On 5 August 2013, the Ministry of Finance published Letter No. 03-03-06/1/27682 issued on 16 July 2013 clarifying the conditions of requalifying the interest as dividends when the interest payments are made by a Russian corporate borrower to a foreign creditor particularly when the loan is assigned to a new creditor.
In 2007, a Russian corporate borrower took a loan from a Cypriot creditor that had a holding of 50% in the capital of the borrower. In 2010, the Cypriot creditor assigned the …