan tax authorities over tax assessments and tax penalties related to exclusion from deductible expenses of local expenses incurred by the Kazakhstan branch; and in a further dispute related to exclusion from deductions of general and administrative expenses of the head office.
  • The Government of Georgia on the annulment proceedings and revision proceedings before the International Centre for Settlement of Investment Disputes (ICSID) in respect of an award against Georgia relating to a joint venture agreement and a related concession to develop oil and gas transportation systems in Georgia, and the successful settlement of this matter.
Energy and Natural Resources

Dechert’s CIS and Georgia practice is recognized as a leading advisor on energy and natural resources matters. We advise domestic and international clients in a broad range of sectors, including oil, gas, liquefied natural gas (LNG), power generation, nuclear energy and the rapidly developing renewable energy sector. We handle all stages of a project, from the initial stages of acquisition, title examination, permitting and exploration and feasibility analyses to site development, financing, management, operation and marketing.

Our lawyers also assist producers, financial institutions, contractors and other related parties on corporate transactions, financings, restructurings, permitting and other aspects of their upstream, midstream and downstream operations. We draft and negotiate industry-specific agreements relating to subsoil exploitation and handle all related commercial and regulatory issues, including environmental issues.

Mining and Metals

Dechert’s CIS and Georgia team handles mining and metals matters, with sector experience including aluminum, coal, copper, diamonds, gold, iron ore, nickel, palladium, platinum, silver, steel and uranium. We have extensive experience advising producers, financial institutions, contractors and other related parties on all aspects of mining operations.

Our lawyers assist clients engaged in all aspects of post- extraction processing and manufacturing as well as with commodities trading, and for nearly two decades we have handled corporate, regulatory and commercial matters for one of the largest foreign mining companies operating in Russia.

Corporate/M&A

Recognized as a leading advisor for corporate/M&A both regionally and globally, Dechert handles transactions involving entities from small start-ups to multinational giants throughout the CIS and Georgia. Noted for our innovative cross-border and financing work in a variety of sectors, we advise national and multinational corporations, financial sponsors, regulated investment companies and investment banking firms on the entire range of corporate and general business law matters, including corporate structuring and complex commercial transactions.

Our lawyers advise joint ventures in various industries on structuring, establishing, reorganizing, unwinding and day-to-day operations. We work with the relevant governmental authorities in the context of corporate transactions as well as antimonopoly authorities in the United States and European Union, and our extensive experience includes the privatization of state companies and drafting of commercial laws for Kazakhstan.

Antitrust/Competition

As part of Dechert’s globally recognized antitrust/competition practice, our CIS and Georgia team advises clients on the full range of competition issues, including general competition advisory, merger clearance, competition compliance audits, cartel and other competition investigations, and competition disputes before the FAS. We also handle complex Strategic Sectors Law approvals and notifications; indeed, we were one of the first law firms to obtain such an approval on behalf of a client.

Banking and Finance

We serve domestic and foreign commercial and investment banks, multilateral financial institutions, export credit agencies, investment funds and corporations as arrangers and lenders, and multinational corporations and financial institutions as sponsors and borrowers. We assist with structuring private equity and venture capital investments, bilateral and syndicated bank loans, and all types of private and public debt and equity financings. We have particular experience with complex cross- border project and acquisition financings.

Financial Services and Investment Management

An integral part of Dechert’s top-ranked financial services group, the CIS and Georgia team advises on fund formation across the full range of asset classes, management company issues, regulatory and compliance matters, fund and management company transactional matters, commodities and derivatives law, and financial institutions regulation.

Our lawyers advise borrowers and lenders on finance transactions and assisting funds on local and international securities laws, asset management agreements, the establishment of foreign entities and the creation of global platforms to provide services to investors. We also advise funds on shareholder disputes and other matters regarding company operations, and assist with all corporate, regulatory, labor and tax issues arising from the acquisition or establishment of a corporate vehicle or other entity in the CIS and Georgia region.

Capital Markets and Securities Regulation

Corporate and sovereign issuers, underwriters, financial sponsors, investors and selling shareholders rely on us for the full range of equity, debt and hybrid securities offerings under both Rule 144A and Regulation S. Our lawyers are noted for handling some of the most innovative transactions by governments, banks and multinational corporations in emerging markets, including debut/first-of-a-kind issuances by issuers in the CIS and Georgia region, including a high-profile premium listing on the London Stock Exchange by a leading Georgian financial institution.

International Litigation, Arbitration and Dispute Resolution

Our lawyers have successfully guided clients through the complexities of litigation at all levels of the domestic court system throughout the CIS and Georgia region. We also have extensive experience litigating against administrative authorities in Russia and Kazakhstan. Our team won the first tobacco consumer lawsuit in Central Asia and one of the first major arbitrations in Kazakhstan.

We are experienced in resolving issues by negotiation, mediation, adjudication and arbitration under various ad hoc and institution rules, including:

  • The London Court of International Arbitration (LCIA).
  • The International Chamber of Commerce (ICC).
  • The International Centre for Settlement of Investment Disputes (ICSID).
  • The International Commercial Arbitration Court (ICAC) (MKAS).
  • The United Nations Commission on International Trade Law (UNCITRAL).

We can approach contentious issues from all sides, having represented parties ranging from stand-alone companies to multinational business corporations and governments.

International Sanctions, Compliance and Anti-Corruption

The risks associated with economic sanctions represent a major compliance challenge for companies worldwide. Working with Dechert’s international trade and government regulation team, our CIS and Georgia lawyers regularly advise clients on the jurisdictional reach of sanctions regulations. On export controls, we assist in developing internal procedures that are tailored to a company’s structure, resources, exposure to export-related risks and commercial objectives. We also conduct due diligence regarding third party partners and acquisition targets.

With corporate criminal and regulatory enforcement actions on the rise, corporations face heightened requirements for corporate compliance programs. We have advised numerous domestic and multinational companies in the region on anti-corruption matters, and Dechert is recognized among the top advisors on the U.S. Foreign Corrupt Practices Act and the UK Bribery Act.

Real Estate

Investors and real estate developers, joint ventures, limited liability companies and other investment vehicles rely on us to handle all relevant corporate, regulatory and tax issues involved in real estate transactions. We have acted in many transactions involving real estate firms and corporate entities with substantial real estate assets, effectively guiding them through the complexities of M&A transactions.

Our lawyers regularly conduct due diligence of target properties, represent clients in negotiations with other parties and governmental authorities, advise on structuring of transactions and draw up all necessary agreements and other legal documents.

Infrastructure and Project Finance

We advise on the development, financing, construction, operation and acquisition of a wide range of capital-intensive projects and facilities. We have significant experience developing and implementing complex, tax-efficient capital structures for all types of infrastructure and project finance transactions, including senior credit facilities, first lien/second lien financings, subordinated/mezzanine debt structured equity, workouts/restructurings and recapitalizations.

General Corporate and Commercial Matters

We provide general corporate and commercial advice to domestic and multinational companies on operations throughout the CIS and Georgia, including on establishing a local presence, receiving accreditation for a representative office, conducting board and shareholder meetings, and other corporate governance matters. Our lawyers also advise on the full range of commercial contracts from supply and distribution to sales and franchise agreements.

Intellectual Property

Developers, owners, licensors, licensees and buyers of IP rights rely on us for a comprehensive range of commercial advice and litigation services. We guide clients through IP issues involved in strategic alliances, collaborative developments, joint ventures, licenses, service agreements, and mergers and acquisitions.

Labor and Data Privacy

We advise multinational companies and individuals on the full spectrum of employment issues. Our lawyers handle employment contracts, guidelines for hiring and dismissal of staff, cross-border transfer of data, management services agreements, temporary employment and independent contractors’ agreements, compensation policies, expatriate packages and stock option programs, and employment disputes. We also prepare internal regulations and handle issues related to data privacy and internal investigations.

Food and Beverage

Dechert represents some of the world’s leading food and beverage companies in a wide range of areas, including corporate and securities transactions, antitrust and merger structuring and clearances, consumer fraud and product liability litigation, distribution and sales arrangements, and the full range of marketing, promotional, labeling and IP issues.

Life Sciences

Our CIS and Georgia team represents pharmaceutical, biotech and other life sciences clients on a wide range of commercial and regulatory matters, including distribution and sales contracts, competition matters, licensing and other IP issues and corporate matters. Our experience includes representing companies in disputes with commercial parties as well as the Russian government, advising on counterfeiting matters, and assisting leading pharmaceutical companies with clinical trial agreements with laboratories based in the region. We also advise on advertising, labeling and other regulatory matters.

Retail

We advise Russian and multinational clients on a wide spectrum of matters relating to the retail sector throughout the CIS and Georgia. Our lawyers have assisted with the establishment of subsidiaries, real estate issues, acquisition and sale of retail assets, banking and finance (including debt restructuring) and litigation, as well as customs issues and general corporate compliance. Our clients include major retailers, banks and private equity funds.

Technology, Media and Telecommunications

Dechert’s CIS and Georgia practice is recognized as a leading advisor on technology, media and telecommunications matters in the region. We handle a wide range of matters for domestic and international clients in the TMT sector, and regularly advise multinational companies on issues concerning establishing a presence and launching operations in special economic zones, including in Skolkovo and Free Industrial Zones in Georgia.