Recognition of Shares as Jointly Acquired Spouse Property and the Division of Shares

According to Article 10 Part 1 of FZ “On investment funds,” a mutual investment fund (MIF) is: a conditional asset complex consisting of property transferred into the trust management of a management company by the founder(s) of the trust under the condition of unifying that property with the property of other founders of the trust and their property obtained over the process of such management, the share in the ownership rights to which is certified by securities issued by the management company.

In other words, an MIF is a collective investment tool. The investors invest the money or the property they have into a mutual fund which uses those common assets to purchase the assets set out in its strategy – shares, bonds, real estate, and other assets. The mutual property fund is divided up proportionally by the share assets invested, each of which certifying the investor's right to ownership of part of the fund's property.

It is indicated in the Family Code of the Russian Federation that securities, stocks, and investments invested into credit organizations or other commercial organizations acquired using the incomes of both spouses constitute the joint property of the spouses, as well as any other property acquired during the time of the spouses’ marriage, regardless of in which of the spouses’ names it was acquired or which of the spouses made the payment.

It follows that if the shares were acquired by the spouses during the period of the marriage, they are recognized as property jointly acquired by the spouses and are subject to division between them.

Appeals ruling N33-28/2019 of Stavropolsky Krai Court on 2/13/2019 indicated the following:

“As it follows from the reply to request N 0996/18 of ‘Sberbank Asset Management,’ JSC on 11/26/2019, R. A. VA. during the period of between 7/2/2015 to 1/19/2019, shares of OEMF RFI “Sberbank Biotechnologies” , shares of OEMF RFI “Sberbank Consumer Sector,” and shares of OEMF RFI “Sberbank Global Internet” were acquired.

As far as the funds entered into the shares investment fund were jointly acquired property and existed at the moment that family relations were terminated, the funds that arrived on the bank account on 8/29/2018 and 8/31/2018 as payment for the investment shares are subject to division between the spouses.”

In order for the court to implement division of funds entered into a mutual investment fund, the following must be proven:

• that the funds were invested during the time of the marriage and at the expense of the spouses’ joint property;
• that the invested funds were on the accounts of the mutual funds at the moment that the divorce was filed.

In satisfying the requirements to divide up funds invested into a mutual investment fund, courts attribute to each spouse a 1/2 right to the share of the funds on the bank accounts in mutual investment funds as of the date the divorce is filed.