In 2016, Russia joined the OECD agreement about information standard for the Automatic Exchange of Information (AEOI) regarding bank accounts on a global level, between tax authorities. 97 countries had already signed this document (there are major offshore zones like Cyprus, the United Arab Emirates, St. Kitts and Nevis, the Bahamas, US Virgin Islands). The purpose of the agreement is to increase tax transparency and combat tax evasion.

 How it works? So, financial institutions (banks, insurance companies, investment funds, etc.) provide information about non-resident accounts to the tax service of their country, and the tax service automatically transfers these data to a similar department in another country where these citizens are residents. Subsequently, the information should be matched with the tax reports. If they find discrepancies, they will use 75-100% fines (it’s possible to lose almost all illegal money and other assets. Tax services of countries – members of the agreement share not only the account number and the name of the owner, but also the balance sheet, the movement of funds over the past year, the amount of investment income, earnings from the sale of shares and interest on deposits.

 Basically this innovation will bring problems to the large companies that have sources of income abroad – countries will fight for these taxes. The second risk category is the owners of passive companies, those where more than 50% of revenues are passive (dividends, interest, etc.). As for other interested parties, a lot of persons have already changed their tax residency, received another citizenship and don’t have tax ties with Russia – no fears for them.

 Despite the fact that almost 3 years have passed since the signing of the agreement, it is too early to speak about big results yet. Full-scale exchange of information and analyzing – it will take some years more. By March 2019, Russia has already received data from 58 jurisdictions and the FTS has begun matching it. By the same moment, the second wave of the banking amnesty, connected with this agreement, was over: according to the results, more than 10 billion euros of bank account balances were declared, the FTS considers this result like a success. The third wave of the amnesty will last until March 1, 2020, but its conditions will be tougher, before it was only necessary to declare capital, now it is necessary to transfer money to Russia, or to re-register the business structure in the official Russian offshore zones –island Oktyabrsky in Kaliningrad or island Russkii in Vladivostok.