Significantly tougher control over transfer pricing in Russia

On 27 November 2023, the President of the Russian Federation signed Federal Law No. 539 “On Amending the First and Second Part of the Tax Code of the Russian Federation and Certain Legislative Acts of the Russian Federation and on Finding Certain Provisions of Russian Legislative Acts Invalid” (“Law”). The Law was officially published on the same day, 27 November 2023.

The Law introduces critical amendments to the Tax Code of the Russian Federation (“Russian Tax Code”), including multiple revisions to Russian transfer pricing rules (“TP”). The amendments are aimed at “toughening control over transfer pricing in cross-border transactions to combat tax evasion.”

For the purpose of implementing this objective, the Law introduces provisions that expand the list of related parties and controlled transactions. It also determines the specifics of taxation in relation to certain cross-border transactions with related parties and establishes the duty of preparing TP documentation on new grounds. The new rules introduce a change in the basis for assessing a penalty for the non-payment of tax as a result of the application of non-arm’s length prices in controlled transactions and that TP penalties have increased 10-20 times compared to those that are currently in effect.

Related parties test

• The list of related parties has been expanded considerably. The related parties test will also include:
• organisations where (i) one individual holds a participation of over 25% and/or (ii) has the authority to appoint (a) director general or (b) no less than 50% of the board of directors in one organisation (jointly with the relatives) and (ii) the other individual can hold or do the same in another organisation, and (iv) they both are recognised as related parties due to their “family relationship” (article 105.1(2)(12) of the Russian Tax Code;
• a foreign company that qualifies as a controlled foreign company (“CFC”) and its controlling person (article 105.1(2)(13) of the Russian Tax Code); and
• foreign companies that qualify as CFCs and have one and the same controlling person (article 105.1(2)(14) of the Russian Tax Code).

Considering the CFC rules (article 25.13(3)(2) of the Russian Tax Code) for recognising a person as a related party of a foreign organisation for TP purposes, such person’s minimum participation in that organisation should be 10% in the case that all persons, being Russian tax residents, hold over 50% in such organisation. For individuals, their share will be measured jointly with the participation of their spouses and underage children.

In addition, a foreign organisation and its controlling persons will also be recognised as related parties by virtue of exercising “control”, no matter what participation percentage they hold (clauses 6 and 7 of article 25.13 of the Russian Tax Code).

The number of related parties will therefore increase due to the inclusion of such criteria as “family relationship” and “control”. Previously the TP rules required that one would have to go to court to find a person related on these grounds (article 105.1 (7) of the Russian Tax Code), while now these criteria are expressly set out in the Russian Tax Code.

Controlled transactions

• Transactions with unincorporated foreign structures will qualify as related party transactions if the place of their registration or tax residence or that of their shareholders or other beneficiaries is a territory that was added by the Ministry of Finance of Russia to the list of offshore and non-cooperating jurisdictions pursuant to article 284(3)(1) of the Russian Tax Code (“Offshore Jurisdictions ListOrder of the Ministry of Finance of Russia No. 56n dated 5 June 2023 “On Approving the List of States and Territories Providing Preferential Tax Treatment and/or Not Providing for the Disclosure and Submission of Information in the course of Carrying out Fiscal Transactions (Offshore Areas)””) (article 105.14(1)(3) of the Russian Tax Code). Accordingly, transactions with the foreign foundations (trusts and other structures) generating income in excess of RUB 120 million per year will be recognised as controlled and will fall within the scope of Russian TP rules.
• According to article 105.3 (13) of the Russian Tax Code, TP rules will also apply to transactions resulting in the need — for at least one party to such transactions — to account income, expenses and/or the value of extracted minerals that influences the tax base of the taxes mentioned in clause 4 article 105.3 of the Russian Tax Code. The Law modifies this rule so that it will also apply to transactions where one of the parties is an unincorporated foreign structure.
• Transactions will not be recognised as controlled where one of the parties to the transaction is an organisation which according to its personal statute is an export credit agency and/or a bank provided that all of the following conditions are met (article 105.14(4)(9) of the Russian Tax Code):
• such organisation is registered in, or is a tax resident of, a foreign state with which certain provisions of a double tax treaty (“DTT”) were suspended by Presidential Decree No. 585 of 8 August 2023Presidential Decree No. 585 of 8 August 2023 “On the Suspension, by the Russian Federation, of Certain Provisions of the Double Tax Treaties of the Russian Federation” (“Decree 585”);
• the specified organisation and other parties to such transactions are not recognised as related parties according to article 105.1 of the Russian Tax Code; and
• there are no grounds for finding such transactions controlled pursuant to paragraphs 1 and 2 of clause 1 of article 105.14 of the Russian Tax Code.
• Exemptions from the list of controlled transactions also include any transactions involving foreign organisations that are registered in or are tax residents of foreign states with whom certain provisions of DTTs were suspended by Decree 585, provided all of the following conditions are met concurrently (article 105.14(4)(11) of the Russian Tax Code):
• agreements were concluded before 1 March 2022;
• the pricing procedure and/or pricing methods (formulae) did not change after that date; and
• as at 1 March 2022, such transactions did not qualify as controlled transactions according to clauses 1 and 3 of article 105.14 of the Russian Tax Code.

As is well known, so called “unfriendly” foreign jurisdictions where the contracting parties of many Russian companies are registered were added to the updated Offshore Jurisdictions List. As a result, beginning from 2024, all transactions with contracting parties from such “new” offshore jurisdictions fall within the scope of TP control (article 105.14(1)(3) of the Russian Tax Code). Now, the burden of preparing documentation and the responsibility for non-compliance with the TP rules in fact lies with the Russian taxpayer. 

The changes suggested in points (c.) and (d.) above are aimed at mitigating the consequences of the adoption of the Offshore Jurisdictions List so that Russian companies can continue working with independent foreign companies (including companies from “unfriendly” jurisdictions) without incurring an additional administrative burden and, among other things, take advantage of utilising and servicing credits from “unfriendly” countries.

At the same time, considering that many companies have already managed to revise their contracting structures on the Russian market and the pricing terms under agreements with Russian contracting parties, it is most likely that the majority of Russian companies will not be able to apply this exemption in practice. In this connection, it is necessary to assess the wording of the changes made from the perspective of its compliance with the requirements for the invariability of pricing terms (not applicable to credit agreements), for example, by virtue of tax gross-up provisions (an increase in the price by the amount of withholding tax to be paid). If this condition is not satisfied, you will need to confirm the arm’s-length price in such transactions and prepare TP documentation.

• Transactions giving rise to debt obligations under tradable bonds issued by foreign organisations are also removed from the list of controlled transactions (article 105.14(4)(10) of the Russian Tax Code).

Secondary TP adjustment

A so called “secondary TP adjustment” is introduced. If the actual price of a transaction between related parties differs from the market price and such actual price is adjusted, whether by tax authorities or the taxpayer himself, the income of a foreign person (not being a Russian tax resident) will qualify as dividends (unless the conditions set out below are satisfied) and will be subject to withholding tax. Russian tax authorities often applied this approach in practice, but now it has been codified in legislation. Such income will be recognised as at the last day of the calendar year in which the controlled transaction took place (clauses 6.1 and 6.2 of article 105.3 of the Russian Tax Code). At the same time, the tax authority receives the right to check whether the Russian organisation, which is a contracting party to a controlled transaction, properly carries out its responsibilities as a tax agent (article 105.3 (4.1) of the Russian Tax Code).

If the taxpayer self-adjusted the tax base (article 105.3 (6) of the Russian Tax Code), the amount of the adjustment will not be reclassified as dividends if the following conditions are met:

• a foreign person pays back the amount of such adjustment to the taxpayer that made the adjustment to its account with a bank based in Russia before the date the relevant tax becomes due for the tax period in which the controlled transaction was made;

or

• a foreign person pays back the amount of such adjustment to the taxpayer that made the adjustment to its account with a bank based in Russia:
• after the date the relevant tax becomes due for the tax period in which the controlled transaction was made, but before the tax authority issues a decision to carry out a TP audit, and
• the taxpayer accrues, in its accounts, the interest income from the use of the adjustment funds by the foreign person for the period from the date of payment of disputable income by the taxpayer to the date preceding the date when such income is paid back to the taxpayer. Interest is calculated at the rate equal to 1/300 of the Bank of Russia base rate.

On the face of it, the exception introduced by the Law is aimed at encouraging self-adjustments to the price of the transaction (article 105.3 (6) of the Russian Tax Code). In such case you can not only avoid the double taxation of the amount of the adjustment (first as dividends and then as a penalty), but also use the current minimum and maximum values of the arm-length price / profit margin range for calculating the market price, which in the end should reduce the amount of the adjustment as compared to a situation when the adjustment is made by a tax authority using the median value (see section “Median” of this newsletter).

Taking advantage of this tax benefit, however, imposes additional obligations on the Russian taxpayer who is a party to the controlled transaction. More specifically, the Russian taxpayer must not only ensure the receipt of the adjustment amount on its bank account, but also assess tax on interest income for the use, by the foreign contracting party, of the adjustment amount (in the case of a delayed payback). It will be necessary to discuss with the foreign contracting party the possibility and the terms of such payback and introduce the relevant amendments to the agreements. The issues of how the payback of the adjustment is to be treated from a tax and legal perspective, as well as the ability to make such payment in the conditions of the current currency and countersanctions restrictions, require additional analysis. Finally, even if all of the abovementioned conditions are satisfied, the Russian taxpayer still has no guarantee that the tax authority would accept the amount of the self-adjustment and would not challenge it in the course of an audit.

As concerns the secondary TP adjustment, this adjustment is generally in line with the international practice and is applied in some foreign jurisdictions (eg in the USA, Canada, Germany, etc). According to the OECD commentariesOECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, Chapter IV: Administrative Approaches on transfer pricing, such secondary adjustments may take the form of constructive dividends, constructive equity contributions or constructive loans. The form of the secondary adjustment usually depends on the factual background and local laws of the country in which the adjustment is made. The Russian legislator chose the form of reclassifying the secondary adjustment as dividends irrespective of the legal group structure in respect of the parties to the controlled transaction.

In the global practice, it is possible to avoid a secondary adjustment not only by physically paying back the amount of the adjustment, but also by crediting other settlements between the parties. Probably, in the current situation, considering the currency related restrictions, it would be easier for taxpayers to ensure such payback by way of set-offs, but the changes introduced by the Law do not provide the taxpayer’s such an opportunity.

The wording of the Law leaves questions as to whether the term “dividends” will apply to secondary TP adjustments under the effective DTTs and, accordingly, whether preferential rates of withholding tax could be applied (where there are any). In addition, this leaves open the question of whether the “look-through” approach would be applicable to such “dividends”.

If the preferential rates under the DTTs are not applicable, tax will be charged at a rate of 15% and the total rate of Russian tax on the adjustment in controlled transactions with foreign companies may reach 50% (20% Russian profits tax + 15% Russian withholding tax on dividends + a 15% tax penalty (equalling the amount of tax in the form of dividends)).

Please note that the tax burden may increase even more due to the introduction of 15% withholding tax on the services that are supplied to Russian taxpayers by related foreign companies (article 284(2)(4) of the Russia Tax Code and article 309(1)(9.4) of the Russian Tax Code).

In addition to this, a secondary adjustment in Russia may result in double taxation for the foreign contracting party in a controlled transaction if the place of such party’s registration or tax residence does not give a corresponding foreign tax credit for the paid Russian withholding tax on the secondary adjustment in the form of dividends. This may, for example, happen where this legal fact may be not a deemed receipt of “dividends” according to the laws of such foreign state. Furthermore, considering the EU’s inclusion of Russia on the “blacklist” and Russia’s suspension of certain provisions of DTTs, the likelihood that such situation may happen in practice to companies from “unfriendly” states is fairly high.

Sources of information

The Law specifically sets out that now, when comparing the terms of transactions between related parties and non-related parties and when preparing TP documentation, the taxpayer will be allowed to use information only from the sources stipulated by article 105.6 of the Russian Tax Code (article 105.6 (5) of the Russian Tax Code).

It is at the same time allowed to use information on comparable transactions made not only by the taxpayer himself with non-related parties, but also on the transactions of the taxpayer’s related party with non-related parties (article 105.6 (6) of the Russian Federation). Technically, according to the Ministry of Finance of RussiaLetters of the Ministry of Finance of Russia No. 03-01-18/27886 of 17 July 2013 and No. 03-01-18/45611 dated 28 October 2013, this option was available before now, but for the purposes of clarity the legislator decided to capture this rule in the Law.

Median

An additional criterion, the “median”, and the procedure for calculating such value has now been introduced (article 105.8(4)(4) of the Russian Tax Code). The median value will be applied if the price/profit margin in a transaction is not within the arm’s-length range of prices / profit margins calculated in accordance with the Russian Tax Code.

The relevant articles of the Russian Tax Code concerning the application of the TP methods (articles 105-9-105.12 of the Russian Tax Code) were supplemented with the rules on the application of the median. Taxpayers were given the right to not apply the median value for making self-adjustments to the price using any TP method. However, as we mentioned before in this newsletter, coupled with incorrectly picked comparables, a taxpayer’s self-adjustments made based on the minimum/maximum values of an arm’s-length range may expose the taxpayer to the risk of the benchmarking results being challenged by the tax authorities. As a result, another risk arises that there will be an increase in the amount of the adjustment due to it being recalculated based on the median value.

TP documentation and notice of controlled transactions

• The following additional information must be set out in the TP documentation (paragraphs 1 and 2 of article 205.15 (1) of the Russian Tax Code):
• documentary proof of information on the functions of the parties to the transaction, the assets they use in connection with this controlled transaction and on the economic (commercial) risks they take, which the taxpayer took into account when entering into the transaction;
• detailed information on the foreign contracting party, including information on income and expenses, headcount, the amount of profit (loss), the value of fixed assets and intangible assets over the period in which the transaction was made, with supporting documents to be enclosed therewith, including financial statements if so provided by the personal statute of that party. This requirement applies to transactions between persons that qualify as related parties under article 105.1 of the Russian Tax Code;
• documents containing registration details of a foreign person, being a party to the transaction, and information on the persons acting on behalf of that person as may have been provided to the taxpayer on entering into the controlled transaction;
• an analysis of commercial and/or financial terms of the controlled transaction made in accordance with article 105.5 of the Russian Tax Code; and
• a description of adjustments to ensure the necessary level of comparability of the financial and/or commercial terms of the controlled transaction and comparable transactions (organisations).

Please note that some of the above-mentioned details (such as, for example, the analysis of commercial and/or financial terms of the controlled transaction) have already been disclosed by many taxpayers in their TP documentation. Taking into account the clarification lettersLetter of the Ministry of Finance of Russia No. ОА-4-13/14433@ of 30 August 2012 “On Preparing and Submitting Documents for Tax Control Purposes” of the tax authorities concerning the preparation of documents, the Law only formalises the taxpayer’s obligation to disclose such details in TP documentation by codifying this rule in the Russian Tax Code.

Given the expanded requirements (according to the provisions of the Russian Tax Code as amended by the Law) for information that must be necessarily included in the documentation and for supporting documents to be enclosed therewith, leaving article 105.15 (6) of the Law — which states that the level of detail and substance in the documentation to be submitted to tax authorities must be commensurate with the complexity of the transaction and its price formation (the profit margin of the parties to the transaction — as it is, would not allow one to use a simplified approach.

• The Law formalises the right of the tax authorities to request information set out in TP documentation not only under clauses 1, 2 and 5 of article 93 of the Russian Tax Code, but also in an out-of-audit procedure under article 93.1 (2) of the Russian Tax Code, which the tax authorities have been doing in practice for a long time up to now. Requested information must be provided within 30 days (article 105.15 (3) of the Russian Tax Code).
• The duty to prepare TP documentation in respect of transactions that are equated with related party transactions will be expressly set out in the Russian Tax Code. Before now, this referred only to transactions with persons for which the taxpayer was a related party. This change to article 105.15(4)(2) of the Russian Tax Code is in line with the position of the Ministry of Finance of Russia which earlier pointed out that transactions with persons that are equated with related parties do not fall within the scope of exemptions and it is necessary to provide documentationFor example, paragraph 3 of Letter of the Ministry of Finance of Russia No. 03-01-18/43895 of 21 October 2013 on such transactions. It will therefore be necessary to prepare TP documentation in relation to transactions with non-related foreign parties that are based in states from the Offshore Jurisdictions List (unless they fall within the scope of exceptions described in point 2 of this newsletter).
• Taking into account the technical revision made to article 105.15 (2) of the Russian Tax Code, any additional information confirming that the terms of the transaction are in line with the arm’s-length principle may be submitted only in addition to documentation. Previously, it was technically possible to provide other information confirming that the commercial and/or financial terms of the controlled transactions are in line with those of the comparable transactions irrespective of whether documentation was provided or not.
• TP documentation in relation to cross-border transactions involving global exchange-traded commodities that are on the list of the Ministry of Industry and TradeOrder of the Ministry of Industry and Trade of Russia No. 267 of 3 February 2022 “On Approving the List of Commodity Codes in accordance with the Harmonised Commodity Description and Coding System of the Eurasian Economic Union Transactions in relation to which Qualify as Controlled Transactions according to Article 105.14 of the First Part of the Tax Code of the Russian Federation” (such as oil, mineral fertilisers, ferrous and non-ferrous metals, precious metals and gems) (“MIT List”) will be provided together with the notice of controlled transactions (article 105.15 (8) of the Russian Tax Code). In relation to the mentioned transactions of 2024 documentation can be provided after the due date, but before 1 December 2025.
• The right to serve notice of controlled transactions in paper form will be given only to individuals; organisations will switch to an e-filing format (article 105.16 (2) of the Russian Tax Code).
• The Law expands the list of mandatory data to be set out in the notice of controlled transactions (clauses 5-7 of article 105.16 of the Russian Tax Code). More specifically, the notice must contain the following information:
• the terms of the transaction and where there is a delivery of goods — the terms of delivery, delivery basis and shipment date (title transfer date, transaction income (expense) recognition date). This is not a significant change, as this rule is being currently applied de facto;
• the applied methods as are stipulated by chapter 14.3 of the Russian Tax Code and sources of information on comparable transactions. Now it is not mandatory to fill in these lines in the notice form, but in practice the taxpayers have already chosen to indicate this information. This rule effectively means that the economic analysis and the choice of the sources of information must be completed before the notice is due; and
• for cross-border transactions between related parties involving commodities from the MIT’s List — information on transactions involving the resale and/or prior purchase of goods, including information on the ultimate purchaser and/or origin of goods, prices, commercial and/or financial terms of such transactions (information on the value chain).
  
  The taxpayer must take action to procure information on the value chain from its related parties and may not invoke the related party’s refusal to disclose the value chain as an excuse (article 105.16 (8) of the Russian Tax Code).

Multinational enterprise group

• A group of organisations that would have to prepare consolidated financial statements had the securities of either of them been admitted to trading will now also qualify as a Multinational Enterprise Group (“MNE Group”) (article 105.16-1(1)(1) of the Russian Tax Code).
  
  This change has brought the definition of MNE Group in line with the definition of MNE Group’s Parent Company (article 105.16-1(7)(1) of the Russian Tax Code) and with the definition of MNE Group set out in the OECD Guidelines. This will probably result in an increase in the number of companies that qualify as MNE Groups from a Russian tax legislation perspective and to such groups incurring additional country-by-country reporting obligations. It is necessary to analyse information disclosure rules for stock listing in relation to each particular group.
• A duty was introduced to provide information from the consolidated and financial statements of an MNE Group and from the financial statements of the members of the MNE Group if all of the following conditions are in place (article 105.16-7 of the Russian Tax Code):
• over 50% of the MNE Group’s assets are located in Russia in the year preceding the year of the controlled transaction;
• at least one member of the MNE Group made cross-borders transactions involving commodities from the MIT List; and
• the specified transactions are controlled transactions.

The abovementioned data is to be provided to the tax authorities by the parent company of the MNE Group or by an authorised member of the MNE Group who is a Russian organisation or a Russian tax resident.

It is necessary to provide not only data from the consolidated financial statements of such MNE Group and from the financial statements of the members of such MNE Group that made the transactions, but also the statements of the MNE Group members that made resale transactions involving the specified goods and/or ensured that such transactions be made (inter alia, by way of providing transportation, storage, packaging, insurance, financing and marketing services).

Information must be provided in electronic form according to an established format within 12 months of the end date of the fiscal year in which the transaction took place.

The tax authority is given the right to request the specified data outside tax audits as stipulated by article 93.1 (2) of the Russian Tax Code.

Advance pricing agreement

• The right to conclude an advance pricing agreement will be granted not only to the so-called “major taxpayers”, but also to the taxpayer who is a party to a controlled transaction involving goods from the MIT List where income (expenses) over a calendar year exceeds RUB 2 billion (article 105.19 (1) of the Russian Tax Code).
• The term of the advance pricing agreements will be five years, covering two years before the application filing date, the year in which the application is filed and two years after that (article 105.21 (1) of the Russian Tax Code).
• It will be possible to conclude an advance pricing agreement in relation to a cross-border transaction with a resident of a foreign state with which there is a DTT (under the mutual agreement procedure) for a maximum of three years (article 105.21 (1.1) of the Russian Tax Code).
• The state fee for the consideration of the application has been reduced from RUB 2,000,000 to RUB 1,000,000 (article 333.33(1)(133) of the Russian Tax Code).

TP related penalties

The basis for calculating a tax penalty for the non-payment or incomplete payment of tax on controlled transactions is changing. Instead of the percentage of the unpaid amount of tax, now the penalty will be charged in the amount of the unpaid amount of tax on dividend income calculated as a result of the adjustment of the transaction price (article 129.3 of the Russian Tax Code). In relation to controlled transactions between Russian residents, the penalty has not changed (article 105.14 (2) of the Russian Tax Code).

Another radical change is that TP documentation will release you from liability under article 129.3 of the Russian Tax Code only in relation to transactions between Russian residents (article 129.3 (2) of the Russian Tax Code).

The tax penalties for breaching the rules on the provision of TP documentation have increased considerably. Below you will find a comparison chart of current penalties versus future tax penalties.

Breach	Current tax penalty	Tax penalty according to the Law
Article 129.3 of the Russian Tax Code Non-payment or incomplete payment of tax as a result of the application of the terms in controlled transactions that are not comparable with the terms of transactions between non-related parties	40% of the unpaid amount of tax, but no less than RUB 30,000 (lifted from 1 January 2022 through to 31 December 2023)	the amount of tax on dividend income, but no less than RUB 500,000 for transactions between Russian residents –same as before
Article 129.4 of the Russian Tax Code Failure to serve notice of controlled transactions or misrepresentation	RUB 5 000	RUB 100 000
Article 129.9 of the Russian Tax Code Failure to serve notice of participation in an MNE Group or misrepresentation	RUB 50 000	RUB 500,000 per each breach
Article 129.10 of the Russian Tax Code Failure to provide a country-by-country report or misrepresentation	RUB 100 000	RUB 1,000,000
Article 129.11 of the Russian Tax Code Failure to submit documentation in relation to an MNE Group, documentation in relation to a particular transaction or information from financial statements	RUB 100 000	RUB 1,000,000 for a failure to submit national and global documentation and data from financial statements; RUB 500,000 for a failure to submit documentation in relation to a particular transaction

Effective period

According to clauses 7 and 8 of article 6 of the Law, the relevant changes will apply to transactions beginning from 1 January 2024 irrespective of the execution date of the relevant agreement, unless provided otherwise by a regulatory act of the President of the Russian Federation. However, transactions where income and/or expenses are recognised for tax purposes before 1 January 2024 will be subject to the currently effective TP rules. Please note that according to articles 1, 4, 5 of the Russian Tax Code the Presidential acts currently do not regulate tax legislation. That said, such Presidential acts may regulate other issues which, in their turn, may lead to the change of the moment of the application of the new rules established by the Law for all or for certain taxpayers.

Conclusions and recommendations

The changes introduced by the Law to the TP rules have undoubtedly become the most far-reaching changes since the introduction of the TP rules to Russian tax legislation. The new rules cover almost all TP aspects and liability for breaching such rules has increased tenfold. In this regard, it is imperative that you analyse: which transactions will fall under TP control as a result of the changes made; what additional responsibilities the taxpayers will incur; what action you need to take in an attempt to soften the new rules; how you can prove the potential entitlement to reliefs and exemptions; what risks you will incur and how you can avoid them; and many other issues.

The Denuo tax team has a wealth of experience in assisting with complex international and Russian transactions involving TP compliance issues, be it at the planning stage or already in the course of an ongoing relationship. Our team possesses the requisite expertise to provide such services and all necessary tools, including authorised access to international databases to search for comparables from a variety of sectors (delivery of goods, work or services, licence arrangements, etc). We are ready to provide assistance on the above-mentioned issues, assess the implications of these changes for your structures and operations, prepare TP documentation with reference to the new rules as well as to provide tax support in Russia and abroad relying on our access to international tax expertise.