Projects

Providing advice to a large IT company on the avoidance of double taxation

Pepeliaev Group’s lawyers provided advice to the client on issues associated with changing the methods of tax accounting for income and expenses based on the current double taxation treaty with the USA. To successfully complete this project, our lawyers actively consulted the Russian Ministry of Finance. This resulted in amendments being made to the treaty based on our research and formulations. In addition we developed the optimal legal form for the current structure.

Obtaining a refund of VAT for a major telecommunication company

Pepeliaev Group's lawyers provided legal support when a set of documents had been drawn up at the request of the tax authority for VAT to be recovered from the state budget.

Drawing up a production sharing agreement (PSA) in relation to developing the Khvalynskoye field

Within the framework of a state contact with the Russian Ministry of Energy, Pepeliaev Group’s lawyers provided services that involved a legal analysis of the draft of a PSA for the use of mineral resources of the Khvalynskoye field. Our lawyers participated in negotiations with the investor representing the Russian government; they provided recommendations on the wording of the PSA, and expert support to the government's representatives to ensure that the project was as favourable as possible for the Russian Federation, and that the state's interests were protected. In the course of the project, we analysed the PSA’s terms and conditions from the standpoint of whether they were in line with the current legislation on PSAs, the legislation on mineral resources, and the tax regime on the use of mineral resources taking into account the specifics of international status of the Caspian Sea, etc.

While continuing to develop the draft of the PSA, our lawyers were holding negotiations with the Russian Ministry of Energy, the Ministry of Natural Resources and the Environment, the Ministry of Finance, and other ministries and the investor’s members. In addition the lawyers were solving various legal issues relating to the legislation on PSAs, the use of mineral resources, environmental protection, and others. Our lawyers also developed amendments to the inter-governmental Agreement between the Russian Federation and Kazakhstan. This PSA was only the fourth in Russia. For this project, Pepeliaev Group won the 'European Tax Transaction of the Year in the Energy Sector' category at the ITR European Tax Awards.

International treaties: Drawing up a draft order of the Ministry of Finance

Pepeliaev Group’s lawyers have developed a draft Order of the Russian Ministry of Finance on entering into bilateral and multilateral transfer pricing agreements with foreign competent authorities based on international practice and the procedure existing in Russia for entering into unilateral pricing agreements. The project is unique because, until now, it was not possible in Russia to enter into bilateral or multilateral pricing agreements with foreign competent authorities since there was no procedure for signing such agreements. Owing to the work performed by our lawyers, Russian taxpayers will be able to use the benefits of pricing agreements in domestic transactions as well as in cases where foreign trade transactions are concluded. Therefore, the tax consequences of transactions between foreign investors and Russian companies will be more predictable.

Advice on the legislation regarding the controlled foreign companies (CFCs) of Gazprom Export group

Pepeliaev Group's lawyers accomplished a project to assess the tax implications for Gazprom Export LLC in connection with its participation in 44 CFCs registered in 18 jurisdictions. Our experts prepared a memo containing conclusions on the CFC’s entitlement to apply an exemption from the taxation of profit in Russia; we issued recommendations on how to calculate the CFCs’ financial figures and apply exemptions; drafted sample documents and instructions required to fill in the notifications of membership in foreign companies and of CFCs; assessed whether the company was entitled to an exemption from the taxation of the CFCs’ profits; and calculated the CFCs' profits in order to pay tax in Russia. Pepeliaev Group's lawyers have already developed business process roadmaps for the companies to comply with Russian legislation on CFCs.

Prevented the client from facing secondary liability of RUB 650 million

Pepeliaev Group’s specialists provided comprehensive support in a bankruptcy case representing former executives and the founder of the debtor. Thanks to the efforts of our lawyers the debtor was liquidated, the executives and the founder were released from secondary liability of RUB 650 million despite the fact that they had been found criminally liable for tax evasion.