A recently introduced draft law aims to clarify the Personal Data Law's data processing procedures. If the draft law is adopted into law, businesses acting as data operators will need to review their data protection documents (ie, consent documents), technical security measures and data processing activities and revise them to be compatible with the proposed amendments and the Federal Service for Supervision of Communications, Information Technology and Mass Media's requirements.
Federal Law 368 of 11 September 2020, which could significantly simplify the tax payment process for the owners of a large number of controlled foreign corporations (CFCs) and significantly reduce such taxes in some cases, was recently adopted in Russia. It is fair to say that, in a sense, the new legislation introduces an alternative simplified tax system for CFC owners. However, the new tax regime will not be beneficial to all taxpayers.
In 2020 Russia launched an intensive process of revising its bilateral tax agreements with numerous jurisdictions. According to the Cyprus minister of finance and the Russian Ministry of Finance, significant amendments to the double tax avoidance agreement between Russia and Cyprus were agreed in August 2020. The most important amendment is the increase in the tax rate levied on the payment of dividends and borrowed money.
President Vladimir Putin recently announced the next set of measures to amend tax legislation to help the Russian economy overcome the crisis caused by the COVID-19 pandemic. Most of the new tax changes relate to companies in the IT industry, for which a so-called 'tax manoeuvre' has been proposed in order to significantly reduce the corporate income tax rate for such companies from 20% to 3%.
President Vladimir Putin recently announced the next set of measures to amend tax legislation to help the Russian economy overcome the crisis caused by the COVID-19 pandemic. Most of the new tax changes relate to companies in the IT industry, for which a so-called 'tax manoeuvre' has been proposed in order to significantly reduce the corporate income tax rate for such companies from 20% to 3%.
Recent amendments to the Information Law aim to tackle the issue of mobile apps and e-platforms that distribute pirated content which infringes copyright and related rights. This article examines upcoming amendments and highlights the new enforcement possibilities that will be available to rights holders in Russia. The changes will also be relevant for businesses that own and operate mobile apps, which should consider the associated risks if their mobile apps contain pirated content.
Although the term 'Big Data' is now common, no Russian legal provision deals expressly with the processing of such data. Various legislative initiatives have attempted to introduce a specific legal framework in this regard, including a recent draft law which aims to create a specific legal regime for Big Data processing. Although the draft law received negative feedback from the government, it is useful to consider the Ministry of Digital Development, Communications and Mass Media's approach when shaping it.
The COVID-19 pandemic and the measures taken to combat it will have a significant impact on both the global and Russian economies. The government has taken a number of measures to stop the spread of the virus, such as suspending the activities of most Russian businesses, including service providers, from 27 March until 30 April 2020. As such, the government has also had to adopt a comprehensive support programme for affected businesses.
At the end of 2019, the Federal Tax Service issued clarifications on calculating the share of Russian immovable property in the indirect sale of such property for corporate income tax purposes. The clarifications are especially relevant as the Russian tax authorities' powers have grown following the signing and ratification of a number of international agreements on the exchange of tax information in recent years.
Keywords play an important role in e-marketing. After typing a specific product name, company name or brand in a search engine, potential customers and users may view specific offers and data, including ads. Further, the list of offers may represent certain keywords selected by an advertiser. Unsurprisingly, the selection and reproduction of designations as keywords can trigger various trademark use concerns that inevitably lead to enforcement issues.
Over the past year, Parliament has adopted several laws amending the Tax Code regarding the taxation of legal entities. This article examines the most significant tax innovations expected in the corporate sector in 2020 which concern corporate income tax, transport and land taxes and changes in tax administration rules.
Federal Law 79-FZ on the Ratification of the Multilateral Convention to Implement Tax Treaty-Related Measures to Prevent Base Erosion and Profit Shifting recently entered into force. Once the ratification procedure has been completed, the convention will enter into force in Russia, introducing changes to the taxation procedure for transactions with counterparties from a large number of countries that have concluded double tax avoidance agreements with Russia.
Advertisers are increasingly using online messenger systems to promote businesses, as well as their goods and services. In this context, the Federal Anti-monopoly Service recently issued an official letter clarifying, among other things, the application of the Federal Law on Advertising to messenger systems such as Viber and WhatsApp. The letter is notable as it reveals the regulator's approach to advertising campaigns disseminated via various instant messaging services.
The president recently signed the Digital Rights Law, which will take effect on 1 October 2019. The law has introduced a number of new legal concepts into Russian legislation, including digital rights, e-transactions, smart contracts and Big Data. Companies doing business on the digital level in Russia should familiarise themselves with the background and key provisions of the law to ensure that they are ready to operate in the new legislative environment.
Roscomnadzor (the Russian data protection authority) recently filed a landmark action against illegal personal data processing by Google Analytics and Yandex Metriсa. If the authority succeeds in the appeal court, Russian websites will have to welcome users with EU General Data Protection Regulation-style cookie banners and privacy policies. Prior to this case, the Russian internet community had not considered statistical information concerning web traffic and user actions to constitute personal data.
The Federal Tax Service recently approved a form of inquiry which it will use to request information from legal entities regarding their beneficial owners in order to, among other things, identify tax evasion schemes. For the purposes of the law, 'legal entities' means not only Russian legal entities, but also foreign legal entities, including those that perform economic operations in Russia and interact with Russian clients.
The basic value added tax (VAT) rate recently increased from 18% to 20%. The new rate will apply to all goods, works and services which are sold, performed or provided from 1 January 2019. In addition, several estimated tax rates have also been amended. As entities are expected to reflect the increased VAT rate in the price of their goods, economists predict a rise in prices associated with the increase in early 2019.
Bill 424632-7 on the Amendment of Parts 1, 2 and 4 of the Civil Code of the Russian Federation (the Digital Rights Bill) and Bill 571124-7 on the Amendment of the Federal Law on Information, Information Technologies and Data Protection (the Big Data Bill) were recently submitted to Parliament for discussion. Both bills are essential developments, especially given the increasing interest in and high value of Big Data in the current digital reform.
The Federal Tax Service recently began publishing information concerning the various obligations of Russian taxpayers (ie, legal entities) and their financial reporting on its website. This practice is new in Russia, as such information was previously classified as tax secrets and, by virtue of the Tax Code, could not be disclosed. This development is useful not only for Russian taxpayers, but also for foreign companies choosing Russian counterparties.
In January 2019 a new law will come into force enabling the tax authorities to request client-related documents from auditors which constitute 'auditing secrets'. This law marks the end of years of struggle by the tax authorities to gain access to audit documents. Although these changes carry no significant risks for bona fide taxpayers, the business community is concerned that the authorities may be able to request auditors' documents and opinions on related services, such as accounting and tax consulting.