Alexander Sotov, FBK Legal Partner on a document stiffening procedure for exchanging tax information between Russia and Cyprus

Alexander Sotov, FBK Legal Partner commented in his interview to Kommersant upon the news that on Friday, the government submitted to State Duma for ratification a document toughening procedure for exchanging tax information between Russia and Cyprus. When the amendments to the double taxation treaty become effective owners of Russian companies will have to prove that the main aim for registering them in Cyprus are not tax benefits. Mr. Sotov expressed an opinion that the market players managed to get ready for the protocol ratification. “Already in 2009, when only rumors about the document preparation started, about 40 thousand companies left the Cyprus”, he points. According to the experts, those companies wishing to stay in Cyprus will manage to find loopholes in the new version as well. “Those who decided to stay will have to complicate the schemes of information exchange with Cyprus, which will make business somehow more expensive, but will not be crucial for it”, Sotov concluded.