Contributing Lawyers


Cyndee Todgham Cherniak

United States

Susan Kohn Ross


Andrew Hudson

Risky Business to Invest in Russia

On August 26, 2008, Diane Francis of Canada's Financial Post wrote a great article "Investing in Russia?  Plan to Lose"  that should raise alarm bells for those investing in Russia.  The posting may be found at

I am reproducing large segments of the article because I agree with the concern and believe that companies should take such advice into consideration when doing business in Russia and similar hot spots.

Some of her key points include:

  • "Robert Amsterdam is an outspoken lawyer who defended Mikhail Khodorkovsky, the jailed oil oligarch in Russia who last week lost his bid for parole. Amsterdam (of Toronto law firm Amsterdam & Peroff ) warns that Canadian corporations, like Magna International or Petro-Canada, that do business in Russia or with Russian entities are endangering their shareholders by so doing."


  • [Diane Francis has previously written in] favour of a ban preventing Russians from owning Canadian entities or assets until Moscow demonstrates that foreigners are protected in its country.
  • "There is a confiscatory attitude, called corporate raiding, a willingness for the state to literally raid companies. Not only the state, but people who have connections to the state,"
  • In an interview yesterday, Amsterdam encouraged Ottawa to take a stand.

".... What we need to understand -- for Russia to take us seriously -- is we need to understand what our values are and insist that Russia abide by those. Values such as the rule of law," he said.

"My advice to businesses is that if you are there or want to be, you have to plan on expropriation, so you must structure a deal so that you have very little to lose. And if expropriation doesn't happen, you're happy. You cannot gamble because it's clear they [the Kremlin and their business friends] will change the deal on you the minute it interests them," he said.

"The problem is that Canadians in energy, mining or automotive sectors, which are considered strategic by the Kremlin, must be aware of the fact Igor Sechin, one of the top three or four people in Russia, has ordered that multinationals be subject to very strict tax enforcement," Amsterdam said.

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