Monitoring of the Federal Legislation dated 11.08.2006

Decision of the Government of the Russian Federation No. 476 of August 9, 2006 on the Formation of the Public Joint-Stock Company "Russian Investment Fund for Information & Communication Technologies"

The exclusive subject matter of the fund's activities is investing in the assets of organisations operating in the field of information & communication technologies. Up to 100 million roubles ($3 million) may be allocated for each investment project.Three phases are envisaged in the fund's development depending on the degree of the state's interest in its authorised capital. In Phase 1, 100% of the fund's shares are under federal ownership, with 1,450 million roubles being used as contribution from the Investment Fund. Here, upon the completion of the fund's formation its authorised capital is going to rise through a supplementary issue of shares by public subscription.Phase 2 will see in 2009 the alienation of the fund's shares under federal ownership, with the stake of the Russian Federation being retained at 25% plus one share.In Phase 3 in 2010 the shares of the public joint-stock company which are under federal ownership are going to be alienated without the preservation of the stake of the Russian Federation in the authorised capital of the fund.Also, an opportunity is provided for financing information & communication technology projects after the share of federally-owned ordinary registered shares falls to 51%.

Letter of the Department of Taxation and Customs Tariff Policies of the Ministry of Finance of the Russian Federation No. No.В 03-02-07/1-203 of August 1, 2006

The Tax Code neither has a provision for overturning a decision of a tax body suspending transactions on bank accounts nor for a bank's returning such a decision to the tax body due to the commencement of winding up proceeding in respect of the bank's client.The bank is not entitled to revoke at its own discretion a decision of a tax body on suspending transactions on bank accounts of a taxpayer being a client of the bank and return the decision to the tax body.

Letter of the Department of Taxation and Customs Tariff Policies of the Ministry of Finance of the Russian Federation No.В 03-06-02-02/102 of August 1, 2006

Explanations are provided for some issues relating to the procedure for realising deductibles for the purposes of land tax.The tax base for the purposes of land tax is reduced by the 10,000-rouble deductible per taxpayer on the territory of one municipal formation (or the federal-significance cities of Moscow and St. Petersburg) in respect of a land plot under the ownership, permanent (in perpetuity) use or life inheritable possession of certain categories of taxpayers. If a taxpayer (including an individual entrepreneur) entitled to have the above privilege has several land plots located on the territory of one municipal formation tax base reduction must take place in respect of only one of these plots. The taxpayer is to chose at his own discretion the land plot for which the tax base will be reduced.If a taxpayer entitled to have the privilege has one land plot each in several municipal formations tax base reduction is to take place for each of the plots.As for a land plot under share ownership the deductible is only applicable to the tax base corresponding to the portion of the land plot owned by the taxpayer having a right to have his tax base reduced.The persons having land plots by the right of ownership, permanent (in perpetuity) use or life inheritable possession when the land plots are leased out remain payers of land tax, and accordingly, retain the right to the tax base deductible.