On December 21, 2017, the OECD published the list of countries which confirmed their readiness to exchange financial information with Russia. The list contains 73 countries and includes offshore jurisdictions that are popular with Russian taxpayers, such as Cyprus, Bermuda, Cayman Islands and BVI.

As of today, Russia has activated channels for automated exchange with 56 countries from the list. We should note that for most of them the exchange will start already in this year for tax periods that will include 2017.

So far, only a few jurisdictions (Malaysia, Pakistan, Lebanon and Switzerland) have agreed to provide data starting 2019 for tax periods after January 01, 2018. Other states have either not determined the precise timeframes for revealing information or indicated 2017 as the starting period for which they are ready to exchange information (Lichtenstein, Mauritius, Great Britain and New Zealand).

As reported earlier, in 2016 Russia joined the Multilateral Competent Authority Agreement (MCAA), after which everyone anxiously waited until all the needed procedures will be completed and each country will confirm the intent to exchange the relevant information, including information on foreign bank accounts, with Russia. The information is available on the OECD web site in the section International framework for the CRS / Exchange relationships (http://www.oecd.org/tax/automatic-exchange/international-framework-for-the-crs/exchange-relationships/).

It is expected that as a result of automatic exchange the Russian Tax Service will gain access to information that was hidden before regarding the activity of Russian holdings abroad, as well as on foreign assets, including foreign bank accounts of Russian taxpayers.

We recommend checking your assets in various jurisdictions once again to assess potential risks and plan further actions.

Anastasya Kuzmina   Head of Tax Group   St. Petersburg   Tel.: +7 (812) 346 79 90

Additional notes

Should any questions arise in connection with the above or if you need any additional materials, please contact Anastasya Kuzmina St. Petersburg Office of Capital Legal Services.

This Information letter keeps the clients of Capital Legal Services and other interested parties abreast of information that may, to any extent, affect their activity or cater to their particular interests. The opinions and commentaries expressed in this information letter shall not be deemed as legal opinions and do not cancel the need to obtain legal advice or legal opinion on separate issues. 

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