The Ministry of Finance has developed rules for cash settlements between residents and non-residents – a draft government decree prepared by the department allows residents to receive foreign currency and rubles from non-residents without restrictions in payments for exports and return advances on failed import transactions. According to lawyers, the amendments de facto neutralize the norms of currency legislation on the prohibition of cash payments and can make it easier for businesses to conduct transactions. Companies, however, without waiting for bureaucratic formalization, are already using such schemes in practice, experts say.
Following Presidential Decree No. 737 of October 15, 2022 on the temporary procedure for transactions due to sanctions, the Ministry of Finance published on regulation.gov.ru a draft government decree on the rules for settlements between Russian exporters and importers with foreign partners. It follows from the document that residents can receive rubles and foreign currency from non-residents in accordance with foreign trade contracts without restrictions on the amount. We are talking regarding payment for goods supplied to non-residents, work performed for them, services rendered to them, information transferred to them and results of intellectual activity (RIA), including exclusive rights to them. The rules also apply to the return to Russian residents of advance payments for goods not imported into Russia, work not performed, services not rendered, RIA and exclusive rights not transferred, as well as settlements on loans in the event that residents provide loans to non-residents.
The cash received in this way can be used by a resident for mutual settlements with foreign counterparties without being credited to bank accounts – either credited to accounts opened with banks abroad, or imported into Russia. In the latter case, it is necessary to credit the currency to your account with a Russian bank within 30 days, or sell the currency to it (at the exchange rate of the Central Bank on the day of sale) and credit the account with rubles, or deposit the currency into your cash desk. In any case, residents must report to the authorized bank within 45 days – send it documents on cash settlements, confirmation of the fact of the transaction (transfer of goods, performance of services, etc.) and data on declarations for goods.
Lawyer, NSP partner Ilya Rachkov explains that now a Russian buyer, as a general rule, is obliged to pay for goods (works, services, IP) to a foreign supplier from his account in a Russian bank.
The same applies to advance payments for goods – it is necessary to ensure their return from a foreign supplier to your accounts in a Russian bank. “Amendments are necessary, because otherwise the possibilities of Russian buyers of goods (works, services, IP) from foreign suppliers are severely limited: either Russian persons cannot send money to foreigners, or foreigners cannot receive it. The situation is complicated by correspondent banks: for example, a Russian bank of a Russian buyer sent money to a foreign supplier, the latter’s bank is ready to accept them, but the correspondent bank does not allow the payment to be made, ”explains the lawyer.
Partner of Kulkov, Kolotilov & Partners Oleg Kolotilov draws attention to the fact that the document concerns only cash. “Until recently, settlements under large contracts in cash were rather exotic, so the document, if adopted, will not have a radical impact on turnover,” he believes. The law on currency regulation lays down the general principle: currency transactions between residents and non-residents must be carried out in a non-cash form through authorized (that is, Russian) banks. According to the lawyer, the decision actually eliminates this rule. “Non-cash settlements are complicated, therefore it is logical to allow settlements in cash, it is also logical to cancel the requirement to credit foreign currency to Russian banks, since following it has been credited, it may be difficult to withdraw it to pay the necessary expenses,” he adds.
Meanwhile, in practice, the rules of the game in the market under the influence of sanctions have already changed, and business has adapted to new conditions. Sergey Sokolov, Vice President of Opora Rossii, notes that Russian companies have the right to receive cash from foreign buyers – money is deposited under the agreement to a settlement account in an authorized bank and no complications arise, but until recently there were restrictions (up to 100 thousand rubles .) to combat the shadow turnover. “So far, mutual settlements are taking place in a mixed version: foreign companies pay to the settlement account of a foreign bank that has a branch in the Russian Federation, Russian companies open accounts there, and the money goes through one correspondent account. This is a well-established settlement scheme since the summer, but not all companies can open such accounts, at the discretion of the bank,” he explains.
Member of the General Council of Delovaya Rossiya, Chairman of the Board of the Council for the Development of Foreign Trade Maxim Chereshnev adds: “Wherever possible, businesses have switched to paying in national currencies. But counterparties in unfriendly countries are sometimes ready to accept payments only in euros or dollars and only from a non-resident of the Russian Federation. The Council for the Development of Foreign Trade solved the problem with the help of a network of partners – when they can accept a payment in a third country in one of the national currencies and then carry it on to an unfriendly country. In this case, the transfer itself abroad takes place even before the fact that the imported goods are delivered to the intermediary company,” he says.
