Medvedev confirmed plans to create offshores in Russia for oligarchs under sanctions

Medvedev confirmed plans to create offshores in Russia for oligarchs under sanctions

Earlier it was reported that the offshore project was developed by the Ministry of Economic Development as a measure to back Russian companies that were subject to sanctions.

Prime Minister Dmitry Medvedev confirmed plans to create special administrative districts with offshore features in Russia, newspaper Vedomosti reports on Wednesday. "Very soon we are planning to create special regions with special legal status and a special tax regime in Primorsky Krai and the Kaliningrad region on the Russky and Oktyabrsky Islands," Medvedev said at a legal forum in St. Petersburg.

Earlier it was reported that the offshore project was developed by the Ministry of Economic Development as a measure to back Russian companies that were subject to sanctions. The document allows transferring foreign enterprises from other countries, including offshores, to Russia retaining their legal forms. They will be able to get the status of an international entrepreneurial company, which will allow to register it in a day, not disclosing a part of data on participation and management.

Only taxes on incomes received in Russia are assumed to be collected from residents of the districts. The Central Bank lashed the proposals of the Ministry of Economic Development. The Central Bank noted that residents of such offshore territories would be able to carry out transactions with currency and securities without restrictions and repatriation of proceeds required by law. It is possible that unscrupulous business will re-register en masse in particular areas for the illegal withdrawal of capital from the country.

On April 6, the US authorities extended sanctions against Russia; the list included 26 people and 15 companies. After that, investors began to quickly sell Russian assets. These measures provoked ‘black Monday’ in the Russian market.

Bloomberg reported that Russia's richest people lost a total of about $16 billion in just one day. Later, Rusal stated that sanctions imposed by the US Treasury could lead to technical defaults.

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