Russia demands 15 percent contribution from exiting Western companies
Date
10/5/2023 5:18:47 AM
(MENAFN) According to a report by Izvestia, Western companies seeking to divest from Russia and sell their assets in the country will soon face an additional financial burden. The Russian Finance Ministry has announced that these companies will be obliged to make a 15 percent contribution to the state budget upon exit. This development marks a further tightening of regulations governing foreign investments and financial transactions involving Western entities in Russia.
Ivan Chebeskov, the Director of the Ministry's Department of Financial Policy, revealed that the 15 percent contribution will be calculated based on the full market value of the company's assets. This means that the financial impact on companies looking to exit the Russian market will be determined by the overall worth of their assets, potentially resulting in significant financial obligations.
The specific details of this new requirement will be outlined in a ruling by the Commission on Foreign Investments, which is expected to be released in the near future. It remains to be seen how this ruling will affect Western companies operating in Russia and their strategies for exiting the market.
This move by the Russian government comes as part of a broader trend of imposing stricter rules on Western firms seeking to divest from Russia. In addition to the 15 percent contribution to the state budget, Moscow has also demanded a 50 percent discount on all foreign deals and mandated that Western companies contribute at least 10 percent of the sale price to the Russian budget. These measures aim to secure a portion of the financial gains from asset sales by Western companies and potentially generate additional revenue for the Russian government.
In summary, the Russian government's decision to require a 15 percent contribution to the state budget from Western companies exiting the market represents a significant financial obligation for such firms. This development underscores the increasingly complex regulatory environment facing foreign companies operating in Russia and highlights the government's efforts to assert control over financial transactions involving Western entities within the country.
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