Volkswagen to go bankrupt: Moscow court initiates proceedings against Russian assets of German auto concern

The Moscow Arbitration Court launched local bankruptcy proceedings against the German auto concern Volkswagen AG on September 12. The decision satisfies the application of AO "Kameya", which acquired the rights to claim against VW after the termination of the agreement on contract assembly of Skoda and VW cars with the GAZ automobile plant (now NAZ). The total amount of debt recovered from the German company is 16.9 billion rubles and €40.05 thousand.

The bankruptcy procedure applies only to Volkswagen's Russian assets. The bankruptcy trustee must identify the auto concern's property in the Russian Federation, include it in the bankruptcy estate and organize a sale at auction to settle with creditors. If necessary, the trustee will be able to challenge the company's pre-bankruptcy transactions.

Volkswagen disputed the competence of the Russian court and claimed that it did not have significant assets in the Russian Federation, and its share in the Russian market before 2022 did not exceed 2%. The company noted that the activity in Russia was carried out by LLC "Volkswagen Group Rus", the share in which was alienated, and there was no "treacherous departure" from the market.

AO "Kameya" insisted on the introduction of the procedure, referring to the remaining property of Volkswagen in Russia, including trademarks, patents and indirect control over shares in the structures of MAN and Porsche. Representatives of the creditor also pointed to the impossibility of recovering assets abroad due to EU sanctions.

The court rejected all of VW's motions, and local bankruptcy proceedings were scheduled for six months. The decision can be appealed, but for now, the bankruptcy trustee will begin to form the bankruptcy estate and prepare it for sale to pay off the debt.