The Federation Council completed its spring session on July 28, 2018 as expected by approving a number of important and widely debated tax bills. We have briefly reviewed below the changes approved by the Federation Council that are, in our opinion, the most important.

We reported earlier on that major changes were due to be made soon to the procedure for migration registration. The new changes essentially provide that it will be possible to register foreign nationals working on Russia only with the address at which they live (rather than the address of their employer’s office as previously).

In the third reading, the State Duma adopted amendments to Federal Law On Migration Registration of Foreign Nationals and Stateless Persons in the Russian Federation. These changes will affect all foreign nationals temporarily staying in Russia, including those employed and working under employment contracts as well as highly qualified specialists.

From May 25, 2018 to July 25, 2018 a special procedure for registering foreign nationals will apply in cities hosting FIFA World Cup matches, i.e. Moscow, St. Petersburg, Volgograd, Yekaterinburg, Kazan, Kaliningrad, Nizhniy Novgorod, Rostov-on-Don, Samara, Saransk and Sochi.

From April 20, 2018 onwards, employers will be required to use new forms when sending to the Department of Migration Matters of the Ministry of Internal Affairs, among others, the following notices regarding foreign employees

A new base for accrual of property tax will be determined by the end of 2018 in St. Petersburg

Companies often do not pay enough attention to issues related to the holding and documenting of annual general meetings. This, in turn, gives rise to unnecessary risks and errors associated with internal control, relations with business partners and compliance with Russian law

The dispute is about supply transactions concluded between Uralkali and a related Swiss trader who resold the goods delivered by Uralkali to independent customers.

The Supreme Court has rendered an important ruling in a dispute over the thin capitalization rule involving OAO SUEK-Kuzbass (further the “Company”). In this case, the Supreme Court allowed considering the loan principal as investment in capital in order to apply the preferential tax rates for dividends provided under double taxation treaties (further “Tax Treaties”) when paying interest re-qualified as dividends under the thin capitalization rule. The conclusions drawn by the Supreme Court will undoubtedly be of interest to all companies that have or are planning to get intragroup loans.

The Constitutional Court of Russia finally published its ruling on a case partially validating “parallel” import. This case involved PAG, a Russian company which imported Sony trademarked products into Russia without Sony’s consent and was required to destroy these products as counterfeit