Freshfields drops Russian client as Norton Rose closes Moscow office

Magic circle firm Freshfields Bruckhaus Deringer is dropping a major Russian client in response to the invasion of Ukraine, as global firm Norton Rose Fulbright follows Linklaters in closing down its Moscow office.

Freshfields is ‘immediately taking steps to terminate our litigation mandate’ with VTB Bank, the firm said today – a matter of days after it told the High Court it would continue to act for the sanctioned lender, having reportedly obtained a ‘general licence’ from the government to receive legal fees.

‘This approach goes beyond what is required to comply with our legal, regulatory and professional obligations, and reflects our values as a firm and the wider responsibilities of the global business community,’ a Freshfields spokesperson said.

Meanwhile, Norton Rose Fulbright said: ‘We are winding down our operations in Russia and will be closing our Moscow office as quickly as we can, in compliance with our professional obligations. The wellbeing of our staff in the region is a priority.’

The firm also said it will not accept ‘any further instructions from businesses, entities or individuals connected with the current Russian regime, irrespective of whether they are sanctioned or not’, and will review ‘exiting from existing work for them where our professional obligations as lawyers allow’.

‘Where we cannot exit from current matters, we will donate the profits from that work to appropriate humanitarian and charitable causes,’ the firm added.

Norton Rose previously told its lawyers not to comment publicly on sanctions imposed on Russian individuals and businesses, but later clarified that its internal notice to staff ‘does not in any way prevent members of the firm from voicing any views that they may hold on the wider Ukraine invasion’.

The firm’s announcement today follows the decision by Linklaters on Friday night to close its office in Moscow, which opened in 1992, and ‘wind down’ all of its operations in Russia.

Several leading firms have responded to Russia’s ongoing invasion of Ukraine by announcing reviews of existing work and decisions to not take on any new clients with links to Russia.

CMS Cameron McKenna Nabarro Olswang said the future of its Moscow office is ‘under critical review’ while Osborne Clarke will not take on ‘new clients that are owned by Russian or Belarusian individuals, corporations or by their governments’.

Herbert Smith Freehills also said it will no long act for ‘certain of our Russian clients and on certain Russia-related work’ and Mishcon de Reya said it has ‘reviewed all existing mandates relating to Russia’, adding: ‘Some of our Russian are themselves the target of President Putin’s government.’

All four other members of the magic circle have also made public statements in response to the conflict, with Clifford Chance saying it will not accept new work from Russian state-controlled entities or individuals linked to Russian president Vladimir Putin.

Allen & Overy said last week that it is ‘reviewing our Russia-related portfolio’ and would refuse new instructions and stop all work ‘that goes against our values’, while Freshfields Bruckhaus Deringer said various client arrangements had been ‘terminated, suspended or declined’.

Slaughter and May said it will ‘continue to review our position to ensure we comply fully with sanctions applied to Russian entities and individuals’, and major firms including Eversheds Sutherland, White & Case and Baker McKenzie have also said they are reviewing client relationships.