There is a difference between related and affiliated entities. II. Related Party Disclosure. Criteria for related transactions

Interdependent For tax purposes in accordance with the provisions of the Tax Code, persons are recognized if the particularities of the relationship between them may influence:

on the conditions and results of transactions made by these persons;

economic results of their activities or the activities of the persons they represent.

When determining the mutual dependence of persons, the influence that may be exerted due to the participation of one person in the capital of other persons is taken into account.

To do this, the agreements concluded between them and other opportunities of one person to influence the decisions made by other persons are analyzed.

In this case, such influence is taken into account regardless of whether it can be exerted by one person directly and independently or jointly with his interdependent persons.

If persons are interdependent, then special rules for tax control of transaction prices may be applied to transactions between them.

Who are recognized as related parties?

According to the Tax Code of the Russian Federation, the following are recognized as interdependent persons:

1. Organizations

1.1 If one organization directly or indirectly participates in another organization and the share of such participation is more than 25%.

1.2 If the same person directly or indirectly participates in these organizations and the share of such participation in each organization is more than 25%.

1.3 If in organizations, by decision of the same individual, together with his interdependent persons - spouse, parents (including adoptive parents), children (including adopted children), full and half brothers and sisters, guardians (trustees) , wards, appointed or elected:

sole executive bodies of organizations;

or at least 50% of the composition of the collegial executive body;

1.4. If in organizations the same individuals together with his interdependent persons - a spouse, parents (including adoptive parents), children (including adopted children), full and half brothers and sisters, guardians (trustees), wards, make up more than 50%:

composition of the collegial executive body;

board of directors (supervisory board).

1.5 If the powers of the sole executive body in organizations are exercised by the same person.

2. Individual and organization

Related persons: details for an accountant

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Interconnected transactions are a term that is quite important within the framework of civil legal relations in our society. Legislative bodies often resort to it, despite the fact that a legal definition has not been fully developed to this day. In many ways, the concept of “interrelated transactions” has become widespread among law enforcement officials for the same reason - there is no single interpretation of the term, which allows for attempts to “pull the blanket to one’s side.”

Laws, rules, interpretations

The laws of our country currently do not provide a precise definition of the term “interrelated transactions.” Analysts expect that this issue will be resolved by the judiciary, but there is no clarification yet, which is especially difficult against the backdrop of quite diverse legal practice, which significantly complicates the conduct of cases.

Civilians and specialists, who are forced to interpret the concept in one way or another in their work, agree that it is necessary to supplement the ninth chapter of the Civil Code with an appropriate definition. This will allow us to once and for all resolve disputes related to whether in a particular case it can be said that interrelated transactions take place or whether the concept is inapplicable to the situation.

In addition to laws considering the activities of legal entities, the concept of “interrelated transaction” and its definition are also important for the 28th federal law, dedicated to competition in the market and the protection of this phenomenon. Such transactions are considered in the Tax Code and some articles of laws devoted to bankruptcy.

Concepts and laws

For antitrust law, interconnected transactions are a phenomenon that must be taken into account when controlling concentration in a country's economy. As for corporate laws, for them the phenomenon plays an important role from the point of view of the correctness of procedures associated with transactions classified as large. In addition, when concluding various transactions for corporate law, the concept of interest comes to the fore. And it is largely based on interrelated transactions.

Theory in practice

What is it about? For example, when concluding a fairly large transaction, company managers can get good benefits if they split it into several relatively small ones. Most often, this practice can be noticed in the work of joint-stock companies. This avoids asking permission from the shareholders meeting.

But if you study the 28th law on competition and the protection of this phenomenon, you can learn from the seventh paragraph that interconnected transactions are those that can only be concluded if the approval of the antimonopoly authority is obtained. This applies to transactions in which shares, rights to property, or the property itself are dealt with. FAS must approve the planned event, when the object will be intangible assets, the book value of which is 20% of the book value of the fixed assets. Obviously, by trying to circumvent the laws and splitting a single transaction into many small ones, managers thereby commit unlawful acts.

Bankruptcy

The federal law on the insolvency of legal entities assumes the use of interrelated transactions for the purpose of determining restrictions: which transactions can be organized and which cannot be arranged. If a bankruptcy case has already been opened, this imposes a certain framework on the conclusion of agreements, so interconnected transactions, credit and collateral become key for the enterprise. It is also worth remembering that in 2009 a new chapter appeared, allowing for the challenge of transactions concluded by an entrepreneur in relation to which the issue of bankruptcy is being considered.

What are related transactions?

To understand whether transactions fall into this category, the court analyzes various parameters, on the basis of which it makes a conclusion. There are a number of criteria, if satisfied, we can talk about mutual connection. Some of them have already become traditional for judicial authorities when conducting hearings in Russia, while others are still being studied. Analysts assume that as soon as it is possible to systematize the criteria, a definition will be derived from them that will allow us to talk about whether transactions are related.

Often the relationship is explained objectively if one transaction flows smoothly from another. Sometimes subjective reasons provoke the phenomenon of mutual connection, for example, a common goal pursued by a chain of interconnected transactions. Bankruptcy, the last buyer - these two aspects attract special attention of the court and serve as one of the indicators of the mutual connection associated with the entrepreneur’s desire to evade responsibility.

JSC: related transactions

When talking about joint stock companies, one cannot fail to mention federal law. Article 78 discusses the concept of interrelated transactions. It is assumed that these are concluded so that a legal entity alienates or acquires some property indirectly or directly. This article defines a major transaction as one whose value is a quarter of the book value of the assets. The assessment is made at the moment when a decision is made in favor of the transaction. The exceptions are such agreements that accompany economic activities in their normal course. Conducts detailed seminars examining related party transactions, Vegas Lex. The company is quite well known in Russia and has been operating since 1995.

From large transactions, the concept of interrelated obviously follows. These can, if desired, include absolutely any agreements concluded by some enterprise, and there is not even a time frame for establishing a mutual connection between the two phenomena. This inaccuracy is a significant problem with current regulations. Persons who jointly own a certain business can nowadays take advantage of such imperfect legislation, against the background of which they open litigation that becomes protracted. As a rule, the pursued goal is to put pressure on other participants, shareholders.

What in practice?

If you study the court cases in which interrelated transactions were considered under 223 Federal Law, you will notice that the court usually classifies as a phenomenon events that quite obviously pursue the same goal. The judges reveal the mutual connection precisely against the background of conclusions about what the real goals were in each specific case.

Related transactions for the purposes of defining a major transaction are those that could be combined into one, but if so approached it would be subject to approval. However, there are no strictly limited criteria, so the judge chooses the circumstances that allow us to talk about a mutual connection based on his personal view of the case, from the specifics of the case. Transactions by their type and nature often turn out to be such that there have never been similar cases in judicial practice, which forces lawyers to literally “invent a position on the fly.”

It can be noted that if there was already a precedent when the judge decided in favor of classifying transactions as interrelated, then in future processes, if the situations are sufficiently similar, lawyers try to maintain this approach.

Improvements and stability

Over the past few years, corporate legislation in our country has become much more advanced in many aspects than it was before. Still, some issues remain controversial, and interconnected transactions will be no exception. Judicial practice shows that Federal Law No. 208 of 1995 and No. 14 of 1998 are insufficient to clarify the system. Moreover, the term “interrelated transactions” is often used for one’s own benefit in order to confuse the court and defend one’s point of view - but without a real basis for the use of such a concept.

Clarity of terminology is important not only in terms of defining large transactions and stabilizing the situation with them, that is, eliminating circumvention of laws. If you pay attention to federal law number 208, and specifically to the first paragraph of article 75, you will notice that here interrelated transactions are considered within the framework of the interests of the shareholders of a certain company. We are talking about the company buying back a certain amount of shares (up to 100%) in the case when a decision is made in favor of a major transaction. This must be approved at a meeting of shareholders, and if the results were not in favor of the transaction or shareholders were not invited to such an event at all, then the question of buying back the shares arises.

Qualification in practice

Conclusions about whether the court qualifies transactions as interrelated or refrains from doing so can be tentatively drawn by comparing a specific case with those already recorded in judicial practice earlier. It is worth remembering that usually responsibility for interrelated transactions falls on the head of the enterprise that is being investigated and considered in court.

So, the key criteria that allow us to talk about the connection between transactions and breaking one large transaction into several small ones in order to circumvent the laws:

• subjects coincide;
• transactions influence each other;
• activities are dependent;
• the economic goal is the same for all transactions.

How to ward off suspicion?

The most reliable method to remove suspicion is to prove that all of the listed criteria are not applicable for the transactions considered by the court.

As for the composition of the subjects, it is assumed that the transactions are planned by the same persons and concluded by them. These can be legal entities or individuals. The court may rule that as a result of a perfect chain, the property ended up in the possession of one legal entity, which is a criterion for mutual connection.

On the other hand, there is a known precedent when agreements for obtaining loans were presented in the case, secured by surety agreements, while the borrowers were several persons, which did not allow the transactions to be classified as interrelated. The court ruled that each event had its own responsibilities and rights.

Individuals and groups of individuals and their purposes

The court may recognize counterparties of one enterprise as an interconnected group of persons. This is based on the text of the federal law adopted in 2006 under number 135. It is also possible to include several affiliates in a group of persons. This is permissible, based on the text of the law adopted in 1991 under number 948-1.

Such phenomena, which allow the grouping of persons, may lead to the classification of transactions concluded with them as interrelated. As part of the consideration of the case, the court identifies aspects of economic interaction. If such is found between the persons organizing the transaction, then we are talking about a mutual connection.

The single goal, in turn, is considered in the context of the results produced by the chain of transactions. If they all allow one to come to a certain single result, then the court can make a verdict, assessing the event as interrelated. This works when it can be proven that a similar result could have been achieved with just one transaction, but it was deliberately avoided in order to circumvent the need for a shareholders meeting.

However, there may not be a common goal between transactions. In this case, there is a possibility that the court will not recognize them as interrelated, but it is not 100%; a lot depends on other criteria.

Guilty - not guilty

If an enterprise was able to prove in court that a chain of transactions suspected of being interconnected consists of activities that give rise to obligations and rights (this condition must be met for everyone), then there is a chance to clear its reputation of any suspicions. But the court will draw conclusions about what connections the chain of transactions has by analyzing the direction of each individual operation. This happens even when the objects are different.

What is it about? The object is usually some property or rights. If the court finds that the chain of transactions has a single purpose, this will be a criterion for recognizing the relationship. On the other hand, if this criterion turns out to be the only one that allows the court to recognize several events as interrelated, then the prosecution will have to abandon its position: in itself it is considered insufficiently weighty.

Example

There was a situation when a certain joint stock company entered into a lease agreement. According to it, on temporary use rights, it transferred the hotel complex, or rather, several specialized premises in it. In addition to it, there were other lease agreements that applied to other parts of the complex. The court ruled that the agreements were not related because the items were different.

What about time?

This criterion is one of the most important for a court considering the issue of recognizing transactions as related to each other. It is generally accepted that, from the point of view under consideration, dubious events include those that took place either simultaneously or in a rather limited time period.

To this day, judicial practice does not have any specific solution on this aspect. There are many cases of judicial practice when the final decision was made in favor of recognizing transactions as unrelated, since there was a fairly significant gap between them in time. But the conclusion of several contracts on one day immediately undermines the company’s reputation and gives rise to suspicions that it was done in this form, and not in the form of a single contract, with one purpose - to avoid bringing the issue up for discussion by shareholders.

Which time period is still considered suspicious, and which does not raise doubts and allows us to talk about the absence of a mutual connection? In the absence of specific indicators standardized by law, much will depend on the specifics of a particular case, but in general, the financial year is considered. Since this time period is important for accounting and reporting, and often plays an important role in corporate events, it is considered appropriate to talk about a possible relationship only in relation to those transactions that took place within one such period.

Evidence and anti-evidence

The Arbitration Court of the Russian Federation ruled that a plaintiff who believes that a certain enterprise has “carried out” several interdependent transactions must provide evidence of his position to the authority. Based on the information provided, the judge can decide to assign this classification or refuse to recognize the activities as such.

If the plaintiff presents information from which it follows that several of the previously specified criteria are met, but at the same time it clearly follows that each of the contracts is associated with unique responsibilities and rights, the decision will be in favor of the head of the enterprise who entered into the transaction. Simply put, the court will conclude that there is no relationship.

To prevent discord within the company, internal regulations should be adopted regulating the specifics of concluding large transactions, including aspects of the parties' interests. It must be remembered that recognition by the court of a chain of transactions as interrelated does not lead to their annulment. The only thing that follows from this fact is the requirement to obtain approval from the board of shareholders and the meeting of directors.

Lending to related borrowers involves significant risk caused by the high probability of their simultaneous failure to fulfill their obligations to the bank. That is why identifying groups of related borrowers is an important part of the lending process and a mandatory element of risk management in a credit institution.

Legal connection

The legal relationship of borrowers is most fully defined in Russian legislation and regulations of the Bank of Russia. It is based on the presence of capital ties between borrowers (participation in capital) or organizational and managerial ties (Table 1).

The concept of legal connection was first established by Art. 64 of the Federal Law of July 10, 2002 No. 86-FZ “On the Central Bank of the Russian Federation (Bank of Russia)”, according to which related borrowers include borrowers who are dependent or primary and subsidiary in relation to each other.

To determine these categories of borrowers, the rules of Art. 105 and 106 of the Civil Code of the Russian Federation (hereinafter referred to as the Civil Code of the Russian Federation). Thus, according to its Article 105, a business company is recognized as a subsidiary if another (main) company or partnership, due to its predominant participation in its authorized capital, or in accordance with an agreement concluded between them, or otherwise has the opportunity to determine the decisions made by such company .

In this case, the dominant participation is the ownership by one borrower of more than 50% of the shares or shares in the authorized capital of another. The ability to determine decisions made by the borrower arises by transferring the powers of the sole executive body, introducing appropriate restrictions into the charter, or exchanging management personnel (employees of one borrower joining the management bodies of another).

Article 106 of the Civil Code of the Russian Federation provides for the recognition of a business company as dependent if another (dominant, participating) company has more than 20% of its voting shares (stakes in the authorized capital).

A significantly broader list of grounds for classifying borrowers as related is contained in clause 4.6 of Bank of Russia Instruction No. 110-I dated January 16, 2004 “On Mandatory Bank Standards” (hereinafter referred to as Instruction No. 110-I).

Table 1

What is new in this definition is the emergence of indirect influence (through third parties), as well as the need to include in the group of related borrowers whose decisions may be influenced by the same third party. This makes it possible to sum up the borrower’s share in the authorized capital of another bank client with the shares of related individuals and legal entities.

In addition, it is necessary to take into account the presence of minority shareholders (interest holders), which allows, even in the absence of a controlling stake, to determine the decisions made by the borrower.

It should also be noted that one individual combines management positions in the management bodies of several bank clients. At the same time, within the framework of Instruction No. 110-I, the participation of state authorities, local governments and state corporations in the authorized capital of legal entities is not considered as a basis for classifying them as a group of related borrowers.

The instruction also contains a requirement, which is quite controversial from the point of view of banking practice, to include individuals, including individual entrepreneurs (hereinafter referred to as individual entrepreneurs) who are close relatives, in the group of related clients. Based on Art. 5 of the Criminal Procedure Code of the Russian Federation and Art. 14 of the Family Code of the Russian Federation, such persons can be recognized as a spouse, parents, children, adoptive parents, adopted children, grandparents, grandchildren, full and half (having a common father or mother) brothers and sisters.

This approach seems justified only for spouses who have a joint budget and are liable for the obligations of each of them with all jointly acquired property. For other categories, its use is illogical: despite the close relationship, the majority of individual borrowers do not depend on each other, since they have completely different sources of income. Therefore, the occurrence of financial difficulties in one of them will not necessarily lead to their occurrence in the other.

Meanwhile, this approach is enshrined in the regulatory documents of the Bank of Russia, and, despite its imperfections, commercial banks must apply it.

The responsibility for identifying the legal relationship is usually assigned to the legal service, to which all the constituent documents of the borrower and documents confirming the powers of its managers are transferred for analysis. The trust management agreements, simple partnership agreements concluded by the borrower, and any agreements at the bank’s disposal, which, in the opinion of the credit officer, may contain conditions that limit the client’s activities, also go there.

In this case, the conclusion of the legal service employee must contain a list of individuals and legal entities that can have a significant influence on the decisions made by the borrower.

It is also mandatory for the participation in this process of a security officer, who, at the stage of consideration of the loan application, should identify and reflect in his conclusion the facts of the borrower’s managers combining their responsibilities with work in other organizations, the presence of the main founders and managers of shares (shares) of other companies, their registration as an individual entrepreneur.

For this purpose, both publicly available databases are used (for example, information from the official website of the Federal Tax Service, the System for Professional Analysis of Markets and Companies SPARK, etc.), and confidential sources of information.

Economic connection

The economic approach to the connectedness of borrowers is based on their financial dependence, i.e. borrowers are considered as related - legal entities and individuals, the deterioration of the financial position of one of which causes or makes likely the deterioration of the financial position of the other, which may be the reason for the non-fulfillment (improper fulfillment) of its obligations to the bank.

For the first time in domestic banking practice, the concept of economic connection was applied in the Letter of the Bank of Russia dated September 10, 2004 No. 106-T “On calculating the standard for the maximum amount of risk per borrower or group of related borrowers (N6).” It recommended drawing a conclusion about classifying borrowers as related based on a comparison of the amount of obligations under a surety (guarantee) issued by one borrower to secure the obligations of another borrower and (or) the amount of obligations of one borrower to another with the value of its net assets.

X 1 = ,

Where DP- obligations under the guarantee agreement (issued guarantee) provided by borrower 1 as security for the obligations of borrower 2;
THAT- current requirements of borrower 1 to borrower 2 (accounts receivable);
TK- requirements of borrower 1 to borrower 2 under loan agreements;
CHA- net assets of borrower 1 as of the last reporting date.

If the value of X 1 is 10% or more, a conclusion can be made that the borrowers are classified as related.

This approach does not seem entirely justified, since the amount of liabilities is determined as of the reporting date and does not take into account the nature of the relationship between borrowers during the reporting period.

The chosen value of 10% of the borrower’s net assets is also insufficiently justified. Many enterprises (mainly those engaged in the trade sector) do not have significant own capital, so most of their counterparties will fall into the category of related ones. So, for example, all agricultural enterprises in the region that purchase mineral fertilizers from a large supplier with deferred payment will have to automatically be classified as related and their lending will become significantly more difficult.

It should be noted that individual entrepreneurs and enterprises under a simplified tax regime do not have the opportunity to use the “net assets” indicator, since they are exempt from the obligation to prepare a balance sheet.

Also unsuccessful, in our opinion, is the proposal of some experts to establish dependence not on net assets, but on the share of each debtor in the total amount of the borrower's receivables.

Despite the large share, in absolute terms the amount of receivables may be insignificant for the borrower and its loss will not significantly affect his financial condition.

At the same time, according to the position of the Bank of Russia 1, a sign of a deterioration in the financial condition of the borrower is the presence of uncollectible claims in an amount equal to or exceeding 25% of its net assets.

In connection with the above, it seems appropriate to use the amount of balance sheet claims (accounts receivable, debt under loan agreements, purchased securities, etc.) and off-balance sheet obligations under surety agreements, guarantees, pledges provided as security for obligations as a quantitative criterion for the financial dependence of borrowers to third parties. At the same time, in order to exclude the influence of single transactions (primarily for wholesale trade enterprises), only receivables with a maturity period of more than 12 months are included in the calculation.

Net assets were chosen as the basis of comparison for enterprises submitting balance sheets to the tax authorities, and revenue for the last completed year for other entities.

X 2 = *100%,
Where THAT is debt- claims of borrower 1 to borrower 2 for current obligations (accounts receivable with a maturity period of more than 12 months);
Central Bank- securities of borrower 2 purchased by borrower 1;
DZ- the residual value of the property of borrower 1, provided as security for the obligations of borrower 2 under the pledge agreement;
ETC- other obligations of borrower 1, the fulfillment of which is related to the insolvency of borrower 2 (validated bills of exchange, obligations to compensate for losses, etc.);
NA(BP)- net assets as of the last reporting date (for enterprises preparing a balance sheet) or revenue for the last completed year (for other entities) of Borrower 1.

The conclusion that borrowers are classified as related is made when the value of the X 2 indicator is equal to or exceeds 25%. It seems that the use of this indicator will make it possible to determine with fairly high accuracy the level of financial dependence of one borrower on another.

However, there are a number of more complex cases that do not fall under the above formula: for example, when lending to a mining company and a trader associated with it, but not formally affiliated. If payments are made on time, borrowers do not have significant obligations to each other, but in any case, the financial condition of the trader critically depends on the solvency of the mining company.

To regulate such cases, in 2005, the Bank of Russia developed and published on its official website a draft instruction “On the mandatory standard for the maximum amount of credit risk for a group of economically related borrowers,” taking into account international practice - recommendations of the Basel Committee on Banking Supervision and international financial reporting standards.

This project classified as economically connected borrowers persons involved in a single economic (production, investment, sales, trade, research) cycle, including those participating in the joint production of the final product at different stages, organizing joint sales, and conducting general scientific research.

Although this instruction was not adopted, the approaches proposed by it can be used by commercial banks when developing their own regulations that determine the procedure for classifying borrowers as related.

Three criteria should be noted as the most significant and most formalized: sales dependence; on consumed raw materials, on mortgaged property.

It seems that borrowers can be considered dependent on sales if one of them occupies more than 25% of the annual revenue structure of the other, and sales of products to other buyers cannot be established within the next 30 calendar days (due to the specificity of the products manufactured, territorial remoteness, strong competition in the market, etc.).

Dependence on consumed raw materials arises if the share of one supplier exceeds 25% of the total supply, and the time for organizing supplies from alternative sources is at least 30 calendar days longer than the period for using up existing stocks.

The value of 30 days in both cases was adopted in accordance with the approaches recommended by the regulator 2. If the borrower has financial difficulties and stops purchasing products (supplying raw materials), the client associated with him will not be able to pay off his obligations to the bank and after 30 days the debt service on his loans will be considered “average” 3.

The basis for classification as related is also the provision by the borrower of property as collateral (even if its residual value is less than 25% of net assets) as security for the obligations of another borrower, if its sale will lead to the suspension of the mortgagor’s production. Such property includes main production lines, buildings, land plots, etc.

All three proposed criteria have a common drawback - dependence on subjective opinion. Meanwhile, their competent use will allow, based on the professional judgment of the credit inspector (or risk manager), to limit the risk of lending to enterprises that do not fall under the formal criteria of relatedness.

In general terms, the criteria for the economic connection of borrowers can be presented as follows (Table 2).

table 2

Informal communication

When lending to small and medium-sized businesses, a situation quite often occurs when there is no formal legal or economic connection between the borrowers, but in fact their activities are managed by one person who controls various companies and/or individual entrepreneurs through nominees.

Typically, such a scheme is used by officials who are prohibited or, from an image point of view, undesirable from combining public service with business activities (heads of municipal districts, employees of legislative and executive authorities, police, prosecutors, etc.). In the regions, such individuals are often among the most attractive borrowers and form a significant part of the loan portfolios of local banks and regional branches.

It should be noted that this practice can also be used by fraudsters who, by conducting fictitious transactions for the purchase and sale of products between several formally unrelated persons, “inflate” revenue and turnover on current accounts, and then apply for a loan for each of the companies. If the connection between them is not identified, loan projects may be reviewed by different credit inspectors, who will find it quite difficult to assess the real creditworthiness of each borrower.

Despite the fact that identifying informal connections between borrowers and suppressing their fraudulent activities in most banks is the responsibility of the security service, a credit officer (or risk manager) can easily do this at his own level. In practice, the following methods have proven their effectiveness (Table 3).

Table 3

The presence of such signs does not yet indicate that the borrowers are connected, but requires additional verification by the bank’s security service. Based on its results, the credit inspector (or risk manager) can conclude that certain borrowers are classified as related to the group based on informal characteristics.

conclusions

As a rule, regulations for identifying groups of related borrowers are developed by commercial banks only in connection with the need to comply with the requirements of the regulator; they do not show interest in developing their own criteria for their assessment. This is due to the fact that in the short term, excessive diversification is unprofitable for the bank. Refusal to lend to several members of a group of related borrowers entails a loss of interest income and may even lead to the entire group leaving for service at another bank.

However, in the long term, credit institutions should avoid excessive concentration of the loan portfolio on a few groups of clients. In a crisis, even the most reliable borrowers may experience problems with repaying loans, which will certainly affect the bank’s financial results. That is why bank services and, first of all, the risk management service need to identify the relationship between borrowers at all stages of the lending process and strictly control the level of concentration of loan investments.

1 Clause 3.4.1 of Bank of Russia Regulation No. 254-P dated March 26, 2004 “On the procedure for credit institutions to form reserves for possible losses on loans, on loan and similar debt.”
2 Letter of the Department of Banking Regulation and Supervision of the Bank of Russia dated November 2, 2005 No. 15-1-1-9/2916 “On some aspects of assessing the quality of loans.”
3 Subject to the bank’s application of Bank of Russia Directive No. 2156-U dated December 23, 2008 “On the specifics of assessing credit risk for issued loans, loan and similar debt.”

There are several concepts and terms in the legislation that relate to entities participating in one way or another in the activities of other persons. Tax legislation uses the concept of “related parties”; accounting and EAEU legislation contains the concept of “related parties (parties)”. Related parties are persons who influence or have the ability to influence the activities of other business entities.

Related persons in accounting

The Tax Code of the Russian Federation directly indicates that this list of criteria is not exhaustive and can be supplemented by the court.

Related entities may become subject to special control by entering into a transaction if:

• income from transactions of related parties amounts to over 1 billion rubles;
• one party (or several parties) to the transaction is a special regime, and the other party (parties) is not;
• one party calculates tax on profits in accordance with Chapter. 25 of the Tax Code of the Russian Federation, and the other - not;
• the party to the transaction participates in the investment project, as a result of which has income tax benefits.

Control over certain types of transactions, in particular, is aimed at preventing the transfer of the tax base to offshore companies and a more equitable distribution of the tax base among the regions of our country.

such an organization is controlled or has significant influence on it by a legal entity and (or) individual;

such an organization controls or has significant influence over the legal entity;

such an organization and legal entity are controlled or significantly influenced (directly or through third legal entities) by the same legal entity and (or) the same individual (the same group of individuals).

7. A legal and (or) individual, as a rule, has the opportunity to determine decisions made by another legal entity in order to obtain economic benefits from the activities of the latter (controls another legal entity), when such a legal and (or) individual has:

by virtue of his participation in a business company (partnership) or in accordance with the powers received from other persons, more than fifty percent of the total number of votes attributable to voting shares (shares) in the authorized (share) capital of this business company (partnership);

the right to dispose (directly or through its subsidiaries) of more than twenty percent of the total number of votes attributable to voting shares (shares) in the authorized (share) capital of this business company (partnership) or contributions constituting the authorized (share) capital of this legal entity and has the ability to determine decisions made by such legal entity.

8. A legal and (or) individual has significant influence on another legal entity when it has the opportunity to participate in decision-making of another legal entity, but does not control it. Significant influence may occur due to participation in the authorized (share) capital, provisions of the constituent documents, concluded agreement, participation in the supervisory board and other circumstances.

9. The list of related parties, information about which is disclosed in the financial statements of the organization preparing the financial statements, is established by such organization independently on the basis of these Regulations based on the content of the relationship between the organization preparing the financial statements and the related party, taking into account the requirement of priority of content over form.

10. If during the reporting period the organization preparing the financial statements carried out transactions with related parties, then at least the following information is disclosed in the financial statements for each related party:

types of operations;

volume of transactions of each type (in absolute or relative terms);

cost indicators for operations not completed at the end of the reporting period;

conditions and terms for carrying out (completion) of settlements for transactions, as well as the form of settlements;

the amount of reserves formed for doubtful debts at the end of the reporting period;

the amount of written off receivables for which the statute of limitations has expired, and other debts that are unrealistic for collection, including through the reserve for doubtful debts.

Indicators that reflect similar relationships and transactions with related parties may be grouped, except in cases where their separate disclosure is necessary to understand the impact of transactions with related parties on the financial statements of the entity preparing the financial statements.

11. Information subject to disclosure in accordance with paragraph 10 of these Regulations must be disclosed separately for each of the following groups of related parties:

main business company (partnership);

subsidiaries;

predominant (participating) business entities;

dependent business entities;

participants in joint activities;

The main management personnel of the organization preparing financial statements. For the purposes of these Regulations, the main management personnel of the organization are understood as managers (general director, other persons exercising the powers of the sole executive body of the organization), their deputies, members of the collegial executive body, members of the board of directors (supervisory board) or other collegial management body of the organization, as well as other officials vested with authority and responsibility in matters of planning, management and control over the activities of the organization;

other related parties.

12. As part of information about related parties, the organization preparing financial statements discloses information on the amount of remuneration paid by such organization to key management personnel in the aggregate and for each of the following types of payments:

short-term remuneration - amounts payable during the reporting period and 12 months after the reporting date (wages for the reporting period, taxes accrued on it and other obligatory payments to the relevant budgets and extra-budgetary funds, annual paid leave for work in the reporting period, payment by the organization treatment, medical care, utilities, etc. payments in favor of key management personnel);