Relaxes the criteria for granting permission to distribute dividends to the owners of Russian companies from “unfriendly” states
23 Aug 2023
On 23 August 2023, the Ministry of Finance released an excerpt from the minutes of the Subcommittee of the Commission for the Control of Foreign Investments, wherein a decision was made to relax the criteria for granting permission to distribute dividends to the owners of Russian companies from “unfriendly” states.
The published excerpt specifies that such permissions may now be granted without adhering to the previously established conditions, which included restrictions such as limiting dividend payouts to 50 per cent of the previous year's net profits, requiring the paying company to hold social and/or economic significance, and mandating the fulfillment of obligations related to key performance indicators.
The new conditions for granting permission to distribute dividends introduce the following changes:
• Foreign shareholders (participants) must have made investments in the Russian economy, including expanding production within the Russian Federation and advancing new technologies, after 1 April 2023.
• The amount of dividends paid cannot exceed the amount of investments made.
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Treatment and operation (Capital transfer and FOREX, Operational conditions )
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