Alina Kalinskova has commented for the Novy Prospect on Lenta retailer’s “move” from Cyprus to Russia

At the end of July 2020, an extraordinary shareholders’ meeting of Lenta (Russia’s largest hypermarket chain) approved the company’s change of jurisdiction from Cyprus to Russia. Retailer`s new registered office will become a special administrative region on Oktyabrsky island in Kaliningrad Region.

It should be noted, that Lenta has resorted to a rare procedure of offshore companies redomiciliation. The tool appeared in Russia only in 2018 and allows to transfer a company from one jurisdiction to another, change the personal law of a legal entity without the need for liquidation, transfer of assets and new company registration. “Moreover, in this case, the date of creation of the company will remain the date of its establishment in the first jurisdiction, not the date of registration in the host state. There will also be no need to renegotiate contracts, close and open bank accounts and generally suspend the company’s activities,” Alina Kalinskova, a junior associate at Maxima Legal, commented for the Novy Prospect online publication.

According to the Ministry of Economic Development of the Russian Federation, a several dozens of companies have already registered in the “Russian offshore” in Primorsky region Kaliningrad region in the process of jurisdiction change.  According to official information, 35 residents were registered on the Oktyabrsky Island in Kaliningrad Region by November, 30.

“However, the procedure will be popular in the near future, taking into account the Russian policy of deoffshorization as well as changes in double taxation agreements, including those with the Republic of Cyprus,” said Alina Kalinskova.

To read the full article (in Russian) please see the Novy prospect website >>>