Rosneft is set to make a public offering of $20 billion, likely to be London's biggest flotation this year.
However, F&C said that legal problems surrounded their acquisition of assets formerly owned by the oil giant Yukos, which was brought down by the Russian government amid tax-evasion accusations, should put-off potential investors.
The asset management company, one of London's top investors, even took the unusual step of publicly threatening to boycott the company until the situation had been resolved.
"Unless Rosneft can provide us with credible assurances that it has identified and made adequate provisions for any liabilities stemming from the acquisition of its Yuganskneftegaz assets, we wonât be interested," F&C said in a statement.
The move reflects the increasing concern of fund managers in the continued expansion of state control over Russian companies and markets.
Clara Furse, chief executive of the London Stock Exchange, was even moved to write personally to Russian president Vladimir Putin, expressing concerns over the expulsion of William Browder, head of Hermitage Capital Management, from the country.
There are also concerns over the risks to London's reputation that an influx of new companies from Russia and elsewhere could bring, as foreign issuers are not bound to the UK's Combined Corporate Governance Code.