MinCifry can restrict foreign IT companies’ access to benefits

Ministry of Digital Development, Communications and Mass Media (Ministry of Finance) Russia intends to change the rules for the formation of the register of accredited IT companies, which will allow not to include foreign structures in the list and thus close their access to benefits, Kommersant reports, citing sources.

The ministry confirmed to the newspaper that the department is discussing changes to the rules for accreditation of IT companies, they may come into force no earlier than July 1, 2025. It is proposed to introduce a mechanism under which a Russian legal entity can receive accreditation, “in which the total share of direct and (or) indirect participation of Russian persons is more than 50% of the total number of votes that fall on voting shares (shares) – in accordance with other applicable accreditation requirements,” the Ministry of Finance clarified.

The Ministry of Finance began to “clean up” the registry in the summer of 2022, and a “Council for revoking state accreditation of organizations operating in the IT field” was established. His task, according to the publication, was to audit the registry for the presence of non-core companies in it.

The register now includes, as the newspaper indicates, subsidiaries of Huawei, Samsung, etc. Companies can count on tax benefits, including the possibility of deferral from military service and mobilization for employees.

The interlocutors of the publication, familiar with the discussion of the initiative, said that one of the reasons why industry participants sought a ban on inclusion in the register of subsidiaries of foreign companies was the “aggressive personnel policy of a number of Asian vendors.”

“They have access to cheap money, which allows them to poach our employees by offering significantly inflated salaries,” a source told the newspaper.

Benefits for IT specialists working in accredited companies were announced by Prime Minister Mikhail Mishustin on March 2, 2022. The presence of a company in the register of the Ministry of Finance gives it the right to claim tax benefits, insurance premiums, etc., and also provides its employees with a deferral on conscription, including as part of partial mobilization.

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In the first two months of the benefits, the number of accredited legal entities increased by 10,000 and reached 25,304 organizations, Vedomosti wrote. By mid-summer, there were already more than 30,000 organizations in the registry, including those not specializing in IT, such as Sberbank, VTB, Alfa-Bank. On August 1, the Ministry of Finance excluded more than 400 companies from the register and announced the suspension of applications and the revision of criteria. On October 10, the Ministry of Finance resumed accepting applications for accreditation, but according to the updated rules. The main change is that now companies in which revenue from IT activities is at least 30% will be able to receive accreditation (previously there were no restrictions on the share of revenue). The list of specialized OKVED has also been expanded, which now includes more than 30 types of activities.

In the fall of 2022, the Ministry of Finance hid the register of accredited IT companies, which was previously publicly available on the official website of the department. A Vedomosti source in the ministry explained that this was done due to fears of Western sanctions against companies.