Recent News

On August 30, 2017, an international team of researchers notified the Estonian government of a security vulnerability of the ID cards issued to around half of the Estonian population. The potential risk concerns the ID cards issued since October 2014 (including cards issued to e-residents), i.e. about 750,000 cards. In this regard, the Department of the Estonian Information System Authority has taken temporary measures to restrict some features of the ID cards of this period of release. Since there were no real cases of unauthorized use of the ID cards, today the vulnerability is theoretical. A security breach was discovered in connection with the advancement of the “e-Estonia” national initiative, designed to bring citizens into the digital ecosystem of public and private services built upon the security and authentication. The Estonian ID card unifies access to a host of services. Using this card, the citizens can carry out banking operations, vote, file their tax returns, apply for state benefits, apply to serve in the armed forces and fulfil many other actions remotely. Business owners can use the ID cards to file their annual reports, apply for licenses, and so on,...

Within the framework of the judicial reform, the Verkhovna Rada of Ukraine adopted the new Economic Procedure Code, the Civil Procedure Code and Code of Administrative Court Procedure. We remind that the innovations were initiated by Peter Poroshenko even in spring. The new procedural legislation regulates such aspects of the Ukrainian legal proceedings as intervention, change of the subject or grounds for the claim, the composition of the court during the examination of the case on newly discovered circumstances, the clear stages of the trial and the deadlines for the filing of evidence are fixed, reasonable restrictions on the possibility of postponement of the consideration and suspension of the proceedings on the case are set, etc. The participants in the case will be required to state their position in it in the procedural documents specified by law, namely in the claim, withdrawal, response to the withdrawal and denial, submitting them to the court within the time limits specified by law or court. The consequences of non-observance of the terms for submission or concealment of evidence will be their subsequent non-acceptance by the court and the application of means of...

The Ministry of Finance of Ukraine has developed a solution that will improve the operation of the system of registration suspension of the TI and it will allow to avoid blocking of the TI of the real sector of the economy. The innovation mainly relates to the agricultural sector, since the increase in the percentage of "blockages" has been recorded in it recently. We remind that since July 1, the system of automated registration of tax invoices has begun to work in full force, designed to prevent billions of twists with VAT and to counter the receipt of tax credits by the unscrupulous payers. However, the practice shows that due to inadequate operation of the system, the honest Ukrainian business sometimes suffers. According to the results of daily monitoring of the system's operation in the context of different branches, the Ministry of Finance discovered a significant increase in the number of suspended tax invoices of the payers of the real sector in the sphere of agriculture, forestry and fisheries. In June 2017, the share of the invoices issued in this industry was 5% of the total number of suspended TI/ AC, in July - 18%, and in August - 29%. After holding a series of...

In connection with the leaving of the UK from the European Union, one of the largest Singaporean banks, Oversea-Chinese Banking Corporation, is planning to open its branch in Luxembourg. Earlier, the European branch of OCBC was located in London, which allowed the bank to manage affairs in the EU. Now the banking corporation is considering Luxembourg as a convenient place for doing business, where it intends to open a new branch. The implementation of this plan will be a very significant event in the financial history of the Grand Duchy. However, it should be noted that the decision is not final yet and the bank is also considering other jurisdictions. It is expected that the situation will become clear after the announcement of the results of the meeting of the Executive Director of OCBC Bahrain Shaari and the Prime Minister of the Grand Duchy Xavier...

On September 27, the Minister of Finance of Ukraine, Alexander Danilyuk, met with the representatives of the Organization for Economic Cooperation and Development (OECD) to discuss the implementation of the Action Plan on Base Erosion and Profit Shifting (BEPS) and joining of Ukraine to the automatic exchange of information between fiscal authorities (AEOI standard). With this visit, the OECD representatives launched the first common program for the implementation of the international standards for information exchange and BEPS activities. According to Alexander Danilyuk, the Ministry has developed a detailed Roadmap for the introduction of the Minimum Standard of the Plan, according to which Ukraine will join the MLI (Multilateral Instrument) before the end of this year. The implementation of the Steps 6 and 14 of the Minimum Standard of the Plan will contribute to improving the mechanisms for combating the artificial use of the additional benefits of the international conventions in order to exempt profits from taxation. The corresponding amendments will be introduced in more than 60 existing international conventions on the avoidance of double taxation. It is also worth noting...

De-offshoring process is gaining momentum. The pressure from the Organization for Economic Cooperation and Development (OECD) is increasing to which the offshore jurisdictions are subjected. Thus, at the request of the OECD, the changes in the Law on International Commercial Companies (hereinafter the Law) have entered in force since July of this year in Belize. Among the main innovations are: the obligation to maintain a register of the beneficial owners and the register of the directors, as well as a ban on the issue or exchange of the bearer shares. Register of beneficial owners Unlike many other jurisdictions, in Belize, this obligation was realized with the requirement to store data on the beneficiaries only at the company registration address. As a rule, this is the address of the registration agent. But there is no requirement to submit data from this register to the state register of the companies. At the same time, it is not necessary to provide historical information - only the data of the current beneficiaries of the company are entered in the register. The term "beneficial owner" is defined as an individual: - who owns or ultimately controls the company; - ...

On August 27, 2017, the president of the UAE signed a law presupposing a change in the tax legislation of the country, namely, the introduction of a value-added tax. This decision was made within the framework of the economic policy of the closed international organization CCASG, which also includes Bahrain, Oman, Kuwait, Qatar and Saudi Arabia. According to the Law, each taxpayer will be obliged to register and submit reports annually to the tax authorities in Arabic or any other language, but with translation into Arabic. The standard rate of VAT in the UAE will be 5%, but there will be some exceptions that provide for a zero-rate tax or full exemption from it. The zero rate will be applicable in such areas as the export of goods and services outside the CCASG, international transportations, operations with certain types of precious metals, the primary sale of real estate (subject to its implementation within 3 years after completion of the construction), the supply of air, sea and land transport, as well as educational and medical services. The provision of certain types of financial services, as well as transactions with residential real estate, land and local passenger...

Switzerland has published a new version of the VAT Law which provides for a number of amendments. The changes are aimed at improving the mechanism for taxing of local companies with the value-added tax and they will come into force on January 1, 2018. To date, the foreign companies providing services in Switzerland are exempt from the VAT from Swiss turnover if it does not exceed 100,000 Swiss francs, that is equivalent to $ 103,726. In the opinion of the Federal Council, this has caused a decline in the competitiveness of the Swiss firms, especially in the border regions. According to the adopted amendments, on calculating the obligations of the company on VAT, its global turnover will be taken into account. The enterprises with world financial turnover of 100,000 Swiss francs or more will be subject to the VAT from their supply, starting with the first franc of the turnover amount in Switzerland. The introduction of a new system for mail-order companies has been postponed until January 1, 2019, because the Swiss post offices will need more time to implement the appropriate technical provisions. With the advent of this date, the mail-order companies will be subject to the value...

While the black list of the offshore companies is only being approved, the European Union is actively discussing the economic sanctions in relation to the jurisdictions that will fall into its final version. We remind that the idea to draw up such a list arose early in the beginning of the last year with the purpose of counteracting the removal of profits from taxation and supporting the "fair tax system in the EU and in the world". According to the criteria approved at the end of 2016, the countries and territories with "weak tax transparency", preferential tax treatment and no income tax will be included in the black list. In order to avoid being included into the list, the jurisdiction must meet three main requirements, namely: to sign the Multilateral Convention on Mutual Administrative Assistance in Tax Matters or conclude separate agreements on the exchange of tax information with all EU Member States by December 31, 2018; by the end of this year, to join the BEPS (Base Erosion and Profit Shifting) Plan developed by the OECD and containing recommendations on combating evasion of income tax; to exclude the possibility of registration and operation on its territory of the...