Supreme Court to Settle Rusal's Dispute with SUAL Shareholder Over Applicable Law

Russia's Supreme Court is set to examine a dispute between aluminum company Rusal and one of its shareholders, SUAL. At the heart of the case is the question of which corporate regulations should apply to Rusal after its redomiciliation to Russia, given that the company's shares continue to trade on a foreign exchange.

The Nature of the Conflict

As reported by Kommersant, the dispute arose because Rusal, which changed its jurisdiction and relocated to Russia, remains a public company whose shares trade on the Hong Kong Stock Exchange. This creates a legal conflict: the listing and corporate governance rules of the Hong Kong exchange may not align with the requirements of Russian legislation applicable to redomiciled companies.

SUAL, acting as one of Rusal's shareholders, insists on the application of a certain set of rules, while the company's own position, based on case materials, may differ. The specific details of the parties' claims have not yet been disclosed.

Why This Matters

The Supreme Court's ruling could set a precedent for other Russian companies that have undergone redomiciliation but retained their listing on foreign exchanges. For such issuers, it remains unclear which jurisdiction's rules—the country of registration or the country of listing—should take priority in matters of corporate governance and shareholder rights.

The exact date of the Supreme Court hearing has not yet been announced. Kommersant notes that the outcome of the proceedings will be closely watched by market participants affected by similar jurisdictional conflicts.