17:56 GMT +321 February 2019
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    Putin urges end to offshore firms in strategic sectors

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    Russian Prime Minister Vladimir Putin said on Monday that Russian companies holding assets in strategic sectors must do away with the practice of creating offshore firms.

    Russian Prime Minister Vladimir Putin said on Monday that Russian companies holding assets in strategic sectors must do away with the practice of creating offshore firms.

    “Measures to bring the national economy and its strategic sectors out of the offshore shadow are our priority task in the forthcoming period,” Putin said.

    Putin, who is running as a candidate in the 2012 presidential elections and is expected to return to the presidency next year, also said that Russian authorities were seeking to create an accommodative investment environment in the country.

    “If we want to create a normal investment climate in the country, we can’t tolerate the practice of offshore schemes in infrastructure sectors,” he said.

    Putin said Russian law did not prohibit companies from channeling their profits abroad if they paid taxes on their earnings in Russia.

    “If someone wants to keep [profits] abroad, we are not against it. The law does not prohibit this but the withdrawal of funds from the sectoral turnover through shell companies is inadmissible,” he said.

    “We must put an end to the offshore legacy of wild privatization. Otherwise, there can be no talk about any normal [investment] climate in the country or trust in us,” he said.

    Putin also called for checks in the coming two months in all state-run energy companies to find any corruption scams or a connection of their staff with offshore companies.

    “I instruct the Energy and Economics Ministries and sectoral departments with the participation of state companies, such as Gazprom, Transneft, Russian Railways, Sovcomflot, VTB, Vnesheconombank and Rosatom to report within two months on measures they will take. The same also applies to Sberbank,” Putin said at a government meeting on the development of the domestic energy sector.

    During the meeting, Putin brought the attention of those present to breaches exposed by the Energy Ministry in some regional energy companies, and also in the Federal Grid Company and RusHydro.

     

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