In what appears to be only a temporary setback in the deal, Sergei Fiveisky, of St. Petersburg's committee for economic development, said the ruling was of a “technical, not political nature,” and that the city authorities would help Flextronics receive the necessary letters of approval.

In February, the Singapore firm Flextronics announced it would buy the Elcoteq plant to produce LCD televisions for the Russian market. Initial investment was reportedly planned at $50 million, according to Mike McNamara, managing director of Flextronics. The value of the Elcoteq plant was estimated by experts at $25 million to $35 million.

The current problem apparently stems from Flextronics’ reported failure to present data about its beneficiaries requested by the FAS. According to the ruling, the FAS claimed it was unable to obtain needed information after twice asking and receiving replies for the information. Based on the incomplete process, the FAS refused to approve the plan.

Flextronics VP Misha Rosenberg and Elcoteq’s Elina Nieminen said that their companies were aware of the ruling, but declined to comment.

According to sources quoted in Russia’s St. Petersburg Times, the FAS often turns down requests due to process formalities, and if documents are drawn up properly, repeating the application procedure would only take about a month.

Dmitry Ivanov, a lawyer at Duvernoix Legal said in the Times article that it is often difficult for companies outside the country to understand all the nuances of drawing up documents for approval in Russia.