Important agreement: Russia tightens conditions for investments in critical assets
Conditions for foreign investors, including from friendly countries, will be tightened in Russia, Izvestia found out. We are talking about assets that are sensitive to defense and security. Traditional property transactions that used to take place without prior approval will now require a petition to a special commission. Earlier, the president extended until the end of the year the ban on transactions with shares of foreigners from unfriendly countries in strategic companies of the Russian Federation, some banks and fuel and energy companies. What advantages the state can get from limiting foreign investments and how this will change the investment climate in Russia — in the Izvestia article.
How will the rules for foreign investors be tightened?
The authorities want to expand restrictions for foreigners to invest in Russian companies. This was reported to Izvestia by sources familiar with the discussion of this initiative. The editorial office also has materials for the meeting of the government commission on legislative activity, the authenticity of the document was confirmed by an interlocutor in the industry. The relevant initiative was supported by the government, a source in the Cabinet of Ministers told Izvestia.
It follows from the documents that the Federal Law "On the Procedure for Making Foreign Investments in Business Entities of Strategic Importance for ensuring national Defense and State Security" will be expanded to a wider range of transactions. They will need to be coordinated with the commissions appointed by the government, explained Alexey Begaev, a member of the Moscow branch of Delovaya Rossiya.
If the document is adopted, the purchase of state property by foreigners will take place through such commissions if it is used for strategic activities, for example, for the defense industry, mining or communications. Moreover, we are talking not only about large contracts with major strategically important companies, but also about any transactions with their property from state or municipal ownership, explained Rustam Bolshakov, lawyer at the law firm Korelsky, Ishchuk, Astafyev and Partners.
Since 2022, citizens of unfriendly countries have not been able to purchase land near the state border of the Russian Federation, in nature reserves and national parks, agricultural land, near defense infrastructure facilities and airports.
Also, according to the document, the acquisition of assets of companies working with mineral resources will be subject to approval. Even if these minerals do not have the status of federal significance, as it is currently fixed in the Federal Law. In other words, control will now extend not only to the largest deposits, said Rustam Bolshakov. Currently, companies in which foreigners control up to 25% can get access to subsurface areas of federal significance.
The third area that they want to restrict for foreigners is the purchase of assets of fishing companies if their income from fishing exceeds half of all revenue and the value of assets together with subsidiaries. This is more than 800 million rubles, said Vladimir Gruzdev, Chairman of the Board of the Russian Bar Association.
— The bill expands the existing rules for foreign investors. Now they will be applied not only to the purchase of shares in large companies, but also to other situations. In fact, the law is becoming stricter and covers more areas important to the country's security when foreigners purchase properties in them," Vladimir Gruzdev summed up.
The document does not specify which countries' residents will be affected by the innovations, so it is also about investors from friendly countries, said Yaroslav Kabakov, Director of Strategy at Finam IC.
Already, the law on foreign investment includes 51 items with more than 100 types of activities of strategic importance, said Alina Akhmetova, head of Corporate practice at Mitra National Law Company. For example, these are the defense industry, communications and IT systems, the chemical and pharmaceutical industries, navigation and the space industry.
Previously, the authorities had already restricted foreign investments in important sectors and territories. From March 14 of this year to January 1, 2028, foreigners from unfriendly countries were banned from state registration of real estate rights in the Donetsk and Lugansk People's Republics, Zaporizhia and Kherson regions. The exception is the availability of a special permit, which is approved by the government and issued if registration does not threaten the security of the country. Similarly, foreigners will need special permits for the new measures, Vladimir Gruzdev added.
Earlier this year, a case was considered on the possession by foreigners of assets of a strategically important facility without the permission of a government commission. The prosecutor's office filed a lawsuit in January 2025, stating that Domodedovo's structures were controlled by residents of foreign countries - Dmitry Kamenshchik (Turkey, UAE) and Valery Kogan (Israel). The Arbitration Court of the Moscow Region granted the claim of the Prosecutor General's Office and decided to convert the assets of DME Holding into state revenue.
In addition, in December 2023, Russian President Vladimir Putin extended until the end of 2025 the ban on transactions with shares of foreigners from unfriendly states in strategic companies of the Russian Federation, some banks and other enterprises, including in the fuel and energy sector.
Why do the authorities restrict foreign investment
The main purpose of the law on foreign investments, as explained by the Constitutional Court of the Russian Federation, is to limit the participation of foreign capital in strategic companies and prevent a foreign investor from obtaining rights to them without approval, said Alina Akhmetova from Mitra.
Yaroslav Kabakov is convinced that control is being strengthened to enhance national security and protect strategic resources. It is important for the state to reduce the vulnerability of the economy and eliminate indirect influence on the most important industries. Izvestia asked the Ministry of Finance and the Ministry of Economic Development why there was a request for such measures.
"For investors, this means expanding the list of transactions that require prior approval, increasing the timing of transactions and increasing legal uncertainty, especially when buying assets that could potentially be considered strategic," explained Yaroslav Kabakov.
The tightening is taking place in several directions, said Mikhail Gordienko, economist at Plekhanov Russian University of Economics. Any transactions that violate the law and give a foreigner control over a strategic company are considered invalid and have no legal effect. Through the court, it is possible to seize acquired shares, property and income from such transactions in favor of the state (taking into account security risks). In addition, strategic companies receive the right to recover losses and damage caused to property from a foreign investor.
The economic consequences of the measures are ambiguous, Finam clarified. In the short term, they can reduce the flow of foreign money into capital-intensive industries, increase the cost of borrowing and slow down the development of projects, as well as limit technological exchange and integration into international chains. Restrictions make transactions more difficult and expensive, alienating investors and slowing down project financing. Nevertheless, these changes are important for the country's independence.
Yaroslav Kabakov stressed that the investment climate in Russia is affected by both sanctions and the high share of the state in key sectors. The key interest rate also affects business opportunities to invest in development, as well as investor interest in the financial market, said Natalia Pyrieva, a leading analyst at Cifra Broker.
The situation can be improved through clear and fast approval procedures, protection of small investors, stable taxes and support for joint public-private projects that will attract technology and investment without losing control over strategic assets, Finam concluded.
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