Russian companies leave Cyprus due to sanctions

Ukrinform reports this with reference to Radio Liberty.

At least ten large Russian companies have left or are planning to leave Cyprus, which has long been the main offshore "piggy bank" for Russian business. Among them are TCS Group (the parent company of Tinkoff Bank), marketplace Ozon, retailer Fix Price, and United Medical Group (the holding company of the European Medical Center).

Some choose to re-register in Kazakhstan, the UAE, and other countries that are not on the Russian government's "unfriendly" list. Others move to Russia's Special Administrative Region (SAR) in the Kaliningrad region, which was created "to attract foreign business and investment from foreign jurisdictions."

The main reason for the companies' withdrawal is the constant expansion of sanctions against Russia in response to its invasion of Ukraine. The sanctions make it difficult to conduct transactions between subsidiaries and parent holdings. Counter-sanctions from Russia, which restrict, for example, the payment of dividends, also have an additional impact.

As for Cyprus itself, in the spring of 2023, an investigation into the Russian presence was launched, opening 29 cases against firms and individuals who helped Russian oligarchs avoid sanctions. Since December, U.S. FBI agents have been assisting in the investigation.

As Ukrinform reported, the International Working Group on Sanctions against Russia, headed by the head of the Office of the President of Ukraine Andriy Yermak and the director of the Freeman-Spogli Institute for International Studies (FSI), Ambassador Michael McFaul, has developed new research focusing on Russia's attempts to circumvent export control restrictions.