In recent years political and economic unpredictability have steered the Russian legal market through periods of significant uncertainty, but despite this, demand is once again rising for lawyers with experience in common law legal systems.
Prior to Russia’s financial crisis, the exchange rate sat at approximately US $1 to ₽35 but following the currency’s collapse rates fell to around ₽100, slumping to ₽80 in January 2016. The nation’s economic troubles - which have been widely attributed to two factors: the drastic fall in oil prices during the global supply glut, and the stringent international sanctions placed on Russia following its annexation of Crimea and military invention in Ukraine - initially had an adverse effect on the legal profession.
In the period before the sanctions implemented by the EU and US, international firms played a significant role in facilitating major corporate deals involving Russian entities, however the widespread sanctions prevent these practices from interacting with a significant number of Russian businesses. The lack of foreign investment following the financial crisis and restrictions imposed by the sanctions led to a drop in volume of work for international firms and a significant number of international professionals returned to the UK and US.
Though the majority of international law firms operating in Russia were forced to implement pay cuts across the board (including at a partner level), legal professionals working in international private practices were not hit nearly as hard as those working across the rest of the legal sector. In Russia international practices set professionals’ pay on a Dollar/Euro/Pound scale, and lawyers are subsequently paid in rubles at the current exchange rate (or as stipulated by the firm). So while pay for lawyers working in-house and in Russian practices fell significantly as the ruble collapsed, those at international firms were protected by the continued strength of the foreign currency.
Following years of economic uncertainty, the Russian legal sector is now once again experiencing a significant skills shortage and demand for lawyers qualified in countries with common law legal systems, which has risen considerably over the course of the first half of the year. Though sanctions are unlikely to be removed any time in the foreseeable future, the volume of work within major international firms provided by multinational businesses still remains stable. Moscow’s legal sector has proved its resilience and looks set to improve, potentially providing compelling new opportunities for professionals looking for international experience.