Bankruptcy of a Russian Agency Principal: Transactions, Funds and Claims

29.08.2026

Short answerBankruptcy of a Russian principal does not automatically make the agent liable for every underlying transaction. First identify whose name the agent used, who owns the money and property, when remuneration and expenses arose, and whether each claim is registered or current.

Agency model

Rights arise for the principal when the agent acts in its name; an agent acting in its own name becomes the transaction party.

Reports and accounts

Agency reports, objections, source documents and bank statements establish the balance.

Keep property separate

Goods, documents and funds must be identified before set-off, retention or a claim.

Liability to third parties

How the agent acted	Holder of rights and duties	Insolvency check
In the principal’s name and at its expense	The principal directly	Authority, power of attorney, performance and claim against the principal
In the agent’s own name at the principal’s expense	The agent	Underlying contract, internal account and ownership of receipts
Mixed model	Depends on each transaction	Separate the documents and money flows transaction by transaction

This distinction follows Article 1005 of the Russian Civil Code. Merely naming the principal in correspondence does not change the contracting party when the agent contracted in its own name.

Do not continue transferring money merely because the old agency agreement has not formally ended. Check the insolvency office-holder’s powers, payment purpose and counter-performance.

Does the agency agreement end?

Article 1010 does not make the principal’s bankruptcy a universal automatic termination event. Performance may nevertheless change because of insolvency restrictions, management powers and current-payment rules. Mandate or commission rules may supplement the agreement according to the model used.

Accounting matrix

Item	What to establish	Possible action
Agent remuneration	Period, accrual condition and accepted report	Separate registered and current parts
Expenses	Connection with the mandate and evidence	Claim only the documented amount
Principal funds held by agent	Purpose, segregation and retention basis	Transfer or litigate set-off/retention
Goods and documents	Owner, identification and location	Inventory and delivery demand
Third-party receipts	Party to the transaction and basis of payment	Do not merge with the internal agency debt

Agent action plan

Map every transaction

Collect the agency agreement, powers and underlying contracts.

Close the reporting period

Prepare reports, attachments, objections and delivery evidence.

Separate assets

List goods, documents and funds with their owner and possession basis.

Check the case

Identify the filing date, procedure, notices and office-holder.

Calculate claims

Separate remuneration, expenses, property return and monetary claims by period.

Frequently asked questions

Does the agreement always terminate?

No. Review the statute, agreement, agency model, procedure and office-holder decisions.

May the agent retain principal funds?

Only with a valid legal basis and subject to insolvency restrictions.

Who is liable to the buyer?

It depends on whose name the agent used for the underlying contract.

Are reports still needed?

Yes. Reports and source documents are usually central to quantifying performance and accounts.

Primary legal sources

Need to separate transactions, assets and accounts under a Russian agency agreement?

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