Moving money from Russia into a Latin American project: limits, permits and reports

What is happening

A company wants to add capital to its Brazilian subsidiary in an amount that, together with earlier payments to it, may exceed the limit. It needs to calculate the aggregate and decide whether to apply to the Bank of Russia.

A Russian company opened an account with a Peruvian bank to pay local suppliers and did not notify the tax authority, and the deadline has passed.

A partner from a state that may be on the unfriendly list is due to become a co-founder of a Mexican company, and the Russian bank is asking questions about the transaction.

What the law says

• Payment by a Russian resident for shares, contributions or interests in the property of foreign legal entities requires Bank of Russia permission (paragraph 2 of Presidential Decree No. 126 of 18 March 2022 on Additional Temporary Economic Measures to Ensure the Financial Stability of the Russian Federation in the Field of Currency Regulation).
• Under Bank of Russia working group decision No. PRG-43-11/1199 of 1 June 2026, from 1 July 2026 such payments may be made without an individual permit, in roubles or foreign currency, up to the equivalent of RUB 30 million at the Bank of Russia rate on the payment date. The limit is aggregated per non-resident legal entity, counting transactions since 1 April 2024, and the decision contains no restriction by the non-resident's country. The previous decision No. PRG-12-3/534 of 6 March 2024 has been revoked.
• Residents may open accounts with foreign banks without restriction, except for persons covered by Federal Law No. 79-FZ of 7 May 2013 (Article 12(1) of Federal Law No. 173-FZ of 10 December 2003 on Currency Regulation and Currency Control). The tax authority must be notified of opening, closing or changing the details of an account within one month (Article 12(2) of Law No. 173-FZ), and legal entities also file cash flow reports with supporting documents (Article 12(7)).
• Crediting funds to foreign accounts and transfers from them are further restricted by acts of the President, the Government and the Bank of Russia; we check the conditions at the date of each transaction.
• Transactions with persons from unfriendly states follow a special procedure under Presidential Decree No. 81 of 1 March 2022 on Additional Temporary Economic Measures to Ensure the Financial Stability of the Russian Federation, with the permission of the Government Commission; the list of such states was approved by Government Order No. 430-r of 5 March 2022.
• Breaches of currency legislation, including missed notification and reporting deadlines, give rise to liability under Article 15.25 of the Russian Code of Administrative Offences.

What we do

• We calculate the aggregate payments to the foreign company since 1 April 2024 and check whether a new payment fits within the general limit.
• If the limit is not enough, we prepare an application to the Bank of Russia for an individual permit, with justification and documents.
• We prepare the Russian shareholder's corporate resolution on the contribution or payment for the stake.
• We handle the paperwork with the authorised bank, including contract registration where required.
• We check whether any parties to the transaction or banks are from unfriendly states.
• We prepare notifications of opening, closing or changing details of foreign accounts and cash flow reports.
• We keep a deadline calendar; tax notifications of shareholdings and CFCs are a separate service within this practice.

What we will need from you

• The amount, currency and schedule of investments in the foreign company.
• A list of payments made to it since 1 April 2024, if any.
• The foreign company's constitutional documents and the resolution on the capital increase or contribution.
• Details of foreign accounts and statements.
• Contacts at your bank's currency control desk.