бн бн бн бн
--8<----8<----8<----8<----8<--  end  -->8---->8---->8---->8---->8----

On line X coding-system-for-write is set to 'no-conversion.
line Y is shown here in function vc-do-command, where I also marked a
line as Z:

--8<----8<----8<----8<----8<-- begin -->8---->8---->8---->8---->8----
	    ;; Run synchronously
	    (when vc-command-messages
	      (message "Running in foreground: %s" full-command))
	    (let ((buffer-undo-list t))
Z	      (setq status (apply 'process-file command nil t nil squeezed)))
Y	    (when (and (not (eq t okstatus))
		       (or (not (integerp status))
			   (and okstatus (< okstatus status))))
              (unless (eq ?\s (aref (buffer-name (current-buffer)) 0))
                (pop-to-buffer (current-buffer))
                (goto-char (point-min))
                (shrink-window-if-larger-than-buffer))
--8<----8<----8<----8<----8<--  end  -->8---->8---->8---->8---->8----

Line Z is where the svn command are called, and there a function
process-file is called, this function calls in turn function
call-process. Function call-process encodes the arguments when
necessary, but the setting of coding-system-for-write to 'no-conversion
disturbs that, and OUCH, the command line passed to svn is not properly
encoded, so with some reason svn unhappilly barks.