Julia Talagaeva commented to RBC on the workings of warranties and representations
The notion of “warranties and representations” has been borrowed from Anglo-American law and appeared in Russia when Article 431.2 of the Russian Civil Code entered into force in 2015. Julia Talagaeva, Senior Associate at Forte Tax & Law, told RBC how this new legal tool caught on in Russia and described the practical problems that arose from its use.
According to Julia, the notion of “warranties and representations” is not really well understood in practice so, even if the parties to a transaction are aware of certain risks, under the pressure of one of the parties, the other party provides written representations of the absence of such risks. “Such warranties and representations confer to the receiving party no guarantees of compensation of losses or receipt of penalties if the risks arise in practice” comments Julia.
To read the full version of RBC article, click here