A House of Commons foreign affairs committee has been investigating Russia’s UK activity and associated security risks, and highlighted the role of Linklaters in the flotation of energy firm En+ Group on the London Stock Exchange last November. Linklaters refused to appear before the committee to give further information on the regulatory framework which allowed the registration.
Russian deal questioned
The committee’s report “Moscow’s Gold: Russian Corruption in the UK” questions how the deal happened despite VTB Bank, a sanctioned Russian bank, holding a stake in En+.The report stated, ‘We regret their unwillingness to engage with our inquiry and must leave others to judge whether their work “at the forefront of financial, corporate and commercial developments in Russia” has left them so entwined in the corruption of the Kremlin and its supporters that they are no longer able to meet the standards expected of a UK regulated law firm.’ The report argued that ‘turning a blind eye to London’s role in hiding the proceeds of Kremlin-connected corruption risks signalling that the UK is not serious about confronting the full spectrum of President Putin’s offensive measures.’ A Linklaters statement expressed surprise and concern ‘at the passing criticism of Linklaters in the report. We reject any suggestion based solely on the fact that we, like dozens of other international firms, operate in a particular market that our services may somehow involve the firm in corruption, state-related or otherwise.’
Linklaters goes further east
The released of the report coincided with an announcement that Linklaters had received its long-awaited Shanghai approval as CMS launches Hong Kong association. The firm’s lawyers will be able to practise local law in the Shanghai Free Trade Zone (FTZ) through a joint operations agreement with local firm Zhao Sheng. FTZ rules allow international players to tie-up with domestic firms and practise local law. The two firms formed a ‘best friends’ alliance in April last year.