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Residents of Russian crypto offshore zones will be allowed to choose jurisdictions at their discretion

The Ministry of Economic Development will further ease the regulatory regime for foreign business residents of Russian offshore zones. The country’s authorities plan to turn the islands of Russky and Oktyabrsky into international financial centers with a focus on crypto economy. Residents of the special economic zones (SEZs) are unlikely to benefit from the promised privileges in the foreseeable future, however. This is partially due to certain curiosities of administrative and juridical nature, like the formal absence of Oktyabrsky Island as a geographical object.

The amendments to the law on the special economic zones in Russia will entitle foreign companies to choose between Russian and foreign forms of corporate regulation. Many experts believe, however, that despite such a generous gesture on the part of the Russian government, only those holdings which are subject to economic sanctions already, could really benefit from moving their headquarters to the local offshore zones. At the same time, it is highly unlikely that some of the internationally recognized companies will abandon their European registration.

“They have a baseline problem there. As it turned out, there is no Oktyabrsky Island in Kaliningrad Region. There is no such geographical object, it does not exist,” – Deputy Minister of finance Ilya Trunin said on the matter.

Back in August, Russian legislators have adopted the law on Russian offshore zones, which formally allows their residents to preserve nominal value of their stocks in foreign currencies and pay dividends in accordance with the International Standards of Financial Accounting (ISFA).

Later the same month, Armenian government issued a decree on the creation of a free economic zone (FEZ) with cryptocurrency mining datacenter in the town of Razdan in order to attract foreign investment and strengthen the country’s investment appeal.