A lawsuit currently being heard in the Moscow Arbitration Court could become one of the most significant economic consequences of the geopolitical conflict. The Russian side, represented by the Moscow Military Prosecutor's Office and JSC "Garnizon," is demanding compensation of over €47 million from the German defense giant Rheinmetall. The cause of the claims is the failure of a contract signed back in 2011, which Berlin terminated due to the start of the aggression against Ukraine.
Unrealized project in Mulino
The history of the conflict dates back to 2011, when the German conglomerate Rheinmetall and the Russian JSC "Oboronservice" signed a cooperation agreement. As part of this project, the construction of a combat training center for the Ground Forces in Mulino, near Nizhny Novgorod, was planned. The German side undertook to supply unique equipment and create one of the most modern training centers for the Russian armed forces.
However, plans were thwarted by the international reaction to the occupation of Crimea. In 2014, the German government took a hard line and immediately banned the export of defense technologies to Russia. The permit for Rheinmetall to participate in the construction in Mulino was revoked, and the project was halted.
Legal battle: from Switzerland to Moscow
Russian authorities have not given up attempts to recover funds spent on preparing for the implementation of the project. Previously, the Russian Ministry of Defense filed a lawsuit in a Swiss court, but they lost the case there — Swiss justice left Moscow's claims unsatisfied.
Now Russian authorities are trying to find justice in their own court. The case is being heard in closed session. The plaintiffs want to officially recognize the contract as terminated to justify financial claims. Nevertheless, experts are skeptical about the prospects of the case: even if the Moscow court rules in favor of the prosecutor's office, it will not be possible to collect the funds, as a Russian court decision will not be valid in Europe.
Countermeasures and new contracts
Against the backdrop of threats from the Russian Federation, the German army is not only maintaining its defense potential but increasing it. The Bundeswehr has ordered more than two thousand all-terrain trucks from Rheinmetall. The value of this contract is approximately one billion euros.
The company is also strengthening its position in the Black Sea region. Rheinmetall plans to acquire the Mangalia shipyard in Romania to expand marine production. Previously, the German conglomerate stated that they highly value the level of Ukrainian developments and admire the country's innovations.