1 signed distribution agreement (PromVet LLC / "Vet Zoo"). HIGHEST sanctions exposure in the portfolio. Distributor banks via Alfa-Bank (OFAC SDN since 24 Feb 2024). Action: pause USD shipments today.
Country profile extract from country notes
Russia — regulatory context
Vet drug authority
Rosselkhoznadzor under Ministry of Agriculture. Vet pharmaceuticals registered under EAEU Regulation 2016/429; state registration via GRAC portal (1-2 years).
Commercial agency law
Russian Civil Code Chapter 52 (agency) and Chapter 51 (supply / distribution). Goodwill compensation possible if exclusive / long-term but court-disputed. No mandatory registration; notarization optional.
FX rules
Federal Law 173-FZ + Central Bank of Russia. Repatriation quota 80-90% of export proceeds (tightened post-sanctions 2026). Type C accounts available for vets.
Multi-distributor permissibility
CONDITIONAL Russian Civil Code Chs 51-52 contemplate exclusive distribution with goodwill compensation possible if exclusive / long-term (court-disputed). Appointing a second distributor for the same product may breach the first's exclusivity if explicitly contracted; non-exclusive multi-distributor freely permitted. Note: APC Art. 248.1 grants mandatory exclusive Russian jurisdiction for disputes involving sanctioned Russian parties.
Voidance risks (what makes a contract unenforceable here)
Language law (CRITICAL): Russian mandatory for state-court use; foreign-language contracts must be translated and notarized for enforcement.
APC Art. 248.1 (CRITICAL): Mandatory exclusive Russian jurisdiction for disputes involving sanctioned Russian parties — overrides foreign arbitration clauses. Russian courts can hear claims even if SIAC was chosen.
FX controls (FL 173-FZ): 80-90% repatriation quota of export proceeds (tightened 2026). Non-compliance voids payment terms.
Sanctions overlay: EU 833/2014 + 20th package — vet pharma NOT in humanitarian carve-out (human-use only); any EU touchpoint voids/blocks contract performance.
OFAC GL 47 / 50%-Russian-content rule: Even non-SDN counterparty becomes blocked if 50% owned by SDN entity — flips contract to unenforceable for US-touchpoint payers.
Formalities: Russia is Hague Apostille member (legacy USSR accession).
Counterparty-court hostility (NEW): Russian courts have invalidated foreign arbitration awards under public-policy grounds in sanctions-related disputes since 2022.
Sanctions exposure
CRITICAL EU 20th sanctions package adopted April 2026 extends bans (Annexes IV / VII / XXIII) to pharma glassware and pharma exports; adds 60 entities and third-country (e.g., Kyrgyzstan) bypass measures. No specific vet pharma carve-out under EU sanctions. OFAC GL 47 oil-focused, not extended to pharma. FATF Russia grey-list — high AML scrutiny.
JAPFA recommendation
Russia is HIGH-RISK. Per-shipment legal review by US + EU sanctions counsel. Use side-letters with sanctions exit clauses, not blanket distribution agreements.
Signed contracts in this country
OOO ПромВет / PromVet LLC — "Vet Zoo"
Counterparty
OOO ПромВет / PromVet LLC — INN 9728035519
Counterparty bank
ALFA-BANK JSC, Moscow — OFAC SDN since 24 Feb 2024 (E.O. 14024) + EU consolidated sanctions list
Distributor banks via Alfa-Bank (OFAC SDN since 24 Feb 2024) — 14 months of USD touchpoint exposure.
One-way sanctions exit (Company-side only) — JAPFA cannot terminate when counterparty / bank goes SDN.
EU 833/2014 vet pharma NOT exempt under medical humanitarian carve-out (human-use only).
Estimated commercial scale
3-year volume estimate: USD 165M+.
Authorized Products (current LOA)
Schedule A of the bilingual EN/RU Distribution Agreement covers Vaksimune full-portfolio export to PromVet for redistribution in Russia + Belarus + Armenia + Kyrgyzstan.
#
Product
Strain
Dose
1
Vaksimune NDLS
ND Lasota
1000 ds
2
Vaksimune ND Clone
ND Clone
1000 ds
3
Vaksimune ND Clone IB
ND Clone + IB
1000 ds
4
Vaksimune IB
IB Mass
1000 ds
5
Vaksimune IBD M+
IBD intermediate-plus
1000 ds
6
Vaksimune Coryza LE
Coryza multi-strain
1000 ds
7
Vaksimune ND L Inaktif
ND inactivated
1000 ds
8
Vaksimune AI Multi (H5+H9)
AI multivalent
1000 ds
9
Vaksimune NDL Multi IBPlus
ND-L + IB combination
1000 ds
Exhibit B (Brands) BLANK in signed contract — trademark license voidable for indeterminacy. Sanctions exposure means JAPFA should pause USD-denominated shipments until Alfa-Bank route is replaced.
Country watch items from state file
HIGHEST SANCTIONS EXPOSURE
Severity: CRITICAL.
No sanctions exit, USD invoicing into Moscow LLC under EU 833/2014 + OFAC. EAEU territory drift (Belarus + Armenia + Kyrgyzstan included). Exhibit B (Brands) BLANK — trademark license is voidable for indeterminacy. Deep review completed.
Clause 15.2 of the Vet Zoo contract names TEHNOKAZ-ELIMP, BIN 990340009573 as Kazakhstan distributor.
JAPFA has a separate signed Kazakhstan agreement with LLP Technokaz ELMI (different BIN). Reconcile both to avoid territorial overlap or counterparty conflict. See Kazakhstan file.
Suggested actions ranked by urgency
Day 0 / Immediate (TODAY)
Pause all USD-denominated shipments and receivables to/from PromVet. Owner: Finance + Treasury.
Catalog all Alfa-Bank transactions from 26 March 2025 onwards. Every payment touched OFAC primary jurisdiction. Owner: Finance.