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Changes in administrative liability for violation of currency legislation

On July 20, 2020, Federal act No. 218 of July 20, 2020, was signed, making comprehensive changes to the administrative Code in terms of liability for violation of currency legislation.

Significantly reduced was liability for violation of the obligation to repatriate funds. From July 31, 2020, the following fines are imposed. First-time violation fines are reduced from current 75% to 100% for the next cases:

  • For ruble-denominated foreign trade contracts, the fine is from 3% to 10% of the unpaid amount;
  • For foreign currency contracts, the fine is from 5% to 30% of the unpaid amount;

At the same time, liability is introduced for citizens for non-receipt of revenue and non-receipt of funds from the borrower. Although the original purpose of the changes is to return funds issued by individuals in the form of loans, the wording of the act also creates the risk of liability for non-repatriation of revenue under any foreign economic contracts (except for prepayment).

Fines for individuals are the same as for organizations and entrepreneurs: from 3% to 10% for ruble contracts or from 5% to 30% for currency contracts.

Exemption from liability

• For violation of the obligation to repatriate

Residents are able to avoid administrative liability for violations of currency legislation in the following cases:

  • if the funds were credited to a foreign account within the established period and were transferred to your account in an authorized bank within 45 days,
  • and the amount of obligations under the agreement does not exceed the equivalent of 200, rubles.

• For late submission of documents

For late submission of documents (accounting and reporting forms, supporting documents, and information on currency operations): penalties are not applied if the delay does not exceed 90 days.

New liability

• For accounts in non-Bank financial market organizations

The act introduces liability for violations related to reports and notifications on residents' accounts not only in banks but also in other financial market organizations located outside the Russian Federation.

This change was quite expected and followed the previously established obligation of residents to notify the tax authorities of the opening of such accounts and provide reports on movements on them.

• For failure to provide for termination of obligations under contracts in rubles

Liability is introduced for non-fulfillment of the obligation to fulfill or terminate obligations under ruble foreign trade contracts concluded between a resident and a non-resident, for which the obligation to repatriate was previously replaced by the obligation to terminate.

The fine for such a violation is set at a rate from 5% to 30% of the amount of money owed to a resident from a non-resident. This is higher than the amount of the fine for non-fulfillment of the obligation to repatriate under steering contracts. Moreover, if the obligation is fulfilled with delay, the fine will not be reduced.