The National Capital Authority has pulled back from enforcing a deadline for Russia to clear land allocated for its new embassy because legal proceedings are pending.

"The Russian federation has signalled its intention to commence legal proceedings in relation to the National Capital Authority's termination of their lease in Yarralumla," an NCA spokesperson said.

"Both parties have agreed to maintain current day to day management arrangements at the site in the short term."

The press secretary at the Russian embassy confirmed that this was the situation but said he had nothing to add.

The NCA controls building permits in the parliamentary zone. It first gave permission to the the Russian Federation for a new embassy in 2008, with building approvals on March 31, 2011 and September 23, 2011.

But more than 10 years later, the land remains as little more than a field with a security hut on one side.

When Russia was given the "termination" notice three weeks ago, a spokesman conceded that "the building project had indeed encountered multiple problems and delays through several years", but said "at all times, these were a matter of constructive and frank consultations between the embassy and the NCA".

"It is really puzzling why the NCA chose to terminate the lease now that the construction process at Yarralumla site has been steadily going on uninterrupted for the last two-plus years, with results already very much visible and prospects rather clear," the spokesman said.

READ MORE:

Russian diplomats are continuing to operate from the embassy on Canberra Avenue.

"The decision to terminate the lease for a new embassy does not affect the existing Russian Embassy," the NCA said. "The Russian federation may submit a new application in the future for a new embassy site, which the NCA will review and assess accordingly."

The ostensible reason for the NCA's blocking of the new compound was that it hadn't been completed within the three years allotted, but it may raise questions about whether any current politics intruded.

The NCA said politics had nothing to do with it: "This is an independent issue, with the decision to terminate the lease based solely on Russia not complying with the lease agreement."

"Under the lease, the Russian federation had agreed to finish construction within three years. Despite some efforts to progress an embassy, completion of the project has not occurred," the NCA said.

The embassy conceded the new building had been dogged with problems. At one stage, the federal government said Russian workers would not be allowed in to work on it.

The embassy conceded the new building had been dogged with problems. At one stage, the federal government said Russian workers would not be allowed in to work on it.

The existing embassy on Canberra Avenue had a colourful history of espionage in the Cold War, with real-life plots which would have pleased John le Carre. The big one was the defection of the third secretary at what was then the Soviet Embassy. The Petrov Affair became one of the great dramas and intrigues of Australian politics.

If, as they say, the walls could talk.

Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content: