English court ruling highlights subsidiary control risks and limits of foreign confidentiality objections

Russian oligarch Vladimir Potanin, president and general director of minerals and smelting company Norilsk Nickel, was told by the High Court in London to provide documents held by the company and 11 named subsidiaries, in the latest round of a long-running dispute with aluminium firm Rusal.

Rusal sought disclosure of documents from Potanin – as effective CEO of the company – ahead of a forthcoming 14-week trial, starting in April 2027

The judgment illustrates that there is nuance to the usual rule that one group company does not automatically have access to documents held by another group entity, with the High Court finding that Potanin did have control of documents held by the 11 subsidiaries because of the operational realities of the Norilsk group.

The court found in essence that that Potanin exercised CEO‑level oversight over both Norilsk Nickel and its subsidiaries – described in the judgment as an “integrated business” - supported by, for example, internal audit functions which reported to him. It also found that Norilsk and the subsidiaries operated a shared document management system, which gave Potanin’s staff practical access to subsidiary documents.

Evidence showed that numerous subsidiary documents were already accessible to Norilsk staff, with the company previously providing such materials in response to shareholder requests.

These factors when taken together meant Potanin had “practical control” over subsidiary documents, even though the entities were legally separate. As a result, the court ordered disclosure by Potanin of documents held by the named subsidiaries and by Norilsk itself, although a wider “catch‑all” request covering additional subsidiaries was removed.

Potanin must now carry out a reasonable search for relevant disclosable documents and provide a witness statement explaining the steps taken, although he may still contend that there are specific categories of documents over which he lacks control and therefore exclude those from his disclosure. He would need to justify any such contention.

Emilie Jones, a litigation expert with Pinsent Masons, said the ruling showed that leadership of a company group cannot necessarily separate themselves from information within businesses forming part of that group, when it comes to disclosure in litigation in England and Wales.

“The decision highlights that senior executives who direct and oversee what is essentially a unified group may not be able to distance themselves from information generated within that structure,” she explained.
“The court here placed emphasis on the operational realities of the group, concluding that the nature of the business, its management structures, past practices and shared systems together meant the CEO had practical control of documents across the relevant subsidiaries.”

Caroline Hearn, a litigation and e-disclosure expert with Pinsent Masons, added: “The court confirmed that where a chief executive holds a legally enforceable right of access to company documents, those documents fall within their ‘control’ for English disclosure purposes.

“It further emphasised that, in a closely integrated corporate group, the practical ability to obtain subsidiary materials may be sufficient to establish control, irrespective of separate corporate personality. International businesses which resolve their disputes in the courts of England and Wales should be aware of the potential impact of these principles on the scope of the disclosure exercise they may need to undertake and seek early specialist advice on this.”

Jones added, however, that determining the question of practical control over a subsidiary’s documents can be complex.

“As this judgment shows, the court will look in detail at how the corporate group operates and any arrangements about documents in place,” she said.

“Where foreign entities are involved, as here, this will generally involve expert evidence on foreign laws relevant to corporate governance and confidentiality, for example.

“In addition, a finding that some documents within other members of a corporate group are within the control of a senior executive or parent company does not necessarily mean that the same is true of all documents. A granular assessment is often necessary.”

Potanin had argued that Russian laws on trade secrets, personal data and counter‑sanctions created a risk of regulatory or criminal exposure if certain documents were disclosed. The High Court acknowledged that these were areas where disclosure could, in principle, carry risks.

However, the court held that broad assertions of potential liability under such laws were insufficient to resist disclosure on this basis. Potanin had not provided any specific examples of documents that might trigger exposure or shown a real and concrete risk of prosecution.

The court emphasised that general assertions of risk are not enough and, without tangible evidence, foreign confidentiality regimes do not override English disclosure obligations.

This means parties which are looking to resist disclosure on grounds of foreign confidentiality laws must identify the actual documents or categories that pose risks, and must establish a real risk of sanctions being imposed, supported by evidence. The court also noted that that any legitimate sensitivities may well be capable of being addressed through protections such as confidentiality rings.

Richard Dickman, a commercial dispute resolution expert with Pinsent Masons, said the ruling demonstrated that restrictions on disclosure overseas do not necessarily supersede obligations in English proceedings.

“Like a number of other decisions in recent times, the judgment makes clear that the existence of foreign confidentiality regimes does not, in itself, displace the obligation to give disclosure in English proceedings,” he said.

“Without evidence of a real and concrete risk of enforcement action abroad, the court will not accept broad assertions of potential liability as a basis for withholding documents relevant to the fair resolution of the dispute.”