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Article

Сложные проценты и судебные расходы

In its ruling, the Supreme Court answered the questions of whether interest can accrue under article 395 of the Russian Federation Civil Code on the annual interest recovered earlier under the same article (no, it cannot) and on the awarded costs (yes, it can) for a period between the pronouncement of the court order and actual payment. The article examines the Supreme Court’s arguments. Based on the annual interest ratio analysis under article 395 of the Civil Code, the indexation of court awards and the legal nature of litigation costs, the author argues that the Supreme Court’s conclusion allowing interest to be calculated de lege lata under article 395 on litigation costs, which are satisfied yet unpaid or not paid in due time, is not correct. It can be supported, however, from the constitutional perspective. The author shares the view that the article 395 interest accrued on the annual interest that was recovered earlier by the court under the said article due to untimely execution should be treated as compound interest.