Expert says Russia-Netherlands tax deal break may hurt Yandex

MOSCOW, Apr 13 (PRIME) -- Internet giant Yandex, whose holding company is registered in Amsterdam, may be forced to change jurisdiction because the tax burden for Dutch holding units in Russia will rise significantly if the tax agreement between Russia and the Netherlands is denounced, Center of Strategic Developments expert Levon Airapetyan said on Tuesday.

The news about possible denunciation of the tax agreement with the Netherlands is “one of the hardest pieces of recent news in the field of international taxation”, Airapetyan, who heads the center’s tax policy division, told PRIME.

“For example, Yandex, whose Dutch holding company Yandex N.V. trades on the Nasdaq. Evidently, it will face a significant rise of the tax burden on flows from Russia, which may also impact final dividends paid to the investors around the globe,” the expert said.

“To avoid such consequences, a company may consider a move to another foreign jurisdiction or Russia. But for such a large firm as Yandex, it will be hard to leave the Netherlands at least for the organizational reasons – it is a real business with a great deal of intergroup connections, all of which should be re-assessed in case of migration and reconsidered not only from the point of view of taxes, but also the business point of view.”

End %%ee/jst%%