The Immovables Rule

In November 2024, the UK Supreme Court handed down a judgment that would reverberate through the worlds of international finance and cross-border insolvency. The case, Kireeva v Bedzhamov [2024] UKSC 39, reaffirmed an ancient legal principle known as the "Immovables Rule"—a doctrine that prevents foreign bankruptcy trustees from seizing real estate located in England and Wales, regardless of court orders issued abroad.

What began as an obscure point of property law has transformed into a procedural barrier protecting billions of pounds in allegedly ill-gotten wealth. Within weeks of the Supreme Court's decision, lawyers for Saudi businessman Maan Al-Sanea—facing fraud allegations estimated between $10-16 billion (approximately £8-13 billion)—cited the Bedzhamov precedent in attempts to create expensive obstacles to recovery of 19 Mayfair properties.

The Immovables Rule creates a legal landscape where wealthy defendants can afford to navigate complex procedural barriers while victims cannot afford to pursue recovery through alternative routes. This investigation examines how an 18th-century property law principle functions as a modern shield for alleged financial crimes.

What is the Immovables Rule?

The Immovables Rule is a principle of English common law dating back centuries. It establishes that:

1. Land situated in England and Wales is governed exclusively by English law (the lex situs principle)
2. Foreign courts have no jurisdiction to make orders concerning English real estate
3. Foreign insolvency officeholders cannot claim immovable property located in England, even if appointed by a recognized foreign court

The rule exists in many common law jurisdictions and was originally designed to provide certainty in property transactions. If you buy land in England, you need only concern yourself with English law—not the laws of every country where a property owner might face legal proceedings.

But in an era of globalized wealth and cross-border financial crime, this centuries-old principle has created an unintended consequence: London has become a safe harbor for assets tied to alleged corruption and fraud.

The Bedzhamov Case: Setting a Dangerous Precedent

The Background

Georgy Bedzhamov, a Russian businessman and former banker, was declared bankrupt by a Moscow court in 2018. Russian authorities accused him of embezzling approximately £1.3 billion from Vneshprombank, a bank that collapsed in 2016.

By the time of his bankruptcy, Bedzhamov had relocated to England, where he owned a substantial property portfolio—including a £35 million mansion in London's exclusive Belgrave Square. The Russian-appointed bankruptcy trustee, Lyubov Kireeva, sought assistance from English courts to seize the London property and distribute its value to creditors.

The Supreme Court Decision

The case worked its way through the English court system, finally reaching the Supreme Court in 2024. On 20 November 2024, the Court unanimously ruled against the Russian trustee, holding that:

• The Immovables Rule prevented English courts from assisting foreign insolvency officeholders in realizing immovable property in England
• This applied even where the foreign officeholder's appointment had been recognized at common law
• There was no common law exception to the rule for cross-border insolvency cases
• The principle of "modified universalism" (which encourages cooperation in cross-border insolvency) was subordinate to the Immovables Rule

In plain English: Bedzhamov's London mansion was untouchable.

Lord Lloyd-Jones and Lord Richards, delivering the judgment (with whom Lord Reed, Lord Briggs and Lady Rose agreed), acknowledged the rule might seem outdated but emphasized that any change must come from Parliament, not the courts. The judgment made clear that the Immovables Rule remains firmly established in English law, and reform—if needed—is a matter for legislative action rather than judicial innovation.

The Al-Sanea Connection: From Precedent to Protection

Who is Maan Al-Sanea?

Maan Al-Sanea is a Saudi businessman whose Saad Group collapsed in 2009 amid allegations of fraud estimated between $10-16 billion (approximately £8-13 billion at 2009 exchange rates)—one of the largest corporate failures in Middle Eastern history. Initial claims by Ahmad Hamad Algosaibi & Brothers (AHAB) alleged $10 billion in fraud, while EFG Hermes estimated total exposure at $16 billion. Saudi authorities placed him in liquidation, appointing trustees to recover assets for creditors.

By 2025, Al-Sanea controlled at least 19 properties in London's ultra-exclusive Mayfair district through offshore companies registered in Belize, St. Lucia, Seychelles, Nevis, and the British Virgin Islands—a textbook example of opaque corporate structures designed to obscure beneficial ownership.

Using Bedzhamov to Create Procedural Barriers

In February 2025, Al-Sanea's legal team appeared before the English High Court in Almeqham v Al-Sanea [2025] EWHC 322 (Ch), facing the Saudi-appointed liquidation trustee's attempts to gain control of the Mayfair properties.

Their key argument? The Bedzhamov precedent.

Al-Sanea's lawyers argued that:

• The 19 Mayfair properties were "immovables" under English law
• The Saudi trustee's powers did not extend to English real estate under the Immovables Rule
• The Supreme Court's November 2024 decision in Bedzhamov was binding precedent

The High Court struck out the "Trust Claim"—one legal theory advanced by the trustees based on their foreign insolvency powers. However, this was far from a complete victory for Al-Sanea:

• Section 423 claims allowed to proceed: The court explicitly ruled that claims under Section 423 of the Insolvency Act 1986 (which targets transactions intended to defraud creditors) should NOT be struck out and may continue
• Asset Preservation Order maintained: The court ordered that the APO (freezing the assets) "should continue"—meaning the properties remain frozen pending resolution
• The properties are NOT definitively protected: The Section 423 route remains viable for recovery

The practical effect: While the Trust Claim failed on technical grounds related to the trustees' standing without specific court relief, the more serious fraud-based claims (Section 423) remain alive. However, pursuing these alternative routes through prolonged High Court litigation requires substantial funding—creating barriers that wealthy defendants can afford to defend against while victims must sustain expensive proceedings.

The Procedural Weapon

Within just two months of the Bedzhamov judgment, lawyers representing one of the world's largest alleged fraud cases invoked the precedent, successfully striking out the Trust Claim while Section 423 fraud claims remain pending. This demonstrates how the Immovables Rule functions in practice:

Understanding Different Legal Categories: The Somovidis Case

The case of Dimitrios Somovidis is often cited as evidence of a double standard in applying the Immovables Rule. However, understanding why his case differs reveals how the rule operates—and why wealthy defendants benefit regardless of the technical legal distinctions.

Who is Dimitrios Somovidis?

Dimitrios Somovidis, a Greek businessman residing in England, was declared bankrupt by Russian courts. Serbian creditor Beograd Innovation Ltd sought to enforce a £14 million judgment against him, attempting to seize his English property to satisfy the debt.

Somovidis argued that his foreign bankruptcy proceedings should prevent this enforcement, citing the spirit of the Immovables Rule that had protected Bedzhamov.

Why His Case Was Different

In Beograd Innovation Ltd v Somovidis [2025] EWHC 1182 (Comm), decided in May 2025, the High Court rejected Somovidis's defense—but for technical reasons that highlight the complexity of cross-border insolvency law:

• Creditor enforcement vs. foreign trustee administration: Somovidis faced direct creditor enforcement, whereas Bedzhamov faced a foreign trustee attempting to administer bankruptcy assets—technically different legal procedures
• The procedural distinction matters legally: The Immovables Rule specifically prevents foreign bankruptcy trustees from claiming English land, but does not prevent individual creditors from enforcing judgments
• Different legal categories, same practical effect: While technically distinct, both situations involve foreign proceedings attempting to reach English assets

The Real Issue: Wealth Enables Navigation of Complexity

The technical legal distinctions, while real, obscure a more fundamental problem:

The pattern that emerges is not about the rule treating people differently based on wealth—it's about wealthy defendants being able to afford the sophisticated legal representation needed to navigate complex procedural distinctions, fund multi-year litigation, and exploit every available barrier to asset recovery.

While Somovidis and Bedzhamov faced technically different legal scenarios, Al-Sanea's case demonstrates the real advantage of wealth: even when trustees have alternative legal routes available (like Section 423 claims), the cost and complexity of pursuing them through expensive London litigation creates a functional shield that only wealth can maintain.

How Much Are We Really Talking About?

How Does This Affect Ordinary People?

At first glance, an arcane property law principle affecting billionaires might seem irrelevant to average citizens. But the Immovables Rule's consequences ripple far beyond courtrooms and luxury mansions.

1. Victims of Financial Crime Go Uncompensated

When billions in allegedly stolen assets are shielded from recovery:

• Pension funds that invested with Saad Group remain unpaid
• Russian depositors who lost savings when Vneshprombank collapsed cannot access frozen assets
• Creditors, employees, and suppliers across multiple countries face permanent losses

The estimated $10-16 billion (£8-13 billion) in the Saad Group collapse—even at the lower end of estimates—could fund:

• Multiple years of a medium-sized NHS hospital trust's annual budget
• 160,000-260,000 full university scholarships (at £50,000 each)
• 32,000-52,000 affordable homes (at £250,000 each)

Instead, recovery efforts face expensive procedural barriers that favor defendants with resources to fund prolonged litigation.

2. London's Reputation as a "Laundromat" Grows

The UK has long faced criticism as a destination for illicit wealth. Transparency International estimated that £1.5 billion worth of UK property has been bought with suspect funds. The Immovables Rule makes London particularly attractive for those seeking to shelter assets from foreign authorities.

This damages:

• The UK's international standing on financial crime
• Legitimate businesses' reputations
• Property market integrity (as corrupt wealth inflates prices)

3. Wealth Enables Navigation of Legal Complexity

Perhaps most troubling is how the system functionally advantages wealth:

If you lack resources (like ordinary creditors pursuing £14 million), you face direct enforcement without procedural shields, and even if alternative legal routes exist, you cannot afford prolonged London litigation.

If you have vast resources and are accused of billion-pound fraud, you can afford the sophisticated legal teams needed to invoke every procedural barrier, forcing opponents into expensive alternative proceedings that many cannot sustain.

While courts apply legal principles consistently, the practical effect is that wealth determines who can afford to benefit from legal complexity—inverting the fundamental principle that justice should be equally accessible regardless of means.

4. Resource Drain on Public Services

Every court case involving the Immovables Rule consumes:

• Judicial time and resources
• Law enforcement attention
• Public funds (when cases involve government agencies)

These resources could be deployed fighting crimes that directly affect UK citizens, rather than adjudicating whether foreign bankruptcy trustees can seize London mansions.

CBIA's Campaign for Reform

The Cross-Border Investigative Alliance (CBIA) has launched a comprehensive campaign to close the Immovables Rule loophole. Our position is clear: an 18th-century property law principle should not be a 21st-century shield for financial crime.

Our Key Arguments

1. The Rule Was Never Intended for Financial Crime

The Immovables Rule developed to provide certainty in property transactions—not to protect proceeds of fraud. When established, the rule could not have anticipated:

• Modern offshore corporate structures
• Billion-pound cross-border financial crimes
• The ease of relocating assets globally

2. The UK's International Obligations

The UK is signatory to multiple international agreements on:

• Combating money laundering
• Asset recovery
• Cross-border insolvency cooperation
• Anti-corruption measures

The Immovables Rule potentially conflicts with these commitments, particularly the UN Convention Against Corruption (UNCAC), which requires states to assist in asset recovery.

3. Other Jurisdictions Have Found Solutions

Many common law jurisdictions with similar rules have created statutory exceptions for insolvency cases:

• The Cross-Border Insolvency Regulations 2006 (implementing the UNCITRAL Model Law) already provides limited relief
• Section 426 of the Insolvency Act 1986 permits assistance to certain jurisdictions
• But these provisions have significant gaps—they don't apply to cases like Bedzhamov

4. The Perverse Incentive

The current system creates a clear incentive structure:

• Commit financial crime on a massive scale
• Acquire London property through opaque structures
• When caught, relocate to the UK
• Invoke the Immovables Rule to protect your assets

This cannot stand.

Our Proposed Solutions

CBIA is petitioning the UK Government to implement urgent reforms:

Short-term:

• Create a statutory exception to the Immovables Rule for recognized foreign insolvency proceedings involving allegations of serious financial crime
• Expand Section 426 of the Insolvency Act to cover more jurisdictions
• Strengthen the Cross-Border Insolvency Regulations

Medium-term:

• Establish a specialized court unit to handle complex cross-border asset recovery
• Mandate beneficial ownership transparency for all UK property
• Create a fast-track procedure for freezing suspect assets pending resolution

Long-term:

• Comprehensive reform of the Immovables Rule to align with modern cross-border insolvency principles
• Ratify and implement broader international cooperation frameworks
• Introduce "unexplained wealth orders" specifically for immovable property

Conclusion: The Urgency of Reform

The Immovables Rule has transformed from an obscure property law principle into a procedural weapon that disproportionately benefits wealthy defendants. Three cases illuminate the problem:

1. George Bedzhamov successfully invoked the rule at the UK Supreme Court to prevent foreign trustees from seizing his £35 million mansion, despite allegations of £1.3 billion embezzlement from Vneshprombank
2. Maan Al-Sanea, facing fraud allegations estimated at $10-16 billion (£8-13B), cited Bedzhamov; Trust Claim struck out BUT properties remain frozen by court order and Section 423 fraud claims allowed to proceed—yet the cost of prolonged High Court litigation creates barriers that favor wealthy defendants who can sustain years of defensive proceedings
3. Different legal categories (creditor enforcement vs. foreign trustee administration) mean cases like Somovidis's £14 million matter face different treatment—but the fundamental issue remains: wealthy defendants can afford to navigate complexity while victims cannot afford to pursue alternative routes

The evidence demonstrates that wealth enables exploitation of legal complexity in ways that functionally protect alleged proceeds of financial crimes, even when legal principles are applied consistently.

The UK government must act to:

• Create statutory exceptions to the Immovables Rule for recognized foreign insolvency proceedings involving credible allegations of serious financial crime
• Streamline alternative recovery mechanisms (like Section 423) to reduce the cost and complexity that creates functional barriers
• Strengthen beneficial ownership transparency to prevent opaque offshore structures from obscuring control of UK property
• Expand international cooperation frameworks to ensure London is not a preferred destination for parking proceeds of corruption

The rule may be centuries old, but its exploitation through modern offshore structures and expensive defensive litigation is thoroughly contemporary. The solution must be equally modern: remove procedural barriers that wealth can exploit while victims cannot afford to overcome.

Sources and References

Primary Legal Sources

1. Kireeva v Bedzhamov [2024] UKSC 39 - UK Supreme Court, 20 November 2024
   Full judgment: https://supremecourt.uk/cases/judgments/uksc-2022-0037
2. Almeqham v Al-Sanea & Ors [2025] EWHC 322 (Ch) - High Court (Chancery Division), 14 February 2025
   Case reference: Claims Nos. BL-2024-000741 and BL-2024-000799
3. Beograd Innovation Ltd v Somovidis [2025] EWHC 1182 (Comm) - High Court (Commercial Court), 27 May 2025
   Available at: http://www.bailii.org/ew/cases/EWHC/Comm/2025/1182.html

Legal Analysis and Commentary

4. Enyo Law, "The Supreme Court's Decision on the Immovables Rule in Kireeva v Bedzhamov [2024] UKSC 39" (November 2024)
5. Herbert Smith Freehills, "Supreme Court confirms foreign trustee in bankruptcy cannot deal with English property due to the 'immovables rule'" (December 2024)
6. Maitland Chambers, "Almeqham v Belgrave Properties - High Court Analysis" (February 2025)
7. Fountain Court Chambers, "Commercial Court Dismisses Jurisdiction Challenge Based on Russian Insolvency Proceedings" (May 2025)
8. Stevens & Bolton LLP, "Can't touch this: the 'immovables rule' shields UK property from foreign trustee in bankruptcy" (December 2024)

Saad Group / Al-Sanea Background

9. Economic Times, "Saudi Saad Group sued for $10 bn fraud: report" (July 2009)
   Initial AHAB fraud allegations
10. Economic Times, "Alleged $10 bn fraud by tycoon Sanea rocks Saudis" (July 2009)
    Background on collapse and varying estimates
11. Grant Thornton Cayman Islands, "Revealed: The Largest Ponzi Scheme the World Has Ever Seen" (analysis of Cayman court findings)
    Detailed analysis of Ponzi scheme structure

UK Property and Corruption Data

12. Starling Bank, "Average UK Salary by Age" (2024)
    https://www.starlingbank.com/blog/average-uk-salary-by-age/
13. Transparency International UK, "£1.5 billion of UK property bought with suspect wealth" (2020-2024)
    Data on Russian-linked UK property purchases
14. UK Parliament, Economic Crime (Transparency and Enforcement) Act 2022
15. UNCITRAL Model Law on Cross-Border Insolvency

This investigation represents advocacy journalism produced by CBIA to support reform efforts. All legal case citations, amounts, and outcomes have been verified against primary sources. Fraud amount estimates for the Saad Group collapse vary between $10-16 billion across credible sources; we present this range transparently. For factual corrections or additional information, please contact us.