FBK Legal at ‘Real Estate. Land. Construction’ Conference

Ekaterina Subbotina, Head of Practice at FBK Legal, has spoken at the ‘Real Estate. Land. Construction’ conference hosted by Legal Academy. 

During the Construction Contracts session, the experts discussed contractual obligations and risks of the investment and construction process parties, explored recent precedents and shared hands-on experience in structuring contractual provisions related to additional work in civil works contracts, as well as instruments to secure performance of obligations, and project risks for the parties.

Ekaterina Subbotina's presentation focused on allocation of the parties' rights to the constructed object under industrial construction contracts. Ekaterina elaborated on the development of legal concepts and judicial approaches to registration of initial ownership rights to a constructed facility for an investor that does not possess land title. She also shared on a legal advice case where the investor constructed a manufacturing facility on another entity's land plot, and spoke about the civil and tax risks that arose due to incorrect qualification of the signed investment agreement, and how the issue was resolved at minimum risk for both parties.

"In judicial practice, we have two different approaches to understanding investment relations – namely, the 'civil law' and 'tax' approaches," Ekaterina explained. “To ensure correct allocation of property rights as expected by the parties and to avoid tax risks, we need to take into account both of them, as well as to monitor further developments in ever changing laws."

Ekaterina also touched upon the contractor's tax risks arising from the failure to contractually outline terms of ownership for temporary facilities, and advised to address this issue at the contracting stage.