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Pepeliaev Group advises that on 14 March 2022 the law[1] on the fourth stage of the ‘capital amnesty’ came into force. This law was adopted at the initiative of the Russian Government. Still, the ‘amnesty’ has a procedural form for the voluntary declaration by individuals of assets (filing a special declaration).
As in the previous stages of the ‘amnesty’, it is possible to declare real estate, the right to participate in organisations that are not recognised as controlled foreign companies (CFCs), as well as CFCs and monetary funds on foreign accounts. As in the third stage of the ‘amnesty’, it is required to redomicile CFCs in Russia in special administrative areas (Oktyabrsky Island and Russky Island),[2] as well as to repatriate monetary funds on foreign accounts. However, now it is necessary to repatriate all, and not only declared, funds and financial assets from foreign accounts (at least this is what the literal text of the law means).
New items to declare have emerged:
other financial assets (derivative financial instruments), in addition to securities, provided that they are transferred to a Russian account in the relevant financial market institution;
cash - provided that it is deposited in a Russian bank account not later than 30 calendar days after filing a special declaration;
vehicles - subject to their registration in the Russian register.
Filing a declaration gives an exemption from the collection of taxes (except for profit tax of CFCs) and from liability for tax or customs violations committed before 1 January 2022 in connection with the acquisition and possession of declared items.
As before, the exemption applies if the procedure for identifying and preventing the relevant violation had not started before the declaration was filed.
The special declaration must be filed by the end of February 2023. It can be submitted only once, and adjusted special declarations are not provided for. If the declaration has been filed at any of the previous stages, a new one can be submitted.
Individuals interested in mitigating the risks of owning assets and ready for their disclosure in the Russian jurisdiction may consider filing a special declaration.
Pepeliaev Group’s lawyers have provided legal support to clients who participated in previous stages of the special declaration and are ready to provide legal support within the current stage.