BGP Litigation senior associate Anastasia Evtushenko speaks with Kommersant about the use of a BVI-registered company in the transaction on the acquisition of JSC Mikheevsky Processing Plant

"Anastasia Evtushenko, senior associate with BGP Litigation, says "before the era of deoffshorisation and the cross-border exchange of information" BVI, along with Cyprus, "were used everywhere by business for effective tax structuring of the holding of assets". Following the introduction of the CFC rules and other deoffshorisation measures in the RF, and "against the background of a worldwide trend towards greater transparency and sharing of financial information, the attitude of impunity in using offshore structures for tax avoidance has now given way to circumspection", says the lawyer".

Expanding on her earlier comments, Anastasia Evtushenko notes that the British Virgin Islands remain a popular low-tax jurisdiction where many Russian businessmen still have their personal holding companies. From 1 January 2016 it became mandatory for all BDI registration agents to collect information about the beneficial owners of offshore companies registered through such agents, notes the BGP Litigation senior associate. Yet such measures have not stopped Russian business from using personal holding mechanisms in offshore jurisdictions when structuring transactions, because the main financial flows enabling shareholders to finance such acquisitions remain, as before, located abroad – including, importantly, for the protection of those financial assets. 

The full article (in Russian) is available here: "Михеевский ГОК пропишут в Атлантике".